“Democracy and globalization requires democratizing the global governance level”

We asked Dena Freeman, Senior Visiting Fellow in the Department of Anthropology at the LSE, whether a global democracy is possible and what this has to do with inequality. We interviewed her about the reasons why democratization often leads to an increase in inequality, and whether democracy is compatible with globalization. She highlighted that the democratization of global governance is of huge importance to strengthen democracy.

In what ways are democracy and inequality related?

Dena Freeman: It has long been assumed that increasing democracy leads to increasing economic equality. Theoretically, the link is clear. If everyone has a say in economic decision-making, through their vote, then redistributionist policies that help the many should gain political support and subsequently be implemented. However, against these theoretical expectations, empirical data shows a surprising pattern. Whilst the democratization of Europe in the nineteenth and early twentieth century did indeed lead to a significant reduction in economic inequality, the more recent phase of democratization that took place in Eastern Europe and Latin America in the 1980s and 90s did not, and in many cases even led to an increase in inequality! And indeed, this pattern of increasing economic inequality, even in established democracies, continues today.

What is the reason for this?

Freeman: There are several theories but I think the most fundamental reason is the increasing de-democratisation of economic policy that is happening because of globalization. Today, many of the rules governing the global economy are decided at the global level by international organizations such as the WTO or the IMF but there is no way for citizens to influence these decisions. International organizations are not democratically organized, instead decisions are made by government delegates and power is concentrated in the hands of a few industrialized countries. These days most states are not free to make their own economic policy but must do so within constraints imposed by the global system. So while it may look like we have democracy, in fact our democracy has been hollowed out and this has happened because of the way that global politics has been designed – namely, in a very undemocratic way. This leads to the conclusion that if we want to reduce inequality then we need to democratise the global political system.

Does that mean democracy is not compatible with globalization?

Freeman: Not necessarily. We can have democracy and globalisation, but this requires democratising the global governance level. This is no easy task. The global economic rules and structures are engrained in the system and powerful national interests are at stake. But there is another problem: Even if we had the political will to democratise the global level, we lack concrete concepts of how to ensure democratic representation in such organizations. And representation should not stop at simply giving public interests a voice – citizens of the world should have an actual vote. We need a real shift in political power from being concentrated in the hands of Western governments to being dispersed equally among citizens from all countries. How can we do this? Should representatives be elected? If yes, by whom? Should national parliaments send delegates? How should we include organized public interests? Should we develop new forms of direct democracy? There are many questions and no straightforward answers. That is why we need to invest in research to develop new models and concepts for democratising international organisations and ultimately building global democracy.

Why do you think we lack the political power to reform global governance?

Freeman: There are many reasons such as geopolitical interests and the role of national identity but first we should look at the role of the powerful themselves. If we want to strengthen democracy, we need ways to curtail the sheer influence economic elites have on political decision-making at both the national and international level through lobbying. Curtailing this influence is crucial and must go hand in hand with democratising global governance. Without that even the best proposals to democratise global governance would be in vain as these institutions would be subject to the same influences. This requires further research to better understand elite motivations and structures of influence.

Dena Freeman is Senior Visiting Fellow at the Department of Anthropology at the London School of Economics and lecturer at the International Inequalities Institute.

The questions were asked by Michael Jennewein.

This interview was originally published in the latest issue of the FES Info (in German). Access the full magazine here.