The Metamorphosis of Governance in the Era of Globalization

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1 The Metamorphosis of Governance in the Era of Globalization Vladimíra Dvořáková Vladimíra Dvořáková University of Economics, Prague, Czech Republic Abstract Since 1995 the term governance has expanded from the language of international organizations, regional integration unions and policy/decision-makers to journalists, NGOs and scientists. During this period the term became more specified and value oriented and the concept of good governance has been coined. There are two basic goals of this paper. First, to discuss the implementation of the term on different scales of societal organization local/national, regional/global. Second, to make emphasis on the ambiguity of the impacts of this concept. This ambiguity springs from the dichotomy between good governance and democracy and also from the "imposition" of good governance from the regional/global environment to the nation states. The author argues that when applied on democratic regimes it can deepen democracy but in the case of hybrid or authoritarian regimes the principles of good governance can strengthen the legitimacy of the regime and can enable the long-term survival of the regime in a liberalized form without pressure for further democratization. On the other hand, the implementation of good governance, although necessarily limited, smoothes the transition and consolidation of democracy if the process starts. The author also warns that the imposition of the principles of good governance can in some cases prevent positive internal development and create a value vacuum in which the society will become fragmented. Key words: governance, globalization, democracy Introduction The term governance, that became the key word of many politicians and political scientists, has gained greater currency (and misuse) since 1995 when the OECD published its report Governance in Transition about public administration reforms. The European Union used this term in 2001 when publishing the White Book written by N. Kinnock under the title Governance in the European Union (the originally proposed title was Reforming the Commission) (Tarschys 2010). The birth of the term was very much associated with political practice and the necessity to find criteria for legitimizing politics that could replace the term democracy (polyarchy),either because the particular states that were objects of some international support could not be characterized as democratic or because of democratic deficit in regional processes of integration (i.e. EU). In fact, the idea brought nothing new, as it was largely based on the Weberian understanding of legal-rational legitimacy of the modern states. The meaning of the term has undergone significant changes and also has been differently applied to diverse cultural environments and to diverse scales of societal organization. The main stream of further scientific development went through a more detailed specification and value orientation. Thus the concept of good governance has emerged, with an emphasis 11

2 placed on procedures. Put simply, good governance means that things are properly done (about the concept see Vymětal 2007). There are two main goals of this paper. First, to analyze how the concept of good governance is or can be used on particular scales of societal organization (local/national, regional/global). And second, to show the ambiguity of this term in the sense of possible dichotomy between democracy and good governance and the ambiguity of impacts when imposing the concept of good governance on member/client states from the regional/global level. Good governance and its implementation For the purposes of this paper, it is not necessary to reproduce the discussion about the term, we can take as granted that to a certain extent there is a consensus among the scholars on eight basic principles of good governance (Vymětal 2008: 9-10): transparency participation rule of law accountability, responsiveness consensus oriented equity and inclusion effectiveness and efficiency The hierarchy of these principles can be debated; however, we can agree that the most important principles are the rule of law, accountability, and transparency. The hierarchy can change according to the type of the regime, political culture, etc. Local/national level Discussing the implementation of the principles of good governance on the national or local level (state and the decentralized units of the state) we have to take into consideration the character of the regime. It is especially necessary to differentiate between democratic and non-democratic states. In case of democratic governments (polyarchies), application of the principles of good governance can enhance the quality of the decision-making process and standards of state administration on both local and national level. By implementing these principles the space for corruption, clientelism, and nepotism is narrowed, thus, the democratic legitimacy and trust are strengthened. These principles can also lower the transactional costs of the activities of state administration ("cheap state"). 1 The implementation of these principles is important particularly in new democracies, where it enables an easier adaptation to democratic principles of conflict resolution that are based on procedures. In old democracies, mainly the principles of participation, inclusion, effectiveness, and efficiency are important for the deepening of democracy. In case of authoritarian or hybrid regimes, the application of the principles of good governance can also narrow the space for corruption, clientelism, and nepotism and lower the transactional costs of the activities of state administration. Nevertheless, the levels to which the principles of participation, inclusion, and consensus oriented politics can be applied are logically limited by the fact of limited pluralism in these regimes. The application of the 1 Discussing the problems of some of the EU states dealing with the current financial crisis and deficits of national budgets very often the "misuse" of social welfare benefits is emphasized; in fact, many problems arise from bad governance. Corruption, clientelism, and nepotism bring very high transactional costs, the state is expensive and both effectiveness and efficiency are very low. 12

3 principle of accountability can also be problematic, mainly in regards to the highest rank politicians, but it can be sometimes applied to middle-rank politicians and officials. 2 Regional/global level Good governance is a very useful concept in the processes of regional integration because it can form rational legal legitimacy to substitute limited democratic principles and/or fill the democratic deficit. Of course, it depends on the level and type of integration. The European Union can be a good example of such an approach. The reason why it is easier to implement "good governance" than "democracy" is rooted in the form of this international regional organisation. Without the framework of the state it is difficult to separate the public and political spheres and so democracy cannot be fully implemented. Good governance can also be very useful at the global level to legitimize some of the international organisations. Organisations with their own policy such as the International Monetary Fund, the World Bank, the OECD, and the UNO can strongly influence the policies and politics of particular states both democratic and non-democratic. The implementation of the principles of good governance inside these organizations forms part of their legitimacy. However, even more important than the internal principles of good governance in these regional/global organisations is the fact that there can be top-down effects some standards of good governance are often asked from member/client states. Membership or financial aid can be conditioned by the implementation of the basic principles. And this top-down effect raises serious questions. Ambigous impacts of good governance Good governance vs.democracy? A very important question is the relation between good governance and democracy. Are these concepts compatible or incompatible, are they complementary and/ or are they contradictory? It is legitimate to ask these questions but it is impossible to answer them in this paper. Having them in our minds we can simplify our position by working with this hypothesis: Good governance does not need democracy it is a technocratic answer to the problems of the organisation of society. Is there anything the two concepts have in common? Sure, they overlap at some points. Both democracy and good governance are based on the acceptance of procedures; that "things are properly done "in good governance means, that rules and principles are given and the results are derived from them. This is also the basic feature of democracy, which has "certain rules and uncertain the results". Nevertheless, good governance does not include other features that democracy/polyarchy is based on. None of the famous seven features of polyarchy described by Robert Dahl are present in the concept of good governance. 3 There are no doubts that the implementation of good governance both in new and old democracies has mostly positive effects, and that good governance is, in fact, complementary to democracy. But in non-democratic regimes the situation is different, and the impact of good governance can be really ambiguous. So, what are the advantages and disadvantages if authoritarian or hybrid regimes start to implement the principles of good governance? 2 Some level of implementation of such principles can be seen for example in China. On the other hand, in these regimes the processes that can look like the results of accountability (the investigation of corruption, the criticism published in the media) can be, in fact, a part of the power conflict between the elites. 3 These features include elected officials, inclusive suffrage, right to run for office, free, fair and competitive elections, freedom of expression, associational autonomy, and access to alternative information (Dahl 1989). 13

4 The main advantages are: A better access to international funding, investments, ranking. This can start structural changes, modernization, inclusion of new social groups into the system, etc. The development of a professional non-politicized state apparatus that can be used even after a regime change. A positive change in political culture (rule of law, transparency), diminishing the probability of using violence for conflict resolution, smoother transition. The main disadvantages are: The broadening of the social base and the strengthening of legitimacy can prevent democratization of the country in the long-run perspective and the regime can be institutionalized in some form of liberalized authoritarianism. The basic principles of good governance can be accepted only in a formal way, without informal acceptance. This challenge leads us to the other important question and hypothesis that is connected with the role the regional/global actors can play in the processes of the implementation of good governance. Good governance by implementation (imposition)? As the starting point for our deliberation we can take this hypothesis: Good governance implementation by regional and global organisations makes globalisation easier to work, but at the same time it can limit the internal development of the society, weaken or even destroy internal values on which the society is based, and, as a consequence, fragment the society. The implementation of good governance at the regional/global level creates more transparent and predictable processes in less developed countries, thus forming a more stable environment for investments, increasing the chance of receiving international aid for projects and using them effectively. At the regional level the implementation of principles of good governance is often part of accession agreements and strictly defined criteria play an important role in forming the space for shared rules and values that are the basis for integration into the regional/global market. Nevertheless, the effects can be sometimes totally different than was originally expected. In cases when the principles were only formally accepted and not internalized the effect can be limited or even opposite. Just now we can witness these problems in the European Union in which Greece is the most visible case. But we do not need to move so far, the problems with corruption and clientelism that Czech Republic is facing are very much connected with only a formal acceptance of some principles that in fact do not work at all. The most visible case is that of the civil service law that was passed in the Czech Republic in 2002, because it was a condition for joining the European Union. The law is still not in force. The cases of Greece or the Czech Republic reveal the difference between the formal and the informal acceptance of the principles, but they do not go against the implementation of good governance; we can even argue that these cases are the results of "bad" governance and that perhaps more pressure and control from "above" can have a positive impact. Many critics argue that as part of good governance different Eurocentric cultural patterns are imposed on non-european countries which enable their economic inclusion into the world market but which also destroy the original values and cultural patterns without a real identification with the new ones. Foreign aid mostly reflects the donor country s domestic (or "global") liberal agenda, the content of which can be very far and sometimes hostile to the traditional values of the society. NGOs, and especially international NGOs, play a very important role in the implementation of some principles of good governance. Which is more, the activities of local (grassroots) organisations are often influenced by financial sources from abroad. The result is some form of hypocrisy on the part of the elites that use the opportunity 14

5 to get support from the outside not by a real implementation of the good principles but by learning how to use the language of good governance to legitimize their demands (even political) for support. We can use here an example that is near to our scholarly environment. Chris Hann described the case of post-communist Russia which is very similar to the situation in other post-communist countries and in many countries of the Third World: "A decade after the collapse of socialism, I found that no academics in Moscow took the notion of civil society seriously. It was simply a magical phrase that it was always desirable to include in any foreign grant applications, just as a phrase about Russia's cultural or spiritual renaissance was obligatory for grant applications within the country" (Hann in Glasius, Lewin and Seckinelgin 2004: 44). In fact, the principles are implemented but no one expects them to work. The other important problem is that foreign aid to local/national organisations as well as many local branches of INGOs mostly understand the public in particular countries as an "object" that is to be "liberated" and/or "educated", not as the subject of the changes, the "driving force" reflecting the concrete problems of particular societies. Sometimes foreign aid can even hinder the internal development of grassroots organisations. The activities organized mostly from above can deepen the gap between the society and politics because the society cannot use the traditional channels of communication with politicians through civil society organizations or social movements. Conclusion The concept of good governance is an instrument that can deepen democracy in democratic regimes and can start modernization processes in less developed and nondemocratic countries. At the same time, it can stabilize and legitimize some authoritarian or hybrid regimes and stabilize them in the long-run perspective. Good governance is an instrument that helps global capitalism to expand more easily because of the spread of some basic standards, principles and sometimes even values all over the world. On the other hand, the imposition of the concept, mainly in the case when the basic principles are not informally accepted, can hinder the internal development of the society. The imposition of good governance can become part of the power conflict and can destroy the value system of particular organisations. This can eve lead to the fragmentation of the society. We can conclude that good governance is a good servant but a bad master. Acknowledgement This paper was prepared as a part of the project of the Faculty of International Relations, University of Economics, Prague, Governance in Context of Globalised Economy and Society MSM References Dahl, R Democracy and its Critics. New Haven, Yale University Press. Dahl, R A democratic Dilemma: System Effectiveness versus Citizen Participation. Political Science Quaterly 109(1): Dvořáková, V. a kol Evropeizace veřejné sféry. Praha: C.H. Beck. 15

6 Hann, Ch In the Church of Civil Society. In: Glasius, M., Lewin, D. and Seckinelgin, H., eds. Exploring Civil Society. Political and Cultural Contexts. New York: Routledge. Kaldor, M Global Civil Society: An Answer to War. Cambridge: Polity Press. Tarchys, D Government, Governance, Governmentality: Political Scientists in Search of Discipline. Participation, 34(1) May. Vymětal, P Defining the concept. Working Papers No. 1. Praha: Vysoká škola ekonomická v Praze, Fakulta mezinárodních vztahů. Vymětal, P What is the Good Governance About? The Roots and the Key Elements of the Concept. Working Papers, No. 11. Praha: Vysoká škola ekonomická v Praze, Fakulta mezinárodních vztahů. 16

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