Toward a Global Economic Ethic: Fraternity Needed

I just got back from a presentation at the United Nations of a new manifesto on advancing a "Global Economic Ethic" by the UN Global Compact, the Swiss Government, Novartis Foundation, and the Global Ethic Foundation. Swiss Ambassador Peter Maurer, UN Global Compact Executive Director Georg Kell, philosopher Hans Kung, economist Jeffrey Sachs, economist Josef Wieland, and Novartis Foundation CEO Klaus Leisinger presented the new manifesto, which draws from all the religious and non-religious moral traditions of the world (including Humanism) and includes as its first signatories Michel Camdessus, Hans Kung, Mary Robinson, Jeffrey Sachs, and Desmond Tutu.

The manifesto starts with a preamble that situates this effort for a more ethical globalization in the urgency of the financial crisis:

For the globalization of economic activity to lead to universal and sustainable prosperity, all those who either take part in or are affected by economic activities are dependent on a values-based commercial exchange and cooperation. This is one of the fundamental lessons of today’s worldwide crisis of the financial and product markets.

At the core of the manifesto are two pillars: humanity and the Golden Rule (or reciprocity).

On humanity, the manifesto states:

The fundamental principle of a desirable global economic ethic is humanity: Being human must be the ethical yardstick for all economic action: It becomes concrete in the following guidelines for doing business in a way that creates value and is oriented to values for the common good.

On the Golden Rule, under its fourth article, the manifesto states:

What you do not wish done to yourself, do not do to others. This Golden Rule of reciprocity, which for thousands of years has been acknowledged in all religious and humanist traditions, promotes mutual responsibility, solidarity, fairness, tolerance, and respect for all persons involved.

Such attitudes or virtues are the basic pillars of a global economic ethos. Fairness in competition and cooperation for mutual benefit are fundamental principles of a sustainably developing global economy that is in conformity with the Golden Rule.

Some of the discussion at the conference focused on the French motto: Liberty, Equality, and Fraternity. Some argued that while governments and societies have done their best to improve the first two goals--liberty (or freedom) and equality--the third goal of fraternity (or brotherhood) had been dropped by the wayside. And this lack of a sense fraternity--the sense of caring for others--accounts for a lack of ethical thinking in the world.

Coincidentally, the new Japanese Prime Minister Hatoyama's personal philosophy (yuai) also emphasizes fraternity.

This morning I attended Japanese economic official Hidehiko Nishiyama's talk at the Japan Society in NYC, moderated by Merit Janow. Giving the audience a sense of where Japan is headed under the DPJ as APEC 2010 approaches, Mr. Nishiyama introduced some concepts:

- Japan's economic policy will emphasize "inclusive growth" (which is to say a fairer economic policy benefiting more people in my words).

- Japan will promote green, sustainable growth, including energy efficiency and green infrastructure.

- Japan will champion "human security," improving food security, human health, etc.

- Yuai (fraternity or brotherhood) will be a guiding principle of Japanese society and Japan's relations with the world.

After the conference, I mentioned Prime Minister Hatoyama's expression to the organizers. Their response: "Probably not a coincidence."

Buddha statue in Kamakura, Japan. Photo by Kristian Stevens (CC).

U.S.-China Climate Change Leadership: Five Ideas for a Common Agenda

NEW YORK, Sept. 29 /PRNewswire-USNewswire/ -- As the United States and China prepare for a bilateral summit on climate change in November, a pair of think tanks--one from each country--said today they have identified five concrete, business-oriented steps their nations could take together to combat climate change while meeting energy needs.

China and the United States--the world's two largest carbon emitters--should identify a handful of "world critical" technologies that address energy production and climate change, according to the China Reform Forum, the Chinese think tank, and the Carnegie Council, a New York-based institution. The two countries should then jointly develop the technologies under a bilateral regime that promotes private investment, project development, and shared intellectual property rights.

Carnegie Council and China Reform Forum said they had developed the proposed measures by convening an expert working group in New York on August 28.

The group identified specific areas in which the two countries could cooperate. Participants at the meeting noted such cooperation will require developing deeper trust. They said, however, finding ways to cooperate will help to build that trust--a reinforcing process. The deeper the level of trust, the more ambitious and successful joint projects will be. Successful cooperation can depoliticize the issue of climate change, allowing U.S. politicians to sell the issue to their constituents and expand the prospects for future bilateral cooperation, participants said.

The two think tanks urged the United States and China to:

- Identify five to ten top "critical" technologies that would abate climate change while increasing needed energy supplies in the near to medium term;

- Establish a bilateral protocol to spur joint development of these technologies by encouraging investment, development, and protection of intellectual property rights;

- Embark on joint research, perhaps creating laboratories, to develop "leapfrog technologies" beyond the carbon footprint--such as hydrogen fuel-cell vehicles or green buildings--with an eye toward harnessing entirely new infrastructures.

- Implement a joint pilot project in each country--such as carbon capture at a coal-fired electricity plant or smart electrical grid--at the local, state, or regional level.

- Support one another in creating and launching public education campaigns aimed at changing public opinion on climate change, strengthening the sense of individual responsibility, moving beyond a zero-sum notion of climate change obligations, and issuing a set of best practices.

The New York meeting, hosted by Booz & Company, a global management consulting firm, took place shortly after it was announced that President Barack Obama and President Hu Jintao of China would hold a summit meeting in Beijing in November ahead of the multilateral climate change talks in Copenhagen this December.

The China Reform Forum sent the delegation to New York City and included a People's Liberation Army major general and leading climate change and economics researchers. Conference participants hailed from two United Nations agencies, North American think tanks, universities, and corporations, including IBM and Booz & Company.

The Carnegie Council and the China Reform Forum said they plan to reconvene within one year in Beijing with two goals in mind: to further develop a common ethical understanding between the United States and China on climate change and other issues, and to report back on the feedback from their networks on the five suggested areas of cooperation.

The meetings are the first steps in what both sides hope will be a strong, long-term, institutional relationship dedicated to the pursuit of common ethical approaches to problem solving.

To show international leadership on climate change the United States and China must overcome domestic mindsets suspicious of real burden-sharing. It was suggested that both countries should find ways to change public attitudes by, for example, recognizing, celebrating, and incentivizing green entrepreneurs.

For an interview with Joel Rosenthal, President of Carnegie Council, or other participants, please contact Carnegie Council Communications Director Madeleine Lynn at 1-212-838-4120 ext.222.

The Carnegie Council for Ethics in International Affairs (www.cceia.org), established in 1914 by Andrew Carnegie, is an independent, nonpartisan, nonprofit organization dedicated to increasing understanding of the relationship between ethics and international affairs.

SOURCE Carnegie Council for Ethics in International Affairs

Reflections on US-China Climate Change Working Group

Last month, the Carnegie Council, Booz & Company, and China Reform Forum held a US-China working group in New York City on the ethics and innovations surrounding the global climate change debate ahead of the US-China summit in November and the Copenhagen climate change talks in December. The big success was in that the group was able to list a set of concrete research, technology, and policy objectives (forthcoming in a later publication).



As Nikhil Chandavarkar of UNDESA noted, the group was able to view the US-China relationship as a positive sum game and less binary than is sometimes portrayed in the press or in domestic constituencies. The group also noted how similar the United States and China are in their attachment to values. Nikhil recommended more US-China talks on the civil society level in order to build confidence between the countries.



Similarly China energy expert Chris Brown noted that the group was able to lay out a set of proposals for future cooperation--and in specifics (an unusual feat). Chris said it was one of the most "forward-looking, constructive" panels he has been on. As for the atmosphere for the US-China summit in November, Chris was encouraged by the agreement on both sides of the enormity of the climate change problem. The problem will be getting past domestic obstacles.



Carnegie Council Trustee Jonathan Gage (of Booz & Company) compared the working group to the delegation we led to Beijing last year. He sensed a growing level of trust and willingness to talk about future initiatives.



One of the big themes of the discussion was the moral obligation of businesses to society in the context of climate change. Jeff Hittner of IBM made the case that publics will hold companies to account for their impact. "Sustainabilty and profit... go hand in hand," he said. "Ethical consumers" are making decisions based on a broader set of factors, he continued. Because of the growing interconnectedness of technology, Jeff said, people can make better, more efficient decisions with a greater awareness of the impact of those decisions.

Stay tuned for our forthcoming conference statement.

Expect Minor Quake (No Tsunami) From Japan's Elections

Next week's lower house national elections in Japan will likely give the inexperienced Democrats (DJP) a majority, putting an opposition party in power for only the second time since 1955. Will the expected DPJ victory really spell a "tsunami" for the U.S.-Japan relationship as some have suggested? My view is that this concern is probably overblown.

Earthquakes are a fact of life in Japan. Some generate tsunami, some don't. During my recent trip there, I experienced three significant quakes, one of which was quite dangerous. Despite a lot of anxiety about what the expected Democratic Party of Japan's victory in the lower house elections on Aug. 30 will mean for U.S.-Japan relations, I expect only a minor quake in Japan's foreign relations. The tastelessness of using the cliche "tsunami" to describe the upcoming elections aside, I would argue that there are too many factors weighing against a Japanese foreign policy moving away from the U.S. alliance in any meaningful sense.

First, political opposition in Japan, just like in most places, likes to create rhetoric in all spheres that distinguish it from the ruling party. That doesn't mean a party will follow through on its campaign or opposition rhetoric. In the United States, one only needs to recall George W. Bush's 2000 campaign promise to carry out a "humble" foreign policy if elected. Once in power, parties have to come to grips with the realities of governing--or as my colleague David Speedie calls it the limitations on options and thinking strategically.

In other words, national interest will trump political rhetoric and most Japanese see close ties with the United States as a critical national interest. The DPJ's Secretary-General Katsuya Okada recently said in an interview that U.S.-Japan relations are "extremely important for Japan's national interests. We should consider how we can make US-Japan relations, the US-Japan alliance, more fruitful."

In fact, as it looks more probable that the Democrats will win in Japan, the DPJ has moderated its critiques of the U.S.-Japan relationship. As Dan Okimoto recently said in an interview, "What I've noticed over the past several weeks is that the DPJ statements have stepped back from commitments to make immediate and far-reaching changes. They've been backtracking from the positions of ending the refueling mission in the Indian Ocean and of moving quickly out of Futenma. What the DPJ leaders appear to be seeking is a smooth, seamless transition, where bilateral issues don't get entangled with domestic reform priorities."

Which brings me to another point: The DPJ (and Japan itself) already has a full plate. At the top of the DPJ's agenda is reviewing budget priorities and eliminating waste, as well as reducing the amount of nepotism in politics and increasing the power of local governments. The DPJ also wants to give more power to politicians in making policy at the expense of the elite bureaucracy. Then there are the long term policy issues, including the aging society and pension burdens on taxpayers. These priorities alone will keep the DPJ busy. It doesn't need another battle.

Some of what we are hearing from the DPJ is a matter of emphasis and being honest about Japan's capabilities. People have long advocated for tighter U.S.-Japan economic ties and collaboration in non-military areas such as energy and the environment. "Japan's relations with the U.S. have been heavily biased toward defense," DPJ head Yukio Hatoyama recently said. "Now it's time to shift our focus to economic ties. We will strengthen our economic ties and promote free trade while protecting our national interests." And above all, the Japanese, like most people, want to feel safe in a region that still looks like a dangerous neighborhood.

The refrain I kept hearing from everyday people in Japan was this: "The DPJ will become the LDP."

What does this mean? The most obvious interpretation is that it will be business as usual; the DPJ (which in fact has former LDP members in its ranks) will adopt the same policies as the LDP. Somewhat darkly, perhaps there is a success strategy in this thinking: For the DPJ to survive as the ruling party, it may be forced to adopt some of the policies and practices of the LDP. The expectations are so low for the DPJ, meanwhile, that if it can govern without being corrupt, it will have a shot at staying in power. Conversely, the phrase may mean that that LDP as the opposition will have to move closer to the DPJ's anti-corruption and pro-social safety net rhetoric.

But if the DPJ seems to be failing, I doubt the Japanese population will have much patience. The Japanese voters love Schadenfreude, and if the party gives them something to complain about, they will. The DPJ must therefore remember that their support from the population comes as a rejection of the LDP, not an explicit endorsement of the DPJ. The DPJ would be unwise to over-interpret their mandate.

But when it comes to the foreign policy differences between the LDP and DPJ, what are we really talking about? A stronger emphasis on the non-military elements of the U.S.-Japan relationship; better relations with Japan's Asian neighbors; more active involvement with multilateral initiatives through international organizations, like the United Nations. These are precisely the types of foreign policies the Obama administration would welcome. The concern among Japanese about U.S. foreign policy stemmed from Bush's unilateral action in Iraq, trashing of international treaties, and contempt for international organizations--the very things that concerned the Obama team, too. When you look at it, the Democrats in Japan and the Democratic Party in the United States are quite aligned.

Instead of sounding the tsunami alarm, Americans should be welcoming political change in Japan as a manifestation of a real, healthy democracy. Japan, which has been held up as the shining example of democracy in Asia can now walk the walk. Small quakes are a fact of life in Japan; a political tsunami in U.S.-Japan relations would be out of character and would probably require a much more dramatic shock to spark it.

Photo by Toe Stubber

Japanese Women Reassess Gender Equity

The Japanese are one big family, it is often said. Small trends and changes in the family mood are amplified and exaggerated in the press--no matter if the trends are real or imagined. In fact, there is a whole industry, involving TV commentators, the print press, social scientists, and small businesses, that taps into these blips. One of the most salient trends I detected during my recent trip to Japan (visiting Tokyo, Yokohama, and Kushiro) was a subtle shift in the attitudes of young women toward gender equity.

A few weeks ago, the New York Times ran a story about a new trend in Japan--again whether it is real or imagined is debatable. The article (titled "With Jobs Scarce in Japan, Women Become Professional Flirts") said that some women are choosing to become hostesses in order to survive during the recession and that the image of hostessing as a job has gained some respectability. The article's sensational photo featured a single mother who works as a hostess (oh no, Japan's mothers are becoming prostitutes!).

I asked a Japanese friend, who is an MBA candidate in Japan, about this article and she said that the deeper issue is that single women in their late 20s and 30s are kicking up their search for financial stability. This drive includes doing previously shunned jobs or searching for husbands by engaging in "kon katsu" or "marriage hunting," which includes the use of websites that help women find men. Given the U.S. media's fondness for exoticizing Japan, what are we to make of this new trend? During my recent trip, I was eager to find out.

After talking with many people during this trip, my view is that this trend is both much ado about nothing and much ado about something very subtle, but not necessarily what one would expect on the surface. Keep in mind my view is based on conversations only, not quantitative analysis.

In one regard, this story is about nothing much or at least something that has been going on for a long time in Japan and in the world. Men and women need ways of finding spouses in all countries. Given Japan's ostensible shy culture, its society has developed indirect methods of match making. In the past, it was arranged marriages ("omiai"). In the recent past, it was singles parties at restaurants ("gokon"). In today's digital world, the newest version of this method is match making websites and other services that facilitate marriage hunting. No big change.

But in another regard, something else is going on here. Women seem to be reassessing gender equity. To understand, we have to go back about ten years. During the middle of Japan's "lost decade" of the 1990s and early 2000s, economic growth was weak and companies were trying to respond--as was the government. Policymakers and businesses appeared to have found a mutually beneficial solution: tap into Japan's under utilized resource--its women's human capital. From the policy community, this idea was captured by my former boss and former MITI official Nobuo Tanaka in his essay "Girls, Be Ambitious," published in the early 2000s. Here is his essay's sober conclusion:

Encouraging women to enter more fully into the labor force will increase competition for jobs at a time when Japan's unemployment rate is at a post-war high; salaries for male workers could suffer as a result. But two working family members instead of one, which is still more or less the norm in Japan, means more income for the household. Also, it could encourage the sharing of housekeeping chores and child-rearing, tasks which are really much more tiring than office work, as a famous female ex-MITI official once said.

One of our recent speakers, Goldman Sachs Japan Chief Strategist Kathy Matsui, remarked that she was surprised to discover it is not only Japanese labor conventions that keep women from participating more fully in the workforce, but a tangible lack of career aspirations among Japanese women themselves. In her investigations into the economic implications of Japanese women in the labor force, an area that she calls "Womanomics," she notes that fostering career ambition is something that must be addressed as well.

It is difficult to say whether this can, in fact, be addressed through policy: it may be an educational, or even simply a child-rearing, issue. But ambitiousness and career aspirations are very much a desirable characteristic in the upcoming generation of Japanese young women. There is no doubt that they can make a significant contribution to the economic restructuring of Japan, something that we, as well as all of you outside of Japan, are anxious to see emerge.

Meanwhile, from a businessman's perspective, this idea seemed appealing in that women could be hired part-time, thus the birth of another trend in Japan--the furita and arubaito (part time workers). It seemed to be a win-win-win situation--policymakers found a new resource for Japan's economy, businesses found new flexible labor, and women found a new role in the workplace and a new sense of equity. In fact, women could pursue a dream of becoming career women. But how did it turn out?

For some women, the dream was fulfilled--they found careers. For others, the dream was ephemeral--they found drudgery in part time work with no social safety net and no stability. The current recession is hitting these women especially hard as they are seen as expendable--thus the New York Times article about women trying previously undesirable types of professions. As my MBA friend put it, women are doing whatever it takes to find financial stability, whether it be in becoming hostesses or trying updated versions of the age-old match-making practice in Japan. Women are also re-thinking gender roles.

My sociologist friend puts it another way. There are two successful types of couple equity: (traditional) complementary relations where the man does certain tasks (say working full time) and the woman does other tasks (say shopping and raising children); and equal relations where both the man and the women pursue the same tasks (say careers, shopping, and raising children). For centuries, Japan has favored the complementary type of relationships and thus its society has been structured to facilitate it. The newer, equal relationship has had some negative consequences: some women chased their careers and now find themselves alone; or in some cases, raising children and pursuing a career has just proven untenable in Japanese society. As my friend put it, women's expectations and goals have changed and they are therefore reassessing what fairness means between the sexes.

Does this mean the drive for gender equality has failed in Japan? Was the push for women to chase careers misguided? It is too soon to tell. But all of this raises a subtle question. Equity, equality, fairness, and well-being are all virtuous goals for a society. Equality between the sexes and the dream of raising children in a happy home are reasonable goals. But as the Japanese case shows, they can be mutually exclusive.

Unfortunately, these trade offs are not unique to Japan either. In a recent phone call back home, I learned about the struggles of Washington's career women in their 30s. Loneliness has driven them to use the dreaded match-making websites. Is this a unavoidable byproduct of modern living?

(Photo by Devin Stewart)

Mieko Nakabayashi: Japan Must Stop Wasting Money

(Posted Aug. 18, 2009; photos by Devin Stewart)

I just saw my old friend and former colleague Mieko Nakabayashi. She is now a bright star in the Democratic Party of Japan (DPJ) who is running to represent Kanagawa's first district in Japan's lower house in the Aug. 30 national election. In many ways, she epitomizes Japan's opposition the DPJ: She is hard-working, innovative, and conservative on budget issues.

Mieko was doing "yuudachi" (evening campaigning at subway stations, targeting people coming home from work). This aspect of Japanese elections is the core of democracy here; the candidate and her staff burst on to the public squares near commuter railway stations to make the case for their candidacy. A DPJ politician who introduced Mieko harshly criticized former prime minister Junichiro Koizumi's deceptive administration, which he said only focused on postal reform. Today is the first official day of Mieko's campaign and she is working from 6am to 9pm each day to get her message out:

True to her unique background working on budget issues at the U.S. Senate years ago, she is a blue dog (in fact, her campaign color is marine blue, a link to Yokohama's maritime culture), fiscal conservative. In line with the top pillar of the DPJ platform, her key message is, Japan must stop wasting money. It is already the most in debt rich country in the world. Like the GOP in the United States, Mieko compared Japan's budget to a household, asking passersby whether they would feel OK with running a household with such high levels of debt (to income).


Mieko said that in this election, the Japanese people will truly have a choice and that choice will allow for a thorough review of the budget. By reviewing budget priorities, Japan will be better able to afford social services like job training--a line that reminded me of the Obama campaign. While the DPJ has campaigned against graft and excess, it has been attacked by ruling party LDP for suggesting the need for new social service.

When Mieko and I worked at a Japanese think tank years ago, a common theme was the need for a competition of ideas and policies---a marketplace of ideas, in the parlance of Washington think tanks. Mieko used this kind of thinking to advocate for a real competition between political parties to bring about competitive policies for Japan. All in all, Mieko struck me as showing a lot of integrity, humility, and sincerity, resembling the colleague I knew years ago. And the people in the Yokohama suburban neighborhood seemed to embrace her as such with many people from all walks of life stopping to shake her hand and read her literature.

Given some of the alarm in Washington about the prospect of having a new party in power in Tokyo (the LDP has been in power almost consistently since 1955), I asked Mieko what her approach to the U.S. alliance would be. Not to worry (no surprise for me), for Japan, "the U.S. relationship is the most important in the world."

Campaign Secrets from Ichiro Ozawa

I am in Japan this week, and everyone is talking about the upcoming national election. What new policies will it bring? How will it alter the policy-making process? What will it mean for the U.S.-Japan alliance?

The opposition party, the Democratic Party of Japan (DPJ), is expected to win, upsetting the Liberal Democratic Party's (LDP) nearly consistent grip on power since 1955. The strategist behind a lot of the DPJ's success is Ichiro Ozawa, who was previously a member of the LDP.

The latest issue (Aug. 17, 2009) of the Asahi Shimbun Weekly (AERA) spells out Ozawa's campaign secrets. Here are his top eight pointers for winning an election:

1. Small speeches in the countryside are more effective than large ones in the city.
2. Give small speeches at least 50 times a day.
3. These small speeches should be done in 1 to 5 minute stretches around local vicinities.
4. Longer (10 to 15 minute) speeches should include two personal failure stories.
5. When you bow, you should do so properly by keeping your legs straight.
6. When you receive a business card, examine it carefully (don't simply stick it in your pocket).
7. When you visit houses, you should always go in pairs (to avoid becoming lazy) and target 200 households per day.
8. If support is strong in a town, you should campaign hard there. If the support is weak, you should campaign less hard (as it warrants).

Good luck with your campaign!