We live in a global whirlwind of accelerating crises, be they economic, political, social or humanitarian. Governments and international organizations are struggling to find lasting solutions to growing inequalities and rising tensions, both within and between nations.
The Altamar team of Peter Schechter and Muni Jensen spoken to Lord Mark Malloch-Brown, the President of the Open Society Foundations (OSF), who believes that the world needs a new Marshall Plan. OSF is the world’s largest private funder of independent groups working for justice, democratic governance and human rights. OSF makes thousands of grants each year through a network of foundations and national and regional offices, funding a wide range of projects.
An old success story a model for renewed action?
Review the story of the marshal plan, Malloch-Brown said, “After World War II, the Americans were losing the peace in Europe with the spread of communism…so incredibly enlightened leaders, General Marshall and others, persuaded President Truman that he had to be a major investment in Europe to turn this situation around. It was an extraordinary figure of 2-3% of US GDP.
Malloch-Brown used the phrase “perfect storm of trouble” to describe today’s global circumstances. “Ukraine is the final trigger for a series of events that over the past decade have really undermined global integration. It probably started with the financial crisis of 2008-2009. It then went through the trade wars. He went through [former President] Trump’s election in the US went through Brexit in the UK. It culminated, obviously, with COVID, but all of these things disrupted supply chains, pushed the world into a distributive political economy.
One of the stated aims of the Marshall Plan was to stop the spread of communism on the European continent. But with today’s threats, is it possible to create a plan, a crisis?
Malloch-Brown replied, “It’s possible that the way something like this plays out this time is organized against a Russian and Chinese bloc in the world. … But actually, I’m hoping we can move beyond that and look at a more collaborative model where it’s not organized in competition and conflict with China, but around a shared vision that China and the United States are the two main players in an open world economy, and that it is in their interests both to try to protect it.
Fate tends to find the right people. Leadership is not about people grabbing the ring, but circumstances can cause individuals to rise far beyond what you expect of them.
The western democratic system is on trial
Any plan should be huge. “My calculations, working with many colleagues and experts and attending various discussions on this,” Malloch-Brown said, “is that if we could somehow establish a baseline of another 2% of global GDP a year, which would be about $2 trillion a year to invest in this area, we would make an incredible difference…. But I’m thinking 2% of not just US GDP or donor country GDP, but global GDP, where everyone contributes according to their means so that it becomes a great exercise in partnership and collaboration around a shared sense of destiny.”
Malloch-Brown admits that Western countries would probably not unite behind such a big idea. “I suspect they might not be in the end. It allows them to take on this challenge, not with an overwhelming sense that it’s going to happen, despite the severity of the need.
“It’s a horrible context to launch this, but it was also the case in 1946/7. It’s about leadership and it’s about identifying problems that arise and solving them, and understanding that the costs are not just a loss of life in the developing world, but potentially the loss of an entire political system.It is in fact the Western democratic model that is being tested.
Donor confidence needs to be restored
With the reluctance to invest in the Global South, it will be a challenge to convince countries and investors to contribute even more. “My own view is that trust is broken. Donors do not believe that developing countries will make good use of funds in many cases; developing countries feel and have a deep sense of grievance against some sort of model of short-term donor austerity and conditionality. And the private sector is looking at both and saying, we can make a lot more money investing in a mall in the west than building a road in Kenya.
Malloch-Brown argues that there needs to be a revived multilateral system where the technocratic expertise of the World Bank or IMF is reorganized around a growth model much more focused on investment than on controlling public spending. “You have to have governments in developing countries commit to this and recognize that you won’t have old-fashioned conditionality imposed from north to south, but you will have a contract that these funds will be paid in exchange the achievement of certain performance objectives.
Ukraine is a paradigm shift
“This was a devastating violation of international law by Russia,” Malloch-Brown said, “But it has to go much further and see Ukraine as just one crisis in a series of crises that must be treated systemically.”
So who is capable of leading this charge? Malloch-Brown said: “There’s the leadership there, it’s just not coalesced around it. It needs to be galvanized. In the end, fate tends to find the right people. Leadership is not about people grabbing the ring, but circumstances can cause individuals to rise far beyond what you expect of them.