[snip] Rousseau’s Social Contract springs to mind… Historically, it has been the role of government to reflect the general will, and government, in this framework, has a responsibility to provide things like social services. The Social Contract has clearly played out in different ways in different societies… One way to look at the social or citizen sector is that it steps in where government has failed to live up to its Social Contract obligations. In this vision for the future, what is the role of the Social Contract? How does the collective take responsibility for the individuals? And what sort of governing principles and practices apply to enable this vision?
Interesting insight and provocative questions, Dahna. While we are persistent advocates of self-generated self-empowerment (as Nike would say, “Just do it.”), there is a limit to the self-empowerment that individuals can achieve on their own. And, yes, the public or social sector can try to lend assistance when governments fail their citizens. But in certain vital areas, there is no substitute for effective/enabling government action and policy.
Reform Wholesale and Reform Retail
In The World Is Flat, Tom Friedman distinguishes two kinds of governmental socioeconomic reform: reform wholesale and reform retail.
Reform wholesale consists of the Big Picture things that a government (usually at the scale of the nationstate) can do to prepare itself and its citizens for participation in the emerging network society and its network economy (what Friedman would call Globalization 3.0). Getting trade policy right, establishing rule of law especially as applied to international business relations, getting roads and utility infrastructure up to quality standards, etc.; these are the things that a nationstate can do largely top-down and by fiat to prepare itself and its people for participation in the Flat World.
The problem is that many nations too often stop at reform wholesale. They don’t move on to the second phase of preparing the themselves and their citizens for the hyper-competitive world of Globalization 3.0. That is, they don’t move on to reform retail.
Reform retail is all the devil in the details of preparing a country and its citizens for effective participation in the Flat World. Such things as how easy and affordable is it to start a business and deal with licenses, how easy or hard it is to hire and fire workers, what are the rights and responsibilities of property ownership, how available is credit, what protections are there for investors, how easy or hard is it to pay business taxes and do they stimulate or stifle economic incentive, do bankruptcy laws encourage or discourage risk-taking and innovation, how long does it take to enforce a business contract through the legal systems, et cetera. These are among the fine-grained details of getting a country and its people empowered for participation in the Flat World.
A ‘Reform Retail’ Best Practices Resource
Friedman cites the 2004 version of an interesting and ongoing study by the International Finance Corporation, an affiliate of the World Bank. The “Doing Business” Economy Rankings look at five broad areas;
- Starting a Business
- Dealing with Licenses
- Hiring and Firing
- Registering Property
- Getting Credit
These areas are combined into an overall Ease of Doing Business ranking. You will find an abundance of information related to the importance and means of reform that enable competitiveness in each of these areas on the IFC’s DoingBusiness.org web site. You will also find detailed information for each of the 155 national economies evaluated under this ongoing study. Follow this link to survey a cumulative list of all 155 economies ranked by their ease of doing business.
Self-Empowerment: Nature or Nurture?
Entrepreneurial self-determination, at its best, knows no bounds. Some folks are born to combine vision, persistence, ambition, pride in a job well done, and the many other traits that are needed to succeed in business, in life, or in any competitive domain. These folks will succeed against all odds. But what about the rest of us?
For those whose nature may not overcome all adversity, we need a little help from our friends. In the case of economic self-empowerment, we need that extra push of a ecosystem that is conducive to our survival and growth. Anthea and Mfume are much more likely to succeed as self-empowered individuals if they find themselves in New Zealand (#1), Iceland (#11), or Thailand (#20), rather than if they find themselves in Cambodia (#133), Sudan (#151), or the Democratic Republic of Congo (#155).
Our socioeconomic environment plays a large factor in whether the seed of self-empowerment grows or lies fallow. Knowing this, we need to hold our local, regional, and national government officials accountable for how well they work with us to ease our starting and sustaining our businesses. The Doing Business project is a readily available resource to monitor and encourage improvements at the nationstate level of the multilayered ecosystem in which we are trying to express our individual empowerment.
But we need finer-grained tools to monitor and improve our self-empowerment environment. We need to encourage nations to adopt and adapt the Doing Business methodology to take this best practices monitoring to the provincial, regional, and state levels. We need to encourage our local town and county officials to stand up and be counted in terms of how well they are helping us to participate in the Flat World of Globalization 3.0. Because, as Friedman so powerfully reminds us in The World is Flat, reform wholesale without an equal measure of reform retail is reform wasted.
While the proverbial saying tells us that we will find the devil in the details, it might be better if we were to look there to find the source of self-empowerment.
–Sohodojo Jim and Timlynn–
Add comment February 15th, 2006