Contemporary Challenges in Regulating Global Crises

M. Findlay

• Publisher: Palgrave Macmillan
• Year: 2013
• ISBN:
  9781137009111
• Topic: Politics & International Relations
• Subtopic: International Relations
• Index: Politics & International Relations

Mark Findlay's treatment of regulatory sociability charts the anticipated and even inevitable transition to mutual interest which is the essence of taking communities from shared risk to shared fate. In the context of today's global crises, he explains that for the sake of sustainability, human diversity can bond in different ways to achieve fate.

1

Hierarchy and Governance: Of Shadows or Equivalence?

Bad regulation … can do terrible damage to people. Good regulation can control problems that might otherwise lead to bankruptcy and war, and can emancipate the lives of ordinary people. Mediocre, unimaginative regulation that occupies the space between good and bad regulation leads to results that are correspondingly between the extremes of good and bad. Regulation matters, and therefore the development and empirical testing of theories about regulation also matter.¹

Introduction

The regulation of global crises sounds like a contradiction in terms. If ever there was an era of crisis worldwide, man-made and natural, it is now. At the same time, as global warming, epidemic poverty and disease, international financial meltdown, populations on the move and the erosion of self-determination and privacy reveal, regulatory strategies are failing the challenge. Then why attempt to address crisis with regulation at anything more than an aspirational level?

The reasons for regulation’s perceived and recurrent failure are both simple and profound. Over a decade ago, I argued in The Globalisation of Crime² that the myopic focus of the West on globalisation as its problem and the unique opportunity it offered to monopolise socio-economic development denied the pressing significance of impacts on cultures in transition. A driving motivation behind this book is to expand on a realisation³ that

…consolidated statehood is the exception rather than the rule in the contemporary international system …outside the world of developed and highly industrialised democratic states most countries contain what we call ‘areas of limited statehood’. While areas of limited statehood still belong to internationally recognised states …it is their domestic sovereignty which is severely circumscribed.⁴

The regulation literature (policy included) is vastly overconcerned with the Western, Westphalian socio-economic contexts. For instance, the debate about non-state-centred regulation (discussed later in Chapter 9) evolves from the assumption of a functioning, strong Weberian⁵ state framework. However, modes of governance, domestically and particularly internationally, today do not exist in any such sophisticated counter-regulatory shadow.⁶ As such, the top-down or bottom-up hierarchies of regulation⁷ which rely on eventual state-institutionalised enforcement capacity are relevant only to a select hegemony of states and economies. It is this Western-centric evaluation of crisis priorities and appropriate regulatory responses from elitist state or corporate frames that the analytical context of this book is set to challenge.

The language of hierarchy, hegemony and empire has become the analytical prism through which scholars explain the emerging politics of globalisation.⁸ This emphasis in the analytical literature has probably arisen from the conviction that preferred governance modes (state, international organisations, NGOs, MNCs and PPPs) reside in capitalist, neo-liberal sociopolitics. As such, contemporary considerations of international political economy

…such as neo-liberalism or neo-realism are too state-centred in their assumptions to fully appreciate the growing importance of non-state actors and various transitional networks.⁹

An argument to justify the disciplinary deficit, when it comes to imagining non-Western, non-capitalist regulatory frameworks from which to view crisis challenges for global governance (except in terms of the manner in which the poor and underdeveloped exacerbate crisis), might consist of stating the obvious: these are the dominant political and economic models and as such they should drive the global regulatory mission. This dogmatic differentiation could be a convincing argument were it not for the realisation that the:

• conditions of global crisis are created by both the developed and developing world,

• negative consequences of global crisis are felt much more profoundly in the developing world,

• failure of regulation is not limited to areas of weak or limited statehood,

• regulatory failure is not always corrected under the shadow or within the hierarchies of strong states, and

• modes of social coordination and embedded social markets essential for good governance in non-consolidated state terrain are at the heart of regulating global crisis, whatever the context.

The task of achieving a more inclusive analysis of incentives for confronting global crisis is to disentangle and reveal the contextual relationships between these modes of social coordination so that regulating global crisis can be given a flatter and wider sweep. This will take our thinking away from hierarchies and more towards relationships in which the incentives to minimise and avoid crisis are stimulated. In these relationships, the role of functional equivalents for a state-based shadow of hierarchy is to

enable effective and sustainable non-hierarchical modes of governance involving non-state actors in areas of limited state-hood,¹⁰

and this leads to a more organic and harmonious shift from crisis to ordering.

Beyond rehabilitating configurations of limited statehood (and more broadly the place of transitional cultures in contemporary globalisation) within contemporary governance scholarship, it is the purpose of this book to understand and maximise incentives for cooperation in the prevention and management of global crisis. In advancing collaborative regulation as a preferred model for global crisis resolution, this book does not take a naïve normative stance. Collaboration is not a compromise for the failure of more vigorous intervention strategies. Nor is it a compromised concession to the self-regulation lobby, many of whom could be held responsible for the crisis in the first place. By selecting, in later chapters, to look at case studies of global crisis and resolution in volatile contexts where collaborative regulatory partners, particularly in third-world economies, are compromised in crisis creation, this book endeavours to reveal how turning self-interest into common good is viable and not altruistic when the realities of global crisis are exposed to communities of shared risk. In any case, state intervention in these circumstances, again especially in developing economies, is too often motivated by the collaborative self-interest of stakeholders requiring regulation.¹¹

Like it or not, state-focused or otherwise, we are obliged to reflect on styles and situations of governance which are multi-layered beyond consolidated state hierarchies and not largely dependent on sanction-based enforcement. Braithwaite recognises this with his regulatory pyramids, and where the analysis to follow extends from such paradigms is the manner in which collaborative regulatory regimes have relevance and potency in governance contexts where the shadow of regulatory enforcement is faint or has failed. Aligned with this perspective is the inescapable need to reflect on the state beyond Western constellations or muffled by cosmopolitan dreaming.

Realistic reflections on the global state

For the purposes of the analysis to follow, I am greatly assisted in conceptualising the state (local and global) as a constellation of power and authority placed somewhere on a continuum between deep consolidation and weak fragmentation. As we progress along that continuum, it is fair to assume that the influence of sanction-based, state-sponsored or complex corporatecompliant governance hierarchies diminishes and the enforcement shadow of the state (or the sophisticated corporate constellations with industrysanctioning mechanisms within the state) fades or diminishes far off.¹² So too as we move from state consolidation to fragmentation, governance relocates from within to beyond the state. This shift should not be confused as governance without government.¹³ Rather it means that the analyst needs to stop struggling to find the institutions of the strong state as evidence of good governance and governability and instead should delve more deeply into what Börzel and Risse (2010) refer to as ‘functional equivalents’ of the state’s imminence.

While there are many configurations of limited statehood (not confined to failed states or to a failure to control territory), the modern liberal democratic notions¹⁴ of the state exhibit a consistent and almost universal emphasis on:

• the ability to enforce collectively binding decisions;

• ultimately possessing a monopoly over the means of legitimate violence;¹⁵

• operating through hierarchies of authority with sanctioning at the apex;

• demonstrating an institutionalised authority structure and a bureaucracy for its execution; and

• authoritatively making, implementing and enduring central decisions for a collectivity.

Universals characterising limited statehood are more difficult to identify as even some consolidated states may contain areas of limited influence. Identifiers may include the following:

• weak domestic sovereignty;

• loss of monopoly over the use of force;

• partial enforcement powers;

• non-hierarchical authority structures;

• reduced administrative capacity;

• loss of control over territorial or functional space; and

• evidence of traditional or new non-hierarchical modes of governance.

A function of the consolidated state is law-making. Law diminishes in governance significance as it moves to the supranational,¹⁶ or it fails to endorse private rights and public obligation when the enforcement shadow of the state is a faint or is fragmented.¹⁷

Is law beyond, not without, the state?¹⁸

The role of law as a regulator in a world, where the reach of domestic jurisdiction is becoming more and more constrained and where supranational law is not yet achieved, features in the discussion of law’s relevance in general later in this text. In systems’ theory terms, autopoetic considerations of private law systems in particular offer a new vision for what some think of as the false dichotomy between law within and beyond the state.¹⁹ Take contracts for instance, where the contract, it is argued, can create its own legal order through its own internal hierarchies of obligations and rights, combining primary norms (contractual rights and obligations) with secondary norms, giving these primary norms their validity. In this way, a legal system in microcosm, including objective law and possible adjudication, emerges out of and applies to the contract. Such a contract may well explain how commercial arrangements can be regulated through contracts prevailing even in limited or fragmented state settings where legal hierarchies are impotent and where the political and economic enforcement administrations of the state cast little or no deterrent shadow over contracting parties.

Perez suggests²⁰ that it is not simply inevitable but in fact to be preferred that public interests will be absorbed into the otherwise sacrosanct interests of contractual private parties. It is particularly where communities are directly influenced by large-scale construction, the argument goes, that community interests have a place within private contractual negotiations, intersecting public and private goods.

Michaels argues against state parallels when trying to imagine the future of supranational legal regulation – an important speculation for later chapters in this book.

Authors endorsing the anational or non national character of lex mercatoria, I argue are barking up the wrong tree. In perpetuating the state/non state dichotomy, the lex mercatoria without state remains within a state focused legal paradigm.²¹

But for Michaels, as with Ulrich Brand, whom I consult in more detail in later chapters, the state referent for supranational legal regulation is not inevitable or perpetual. In the sense that the legal system creates itself in separation – but not away – from the influences of the institutions of politics, law can be seen as without the state. At the global level, however, the internal differentiation of legal systems applying supranationally is not so easily or ideally divorced from politics or economy. At the global level, law as regulation still represents a segmentary differentiation, linked hard or soft to the functioning of state interest. That is the immediate barrier to Brand’s new politics or Teubner’s global law.

In later writing on non-state governance,²² Michaels provocatively suggests that for law and governance as state indicia, it is not about state/non-state divides, but that the analyst must ‘put the state in perspective in order to overcome it’.²³

Here is where the challenge emerges for considerations of governance to detach from hierarchies within the state, characterised by its sanctioning capacity towards the apex. More of this will be described later, when the discussion turns to flat regulation.

Governance from afar

Governance can be considered, from the perspective of regulation, as various institutionalised modes of social coordination that produce and implement binding rules collectively or provide collective ‘goods’.²⁴ Governance is a dynamic and evolutionary phenomenon, particularly at the global level,²⁵ involving process and structure, and sometimes calling on the creation of new political manifestations and languages.

It will become clearer later in this book that I do not see conventional discourse on sovereignty as helpful in understanding the nature of modern governance, particularly at the global level. A reason for this resides in the incapacity of some regulatory paradigms such as public international law to break free from the referent of the liberal democratic state in the conceptualisation of sovereign authority, power and obligations. In replacing a discourse of sovereignty when looking at the manner in which regulation determines governance (and vice versa), an examination of frames and actions of particular governance styles is rewarding. Take for instance, the determination of governance by examining the actors which advance it. Therefore, in liberal democratic states, governance is governments resting on personalities and alliances, not on compatibilities, while in multinational global networks governance assumes life through negotiation and competition (between firms, consumers, shareholders, managers etc.). As a process, governance is determined by different modes of social coordination. Another strong theme to ...

Table of contents

• Cover
• Title Page
• Copyright
• Contents
• Preface and Acknowledgements
• Acronyms
• 1. Hierarchy and Governance: Of Shadows or Equivalence?
• 2. Comparative Theories of Regulation – North vs South Worlds
• 3. Regulatory Instruments, Strategies and Techniques – Sticks and Carrots
• 4. Contexts of Global Regulatory Challenge – Compulsion or Compliance?
• 5. Regulating Communication – New Media, Old Challenges
• 6. Regulating Human Integrity – Who Owns Your Body?
• 7. Regulating Finance and Economies – Profit and Beyond
• 8. Environmental Regulation – Liability or Responsibility?
• 9. Regulating Regulation – Who Guards the Guardian
• 10. Regulation and Governance – Beyond Terror/Risk/Security
• 11. Conclusion: Regulatory Sociability and Regulatory Futures
• Notes
• Bibliography
• Index