by Parag Khanna
Critics of the rising power of NGOs insinuatingly ask whom they actually speak for. The answer is that their legitimacy derives from their authority of expertise, impartiality, representativeness, and transparency of operations. In many ways they act far more accountably than governments: The more exposed they are, the more they are held to account by donors, charities, customers, and their own competition. Their funding is certainly more efficient than official sources: Almost all of it goes to frontline operations and partners, making it less susceptible to government leakage and meddling, while training local civil society in the process.
Other super-NGOs, including CARE, Save the Children, and Mercy Corps, have also established themselves as truly independent global players. Their ability to leverage technology and capital enables them to bypass governments altogether. They no longer refer to their contributors as donors but as investors. The largest humanitarian NGOs (whose annual giving exceeds $20 billion) have teamed with Microsoft in an “NGO Connection” platform to assist them in compiling and sharing best practices. This kind of interoperability planning is what we typically expect from members of the NATO alliance—now anyone can do it.
Flash Diplomacy: The World Economic Forum
On a typically sunny day in the Persian Gulf emirate of Dubai, more than one thousand men and women gathered for anything but a day at the beach. All top figures in their fields, they were convened by the World Economic Forum (WEF) for a “Summit on the Global Agenda,” lending their minds to what the BBC’s Nik Gowing dubbed a “fundamental reboot” of global problem solving. But rather than formulating extravagant proposals, they huddled in “Global Agenda Councils” to perform mental brain dumps, sharing the latest thinking on alternative energy, food security, Mideast peace, financial risk, social entrepreneurship, biodiversity, trade liberalization, and dozens of other issues. No oversized groupthink here: Each expert group appointed ambassadors to fan out like intellectual hunter-gatherers, identifying linkage points: How can more efficient construction and transportation cut emissions while also creating jobs? How can skill-building centers be used to mitigate interfaith tensions? Even in the wake of the worst economic crisis since the Great Depression, win-win solutions are still possible.
From the outside, the WEF is just another nonprofit foundation in Geneva with a staff of about 250 people. Yet it has engendered a revolution in where and how diplomacy gets done: Its summits are sophisticated flash mobs. On location from Africa to China, and each January in the secluded Swiss mountain resort of Davos, hundreds of top business, political, economic, academic, and civic leaders congregate to network, argue, lobby, and collaborate. Scholars don’t need appointments to see presidents, who it turns out would rather hear ideas from their authors than filtered through assistants and ministers. CEOs get the latest trends and analysis without waiting for cumbersome reports and come away with a growing sense of social obligation beyond the bottom line. At WEF gatherings, everyone at the table is at the top of their game, so there is no question as to who is in charge and on whose shoulders responsibility falls.
North and South, public and private, West and East: All the new power centers are present within the WEF’s activities, making it the world’s only organization truly devoted to mega-diplomacy. Whereas the United Nations and World Bank speak of “reform” as a code for strengthening themselves, the WEF creates the space for thinking about a genuine redesign of how we run the world—always partnering governments, businesses, and organizations. Indeed, while official diplomacy has been slow to recognize the importance of NGOs, their participation has grown so rapidly at WEF summits that the waves of anti-globalization protests that racked international gatherings over the past decade have ceased to bother the organization. The WEF brought the protesters inside the tent and set them on par with government leaders and CEOs. Another advantage the WEF has over its state-centric peers is that it has rapidly adjusted to the world’s shifting balance of power. To show respect for emerging powers, you have to take the show to them. Summits in China and the Middle East have maintained the WEF’s relevance as U.S. power wanes. Capturing the shift in influence under way in Africa, the cochairs of the forum’s 2009 Africa Summit in Cape Town included the chairmen of the Dubai Group and the Industrial and Commercial Bank of China.
Over the past forty years, the WEF has grown into the archetype of the new diplomacy: informal, efficient, and involving all relevant types of actors on equal footing. At WEF summits, collaborations among companies, NGOs, and government agencies are both incidental and facilitated. Organizations with obvious complementarities waste no time in launching joint projects. One of the most common refrains one hears is “We should have met ages ago!” Importantly, WEF meetings are not places where the only people you meet are those you already know. Instead, bloggers, social entrepreneurs, and a host of “change makers” under the age of twenty build networks with one another and otherwise far-off leaders. Many great ideas and projects are born through connections made at these summits. The WEF will never get any credit—but who cares?
The WEF itself has evolved into a hybrid structure not seen before: corporate funding, nonprofit status, current and former government officials on its board, and summits accorded the status of official diplomatic events. Its staff has come on secondment from member companies and governments such as Singapore, and it has seconded staff to UN agencies and think tanks. The WEF also embodies our postmodern age because it allows people to maintain the multiple identities they carry today. Bill Gates has appeared at Davos as Microsoft CEO and as head of the Gates Foundation at the same time, gradually speaking much more about malaria than software. Indeed, it was at Davos that Gates first had the idea to found his pioneering foundation. George Soros comes as a billionaire fund manager giving signals about currency markets but also as a democracy activist. Richard Branson attends as Virgin chairman but also as an environmental crusader dangling massive rewards in front of tech start-ups willing to tackle climate change. And Bono shows up as the head of his African development outfit the One Campaign—playing rock star only at night. There need not be tension among the roles the rich and powerful play, and the WEF gives them the space to evolve their priorities.
Advocates of some form of global democracy evoke the ancient Greek agora, a marketplace free of coercion. The term that best captures the WEF, however, is the Latin consilium, meaning a consultative assembly. Many detractors complain that the WEF masks secretive corporate activity and conspiratorial deal making with corrupt governments. But no CEO needs to go to Davos for this—they can do that year-round in London, New York, Geneva, Moscow, or Riyadh. What the WEF reveals about corporate activity is that transparency within industries—that is, among companies—is as important as government regulation: They want to monitor one another on a level playing field. Furthermore, the WEF gets industry giants to undertake projects together; for example, construction companies lend resources to disaster relief projects in Latin America, mining companies run health clinics in Africa, and information technology companies set up e-learning academies in the Middle East. Companies now go to Davos and other WEF summits to learn precisely how to become better corporate citizens, and increasingly do so under WEF auspices.
WEF meetings and the increasingly numerous initiatives the forum sponsors are vehicles for leaders to find out what they can do together and what each can do better than another, and then devise a division of labor to get a job done. Presidents and ministers leave the UN General Assembly or its regional group meetings having recited pro forma speeches and defended their turf. Executives, ministers, and NGO heads all leave WEF meetings with stacks of business cards of potential partners and ideas for mega-diplomacy projects to undertake together. The WEF gives all these diverse leaders homework, making them smarter year after year.
The Broker: The Clinton Global Initiative
Each September, New Yorkers are subjected to a midtown traffic nightmare as the world’s political leaders come to town for
the UN General Assembly. Impatient pedestrians on Park Avenue stand behind blue barricades for up to an hour waiting for the blitz of armed motorcades to go by, ferrying presidents, kings, and despots from JFK International Airport to the Waldorf Astoria Hotel to UN headquarters. In the past five years, the congestion has gotten only worse because of a parallel event at the Sheraton Hotel near Times Square. Many New Yorkers may not know it, but they are witnessing a crosstown diplomatic duel over how to run the world.
In 2008, diplomats asked to recall the overriding theme or priority for that year’s UN General Assembly were dumbstruck. Yet there was no such confusion a few blocks west at the Sheraton, where what many have dubbed “Clintonpalooza” was taking place. Bill Clinton of course schedules the annual Clinton Global Initiative (CGI) to coincide with the United Nations in order to lure about sixty heads of state (as well as hundreds of business leaders and NGO representatives from ninety countries) to validate his mission—but by so overshadowing them with the array of successes CGI achieves, it also seems they are really brought there to be shown the light. At his 2009 gathering, which ran under the motto “Actions speak louder than words,” he mused that “ninety percent of politics is about what you are going to do and how much you are going to spend.” While spending and action are out of synch in politics, Clinton wants money to actually do something. “We know what to do,” he says. “It’s only a question of organizing ourselves to do what needs to be done.”
Like the World Economic Forum, CGI needs no public funding to sustain itself, yet it produces the same aura of great consequence. Underwritten by wealthy entrepreneurs and the Children’s Investment Fund Foundation, CGI gets regular support from about a dozen major corporations, foundations, and governments. Rather than stiff speeches, CGI panels feature notables such as Partners in Health founder Paul Farmer and Nobel Prize winners Muhammad Yunus and Wangari Maathai sharing examples of how they impact thousands of lives every day. All CGI sessions end with concrete action items, not just recommendations. Plenary sessions take place at CGI only to praise major commitments, with recognition taking the form of a handshake or bear hug from Clinton himself. Such public gratitude shows why Clinton would have made the best UN secretary-general had he considered the post: His personal authority to name and shame would be vital to changing bad behavior. But now that he has found his groove, it makes more sense that he pioneer a new model than wrestle with fatally outmoded bureaucracies.
The simplicity of Clinton’s premise is elegant: Connect the world’s top billion with the bottom billion in as many ways as possible. Bridging the first and third worlds is not about socialist redistribution schemes and whopping aid programs, however. Rather, it’s about expanding the corporate world’s focus on high-value branding and products toward low-cost but wide-scale opportunities. If ever there was a place to see how far we have come from the anti-globalization movement of just a decade ago, and how far corporate funding can go to change the way so many various places are run, CGI is it.
CGI also works because it brings politicians, business, and civil society leaders together on the same plane to devise a division of labor in their activities. No CEO or head of state is entitled to attend CGI—he or she has to earn it. The only way in the door is to first stop at the Commitments Office and put forth a workable and funded plan to support local development, environment, health, or education initiatives. The Clinton Hunter Development Initiative, for example, is a suite of efforts to promote Rwandan fair-trade coffee while also making coffee production more eco-efficient through smarter planting of shade trees. In 2008 alone, companies with extensive Africa operations pledged $300 million for small enterprise support and another $100 million to expand mobile banking services. NGOs that used to lobby governments for funding now go to CGI instead to join forces with companies. For the past three years it has also run a “CGI University,” inspiring thousands of students at colleges worldwide to make their own commitments to sustainable projects.
It’s easy to dismiss Clinton’s efforts as a vanity project, but then why do more and more companies want to make their corporate citizenship commitments via CGI? The most important factor underscoring the CGI’s sustainability is that it is backed by a foundation with year-round activity—the annual capstone event serves mostly to generate public awareness. Indeed, the William J. Clinton Foundation boasts accomplishments perhaps greater than the CGI statistics, particularly in the arena of access to low-cost HIV vaccines. Rather than engage in endless policy debates over intellectual property rights at the WTO, the foundation identifies bottlenecks in vaccine distribution and supplies funding to incentivize companies to increase volumes and lower costs. Clinton has brought down drug costs much faster than would otherwise have been the case—saving countless lives in the process.
The Clinton Initiative seems like a quixotic forum to the old guard who feel that diplomacy is their turf—as if the diplomats who sign climate treaties are more important than those who actually innovate emissions reductions, as if those who allocate development aid are more important than those who liberate people from it, and as if those who debate political and military interventions are more important than those who act based on their conscience. Clinton ends that debate. We are all part of the dam preventing the flood. We are the new global architecture.
Chapter Three
The (Fill-in-the-Blank) Consensus
At the April 2009 summit of the Group of Twenty (G-20) countries in London, President Obama mused during a press conference about how the United States and Great Britain put together the post–World War II economic order: “If it’s just Roosevelt and Churchill having a brandy, that’s an easier negotiation … but that’s not what it’s like anymore.” If the world economy were a company, it’s no longer clear who the chairman of the board would be. Today every country wants a seat at the high table; otherwise, they’ll shop around for another forum that gives them more respect and voice. A former Mexican diplomat in London put it best: “If you’re not at the table, you’ll be on the menu.” Economic diplomacy is now a dizzying game of musical tables—with the fate of globalization hanging in the balance.
The first global economy took shape during the Middle Ages, but it was one in which different regions had their own anchors and rules. Similarly, today there is no more free-market “Washington Consensus” to which the world’s economies subscribe. Instead, each is searching for ways to manage globalization to its benefit. Yet all seem to agree with the mantra that the world coming out of the financial crisis must be different from the world going in. For that to happen, however, the public and private sectors need a new kind of partnership: one fast enough to manage risks and progressive enough to benefit the masses. Countries that get public-private synergy right will occupy the commanding heights of a global economy that has become as much Eastern as Western. If you want to know who sets the rules for the new global economy, follow the money.
“Twenty HUBS and No HQ”
Utter the word “Sherpa” and one name—Tenzing Norgay—usually comes to mind. Certainly not Michael Jay, who with his lanky frame, wiry spectacles, and balding head looks more like an accountant than the record holder in Mount Everest expeditions. But after a long career in and out of the British government, Jay was tapped by then prime minister Tony Blair to help him navigate the rapidly shifting landscape of club diplomacy. His title was the coolest one can attain in the diplomatic world: “Sherpa.” As Robert Hormats, a veteran America Sherpa recently returned to the Obama administration, recalls, Sherpas think of themselves as “munchkins,” like the old but diminutive Wizard of Oz characters. So many young diplomats today want to become Sherpas—but first they have to do an apprenticeship as “yaks.” For Jay and his counterparts, being a Sherpa is the peak of professional achievement in diplomacy: “It’s a tough job, but huge fun!”
Since the 1970s oil shocks, the Sherpa job has attracted some of the best troubleshooters from the world’s leading governments. For thirty-five ye
ars, their main job was to coordinate financial stability policies among the Group of Seven (G-7), which until recently was the exclusive club of the world’s leading industrial economies.*
But in late 2008, their task was nothing less than saving the world from a looming depression. Unfortunately, by this point the G-7 had degenerated into group therapy for Western leaders. When the global economic agenda is set by Italy and not China, you know your club is in the wrong century. Sherpas nonetheless sprang into action, this time activating the dormant G-20 network: twenty countries that collectively represent 80 percent of the world’s population, 80 percent of its economy, and 80 percent of its emissions.* In lightning speed, Sherpas coordinated treasuries and central banks across the G-20 to craft the mother of all global bailout packages. Shifting from the G-7 to the G-20 was no problem for Sherpas: It was as easy as adding friends on Facebook.
Indeed, what Sherpas do is what World Bank president Robert Zoellick calls “Facebook diplomacy”: They are a cabal of policy experts constantly in touch by phone and e-mail. When they do meet in person, it’s for working lunches, not six-course meals. Sherpas don’t show up at meetings with prefabricated statements; they exchange ideas and negotiate on the fly. Members of this trusted behind-the-scenes network keep negotiations going no matter who’s in power and help their bosses prepare for the most delicate diplomatic face-offs. As one former European Sherpa said, “Leaders get along best after they’ve yelled at each other behind closed doors. That builds empathy and trust.”
