Posted on 13-2-2003

Brasil Key To Re-defining Globalism
by Hazel Henderson (www.hazelhenderson.com)

Brasil's financial capital and largest city is buzzing with excitement and
a sense of new beginnings and opportunities to forge a new model of
development beyond the "Washington Consensus."

Twenty years ago, I described (Futures Research Quarterly, 1985) how China
would emerge as an important world player with a unique cultural model of
development. Today, Brasil, already the world's eighth largest economy,
has also emerged as a powerful global actor with unique cultural resources
to match its bountiful natural assets. While China has matchless human
assets in its 1.2 billion clever, industrious people, its natural resources
are depleted. Brasil's 170 million people enjoy energy self-sufficiency,
thousands of miles of glorious beaches, abundant, rich agricultural land, a
benign climate, emeralds and other precious mineral resources and a
matchless storehouse of the world's biodiversity.

The election of President Luis Inacio Lula da Silva in a civilized
democratic process provided a new benchmark for the world's growing ranks
of democracies. A new sense of hope, solidarity and national purpose
pervades Brasil - a continental giant similar in size to its North American
neighbor the United States. Meanwhile, the obsolete economic analyses of
financial markets and the International Monetary Fund (IMF) cannot see
Brasil's real wealth and resources any better than they understood China's
cultural assets 20 years ago. Locked into the narrow "economism" of the
Washington Consensus, financial analysts see only money-denominated
indicators: ability to service external debt and growth rates of GDP -
however socially
and ecologically destructive.

Brasil has real problems: educating its creative citizens for the
Information Age; creating more jobs and livelihoods; closing its wide gap
between the rich and poor and restructuring its domestic economy. The
Brasil that the IMF and financial players focus on: debt levels of some 60%
of GDP; currency risk; its GDP growth and inflation rates, are based more
on their own faulty economic statistics than on Brasil's real situation and
enormous potentials.

The new administration of President Lula da Silva embraces new thinking and
innovative policy proposals. They range from the globally-acclaimed "bolsa
scuola" programs of the new Education Minister Christovam Buarque to the
new models of sustainable development adopted by Brasil's top think tanks
and leading segment of the business community. I was amazed at the breadth
of the new understanding for the need to steer business and government
decisions with broader, more systemic, scientific indicators.

A new initiative, lead by business groups, including the influential
Instituto Ethos de Empresas e Responsabilidade Social, the Institute for
Sustainable Development of the Getulio Vargas Foundation, CEOs of important
Brasilian companies and civil society groups will host a major
international conference in October 2003. This conference will bring
together Brasilian statistical experts and academics from many disciplines
with their counterparts in Europe, North America and Asia who have
pioneered the new national accounts, indicators of sustainable development
and quality of life, as well as the "triple bottom line" company accounting
methods.

By these measures, Brasil's social and ecological capital would be added,
along with similar accounting of publicly-funded infrastructure (which the
USA added to its national accounts starting in 1996). This would balance
Brasil's public debt with these assets, in the same way that this
accounting correction added one third of the US's budget surplus between
1996 and 2000, Canada followed suit in 1999 and went from a budget deficit
to a Can$50 billion surplus. Other corrections still not made by the US
call for re-categorizing healthcare and education from "expenses" to
investments in human capital.

The new Brasil is steering a course beyond the Washington Consensus. The
new model of development will be geared toward investing in Brasil's human
and intellectual assets while further growing its robust domestic
industries and capitalizing new sustainability sectors of its economy:
renewable clean energy (hydropower is already a dominant source), efficient
transportation and infrastructure, clean technologies, urban design and
innovations in many older industrial sectors. For example, I toured a new
facility at Catholic University in Porto Alegre, which will manufacture
highly efficient solar photovoltaic cells to power Brasil's domestic and
rural sectors, small businesses and homes.

I visited the southern states of Rio Grande do Sul and Parana, which,
together with Santa Catarina have welcomed European immigrants for 300
years. They have reproduced the prosperous small and medium sized family
businesses reminiscent of Germany's famous "mittelstand." These robust
local economies provide most of the jobs as well as the kind of civic
minded business leadership that makes their well designed, attractive
cities, Porto Alegre, Curitiba, and Florianopolis meccas for the world's
urban planners.

E.F. Schumacher's Small is Beautiful vision of healthy homegrown economies
based on respect for people and nature is alive and flourishing in Brasil -
but invisible to the global macroeconomic worldviews of IMF statisticians.
This vision of thriving, equitable localized economies based on nature's
capital was articulated in my Politics of the Solar Age in 1981 - just as
Ronald Reagan became US President. Reagan's view, shared by the Britain's
Margaret Thatcher backed the world's economies into the 21st century
looking through the rearview mirror: imposing Adam Smith and his theories
of Britain's 18th century markets onto complex, interdependent industrial
societies not imagined by Smith.

Since the Reagan-Thatcher 1980s, much damage has been wrought on societies
and natural resources by knee-jerk privatizations and the globalization of
markets and trade by multinational corporations following this obsolete
economic model. While such narrow models of globalization encourage rapid
technological change - from the explosion of the Internet to biotechnology
- such technological innovations are also disruptive. They require
concomitant social innovations and democratic control to steer their
development more wisely. While trillions were wastefully invested and lost
in these sectors in the 1990s, the huge opportunities in the sustainability
sectors were overlooked by US venture capitalists.

Today, a spate of new books have helped articulate my vision of the 21st
century as the information-rich Solar Age of lightwave-based technologies -
from photonics, optical computers to biotech, solar photovoltaics,
hydrogen-based, fuel-cell powered transport, construction and manufacturing
sectors. These later books, including Natural Capital by Paul Hawken, Amory
and Hunter Lovins; Biomimicry by Janine Benyus; Earth Dance by Elisabet
Sahtouris and David Korten's The Post-Corporate World are widely read in
Brasil. Meanwhile, the works of Austrian physicist Fritjof Capra, The
Turning Point and The Web of Life have captured a large following,
including among the advisors to President Lula da Silva. Thus, I found a
new paradigm being articulated in Brasil and widely-debated in business,
government, and civic organizations, as well as in mass media. In the USA,
commercially-controlled media have largely ignored this debate about the
transition from early industrial methods based on fossil fuels to
information-rich, post-industrial economies based on greater resource
efficiency, services and renewable energy.

This great debate began in Porto Alegre in 2000 and is now becoming
mainstream in Brasil. The Agenda 21 agreements to correct national
accounts (GDP) and other obsolete macroecnomic systems and models were
signed by 170 countries at the 1992 Earth Summit in Rio de Janeiro. As
they are implemented, the IMF, the financial markets and investors will
come to correct their analyses and capital asset pricing models. Many have
already adopted the more sophisticated financial and technological
assessment tools that more accurately count for ecological, social,
cultural and human capital. These include the Global Reporting Initiative
on corporate accounting; the ISO 9000 to ISO 14001 corporate performance
criteria; the SA 2000 and ILO standards of work place excellence, as well
as the new, clean, ethical stock indexes; Brasil's BOVESPA New Market,
London's FTSE4Good, Dow-Jones Sustainability Group, the USA's Domini
Social 400 and Calvert Group's CALVIN Index and Calvert-Henderson Quality
of Life Indicators (developed in partnership with this author). As
documented by BOVESPA and in The Socially Responsible Investing Advantage
by Peter Camejo, founder of US-based Progressive Asset Management Company,
these new, more complete indicators regularly outperform the traditional
Standard & Poors and other Wall Street indexes.

Brasil may become a world leader in the transition to sustainable
prosperity and human development. My ears are still ringing with the
city-wide teach-ins in Porte Alegre's universities where over 100,000
delegates from around the world articulated ways to accelerate this
transition. "Another World Is Possible and Achievable!"