Globalization’s institutional collapse?
August 7, 2008
In response to the failure of Doha and the current global economic slow-down, two of Dani Rodrik’s most recent editorial pieces take the positions that #1: Doha was built on bad economic plans as well as ill-conceived negotiating strategies; and #2: the political and economic project of globalization currently suffers from a lack of intellectual consensus.
In the process, Rodrik points out the underlying problem with the existing global governance institutions:
There is no global anti-trust authority, no global lender of last resort, no global regulator, no global safety nets, and, of course, no global democracy. In other words, global markets suffer from weak governance, and therefore from weak popular legitimacy.
Is the lack of popular legitimacy just about weak governance, though? Clearly not – in order to obtain popular legitimacy, global governance institutions not only need to fulfill the functions listed above, but also to do so in an accountable way that integrates a semblance of democratic due process for the majority of stakeholders. These problems comprise Joseph Stiglitz’s famous “democratic deficit” and they are as much a part of Doha’s failure and the broader crisis of global institutions as the factors Rodrik enumerates.
In this sense, the broken consensus at the WTO also reflects the long-term costs of the G8’s constant maneuvering to undermine the institutional legitimacy of various multilateral fora.