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Global Self-Organization: the systemic structural challenge of the exchange of meaning, dramatized by the Asian financial crisis


Global Self-Organization
Defining the quest for global organization
Comparing the Web and the Global Financial System
The conceptual challenge
Protocols for tensional integrity

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Over the past decade, at the World Economic Forum and elsewhere, there has been much hype concerning the desirability and inevitability of "globalization". The Asian financial crash of 1997-98 caused much mutual recrimination and reassessment amongst the experts and the powerful with regard to the nature of a possible control system -- previously considered unnecessary. It is now accepted that there was "collective misjudgement". The fact that economic and financial globalization also resulted in rapid spread of economic and financial problems had seemingly not been anticipated despite the immense intellectual and financial resources allocated to the globalization strategy.

The crash elicited the confession from Richard Haass (Brookings Institution), at the 1998 Forum, that: "Creating the institutions for handling globalization is the greatest intellectual challenge now facing the world" (Wall Street Journal, 2 Feb 1998). The same issue notes that the Forum was at least agreed that globalization has outpaced the financial world's ability to manage it and has unleashed forces that the world must come to terms with quickly before a larger crisis strikes. The financier George Soros sees the world's financial system as complex beyond any one individual's capacity to comprehend, as well as chaotic and virtually blind. Using the metaphor of a casino (popularized by Hazel Henderson), he and others call for an "international croupier" to provide rules for the casino -- and to keep track of the large sums moving rapidly around the globe. Furthermore, attention must be given to social safety nets, especially in emerging markets, to guard against catastrophic downturns in the future -- as well as fighting against new forms of protectionism.

For the Secretary-General of the International Chamber of Commerce (International Herald Tribune, 5 February 1998): "Globalization has the potential to bring immense benefits to the human race. But, as recent events in East Asia have demonstrated, it can swiftly magnify local crises into problems affecting the entire world economy. Hence the need for a framework of rules on investment, captial markets, competition policy and a host of other areas."

One of the merits of this intellectual panic and disarray, following a long period of complacency (if not arrogance), is that the challenge of the concrete case of the financial system can be used to illustrate possibilities for other global systems that may be equally challenging, although accorded lower priority. The financial system is at the same time both concrete, in that it is central to the present economic system, and intangible, in that the flows of capital are in many ways unrelated to any tangible assets -- and are often purely electronic entries in electronic "books".

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