Introduction

It is indeed a pleasure to be able to present some thoughts on the notion of public goods. The importance of this to international politics and economy cannot be underestimated. Its relevance to current debates in the World Summit for Sustainable Development, and its consistency with Islamic philosophy and ethics concerning the use of public goods for the achievement of broader social objectives has come at an opportune time.

I must confess that although I have been a student of Islam, I do not wish to pretend that I am an expert on Islam. Neither have I delved into the various interpretative frameworks (tafsir) that already constitute the rich body of Islamic teachings that exist in the different schools of thought in Islam. I will rather be approaching the issue within Islam from a broad perspective, and not engage in the level of detail that scholars would as a matter of course do, when seeking an Islamic perspective on a specific issue. Mine will take more of a philosophical approach, and hopefully draw some conclusions that will guide the opinions and thinking of Muslims for actions in the future.

One of the central focuses for the World Summit, and which underpins all its major proposals is the recognition that for sustainable development goals to be achieved global poverty needs to be eradicated. This cannot happen without the willingness of rich countries to be emphatic and support the creation and expansion of global public goods or the management of these in such a manner that all of the citizens of the world can derive mutual benefit from their use. It simultaneously, also requires that leaders and the elite who possess power and resources in developing countries also to show a great deal of responsibility in protecting the interests of their fellow citizenry.

If we are to achieve, the goal of an eco-economy, as promoted by one of the leading thinkers in the field on this issue, Lester Brown, then it is clear no eco-economy (where economic behaviour is consistent with ecological systems) is possible without global social justice and the eradication of poverty. The root of all environmental problems emanate from social inequity and conflict. These conflicts and inequity are a result of oppressive forms of hierarchy and hegemony that continue to be exercised by dominant powers in the world today. The greatest challenge today is the need to deepen democratic traditions and the protection of human rights. These are the key to ensuring the challenge of poverty I tackled with all seriousness that it deserves.

Poverty is to be understood in broader terms as the erosion of the capabilities of individuals due to the denial of certain rights or the manner in which opportunities are distributed in society. While there is a general tendency to focus the problem of poverty as being the result of the behaviour of poor people, it is also important to focus on the behaviour of the rich in terms of how wealth is accumulated, distributed or disposed of. In general, inequality is a result of the lack of proper system of distributive justice.

What then is a public good?

The concept is a wide concept, and applies to resources that are both categorised as human and natural capital. The importance though is that unlike private goods, a public good has utility value that is communal or societal. The two key economic principles regarding public goods, and that which distinguishes them from a private good is that they should have the characteristic of non-rivalrous consumption and non-excludability. In the first instance the consumption of a good does not deny the ability of another person to enjoy the same privilege. In the second, a public good produces a benefit which is impossible to exclude or prevent anyone else from enjoying. Public goods are also becoming global in dimension and as a concept guiding international policy, i.e., the concept of a Global Public Good, is still a relatively new concept. In the natural resource sector, the use of oceans, and the atmosphere are examples of global public goods where the use is not limited to one nation but is open for all nations to use. The important thing about a public good is that while benefits accrue to individuals, the good can only be accomplished through the actions of a collective.

By its very nature a public good cannot be owned exclusively by an individual where their exclusivity over a resource denies a right of access to other people. Public goods, such as international security, the internet, environment, knowledge, and so on, require the mustering of collective effort in order for such a good to be secured for everybody's benefit. In the case of a natural resource or human goods have to be regulated so that its use has limited negative impacts that are likely to go beyond the individual user to members of society that are either users on non-users of the resource. It is also natural or feasible that some people or countries may derive a greater benefit from a public good than others. For instance the eradication of malaria in Uganda may provide a maximum benefit to Ugandans, but this still does not detract from the fact that the utility of the treatment is of value to people outside of Uganda if they would want to use it one day. The knowledge and expertise that is generated as a result of developing the remedy for malaria is open for wider public use. This knowledge can also be used by others and contribute to the development of other forms of remedies.

A private good on the other hand is inalienable, and the benefit can only be secured by a few who have the right of access or who are willing to pay to have the right of access. An important point to remember, that increasingly as the world becomes more globalised and integrated, a public good, such as knowledge has more global dimensions to it than being merely confined to a particular sovereign State. The establishment of a global public good system, particularly for environmental goods, requires the maximum amount of countries to act collectively. The incentive to act as a collective should be high enough for global collective actions to be effected. If only a few countries participate, others derive a benefit at the cost of the investment of a few. This leads to what economist call a 'free rider' scenario. It is for this reason that implementing environmental targets, as have been set out in the Kyoto Protocol, are daunting. If a major player like the United States rejects the Kyoto protocol, it is a sufficient incentive for others not to collaborate.

Public goods are instrumental in dealing with some of challenges of poverty globally. In most instances where public good systems are created, they also help to determine the investment patterns and objectives of civic and private holders of capital, services and goods.

What is the importance of public goods in the current political and economic context?

There is generally a perception, and in fact, in many cases it is true that the ethos that informed the idea of public goods is being eroded by the dominance of the idea of privatisation or the idea of private goods. It is assumed that the management, and the maximal benefits can be derived if the good is in control of private hands. The tilt is far too much on the end of private goods that the very philosophical underpinning that informs the utility value of public goods is being lost in modern economic and political life. Given that much of the debate on sustainable development issues is focused on poverty at the Summit, the role of public goods in supporting this objective becomes ever more critical. It is also assumed that if markets are allowed to reign, then the markets will lead to efficient allocations of scarce resources where it is needed most. This is all proving to be false. One of the key reasons why State intervention in creating a public good is precisely because the markets have failed, and if it does not act, resources will not be allocated where it is needed most. Markets if anything have often proven to defeat the ends of social welfare and justice. They work best, where State supervision and regulation are able to monitor and ensure that the market acts responsibly.

This erosion of a key principle enshrined in the notion of a public good, that underpinned much of our civilization, has happened over the last 30 years or so. In the 1980s with the rise of Reagonomics and Thatcherite free market orientated economics, a substantive role in managing and promoting the idea of public goods has been whittled down. The mass scale privatisation of State functions in many developed countries and now beginning to be felt in developing countries has led to what was once seen as a public asset to fall under the control of private hands. In order for a public good notion to regain legitimacy there has to be a revisiting of neo-liberal economics and the role of the State. The spread of unbridled free marketeering, and notions of free trade, premised on opening up markets for capital have not had the desired intent on protecting the interest of developing countries. In fact, in free market economies like New Zealand, the wholesaling of State assets-which is seen as a virtue-, is being revisited.

If anything, globalization, which has enabled markets and the global economy to be dominated by the whims of financial markets -controlled by a few countries and individuals-, and has often led to sovereign States being left powerless against their impacts and in some cases the infringement of the rights of their own citizens. Structural adjustment programmes instituted by the Bretton Woods institutions such as the IMF and World Bank, have not helped poor countries but made them more vulnerable too the risks global financial markets have generated. The net effect has been the withering of the State. And, as we have seen in countries such as Asia and Russia with the crash of their currencies and economies, those most affected have been their own citizens.

States which have been left powerless cannot determine national policy anymore without being accused of scaring foreign capital or investment. For these States to attract foreign capital, they have to give up significant autonomy and control of their resources to either individual or foreign private or public corporations. Their ability therefore to pursue economic planning and funding of national programmes that support the interests of their citizens foremost is constantly being hampered and slowed down because of their need to bend over to foreign interest. Recently, when villagers from the Island of Aceh in Indonesia, took the big multinational company Exxon-Mobil to court for human rights abuses, the US State Department intervened in the affair. The State Department argued that the case undermines US interests and its war on terrorism and is trying to get the case squashed. (Financial Times, August 6, 2002)

Perhaps the current crises in the USA, around corporate responsibility and the corruption that is engulfing corporations may provide an opportunity for these issues to be revisited. Indeed, people like Adair Turner, who is from the famous management consulting firm, Mckinsey, in his latest book, 'Just Capitalism', is beginning to ask whether neoliberal principles should not be revisited and reformed. It is also clear that the role of the State, and transnational institutions such as the United Nations, are critical in creating an enabling environment for the creation of public goods and the spreading of the welfare which result from the creation of public goods. However, Turner's prognosis on the issue of rapacious liberalism is very insightful. He writes:

"Global free trade cannot be pursued outside the context of other global issues, and Britain's (or preferably all of Europe's) export policies should not be pursued without moral concern for human rights and for the uses to which our exports will be put. To some free marketers and to some business interests these assertions will be anathema, an attack on market economics. But they are not. For market economics should never be dogma, but a set of propositions about how we best achieve desirable ends. And free markets should never be thought sufficient in themselves to meet the full range of human aspirations: they have to be managed and moderated, domestically and internationally, to offset imperfections, to achieve inherently collective rather than individual objectives, and to deal with distributional issues." (Turner, 2001)

It is clear that the more stable the State, and the larger its capacity to deal with both internal and external forces the more capable it will be in pursuing a public good agenda and paradigm. Therefore this issue of the State is central, and also an intrinsic component of the debate around the creation of public goods. Public good services is not solely dependent on the State making provision for this. Important public good services are also being carried out by NGOs, religious organizations, labour unions, and even businesses. The role of civic organizations is enhanced and complementary if the State is able to paint the landscape, and creating the platform which allows others to act in a complementary manner. The role of the State is to facilitate, make interventions where needed, and to regulate where pernicious forces stand to undermine a public good objective.

This is more so now, as the net effect of globalization has been that the vast majority of the people, who live on this planet, are marginal to the mainstream economy. If, anything globalization has resulted in the greater 'informalization' of the economies of developing countries as State assets have been sold, and industries being gobbled up by foreign capital. An important work by sociologist such as Theodor Shanin who studied extensively Russian peasantry-are of the view that in fact the global economy will always have two kinds of economies. One that is formal, and one that is informal dominated by the unemployed or part-time workers whose sole purpose is merely to subsist. The idea is not to see subsistence as an objectionable activity, but to understand its nature and reduce the burdens under which it takes place. As Shanin in an interview notes:

"They found that their way of life was completely the opposite of how a human being in an industrial society survives. They didn't have a job, pension, steady place to work or regular flow of income. Families held a range of occupations from farming and selling in the market to doing odd jobs or handcrafts. Their aim was survival rather than the maximisation of profit. Rather than earn wages, labour was used within family enterprises, or shared put among the village. Researchers discovered the same way of life in Latin America, in South Asia-even Italy."

His work is also corroborated by the work of the Latin American economist Hernando de Soto, who found that much of Latin America's poor survive in the informal economy, and manage to make a living from limited resources and having for long periods no formal employment, which has baffled conventional economic thinking, because their activities are 'hidden' and not captured in national accounts. The vast mass of poor survives using social networks, family and friends as a way of ensuring social and economic security. They do live through hardship, but nonetheless have developed remarkable and innovative ways of surviving against great odds. To a large extent these people live through these hardships because the institutions of State in their own countries have become dysfunctional, suffer from corruption, or have an economic planning system that is geared to only cater for a 'market orientated' economy. With the collapse of the financial and banking system in Argentina, economists would have expected people to starve, but instead Argentinians have reverted to a system of bartering as a means of economic exchange rather than rely on the cash economy.

The basic needs of the poor have to be juxtaposed against the conspicuous consumption of the rich. Much of the formal economy is driven by the overproduction of goods. In order for these goods to be consumed-most of which we do not need for basic survival-they have to be branded and marketed so that a consumption pattern is created rather than organically evolved premised on need rather then social and peer pressure to consume in order to adhere to a certain lifestyle. This does not only have social cost, but also environmental cost. We have a glut of consumer goods driven a mass pop culture, juxtaposed, unashamedly, against a mass of poverty. Over half of the world's population live on less than $1 dollar per day. This is a misappropriation of resources on a grand scale.

In fact, environmental experts, who have developed an accounting method called the ecological footprint, are able to show how an individual in a developed country because of his/her consumption pattern, impacts on the environment. The footprint of an average world citizen is estimated to be about 2.3 global hectares. That of a German is 4.7 hectares and an American is close to three times the average at about 9.6 hectares. There is only 1.9 hectares of biologically productive space available per person on Earth. If, the global average per citizen is already 2.3, then the consumption patterns of rich countries far exceeds what is biologically possible to sustain into the future.

There is no doubt that the privatisation of a good has some value in some context, like the management of a service that is clearly not used by all, or upon which all citizens of a country are not dependent upon for their own survival or livelihood. You could also have both a public and private good system living side by side with each other. For instance general health care that is accessible and affordable to all citizens and then private clinics where citizens who can afford more sophisticated health care are able to pay for such services. However, the choice of how much of our human and natural capital is to be regarded as a public or private good is determined by the social values of a particular society or cultural context. It has to be determined by the socio-political context of the country and the pressing development objectives of each country. Global markets are oblivious of this. They are not in most cases development friendly. Given the integrated nature of our global economy, there is a need to view issues of distributive justice not only as a national priority, but international as well. The establishment of global public goods needs to be an essential component of international mechanisms for distributive justice.

Attaining global collective action on these issues is much more complicated though when we have to determine these definitions and policies within a global community of nations which adhere to different value systems, cultures and beliefs. The issue of privatization is a major source of consternation. In some cases, like the management of water utilities, which is seen by many developing countries as an issue of access and a basic right, has lead to riots in countries like Bolivia. Water may in the future become a private commodity in some countries, although it has a public good value. A good example of the dangers and complexities associated with the privatisation of what was generally regarded as a public good across civilizations for generations is the question of knowledge. Wealth creation in the 21st century is becoming increasingly knowledge dependent. Countries which are able to generate and access this at the lowest possible cost will be the forerunners in terms of making economic progress. (Anderson, 1999) It is for this reason that this issue is so politically contentious.

The increasing privatisation of knowledge, through the use of the intellectual property rights system is likely to impose constraints on economic progress and development in the future. Although IPRs are managed through the World Intellectual Property Organization (WIPO), they are enforced through trade agreements such as the Trade Agreement on Intellectual Property Rights (TRIPS) which falls under the World Trade Organization (WTO). For instance the South African government had to fend off the attempts of big multinationals who wanted to institute IPR rules by trying to force the South African government not to introduce a system of parallel importation and compulsory licensing. In this way the South African government would be able to make these drugs more cheaply available. Drugs companies, because they are concerned about eroding shareholder profitability, use patents as a way of exercising monopoly and justifying high prices for drugs.

Patents are a new frontier of exploitation and control, given that as the world becomes more service orientated and globalise it becomes more knowledge dependent. Knowledge will hold a premium value in the future, and the manner in which it is shared and disposed off will be limited by the homogenisation of international IPR rules. OECD countries hold 90% of the world's patents, and therefore exercise a monopoly over a good that limits the development potential of other countries. Patent holders can exercise a monopoly over the use of the knowledge for 20 years. Once the 20 years is over, when the knowledge is made public, other innovations and technologies may have superseded the patented technology. In recent years the most disturbing trend has been in the biological sciences, where genetic sequences have increasingly been subjected to patents.

This is all the more worrisome, if you consider that the Human Genome Project, which was funded by public funds, had its whole ethos sacrificed, by venture capitalist such as Craig Venter. Venter established a rival sequencing 'factory' through his company, Celera Genomics, to beat the public sector gene sequencing programme. He did. But, not also without patenting a considerable amount of the sequences, that limits scientific access and use. Countries involved in the Human Genome project -dominated by the US and UK-agreed in 1996, on the island of Bermuda that as soon as the genes have been sequenced they would deposit the data on public database for the benefit of the global community. The Bermuda agreement espoused the principles of free availability, scientific co-operation, and the recognition that given that humans are special the material should not be the property of any individual, group or country. The Bermuda agreement depicted a global public good ethos in the purest and truest sense. (Ashburner, 2001) What the Bermuda agreement tried to achieve is rapid advancement in human knowledge. Venter's group on the other hand infringed the basic principles of the Bermuda agreement by commercialising the availability of the sequences to companies and researchers and in so doing restricting access to this knowledge.

Patents must be seen as an economic inefficiency, by the mere fact that they allow a monopoly over an idea to be exercised for such a long period. Such economic inefficiencies are already evident in the biotechnology industry, where there are numerous patent holders of genetic sequences, protein models, and other biological material. The ability for innovators to introduce new innovations is being impeded by the fact that there are so many patent holders that they have to negotiate with before they have the right to use the patent. Instead of being an incentive for innovation it in fact is having the opposite effect of raising the cost of innovation. Some experts have called this phenomena the 'tragedy of the anti-commons', because a swathe of private holders of patents are creating barriers to invention, and in so doing potentially, inhibiting the possibility of scientific and technological progress.

The effect of patents, where its earlier intention was to protect the right of the inventor and to ensure the inventor was not exploited has been subverted by monopolistic tendencies. Patents have been tainted by the ethos of greed. Where protection is merely seen as an end to achieving monetary rewarded. It has lost all its social good value which traditionally informed a patent system. They have in effect become monopoly goods. Once again this monopolistic tendency is reinforced if there is a weak State. For instance if health care was still dominated by the State, it is more than likely that the State which is the largest buyer of drugs, would be able to break the price logjam that big multinationals exercise by hiking prices even though there is a surplus of consumers. (In classical economic terms if there was true competition and surplus of consumers prices of goods should come down, not go higher. In the case of drugs, because of monopoly, prices in fact go up rather than come down).The Canadian government was able to do this. Also with the lack of an international policy on competition, and the regulation of price for essential goods, pharmaceutical companies can exercise price differentiation. This could lead to least developed countries paying a higher price for a drug, and effect subsiding the research and development cost of rich countries and their consumers. In general, developing countries lack effective anti-trust mechanisms to protect them against monopolistic pricing. Once again, this raises too the importance of better regulation of competition at the international level.

A further reason why IPR is such an emotional issue is that innovation is only possible because of the accumulation of a global commons of knowledge which is and has been freely accessible for centuries. Developing countries have contributed considerably to this pool of global knowledge, and feel that they have not been fairly rewarded as result of innovations being exploited during the colonial era and present exploitation of indigenous knowledge. Indeed, one of the persistent issues that keeps on raising its head, in for a specifically dealing with the environment and development, is the issue of technology transfer and the sharing of scientific expertise. Developing countries have pointed out that sustainable development goals in their own country cannot be achieved without developed countries offering significant concessions in terms of their willingness to share more freely and in affordable manner their technological and scientific expertise.

Increasingly, global benefits from a global knowledge commons has favoured developed countries because of the manner in which the IPR system has worked to their advantage. This inequity in the distribution of benefits arising from a global knowledge commons is an impediment to development in developing countries. As the Economist Joseph Stiglitz notes: "I have argued that knowledge is one of the critical keys to development and that knowledge is complementary to private and public capital. Knowledge is a global public good requiring public support at the global level." (Stiglitz, 1999) The preservation of the ideal of knowledge as a global public good still faces persistent threats. The latest is the attempt by the World Intellectual Property Organization's (WIPO) to establish a central global patent system that will do away with national patent systems and laws. (Grain, July 2002) As GRAIN-a advocacy group-notes that the implications are that by removing sovereign responsibility over patents, patent policy cannot be used to pursue national development strategies. In fact, patent policy, and the rights associated with it, will be determined by powerful countries and corporations outside of the realm of national democracies and legislative powers. National authority will be superseded by an international regime, without possible proper avenues for appeal if a decision is unfavourable.