CAIS Summary and Overview
by David Lewit, Alliance for Democracy
noimage Everyone here is concerned about the World Trade Organization and their big rush to embrace all forms of economic and cultural life. Exactly how are they trying to accomplish this? What institutions make this possible? If you were to picture this, what would you draw? And after you've drawn all those institutions, what would you change to make it a people's picture rather than one of the economic and political elites?

Your first picture might put the WTO at the center, with its dozen or so multilateral agreements, surrounded by major transnational corporations, and such government departments as state, commerce, treasury, and agriculture. Then you might add the military establishments which enforce the policies of those governments. Then you might add international institutions like IMF, the World Bank, the International Labor Organization, and the UN Conference on Trade and Development. Then you might add the parliaments or congresses of the world powers which ratify WTO agreements or set other economic policies. You might connect some dots (the institutions) to show some major dependencies and power linkages. The people themselves might hardly show up in the picture, except as amorphous workers and consumers.

That picture is top-heavy.

A year and a half ago we in the Alliance for Democracy set out to democratically draw a democratic world economic system that might be achievable in 15 or 20 years— a system which recognizes world trade and investment but emphasizes and empowers _communities and the human imagination.

In the Boston area we gathered 14 nonspecialists who were interested in the problem as a panel to brainstorm and to guide the effort, including a coffee importer, a sheep farmer, a physician, a union electrician, and ten others varying in occupation, gender, and nativity. We decided to produce a document that reads like a treaty— quite demanding for us and for business people, government people, and the rest of us. We call it the Common Agreement on Investment and Society (CAIS). Right now it has 23 articles and 158 provisions. I have a few copies here if you ask me.

We wound up emphasizing communities, but with some international institutions to provide assistance, protection, and integration. Our proposed world system is pictured on your handout.

First we focus on a world-wide network of distinctive communities whose people have mutual concerns and economic possibilities, like the county where we are gathered right now. By forming a "Local System Organization," each community would be assisted by a global "Development Assistance Institute," sort of like the National Institutes of Health combined with a Community Development Corporation which would provide seed money and development loans, assist in designing and evaluating developments and their outcomes for all stakeholders and for the environment, and provide a variety of technical services. DAI would further study international capital flow and control, and their effects, and democratic ways of ameliorating adverse effects. Positive developments would be encouraged rather than competition and conflict-settlement as in the present system.

A "World Economic Parliament" would be elected by municipalities wherever elections are possible, sort of on the model of the European Parliament.  The municipalities also would have elected officers of their Local System Organizations. The Parliament would set policy for international economic relations, which might well evolve to be consistent with community self- reliance, autonomy, and cooperation. The operations and records of all bodies under CAIS would be open to public scrutiny.

Where local forums cannot resolve conflicts with such policy, a "World Economic and Environmental Court" would hear cases. Judges would be appointed by national parliaments world-wide, and legal fees would be paid from a legal expense pool where rich parties would be assessed more than poorer parties.

Our system would also create a world-wide "University of Enterprise" with many local branches and distance learning, to teach and train and share among people, for work in mixed economies where private, public, and nonprofit enterprises mingle.

To help stabilize international payments the IMF would be held to its original limited purposes, be put into receivership, and be re-staffed with input from the full range of stakeholders. The World Bank would similarly be held to its original mission, and be accountable to the elected World Economic Parliament. The World Trade Organization and its impacts would be assessed, and its agreements and functions modified or eliminated by action of the General Assembly of the United Nations upon recommendation of ECOSOC— the Economic and Social Council. If it is not dissolved, WTO would be further reviewed by the World Economic Parliament.

Split up and disempowered by the Bush administration advising the UN's Secretary General, the "Center on Transnational Corporations" would be revived as an independent body, with powers to set standards for transnational corporations and to monitor their conduct, and be accountable— as international actors— to the Parliament.

Whether the World Bank would go on funding huge, host-unfriendly projects like dams and oil pipelines would depend on local and parliamentary deliberations, but both local system organizations (in their varied ways) and the new international bodies would be charged with just and sustainable project-facilitation. They would refocus on viable local and regional integration rather than so-called "comparative advantage," internationally.

The CAIS calls for new accounting concepts and methods which internalize costs to society and the environment in assessing the value of products, processes, and enterprises. These new methods would be proposed in open global conferences with subsidies for sending local system representatives, and debated and adapted to localities by local system organizations.

The heart of heartless capitalism is property ownership and the ownership of rights. CAIS recognizes that today's inventions depend on yesterday's inventions and insights. We propose a new system of patents and copyrights to replace the US model being forced upon the world through the WTO. All patents in international trade would thus be considered joint property of the inventor or patent holder, and the people whose cultures gave rise to the craft, science, and technology underlying that invention. Evidence would be evaluated by the popularly accountable Development Assistance Institute rather than by the unaccountable US Patent Office. Thus profits from the rent or sale of patented products or processes would be in part returned to the people or their public programs, or used to support international regulatory activities. Starting with a standard percentage of the rent or sale value, in cases of dispute the exact amount of return would be decided by the World Economic and Environmental Court.

This raises the question of how this new stimulating and regulatory system would be funded. Initial funding would draw upon assets of IMF and the World Bank. Like any company or government, the inputs of resources would be many, and would vary with its parts. Local System Organizations being autonomous, would make use of local taxes, fees for services to local and distant cooperating organizations, and grants and loans from the Development Assistance Institute, especially for new projects and programs. The Institute, Parliament, Court, and Center on Transnational Corporations would be supported by assessments from member countries, Institute fees for services, and Court fines.

Taxes on short-term international investment would also provide funds, with other means being instituted after periodic reviews of speculation control, so as to avoid regulators becoming addicted to a share of speculative profits.

The University of Enterprise would be funded in the many ways familiar to any state university.

Although three members of our citizen panel grew up in India, Cameroon, or Sicily, the democratic flavor of CAIS suggests its Western or Northern origins. How would the proposed system work in poor or authoritarian countries?

CAIS requires election of representatives to local system organizations and to the World Economic Parliament. Would such elections be possible in places like China, Uganda, Turkey, or Cuba? Apart from the question of whether elections are truly democratic in places like Mexico or the United States, China has recently reported popular elections in one set of towns. Cuba has intense local councils which elect representatives to regional bodies. Others may follow suit.

What about poor countries? CAIS is based on the principle of helping, not of competing and takeovers. Unlike neoliberalism, the emphasis is on integrated local development and self-reliance rather than foreign ownership and export. Because of their large populations, certain second- and third-world countries would have prominent representation in the Parliament and the Institute. Linkages with UN agencies, now languishing, would be revived. Sovereignty would be respected, and state services respected alongside private and nonprofit.

Economic arrangements like these may go a long way toward fostering democracy— different flavors of democracy— and the public welfare in all countries. #