Policy reform
Encyclopedia
Policy reform, in addition to its more general meanings, has been used to refer to a future scenario which relies on government action to correct economic market failures and to stimulate the technological investment necessary for sustainable development and the creation of a truly sustainable planetary society.
(1)Why were some countries able to undertake reform while others were not?
(2)What factors enabled some countries to achieve success in implementing reform programs, while for others, these programs failed?
(3)What were the characteristics of reform programs that helped them deliver outcomes?
It is apparent that a focus on the standard economic analysis with its emphasis on macroeconomic imbalances and projected policy impacts on long-run growth was not sufficient in understanding the complexities of the reform process. A more detailed study is needed to adopt a multidisciplinary approach with a strong emphasis on political economy and to understand the behavior of various stakeholders – how they reacted to new policy regimes and institutional configurations.
(GSG), which was convened in 1995 by Paul Raskin
, president of the Stockholm Environmental Institute and Tellus Institute
. These scenarios are summarized in GSG’s 2002 report entitled Great Transition: The Promise and Lure of the Times Ahead. It is categorized within this report as one of two ‘conventional worlds’ because it does not require a societal shift in fundamental values, power structure, or transformation of human consciousness. Put simply, conventional worlds scenarios correspond to the dominant world views of global leaders pursuing business-as-usual.
Rather than positing a dramatic shift in society
(either towards devastating collapse (Barbarization) or complete harmony with nature (Great Transition
)), Policy Reform posits incremental changes to economic, industrial
, technological, and environmental
forces. The goal of these changes is to create a sustainable world while maintaining current consumption and lifestyle practices.
A contrasting scenario, that is also part of business-as-usual, is Market Forces
. This scenario assumes that the invisible hand
of the market will foster development, as a “rising tide lifts all boats.” It stands on the idea that the market is a self regulating entity, and that human progress and innovation (i.e., new technologies and business practices spurred by competition) will always overcome challenges.
Both of these are possible bridges between environmental concern and economic growth
. Such bridges constitute the field of sustainable development
, as opposed to such movements as Eco-Communalism
, which calls for a reduction in consumption and de-industrialization to achieve environmental sustainability. While Market Forces
relies heavily on technology to achieve sustainable development; “Policy Reform depends on government action to seek a sustainable future” (Great Transitions, Pg. 16).
Libertarian
free-market capitalist
s and defenders of the Washington Consensus
correspond to a Market Forces scenario, arguing this should be the official perspective on international development. Keyensian economists, public figures like Al Gore
or Kofi Annan
, and the many organizations working for sustainable development
correspond to a Policy Reform scenario, and see inherent flaws in the unregulated forces of the market; most notably “tendencies towards economic crisis, social conflict and environmental degradation” (Great Transitions, Pg. 17).
. One unanswered question among those who’d support a Policy Reform scenario, is where would the political will for change come from?
In contrast, the New Sustainability Paradigm (NSP), which is put forth as the ideal future scenario in Great Transition: The Promise and Lure of the Times Ahead, posits a radical shift in the consciousness and the engagement of civil society
. Whereas, Policy Reform relies on strong leaders to be the stewards of the future, NSP asks what might happen if the citizens of the world where to find a voice in the ongoing debates about the emerging planetary phase of civilization
?
To illustrate the contrasting perspectives, one can look at the differences between the World Economic Forum
and the World Social Forum
. World Economic Forum
is a yearly meeting in Davos, Switzerland, that has the stated purpose of “improving the state of the world by engaging leaders in partnerships to shape global, regional and industry agendas” (WEF). This represents a belief that increased coordination among powerful global actors is sufficient to create a sustainable world. Contrasting this is the World Social Forum
. This forum grew as a response to the WEF by the anti-globalization
movement. It is made up of civil society groups and NGO’s from around the globe. This example shows a burgeoning latency of citizen desire to shape the global future and is in line with the NSP but highly irregular to Policy Reform.
Another concept important to understanding policy reform is ‘proximate drivers’. These include population
, economy
, technology
and governance
. Proximate Drivers are responsive to changes in policy: through mechanisms such as tariffs, taxes, and environmental regulations.
Below the surface of proximate drivers are ultimate drivers. These are the underlying causes that shape society: human values and needs, culture, power structures and systems for organizing knowledge and understanding. Contrasting Policy Reform, the New Sustainability Paradigm scenario assumes transformational shifts in these “root causes that shape society and the human experience” (Great Transition, p.49).
A real world example of this contrast might include the Global Reporting Initiative
, which seeks to create voluntary reporting mechanisms for corporations to report on their impact on sustainable development goals. This focus on proximate drivers contrasts with efforts like Corporation 2020 which seek to alter the underlying principals of corporate form and governance. The Earth Charter Initiative is another example of an attempt to address ultimate drivers, in this case by shifting underlying values.
, an economist who saw firsthand the failures of the free market during the great depression. It was his belief that capitalism
must be monitored and corralled in order to prevent periodic economic tantrums (Keynes, 1936). This idea of capitalism being guided by political decision-making is at the heart of Policy Reform.
While government intervention in economic affairs is nothing new, there have been recent milestones towards a more global recognition of policy reform. The UN World Summit on Sustainability in 2002 marked one of these milestones. It rallied nations together to work cohesively towards policy change. Other examples include the UN’s Global Compact which challenges businesses to adhere to social and environmental standards.
Understanding policy reform
Policy reform entails understanding the successes and failures of various reforms through a cross country comparison of reform policies and experiences in different regions. Questions to address:(1)Why were some countries able to undertake reform while others were not?
(2)What factors enabled some countries to achieve success in implementing reform programs, while for others, these programs failed?
(3)What were the characteristics of reform programs that helped them deliver outcomes?
It is apparent that a focus on the standard economic analysis with its emphasis on macroeconomic imbalances and projected policy impacts on long-run growth was not sufficient in understanding the complexities of the reform process. A more detailed study is needed to adopt a multidisciplinary approach with a strong emphasis on political economy and to understand the behavior of various stakeholders – how they reacted to new policy regimes and institutional configurations.
Explanation
Policy Reform is one of six possible future scenarios put forth by the Global Scenario GroupGlobal scenario group
The Global Scenario Group was a team of environmental scholars, headed by Paul Raskin, who used scenario analysis to analyze future paths for world development in the face of environmental pressures and crises...
(GSG), which was convened in 1995 by Paul Raskin
Paul Raskin
Paul Raskin is the Founding Director of the Tellus Institute which has conducted over 3,500 research and policy projects throughout the world on environmental issues, resource planning, and sustainable development...
, president of the Stockholm Environmental Institute and Tellus Institute
Tellus Institute
The Tellus Institute is a non-profit research and policy organization based in Boston, Massachusetts, in the United States. Its mission is to advance the transition to a sustainable, equitable, and humane global civilization. The Tellus Institute was founded in 1976 by Paul Raskin, Richard Rosen,...
. These scenarios are summarized in GSG’s 2002 report entitled Great Transition: The Promise and Lure of the Times Ahead. It is categorized within this report as one of two ‘conventional worlds’ because it does not require a societal shift in fundamental values, power structure, or transformation of human consciousness. Put simply, conventional worlds scenarios correspond to the dominant world views of global leaders pursuing business-as-usual.
Rather than positing a dramatic shift in society
Society
A society, or a human society, is a group of people related to each other through persistent relations, or a large social grouping sharing the same geographical or virtual territory, subject to the same political authority and dominant cultural expectations...
(either towards devastating collapse (Barbarization) or complete harmony with nature (Great Transition
Great Transition
Great Transition is a vision created by the Global Scenario Group of how humanity could create a civilization that reflects egalitarian social and ecological values, affirms diversity, and defeats poverty, war, and environmental destruction....
)), Policy Reform posits incremental changes to economic, industrial
Industry
Industry refers to the production of an economic good or service within an economy.-Industrial sectors:There are four key industrial economic sectors: the primary sector, largely raw material extraction industries such as mining and farming; the secondary sector, involving refining, construction,...
, technological, and environmental
Environmental policy
Environmental policy is any [course of] action deliberately taken [or not taken] to manage human activities with a view to prevent, reduce, or mitigate harmful effects on nature and natural resources, and ensuring that man-made changes to the environment do not have harmful effects on...
forces. The goal of these changes is to create a sustainable world while maintaining current consumption and lifestyle practices.
A contrasting scenario, that is also part of business-as-usual, is Market Forces
Market Forces
Market Forces is a science fiction novel by Richard Morgan, first published in 2004.Set in 2049 in the wake of a global economic downturn called the Domino Recessions, it follows up-and-coming executive Chris as he plunges into the profitable field of Conflict Investment...
. This scenario assumes that the invisible hand
Invisible hand
In economics, invisible hand or invisible hand of the market is the term economists use to describe the self-regulating nature of the marketplace. This is a metaphor first coined by the economist Adam Smith...
of the market will foster development, as a “rising tide lifts all boats.” It stands on the idea that the market is a self regulating entity, and that human progress and innovation (i.e., new technologies and business practices spurred by competition) will always overcome challenges.
Both of these are possible bridges between environmental concern and economic growth
Economic growth
In economics, economic growth is defined as the increasing capacity of the economy to satisfy the wants of goods and services of the members of society. Economic growth is enabled by increases in productivity, which lowers the inputs for a given amount of output. Lowered costs increase demand...
. Such bridges constitute the field of sustainable development
Sustainable development
Sustainable development is a pattern of resource use, that aims to meet human needs while preserving the environment so that these needs can be met not only in the present, but also for generations to come...
, as opposed to such movements as Eco-Communalism
Eco-communalism
Eco-communalism is an environmental philosophy based on ideals of simple living, self-sufficiency, sustainability, and local economies. Eco-communalists envision a future in which the economic system of capitalism is replaced with a global web of economically interdependent and interconnected...
, which calls for a reduction in consumption and de-industrialization to achieve environmental sustainability. While Market Forces
Market Forces
Market Forces is a science fiction novel by Richard Morgan, first published in 2004.Set in 2049 in the wake of a global economic downturn called the Domino Recessions, it follows up-and-coming executive Chris as he plunges into the profitable field of Conflict Investment...
relies heavily on technology to achieve sustainable development; “Policy Reform depends on government action to seek a sustainable future” (Great Transitions, Pg. 16).
Libertarian
Libertarianism
Libertarianism, in the strictest sense, is the political philosophy that holds individual liberty as the basic moral principle of society. In the broadest sense, it is any political philosophy which approximates this view...
free-market capitalist
Capitalism
Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...
s and defenders of the Washington Consensus
Washington Consensus
The term Washington Consensus was coined in 1989 by the economist John Williamson to describe a set of ten relatively specific economic policy prescriptions that he considered constituted the "standard" reform package promoted for crisis-wracked developing countries...
correspond to a Market Forces scenario, arguing this should be the official perspective on international development. Keyensian economists, public figures like Al Gore
Al Gore
Albert Arnold "Al" Gore, Jr. served as the 45th Vice President of the United States , under President Bill Clinton. He was the Democratic Party's nominee for President in the 2000 U.S. presidential election....
or Kofi Annan
Kofi Annan
Kofi Atta Annan is a Ghanaian diplomat who served as the seventh Secretary-General of the UN from 1 January 1997 to 31 December 2006...
, and the many organizations working for sustainable development
Sustainable development
Sustainable development is a pattern of resource use, that aims to meet human needs while preserving the environment so that these needs can be met not only in the present, but also for generations to come...
correspond to a Policy Reform scenario, and see inherent flaws in the unregulated forces of the market; most notably “tendencies towards economic crisis, social conflict and environmental degradation” (Great Transitions, Pg. 17).
New Sustainability Paradigm
The Policy Reform and Market Forces scenario are optimistic in their assumptions that business-as-usual is sufficient to meet the mounting challenges facing humanityHuman Race
Human Race refers to the Human species.Human race may also refer to:*The Human Race, 79th episode of YuYu Hakusho* Human Race Theatre Company of Dayton Ohio* Human Race Machine, a computer graphics device...
. One unanswered question among those who’d support a Policy Reform scenario, is where would the political will for change come from?
In contrast, the New Sustainability Paradigm (NSP), which is put forth as the ideal future scenario in Great Transition: The Promise and Lure of the Times Ahead, posits a radical shift in the consciousness and the engagement of civil society
Civil society
Civil society is composed of the totality of many voluntary social relationships, civic and social organizations, and institutions that form the basis of a functioning society, as distinct from the force-backed structures of a state , the commercial institutions of the market, and private criminal...
. Whereas, Policy Reform relies on strong leaders to be the stewards of the future, NSP asks what might happen if the citizens of the world where to find a voice in the ongoing debates about the emerging planetary phase of civilization
Planetary Phase of Civilization
The Planetary Phase of Civilization is a concept defined by the Global Scenario Group , an environmental organization that specializes in scenario analysis and forecasting...
?
To illustrate the contrasting perspectives, one can look at the differences between the World Economic Forum
World Economic Forum
The World Economic Forum is a Swiss non-profit foundation, based in Cologny, Geneva, best known for its annual meeting in Davos, a mountain resort in Graubünden, in the eastern Alps region of Switzerland....
and the World Social Forum
World Social Forum
The World Social Forum is an annual meeting of civil society organizations, first held in Brazil, which offers a self-conscious effort to develop an alternative future through the championing of counter-hegemonic globalization...
. World Economic Forum
World Economic Forum
The World Economic Forum is a Swiss non-profit foundation, based in Cologny, Geneva, best known for its annual meeting in Davos, a mountain resort in Graubünden, in the eastern Alps region of Switzerland....
is a yearly meeting in Davos, Switzerland, that has the stated purpose of “improving the state of the world by engaging leaders in partnerships to shape global, regional and industry agendas” (WEF). This represents a belief that increased coordination among powerful global actors is sufficient to create a sustainable world. Contrasting this is the World Social Forum
World Social Forum
The World Social Forum is an annual meeting of civil society organizations, first held in Brazil, which offers a self-conscious effort to develop an alternative future through the championing of counter-hegemonic globalization...
. This forum grew as a response to the WEF by the anti-globalization
Anti-globalization
Criticism of globalization is skepticism of the claimed benefits of the globalization of capitalism. Many of these views are held by the anti-globalization movement however other groups also are critical of the policies of globalization....
movement. It is made up of civil society groups and NGO’s from around the globe. This example shows a burgeoning latency of citizen desire to shape the global future and is in line with the NSP but highly irregular to Policy Reform.
Another concept important to understanding policy reform is ‘proximate drivers’. These include population
Population
A population is all the organisms that both belong to the same group or species and live in the same geographical area. The area that is used to define a sexual population is such that inter-breeding is possible between any pair within the area and more probable than cross-breeding with individuals...
, economy
Economy
An economy consists of the economic system of a country or other area; the labor, capital and land resources; and the manufacturing, trade, distribution, and consumption of goods and services of that area...
, technology
Technology
Technology is the making, usage, and knowledge of tools, machines, techniques, crafts, systems or methods of organization in order to solve a problem or perform a specific function. It can also refer to the collection of such tools, machinery, and procedures. The word technology comes ;...
and governance
Governance
Governance is the act of governing. It relates to decisions that define expectations, grant power, or verify performance. It consists of either a separate process or part of management or leadership processes...
. Proximate Drivers are responsive to changes in policy: through mechanisms such as tariffs, taxes, and environmental regulations.
Below the surface of proximate drivers are ultimate drivers. These are the underlying causes that shape society: human values and needs, culture, power structures and systems for organizing knowledge and understanding. Contrasting Policy Reform, the New Sustainability Paradigm scenario assumes transformational shifts in these “root causes that shape society and the human experience” (Great Transition, p.49).
A real world example of this contrast might include the Global Reporting Initiative
Global Reporting Initiative
The Global Reporting Initiative produces one of the world's most prevalent standards for sustainability reporting - also known as ecological footprint reporting, Environmental Social Governance reporting, Triple Bottom Line reporting, Corporate Social Responsibility reporting...
, which seeks to create voluntary reporting mechanisms for corporations to report on their impact on sustainable development goals. This focus on proximate drivers contrasts with efforts like Corporation 2020 which seek to alter the underlying principals of corporate form and governance. The Earth Charter Initiative is another example of an attempt to address ultimate drivers, in this case by shifting underlying values.
History
This specific usage of the phrase Policy Reform is heavily influenced by the ideas of John Maynard KeynesJohn Maynard Keynes
John Maynard Keynes, Baron Keynes of Tilton, CB FBA , was a British economist whose ideas have profoundly affected the theory and practice of modern macroeconomics, as well as the economic policies of governments...
, an economist who saw firsthand the failures of the free market during the great depression. It was his belief that capitalism
Capitalism
Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...
must be monitored and corralled in order to prevent periodic economic tantrums (Keynes, 1936). This idea of capitalism being guided by political decision-making is at the heart of Policy Reform.
While government intervention in economic affairs is nothing new, there have been recent milestones towards a more global recognition of policy reform. The UN World Summit on Sustainability in 2002 marked one of these milestones. It rallied nations together to work cohesively towards policy change. Other examples include the UN’s Global Compact which challenges businesses to adhere to social and environmental standards.