CHICAGO BOYS, GO HOME!

The multi-trillion dollar \"losses\" on Wall Street are simply cancelling out their illusory \"gains\". No amount of federal bailing and money printing can fill the black hole of unrealistic expectations created by faulty economics, writes Hazel Henderson, author of Ethical Markets: Growing the Green Economy (2007), president of Ethical Markets Media LLC, USA, and co-creator of the Calvert Henderson Quality of Life Indicators regularly updated at www.calvert-henderson.com. In this analysis, Henderson writes that Wall Street became a parasite on the real economy of Main Street and has spread its contagion around the world. The lesson is that financial markets must shrink; the non-bank investment firms\' business model is broken. The task now is to manage the downsizing of Wall Street and the global financial casino and redesign regulatory systems and markets to restore their useful but limited role in facilitating the production of useful, ecologically-benign goods and services in the growing green economies of the Solar Age. The truth is now in plain sight: there was no invisible hand! Markets and money are both shaped by legislation, central bankers, tax policies, subsidies, lobbying special interests and cronyism. Economics has always been politics in disguise. Money was confused with real wealth: educated healthy citizens and the basic productive eco-systems of our planet.

BEYOND GDP: MEASURING REAL NATIONAL PROGRESS

Will the 27 nations of the EU be the first to adopt a new GDP that can integrate all the factors that comprise our quality of life? asks Hazel Henderson, author of Ethical Markets: Growing the Green Economy and other books, co-creator of the Calvert-Henderson Quality of Life Indicators with the Calvert Group and member of the Organizing Committee for the \'\'Beyond GDP\'\' conference in the European Parliament, November 19-20 in Brussels. In this article, Henderson writes that GDP ignores all non money- measured aspects of national progress and even tacitly encourages bad behaviour. For example, since ecological assets like forests and ocean fish stocks are not valued in GDP, a country could chop down its forests and record the sale of the wood as an addition to GDP with no losses recorded anywhere. Similarly, GDP treats education as a cost, instead of the basic investment societies make in developing educated, productive citizens. GDP still sets at zero the value of vital ecological assets: clean air, water and biodiversity, as well as the value of healthy, productive citizens and their unpaid work (raising children, maintaining households, caring for the sick and elderly, serving as volunteers, etc.) which accounts for some 50 percent of all production, even in industrial societies.

TIME FOR TRUE MARKET REFORM

Today, the one-size-fits-all conventional recipe for economic growth, measured by GDP, is being challenged not only on social and environmental grounds but also because it is widely seen as a failure, writes Hazel Henderson, futurist, syndicated columnist, and author of many books including Ethical Markets: Growing The Green Economy(2007). In this article, the author writes that market reform is coming to mean reforming markets and capitalism itself. Would Adam Smith be surprised? Probably not, since he lauded the dynamism of capitalism. Schumpeter later saw the evolution of markets as \'\'creative destruction\'\', as seen today in the new \'\'disruptive\'\' technologies of cleaner, greener energy and resource-use shifts now challenging coal, oil, and nuclear power. The new values and ethical concerns driving the further evolution of capitalism reflect the new imperatives of the 21st century on our small, endangered planet. Guided by our growing human awareness of what we have wrought on this planet and our potential for further development, all our long-term self-interests are now indivisible. Ethics and morality are becoming the new pragmatism.

REGIME CHANGE IN THE US

As the administration finds it harder to spin the tragic fiasco in Iraq, a resurgent Taliban in Afghanistan, bungling over Hurricane Katrina, immigration policy, the nightmarish Homeland Security Administration, turf battles between the CIA and FBI, spiraling debt, and revelations of corruption, and now the Mark Foley scandal, Americans are also increasingly disenchanted with Democrats, who are often mired in the same Washington sleaze, writes Hazel Henderson, whose new book, \'\'Ethical Markets: Growing the Green Economy\'\' , covers reform of capitalism and unsustainable, fossilized industrialism. She created the TV series \'\'Ethical Markets\'\' and the Calvert-Henderson Quality of Life Indicators. In this analysis, Henderson writes that the two-party political duopoly makes a mockery of \'\'bi-partisan\'\' cooperation and hypocritical calls for national unity. Too many voters see only collusion between the powerful corporate and financial special interests and legislators with the burgeoning lobbying industry making the deals that leave out ordinary citizens. The rigidly-controlled two-party system, largely supported by contributions from similar corporations, makes third parties unviable unless led by billionaires. Both parties control the TV debates. Systemic reforms of the US political system are essential and go well beyond regime change:overhaul and standardise elections nationally, abolish the Electoral College, require all election supervisors and officials to be unaffiliated to political parties; require all voting machines be transparent to voters and provide paper ballot receipts, introducing universal health care.

WASHINGTON NEO CONS PUSH WORLD WAR III AS ELECTION STRATEGY

In the current US political climate with majorities in both Houses of Congress passing resolutions of support for Israel in its new war on Hezbollah, dissenting voices are heard mainly on alternative independent media and the blogosphere, writes Hazel Henderson, author of the forthcoming Ethical Markets: Growing the Green Economy and other books. In this article, Henderson writes of independent journalist Bill Berkowitz\'s timely alert in Other News, July 20, 2006 about the Republican strategy to market more fear by escalating their war-on-terror rhetoric to panic about the advent of World War III, setting up Syria and Iran as the next US targets. As the coming mid-term elections in November look likely to unseat Republican majorities in Congress, such useful domestic reforms as alternative energy or Newt Gingrich`s ideas on health care are proving too tame to fire up the Republican base. Thus, the switch to escalating the \"war on terror\" on \"axis of evil\" countries and \"Islamic extremists\" and the new media-friendly, propaganda-perfect soundbite \"World War III\". No doubt already tested in focus groups, this new slogan is perfect for bumper stickers, campaign buttons, tee shirts, stickers, 15-second TV and radio spots as well as talk show soundbites. Let`s remember President Dwight Eisenhower`s cautions about the US military-industrial complex and President Franklin D. Roosevelt who reminded us that we have nothing to fear but fear itself.

MIDDLE EAST: SELF-DEFENSE OR WAR?

Bombs are falling again on innocent civilians in Lebanon, Gaza, and northern Israel. Why? It is necessary to go back in history to understand what is happening today, write Johan Galtung, a Professor of Peace Studies and Founder and Co-Director of TRANSCEND: A Peace and Development Network (www.transcend.org), and Dietrich Fischer, Director of the European University Centre for Peace Studies (www.epu.ac.at) and Co-Director of TRANSCEND. The problem is the vicious cycle of repeated mutual retaliation characteristic of wars, and underlying it the unresolved conflict between Jews and Arabs. This problem cannot be solved by de-escalation in the choice of targets and level of destruction. A ceasefire is urgent to end the immediate suffering, but it will remain only temporary as long as the underlying conflict is not solved. Israel should consider how to make peace rather than war. One way out might be a Middle East Community modeled after the European Community of 1958, with Palestine fully recognised. It would be in Israel\'s and its Arab neighbor\'s interest to learn from that success story. People of good will should come together in the midst of the present crisis to elaborate what a peaceful Middle East could look like.

THE POLITICS OF MONEY

The word is out that economics, never a science, has always been politics in disguise, writes Hazel Henderson, author of Creating Alternative Futures and numerous other books and co-creator of the Calvert Group, the Calvert-Henderson Quality of Life Indicators. In this article, Henderson writes that civic action with local currencies, barter, community credit, and the more dubious rash of digital cybermoney all reveal the politics of money. Economics is now widely seen as the faulty sourcecode deep in societies\' hard drives, replicating unsustainability: booms, busts, bubbles, recessions, energy crises, resource depletion, poverty, trade wars, pollution, disruption of communities, and the loss of cultural and biodiversity. Citizens all over the world are rejecting this malfunctioning code and its operating systems: the World Bank, the IMF, WTO, and central banks. As local groups and communities created their own local scrip currencies and exchange systems, they learned about economists\' deepest secret: money and information are equivalent -- and neither is scarce! Barter, dismissed in economic textbooks as a primitive relic, went hi-tech. The deconstructing of money systems, and the growth of all the healthy local, real world alternatives is propagating widely.

WHITE BAND DAY: A GLOBAL CALL TO END POVERTY

In September the heads of state will return to the UN in New York to evaluate their progress on the UN Millennium goal of ending poverty by 2015. Before that, G-8 leaders will meet in Scotland, and for the first time their agenda will focus on Africa and poverty. In December in Hong Kong trade ministers will meet in an effort to restart the talks that were begun at Cancun and which are absolutely central to development. In response to these three fundamental meetings, a global movement was created to exert pressure to bring about an end to poverty, write Eveline Herfkens, representative of the UN Secretary General for the Millennium Development Goals, and Walter Veltroni, mayor of Rome. The authors write in this article that the Global Call to Action Against Poverty is a movement comprised of more than 1000 international networks. Three dates for mobilisations in more than seventy countries have been set before the three major meetings. The symbol that will unite all of these events will be a white band, a sign of commitment, which will encircle not only wrists but also important buildings, for example, Rome\'s Trevi Fountain (a band of light in this case) and the Colosseum (an 80 metre band). Wearing the white band serves as a reminder to the powers of this earth that eradicating poverty is a duty, and that the path to the future passes through every part of the earth, not only the developed world.

WTO AT A CROSSROADS: MORE DEVELOPMENT, OR MORE OF THE SAME?

The selection of a new Director-General of the World Trade Organisation presents a fundamental choice between a vision of a WTO that is genuinely oriented towards development and one that would keep the organisation more or less aligned with the interests of the major players in the international arena, writes Carlos Perez del Castillo, Uruguayan Ambassador to the WTO, president of the WTO General Committee in 2003, and ex-secretary of the Latin American Economic System (SELA). Many now believe that the time has come to end the developed countries\' historic control over the position of Director-General of the WTO and the GATT process before that, the author writes in this article. It is time to introduce greater balance into the multilateral system and it is imperative that this process begin with the WTO. There are three reasons for this: the first is that it is politically beneficial that the demanded greater integration of developing countries into the multilateral trade process also implies sharing responsibility for its direction. The second is that it is necessary to conclude the present negotiations with a result that does honour to their name: the Development Round. The third is that to make this happen, nothing could be better than choosing a WTO Director-General who comes from a developing country and has dedicated his or her professional life to working directly and continually in this area.

ECONOMISTS AS ADVOCATES

At last, the public debate over corporate social responsibility has been fully joined by the mainstream financial press. However, to properly context this debate, the enduring myth that economics is a science must be dispelled, writes Hazel Henderson, economist and author of Beyond Globalization and other books. In this article, Henderson writes that in truth, economics is a profession -- one with rather poor quality control. Economists are advocates, not scientists. In 1969 the Central Bank of Sweden, put up USD 1 million to create a prize to confer scientific status and legitimacy on the academic discipline and policy advocacy of the economics profession. Economists need not be embarrassed by this unmasking of their field as a profession rather than a science. Economists have always been advocates of various government policies, regulations or deregulation, and of the interests of their clients (most often bankers, financial firms and corporations in general). All that is necessary is clarity on the part of these professionals and all other advocates - so that the public is fully informed - and the issues are argued honestly.

ABOLISH THE ‘NOBEL’ IN ECONOMICS

The so-called \'\'Nobel Memorial Prize in Economics\'\' is not a proper Nobel Prize at all but an award set up in 1969 by the Bank of Sweden to legitimize the economics profession as a science, writes Hazel Henderson, economist and author of Building a Win-Win World and other books. As this year\'s Nobel Prizes were awarded, a number of scientists went public criticizing the mis-labeled \"Nobel\" Memorial Prize in Economics as an embarrassment which diminishes the value of all other Nobel Prizes. In this article Henderson quotes Peter Nobel, Alfred Nobel\'s descendent, as saying \'\'Two thirds of these prizes in economics have gone to US economists, particularly of the Chicago School, to people speculating in stock markets and options. These have nothing to do with Alfred Nobel\'s goal of improving the human condition and our survival. Indeed they are the exact opposite.\'\' In awarding the economics prize, the Swedish Central Bank, in its continuing and subtle campaign to legitimate economic as a \'\'science\'\', still hopes to portray the field as politically neutral. It is precisely these claims that economics shares science\'s \'\'value-free\'\' objectivity and mathematical precision that have given economists their mystique and predominant role in public policy-making worldwide.

CORPORATE SOCIAL RESPONSIBILITY: WALKING THE TALK

Corporations today face a challenge from the world\'s newest superpower: global public opinion, with its power to make or break companies\' brands and reputations in today\'s round-the-clock, global electronic marketplace, writes Hazel Henderson, author of \'\'Beyond Globalisation\'\' and a creator, with the Calvert Group, of the Calvert-Henderson Quality of Life Indicators. Many companies will fail the test, as they seek to \'\'green-wash\'\' their operations with advertising and public relations. Others try \'\'blue-washing\'\' by engaging the UN Global Compact\'s ten principles of global corporate citizenship. Such companies actual performance in walking their talk is now increasingly monitored by legions of civic organisations and auditing firms The growing global debate over socially-responsible investing funds is a very positive development, since higher ethical standards and performance on broader social and environmental criteria will determine the future of capitalism itself. Indeed this re-shaping of capitalism and corporations to conserve the environment while serving human needs and aspirations for equity justice, health, education, and the rights of all will also affect humanity\'s survival on this small planet.

GLOBAL COMPACT SHOULD SPIN OFF FROM UN

The UN Global Compact brought together over 400 leaders of corporations, labour unions, and civil society at its June 24th Summit, writes Hazel Henderson, author of numerous books on global sustainability and financial reform and is founder and president of Ethical Marketplace, a global media company. In this article, Henderson writes that what is now a global network of 1,500 signatory companies began in 2000 as a challenge in a speech by UN Secretary-General Kofi Annan to corporate leaders to adopt nine principles of good corporate citizenship -- regarding human rights, labour standards, and the environment. The Compact, initially a system of voluntary \'\'engagement\'\' with little monitoring or accountability, became a mutual peer-pressure association at the Summit. However, civil society organisations led by the Earth Rights Foundation asserted that the Global Compact is a distraction from the real task of the UN and governments, which is to establish effective inter-governmental frameworks for corporate accountability. They urge that the Compact be disbanded. The wisest course would be to spin off the Compact as an independent organisation, Henderson concludes.

NEW OPPORTUNITIES FOR THE UN

The Iraq debacle provides a historic opportunity to implement long-sought and widely-supported reform of the UN to assure its independence and its vital role in this new century, writes Hazel Henderson, author of \'\'Beyond Globalisation\'\' and co-editor of \'\'The UN: Policy and Financing Alternatives\'\' (1995). The breakdown in the Security Council over the US war on Iraq clearly illustrated its obsolete and dysfunctional aspects. The Council needs to finally dispense with the veto. Then the permanent seats can be rearranged to accommodate important new world players, including India, Brazil, Japan, South Africa, and Indonesia. Another long-sought security council reform --more necessary than ever in a world of terrorism and asymmetrical threats-- is a standing UN peace-keeping and humanitarian force. The world recognises again that the UN is indispensable, the only forum that can convene all the world\'s nations. Even the Bush Administration is seeking UN help, namely \'\'burden sharing\'\' of the costs of its ill-considered adventure in Iraq. Only the UN can legitimise reluctant member nations\' involvement in re-building Iraq.

G-8 ECONOMISTS IN RETREAT

The G-8 Summit is no longer just about economics, as seen in the agenda of the recent Evian meeting, yet the economics profession still bestrides national policy, writes Hazel Henderson, author of \'\'Beyond Globalisation\'\', \'\'Building a Win-Win World\'\', and co-developer of the Calvert-Henderson Quality of Life Indicators. In this analysis for IPS, Henderson writes that economics is politics in disguise. Cost-benefit analysis or a carefully crafted economic impact statement can squelch any government reform or new social or environmental initiative, emphasising the costs of change to existing interests while down-playing the current costs of the status quo on other actors, the environment, or future generations. Economics was always based on patriarchal values, ignoring the work of women in child rearing, caring for the old, community volunteering as \'\'uneconomic\'\'. It did not predict the rise of socially-responsible investing, now at USD 2.3 trillion in the US alone. Nor did \'\'inflation-hawk\'\' economists foresee the new threat of worldwide deflation. Today, the chinks in economists\' armour are becoming more evident. As we witness the debacles in Asia, Russia, and Argentina, economist-ridden governments clearly need no longer defer to these defrocked priests.

IRAQ, THE DOLLAR AND THE EURO

In even the best-laid human plans, events rarely unfold as predicted, even by experts. One surprise scenario is rooted in the close relationship between oil, dollars, gold, and the euro, writes Hazel Henderson, author of \'\'Beyond Globalisation\'\', \'\'Building a Win-Win World\'\', and other books. In this article, the author writes that countries that formerly held mostly US dollars in their currency reserves have begun to diversify into euros, where they perceive less risky fundamentals. What happens if global investors continue pulling out of the US and the dollar keeps falling? What if OPEC decides to officially re-denominate their oil in euros, since most of the their customers are in Europe anyway? The US, heavily dependent on imported oil, benefits considerably from OPEC\'s US dollar pricing.

OPEN MARKETS OR OPEN PLUNDER ?

Once upon a time, empires were built through direct conquest. These days the equivalent gains are routinely achieved through different, and more efficient, means, which those in power prefer to call not open theft but \'\'open markets\'\', writes Anuradha Mittal, Co-Director of Food First (Institute for Food and Development Policy). The question is, open for whom, and for what? the author writes in this article for IPS. US Secretary of State Colin Powell gave the clearest possible answer: \'\'Our objective with FTAA is to guarantee North American companies the control of a territory that goes from the Arctic Pole all the way to Antarctica, free access to the whole hemisphere without difficulties or obstacles for our products, services, technology, and capital.\'\' Resistance to such domination is strong and growing stronger. Since January 7, 2003, Mexican farm leaders have been on hunger strike as many demonstrations have been held. These protests are part of a worldwide opposition to free trade in agriculture that will be present at the World Social Forum in Porto Alegre. It advocates alternatives to corporate agriculture, rallying around the battle cry,\'\'Food sovereignty is a fundamental human right.\'\' To make this vision a reality for farmers around the world, the corporate elites are being put on notice -- the World Trade Organisation, NAFTA, FTAA, and other trade agreements must get out of agriculture; there must be a complete moratorium on GE crops and no patents on living matter.

THE DELIBERATE GLOBALISATION OF DEBT AND ITS DIVIDEND OF RUIN

The central component of what has been widely defined as \'\'globalisation\'\' is the transformation of the global economy into one of unsustainable debts in which the finance sector plays a dominant role, writes Anne Pettifor, director of The Jubilee Research programme and former director of Jubilee 2000 Coalition UK. In this article for IPS, the author argues that this transformation was the intended result of government action. The US trade deficit had to be financed, and the US was determined to finance it without lowering living standards or ceding its policy autonomy to foreign creditors. Capital controls had to be lifted so the US could access foreign capital markets. The City of London, backed by the UK government, was only too happy to broker financing for the US deficit, first through the \'\'stateless\'\' Eurodollar market based in London. We should be prepared for the economic, environmental, and social degradation associated with destruction of the \'\'credit bubble\'\', in particular widespread depression and deflation. However, we cannot do so if our analysis of the forces at play in the global economy is wrong, or if we play into the hands of the finance sector by ignoring it. Above all we should be prepared to shape the alternative: a world in which the finance sector and markets in general are once again subordinated to environmental, social, and political priorities, determined locally and democratically.