Globalization, particularly of finance, has led to short-term hot money flows (currencies and portfolio investments) which have become the transmission belts of ecological and livelihood destruction, disruption of domestic, social/economic policies in all countries and exacerbation of poverty and social exclusion – sometimes affecting whole countries.  Thus, socially-responsible investors and businesses still must operate on this dysfunctional money market platform, driven by unrealistic expectations of returns on investment, below full-cost prices and the herd behavior of market players.  These financial flows affect the global sustainability agenda more than trade.  They dwarf the less than 10% of global trade-related transactions in the $1.5-2 trillion total of daily currency exchange.  It is the speculative 90% of these daily trillion dollar flows that are un-related to trade that proposals for currency exchange taxes (i.e., Tobin tax) seek to address. At the UN Social Summit in Geneva, June 2000, 160 governments agreed to perform feasibility studies on currency exchange taxes.  The USA refused, even though then Treasury Secretary Lawrence Summers had argued for such a small (.01%) currency change tax in his paper “When Financial Markets Work Too Well: A Caution Case for A Financial Transactions Tax; journal of financial services, November 3, 1989.   In my Beyond Globalization, I discuss the many other ways of collecting such taxes (including the Foreign Exchange Transaction Reporting System FXTRS^sm) as well as proposals to collect fees or fines on all uses or abuses of the global commons (CO₂ and other cross-border pollution, arms sales, etc.). Further information on currency exchange tax movements can be accessed at www.attac.org; www.tobintax.org; www.halifaxinitiative.org and www.waronwant.org/tobin.htm.  The world must address these globalization issues and how to finance development through such innovative funding sources, as well as how to fund global public goods.  They are all on the agenda of the UN Summit on Financing for Development, Monterrey, Mexico, March 2002.  Estimates of revenues from even .01% currency exchange taxes range from $50billion to $300 billion annually.  (I will serve as a delegate of the State of the World Forum and its new Commission on Globalization of which I am a member.)  As a member of the Advisory Council to the Calvert Group, Inc. socially-responsible mutual funds, and Partner in the Calvert-Henderson Quality of Life Indicators (www.calvert-henderson.com), I have the honor of also working with the office of UN Secretary General Kofi Annan on the UN Global Compact and its nine principles of global corporate “good citizenship” in human rights, core labor standards and environmental stewardship.  Equally important is the need to clearly define what is meant by “development” and “wealth” and “money” and even “finance” because we will need to redefine them in terms of global justice and ecological sustainability. We should redefine these terms in context of livelihoods, the unpaid, “Love Economy” (UNDP's estimate: $16 trillion missing from global GDP); the informal, grassroots sectors (micro-enterprises, credit and venture equity) and the barter sectors (some $2 trillion globally on an annual basis, mostly government-to-government “counter-trade” or payments unions, TNC-trading and the balance consists of small businesses and people-to-people in livelihood economies).  We must clarify the difference between money and wealth, as well as between per-capita averaged GDP-growth and progress toward equitable ecologically-sustainable human development.  Beyond such context re-definition, specific proposals are needed to protect livelihoods, and enhance the informal grassroots sectors, micro-enterprises, and village cooperatives and facilitate local barter.  Proposals are also needed to advance ethical markets, socially-responsible investing and consumption, full-cost prices, life-cycle costing and all the other ways of regulating, taxing, and taming today's global financial casino.  G-7 finance ministers and central bankers have called for a New Global Financial Architecture repeatedly since the Asian financial crises of 1997.  Even after crises that followed in 1998 involving Russia and continuing with Brazil, Turkey and Argentina in 2001, official rhetoric has not been matched by results.  After severe public criticism by such mainstream economists as Jeffrey Sachs, Joseph Stiglitz, as well as others worldwide, the IMF has taken some responsibility for its macroeconomic policy prescriptions, which exacerbated the 1997 crises in Thailand, Indonesia, Korea and other Asian countries.  These orthodox “Washington Consensus” policies and their conditionalities requiring draconian cuts in social programs, further opening of these economies and the like, caused runs on their currencies and plunged millions into poverty.  The performance of the Bretton Woods “twins” (IMF and the World Bank) has been no better regarding reducing or canceling the unrepayable debts of the HIPIC countries.  Many of these debts are deemed “odious,” i.e., they were incurred in corrupt deals between politicians and their corporate and financial cronies – and should be repudiated.  The rapid reduction of unrepayable debt is necessary – but not sufficient to build a basis for alternative, sustainable paths to development.  It may be necessary for many indebted developing countries to seek bankruptcy protection.  The most appropriate model is that of Chapter 9 of the US Bankruptcy Law, which covers municipal bankruptcies.  Chapter 9 allows the continuation of all social programs, services and public expenditures and is therefore a way to protect the vulnerable and poor of a country seeking protection under this law.  Also necessary, is the cessation of Structural Adjustment Programs, which have been cosmetically renamed as “Poverty Reduction” programs, with their many inappropriate conditionalities based on Washington Consensus orthodoxies.  Both the IMF and the World Bank need to be re-directed, democratized and re-structured for more limited missions and made transparent and accountable to all countries – not only their rich shareholders.  The IMF should desist from its dangerous fixations regarding opening up economies and their capital accounts before their financial sectors, public institutions, industries and civic societies are robust enough for global competition.  Research shows that powerful countries benefit from globalization and competition while weak countries are further weakened (world affairs, Mihaly Simai, Delhi, Vol 5, #2, April-June 2001).  The IMF's various bailout packages have too often, in effect, bailed out private investors, while offering tempting targets for currency speculators.  A new issue by the IMF of Special Drawing Rights (SDRs) would be preferable to assist countries in crisis.  The World Bank should relinquish involvement in structural adjustment and in the financing of large infrastructure and energy projects.  The Bank's focus should change to direct funding of grassroots health, education and the needs of village microenterprises, cooperatives and sustaining local livelihoods.  A new, global financial architecture must begin to acknowledge that the globalization of finance and technology along laissez faire market logic has created huge imbalances in power and wealth.  To redress these imbalances, which were the result of international deregulation, privatization and trade policies – it will be necessary to create new global governance structures to steer and control these global markets.  Financial bubbles are fueled by easy credit and the erosion of bank reserve requirements under the Bank for International Settlements (BIS).   Instead of current moves to decrease bank reserve requirements, they should be increased.  Manipulating interest rates as the main tool of monetary policy is ever more ineffective and unjustly impacts employment and increases poverty.  In my Beyond Globalization (1999) are details of the many useful proposals currently debated, including the need to re-establish public control over processing payments in different currencies so that all countries could use their own currencies for international transactions.  This would enable an international reserve asset based on a basket of currencies – rather than today's unsustainable reliance on the US dollar.  International treaties, agreement, and protocols on human rights, democracy, transparency, workplace standards and consumer and environmental protection will need strengthening.   Beyond international regulation and democratization of global finance, markets and trade – new institutions are needed.  These include a World Environment Organization to balance the narrow focus of the WTO; the International Bank for Environmental Settlements (UNDP Paper 10, 1997) to manage the disputes and inequities arising from global climate change and a “Global Securities and Exchange Commission” to police financial markets and stock exchanges.  New “best practices” currency trading systems (such as FXTRS), which allow collection of fees on all trades, provide transparency and oversight to check tax evasion, capital flight, money laundering and speculation.  Progress was made on blacklisting offshore havens by the G-7 and the OECD until the US Bush Administration backed away from this successful effort to informally sanction money-laundering and tax evasion in early 2001.  Bush reversed his position after September 11^th in order to freeze the assets of Al Qaeda.  Beyond such regulatory functions, user fees and taxes collected by such systems, there are other innovative proposals, including taxes on CO₂, cross-border pollution, fines for toxic dumping and other abuses of the global commons, arms sales, taxes on airline tickets or aircraft fuels, advertising and peace-keeping insurance to reduce reliance on costly military approaches to security.  All these proposals were brought to the UN Summit on Social Development in Copenhagen, 1995, in the Report of the Global Commission to Fund the United Nations, co-editors, Harlan Cleveland, Hazel Henderson and Inge Kaul, The UN: Policy and Financing Alternatives, US edition, 1996.Most of these innovative sources of revenues from global commercial activities will be debated at the UN Summit on Financing for Development in Mexico, March 2002.  Just as national governments have funded public goods (infrastructure, municipal services, education, health and defense) through taxation – the principles of progressive taxation are seen as supplying global public goods. These include, education, health, infrastructure, global non-commercial, public-access TV networks (such as WETV, a Canadian-European initiative) and below-cost internet access, worker, consumer and human rights protection, environmental monitoring and conservation of ecosystems, species, biodiversity and international peace-keeping insurance (see for example, I. Kaul, Global Public Goods, 1999).  The hegemonic role of the still-overvalued US dollar as a de facto global reserve currency is creating serious imbalances and threatens other currencies tied to it, for example the Argentine peso.  The USA in the 1990s has been a magnet for the world's flight capital and remains so in spite of the bursting of the “new economy” bubble.  A more stable global currency regime is essential to curbing today's turbulence.  A Bretton Woods type system of fixed exchange rates would be unworkable today.  The ad hoc approaches since the USA unilaterally withdrew from the gold-backed Bretton Woods system in 1971 (i.e., free floating or pegging currencies to the US dollar, currency boards, and dollarization) have also proved highly unstable and crises-prone.  Thus, only a re-constructed global financial architecture can address the need to regulate global capital markets – together with a new approach to a global reserve currency, perhaps a dollar-euro-yen parity regime, buttressed by SDR issues as needed.  I have advocated that developing countries trade some of their US dollars for euros so as to relieve over-reliance on the US dollar, which is still about 10% overvalued and hurting even US exporters. 

Global Governance of trans-national corporations (TNCs) is essential for the broader global agenda of democratizing equitable, ecologically-sustainable development and poverty eradication.  Current approaches: international treaties on human rights, labor standards and environmental protection; as well as such principles as the OECD's 1972 “Polluter Pays Principle,” the Precautionary Principle and that of subsidiarity must be extended and augmented.  Full cost prices and life-cycle costing are endorsed widely – but still far from implementation.  This is due to business-friendly politicians and the power of TNCs to lobby and fight legal battles to continue externalizing social and environmental costs from corporate balance sheets.  A new wave of legal actions against irresponsible TNCs seeks to hold parent companies liable for negative impacts on society and the environment under the legal doctrine of Foreign Direct Liability (The Royal Institute of International Affairs Briefing Paper #18, Feb, 2001, U.K.) A multi-pronged effort at containing and re-directing the productive and destructive powers of TNCs include: