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The
Politics of Fortune: A New Agenda for Business Leaders by Jeffrey E.
Garten Rating: •• (Mildly Recommended) |
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Click on title or picture to buy from amazon.com |
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Manifesto for CEO Action Jeffrey Garten calls CEOs to action for
public policy collaboration in his new book, The
Politics of Fortune: A New Agenda for Business Leaders. You may not have
the time or interest to pursue even a quarter of what Garten proposes, and
you may disagree with him wholeheartedly. You’re likely to feel uncomfortable
with what Garten has to say, and for that reason alone, The
Politics of Fortune may be worth reading. Here’s the agenda list Garten proposes for
CEOs: The administration and
business leaders should insure that the homeland security advisory council is
accorded the scope and importance it deserves. The administration and
business leaders should conduct a postmortem of recent scandals, with
recommendations for strengthening America’s business culture. CEOs should help restore
fiscal soundness. CEOs should help
strengthen the social safety net. Business leaders should
work to keep the world economy open in the face of strong head winds. Business leaders should
redouble efforts to liberalize global trade. CEOs should support
higher levels of investment in global rules and institutions. CEOs should press for
trade policies that benefit poor countries. CEOs should press for
increases in foreign assistance. Business leaders should
help ease the crisis in global health. CEOs should contribute
to the evolution of development strategy. Business leaders should
give added attention to Islamic countries. CEOs must be proactive
and transparent when it comes to issues of corporate citizenship and social
responsibility. Business leaders should
expand the work of industry associations. Business leaders should
expand engagement with public and nonprofit institutions. Business leaders should
develop more rigorous strategies toward NGOs that act as antiglobalization
protest groups. CEOs should press
governments and international organizations to develop global rules of
conduct. CEOs should press for
sustained multilateralism. CEOs should keep global
economic priorities high on the administration’s radar screen. CEOs should step up
support for the protection of human rights and democracy. CEOs should help Washington
with public diplomacy. CEOs should press for a
foreign policy advisory board. Business leaders should
push for the establishment of a national commission to take a fresh look at
business education at all levels. If all those “shoulds” make you a little
twitchy, here’s an excerpt (pp. 127-30) from the agenda item, “CEOs should
press for increases in foreign assistance”: The world needs a powerful set of voices
outside the U.S. government advocating higher levels of aid and more
effective use of the funds. Precisely what is needed can only be estimated in
orders of magnitude. A U.N. commission, cochaired by former Mexican president
Ernesto Zedillo, and including former U.S. Treasury Secretary Robert Rubin,
has indicated that at least an incremental $50 billion per year is required
to substantially reduce poverty—twice as much as the aid flowing today. Yet
the trend is in the opposite direction: Total aid in 2002 adjusted for
inflation was about 10 percent lower than it was a decade before then. CEOs should press the Congress and the Bush
administration to increase the levels of America's foreign aid, and they also
need to make the case with the public. The performance of the U.S. government
has been dismal by any standard. The United States provides 0.1 percent of
its GDP in foreign aid, the lowest percentage of any major industrial country
and less than a third of European levels. Over the last decade, American
foreign aid has declined by over 30 percent, when inflation is stripped out.
There is room to argue about how the aid ought to be used, how to link it to
policies in recipient countries, and how to measure its impact—and CEOs can
bring a lot to this debate. But if America doesn't step up its performance,
other countries won't either. Foreign
aid from the United States and other countries should also include more
assistance for debt relief for the poorest nations, in return for their own
governments' pursuit of sound policies. A major international initiative on
debt relief is under way and deserves the support of the Unred States, not
only to implement what is on the table now, but to expand the scope of the
plan. Financial help is also needed for the budgets of the U.N.’s specialized
agencies. Increased support for the World Health Organization and for those
agencies that oversee aid for children, food production in poor countries,
refugees services, and the reconstruction of states recovering from civil
wars is critical. The budgets of institutions like the World Trade
Organization must also provide for essential technical assistance to
developing countries, whose officials lack the expertise to negotiate
international economic arrangements that will give them a chance to take
advantage of what globalization can offer them. For instance, a typical
developing country spends $250 million per year just to implement three of
the dozens of agreements that constitute membership in the WTO: agreements on
customs valuation, intellectual property rights, and technical standards.
That’s more than the average country's entire annual budget for roads,
communications, and other development projects. In the spring of 2002, the politics of foreign aid
began to change in Washington, although it was not clear by how much. At a
global conference on financing for development, held in Monterrey, Mexico, in
mid-March 2002, President Bush announced that the United States would
increase its annual development aid budget by 50 percent by 2006. Although
the funds would be dispensed only after Washington was satisfied that the
recipients had followed a host of sound policies, the Bush administrations
U-turn generally pleased the international community. Still, what America
didn't like about foreign aid was clearer than what it did. "For
decades, success of development aid was measured only in resources spent, and
not in results achieved," said President Bush. "Pouring money into
a status quo does little to help the poor." 12 Three months later, the
Bush administration proposed doubling the amount of money it spends on
education in Africa and substantially increasing funding for dealing with
HIV/AIDS on the continent. The business community needs now to press Washington
to keep up the new momentum. The increases in American aid, while welcome if
they in fact materialize, still fall far short of what is necessary. Also,
virtually no part of the new plan can be implemented without congressional
support, and business pressure on Capitol Hill will be a critical element in
getting any new approach off the ground. Foreign aid to help the
poor has been unpopular in the United States ever since the Marshall Plan was
completed. Even if and when the new U.S. approach announced by President Bush
is combined with new aid pledges from Europe and elsewhere, the total aid
would constitute less than 20 percent of the goals supported by the U.N.
Given the political realities and the problems that will ensure if poverty continues
to spread and deepen, a more radical approach ought to be considered: a
global tax on trade, or on carbon emissions, or on sales of military
equipment. Most governments and business executives consider such ideas
heretical. But if you know that the course you are on is bound to fail – if
the problems grow faster than the remedies you have been trying – is it so
crazy to think about approaches of a different order of magnitude? In a
system of global taxation of some kind, revenues would be funneled into one
or more trust funds that would be available, under precise guidelines, for
investments in poor countries. Choosing who would manage those funds would be
a crucial decision, of course. Many other fundamentals of any plan – the rate
of the tax, the collection procedures, the allocation mechanism, etc. – would
have to be worked out. However, if business leaders took a serious interest
in such plans and participated in thinking them through, it would help to
diffuse the objections that the plans are socialist schemes. After all, there
are no advanced societies in which taxes do not help fund pressing social
investments. Garten’s tone is preachy throughout The
Politics of Fortune, and if the image of a wagging finger bugs you too
much, you should take a pass. Otherwise, you may find your thinking
stimulated, and your blood pressure raised as you turn the pages of this
book. Steve Hopkins, March 25, 2003 |
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ă 2003 Hopkins and Company, LLC The
recommendation rating for this book appeared in the April 2003
issue of Executive
Times URL
for this review: http://www.hopkinsandcompany.com/Books/The
Politics of Fortune.htm For
Reprint Permission, Contact: Hopkins
& Company, LLC • 723 North Kenilworth Avenue • Oak Park, IL 60302 E-mail: books@hopkinsandcompany.com |
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