Flexibility, networking are keys to new world order

Elwin Tobing, Economist, Iowa, USA

During the 1980s and early 1990s, there was much talk, most strongly among conspiracy theorists, of a new world order. The focus was on the declining power of national governments and the growing power of global organizations of member states, such as the United Nations and the World Bank.

Through its infamous Structural Adjustment Program (SAP) aimed at helping under-developed and developing countries in reducing poverty and unemployment, the World Bank and its people seemed like Santa Claus coming from outer planet bringing wealth to the poor nations. The new world order jargon became more popular when the cold war was over in the late 1980s, the Coalition won the Gulf war and when then U.S. president George Bush Sr, uttered the famous line "the new world order".

The combination of these seemingly unrelated great events, the growing power of non-governmental organizations, the conclusion of the cold war and the above victory of the Coalition practically created a new world order based on a totally new different paradigm.

The relationship among most nations is no longer based on hatred, but has been replaced by the spirit of economic and brotherhood cooperation. The West poured out huge cash to help the failing Russian economy and NGOs helped disseminate the message of democracy which brought several authoritative governments down.

What is becoming clear now is a new kind of order, supranational organizations based on formal and informal cooperation among NGOs and grass roots movements supported by instant connection through the Internet.

The paradigm of relationship among nations has now been replaced by the need to root out terrorist organizations.

Traditional global organizations such as the UN, the World Bank, the IMF and WTO are no longer viewed as superior organizations that will bring help to troubling nations. They are not only considered as ineffective and inefficient as the SAP failed in many countries, but viewed as biased towards the West.

The financial crisis in the East Asian and South American regions just made the IMF even like an unworthy giant helper. Its prescriptions are simply inadequate and in most cases are out of context.

The IMF in particular forgets the very basic nature of the real world, that politics affects the economy as much as sugar changes the taste of coffee. The controversial example is the prescription of the IMF to the Indonesian government to lower the subsidy for fuel and gasoline, and thus raise their market prices, to increase revenue and improve the balance budget.

What is economically correct is not necessary acceptable. What most people want now are stability of prices, jobs, justice for corruptors and a clean government. None of this seems directly implied by the IMF recommendations. "Economic science" is basically driven by results of research on Western economies.

While the giant organizations of member states seem ineffective and inefficient in the 21th century, the phenomenon of NGOs is on the rise. Ashoka is one example. Ashoka which supports "social entrepreneurs" worldwide, was founded in 1980 by Bill Drayton who spent the past 20 years on a search across the globe for people capable of bringing about social change in areas of critical human need.

When the foundation locates a good candidate, it elects him or her to a fellowship, provides financial and professional support to help launch the fellow's idea, and connects the fellow with other social entrepreneurs working on similar problems. It is primarily interested in advances in education, environmental protection, poverty alleviation, human rights, health care, care for the disabled, care for children at risk, and others.

After 21 years Ashoka has achieved an international network of 1,100 fellows in 41 countries, working on education, children's, environment, income generation, poverty alleviation and women's issues. There has been enormous growth in the not-for-profit sector globally. Peter Drucker estimates that some 800,000 nonprofits have been established over the past 30 years.

On a grass root level, the overseas Chinese network has emerged as a potent global economic force. These players may be based in different countries but their common denominator is a strong Chinese influence.

The overseas Chinese dominate medium- and large-scale corporate capital in all Asian markets except for Japan and Korea. The overseas Chinese are part of a powerful business network. Gordon Redding, a leading expert on the subject, estimates that the overseas Chinese have a GDP equivalent in the region of $200 billion with around 40 million people. This compares with a GNP for China (1.2 billion people) of around $350 billion.

Perhaps the most dramatic shift in the new world order is the change in the paradigm of relationship among nations brought about by the horrible 9-11 attack, and Bush's remarks: "Either you are with us, or you are with the terrorists".

Pakistan and India, for example, have enjoyed tremendous economic and political supports from the West due to their cooperative gesture on the U.S. war on terrorists, something that might not happen even with years of diplomatic efforts.

What are the implications to development of nations, including Indonesia?

As the new format of world order takes shape, and as its parameters become more sharply defined, all organizations will have to become more objective and flexible, including government. New ways of regulating are emerging, not only due to the changes the way people communicate but also as a result of the new paradigm in international relations.

The opportunity to help shape these ways will come from understanding what's happening rather than blindly resisting it. The worldwide Chinese network has shown that even without formal government, the network can grow and achieve a position as a substantial global power. Flexibility and network are the key, not rigidity and authority.

Rigidity and authority toward terrorist groups seem to be the keys to overcome barriers in international economic and political relations. None of the leaders in the East better understand this importance other than President of Pakistan, Gen. Pervez Musharraf.

He realized the dangers of living under radical threats and made moves meant to benefit the welfare of its nation. Our leaders, amidst the urgent need of the nation for outside help, still seem hesitate even to acknowledge the first, the dangerous of living under the shadow of terror.

And as the new new world order is rolling, the management power of society demands changes. There is growing concern that existing government structures -- local, national, international- are inadequate to the demands of the emerging new process. Unfortunately, many important people, leaders that can influence the lives of many, still believe in the old philosophy that the concentration of authority is the key to sustain power.

Worse, in the era of globalization, when the management of power trickles down from central authority to local leaders, the latter become the kings but still inherit the authoritative character of the former. A clear warning that decentralization program could be a new haven for corruption and bribery practices.