St Paul's Institute

Democracy, Free Movement and the Common Good

What we're doing
Our starting point
More on the common good?
What can I do?
Want to join a common good debate?
Want to start a common good debate where you are?
Want to get involved?
Find out more
Democracy and its discontents
Economics and finance and the common good
Free movement of people and the common good
Free movement of capital

What we're doing

This initiative is about working with others to advance the common good.

By 'common good', we mean an ordering of social relations in a way that holds in balance individual fulfilment with mutual flourishing, based on the dignity and equality of all people.

It concerns the future of democracy and how we create the society in which we wish to live. In particular, it concerns the free movement of people and capital. The movement of people and capital is fundamental to national, regional and global economic development. However, it is also a key source of widespread feelings of economic and cultural insecurity. Attempts to address this often rely on assumptions about freedom of choice for the individual or economic utility (i.e. the benefits or costs for the majority). Instead, this initiative seeks to stimulate a national conversation, based on the dignity of the person and the common good. That does not mean ignoring freedom and utility, but it does involve holding personal fulfilment and community flourishing in balance. Taking that approach, we hope to advance a constructive alternative - one that can help to address existing anxieties and provide a source of fresh policy ideas, adding to the ongoing work being carried on in faith communities and other groups that exist in the space between the individual and the state.

The rest of this site contains:
  • suggestions on engagements; and
  • useful materials for thinking about the common good and free movement of people and of capital, and their impact on democracy.

Our starting point

Our starting point is this paper by Adrian Pabst. It is the product of the first phase of our work which involved bringing a small group of people together to think about how a common good perspective might help us in addressing the impacts of free movement of people and capital. We then sought comments from a much wider group. Here is the result.

Why not share what you think? Send your comments to institute@stpaulscathedral.org.uk





More on the common good?

By 'common good', we mean an ordering of social relations in a way that holds in balance individual fulfilment with mutual flourishing, based on the dignity and equality of all people.

UNESCO has described it in this way, which you can read here.

Do you want to hear more about the common good? Anna Rowlands gives us the Christian take on the subject here.

What might that look like in practice? Archbishop Justin Welby's new book, 'Reimagining Britain', which applies common good thinking to some of the UK's most pressing social and economic challenges. Further details here.

If you want to find out more about the alternative ways in which people have suggested social relations should work, Michael Sandel's Justice seminars are a great way in.

What can I do?

The following are just a few suggestions. It is also well worth checking out the Together for the Common Good website. Among other things, it provides a wealth of information on the common good and related initiatives.


Want to join a common good debate?

St Paul's Institute is holding a series of events and discussions during 2018, which started with a major public debate under the Dome of St Paul's Cathedral which was broadcasted by BBC Radio 4 as part of their Public Philosopher programme.




 

Democracy and the Common Good: What do we Value?
Monday 19th March 2018

On Monday 19th March St Paul's Institute hosted a large audience under the Dome of St Paul's Cathedral to hear Harvard Philosopher Michael Sandel in dialogue with 90 students. Professor Sandel started by asking the students to think about whether we should aspire to be citizens of the world, or if a citizen of the world is really a citizen of nowhere.

This led the students to debate issues of globalisation, deepening inequality and the values that bring communities together. It was a fascinating discussion, with views from both sides articulated throughout the course of the night.

We were very grateful to Michael Sandel for leading this debate and also extend our thanks to all the students who participated. If you weren't able to join us, you can hear the BBC Radio 4 broadcast of the evening here.

Watch this space for further events in the series, and sign up to our newsletter to receive announcements here.

Want to start a common good debate where you are?

Try these...

Calling People of Goodwill: for those wanting to get together and think about the common good from a Christian perspective, this short Bible study booklet is an excellent, easily accessible prompt for personal reflection or group discussion that leads to positive action. It is available here.


Together for the Common Good are also developing a new training programme in Common Good Thinking and Practice. Available soon, these resources are designed to help church leaders and members across all Christian traditions support their church's mission to build the Common Good in neighbourhoods, workplaces and communities. Find out more here.

Citizens UK runs training for those seeking to lead community change. Find more information here.

Meanwhile, although this British Council document does not approach things from the Common Good perspective outlined above, Module 4 (at page 177) contains useful material for facilitating community engagement.

Want to get involved?

One thing to remember is that you probably are already!

A common good approach strongly affirms the potential for civic and business organisations to help realise the common good. Indeed, it sees that as their purpose. So, we can be part of realising the common good through how we work, engage politically and in shaping these organisations.

A number of institutions have a particular focus on seeking to mobilise communities in the pursuit of the common good. Some are profit making, such as some forms of social impact investment (for more information, see https://www.goodfinance.org.uk). But those listed below are not for profits that are active in the UK (as opposed to international development) in areas relevant to the current project. NB, the list is by no means exhaustive. Explore:

Find Out More

Below are a selection of materials to help you think about the current state of democracy and the common good and, as part of that, the impact of the free movement of people and capital, and globalisation more widely. It is a starting point. We have sought to reflect a range of perspectives, but is not comprehensive. The materials do not necessarily reflect the views of the Institute.

We welcome ideas for additions. Please do email us at: institute@stpaulscathedral.org.uk

As a starter, take a look at Miroslav Volf's take on how followers of Christ should serve the common good here.

Another good place to start is the book Together for the Common Good: Towards a National Conversation, a collection of essays intended as a conversation opener to inspire a deeper quality of discussion about the common good.

Hilary Russell, who helped found Together for the Common Good, has written the book A Faithful Presence which explores how faith-based collaboration works best for the common good.

Reclaiming the Common Good: How Christians can help re-build our broken world is a collection of essays that helps to explain the concept of the common good and provide people with ways that common good thinking can be applied to issues such as welfare, austerity, migration, environment, peace and justice. You can buy this book here.

Building Better Societies is collection of essays that asks the question; 'What would it take to make society better?" This book outlines what mechanisms and interventions will help to make societies better as well as providing the reader with practical steps and existing policy programmes that promote social justice. You can find more information here.

This interview with Professor John Milbank on Christianity and the Politics of the Common Good, considers what a common good politics would look like, post-liberalism and the role of Christianity. You can read this interview here

Who is my Neighbour? The Global and Personal Challenge is a collection of contributions from a team of leading theologians and practitioners to consider what Christ's injunction to 'love your neighbour' should mean in practice today, especially with regards to the politics of poverty, discrimination, immigration, ecology and the fallout from recent political upheavals in Europe and America. Find out more here.

Democracy and its discontents

For an overview of the ways in which people have thought about the moral foundations of democracy, including the role of the citizen and the common good, take a look here.

There is a malaise within Western democracies. Quite apart from the experience of recent elections and referenda, a range of indicators suggest that all is not well. For example, for the last two years, the Edelman 'trust barometer' has shown that trust in public and commercial organisations is at a low. While we should perhaps also be considering whether these bodies are trustworthy, this nonetheless seems to suggest that relationships are strained.

Meanwhile in its 2018 annual survey Freedom House (a US state funded non-profit making organisation committed to freedom and democracy) expressed the view that, globally, democracy appeared to have receded in 2017 for the 12th year in succession. You can find their report here.

But why?

There is no single cause, but the impact of dislocations of economic globalisation, including the movement of capital and people seem to be important elements for Western democracies.

Just as important, however, we also have some power to determine how we respond to what we cannot control. For example, the outcomes of an 'antagonistic liberalism' (risking further fragmentation) are likely to be different from approaches that build and respond out of solidarity. Ultimately, democracy is a 'culturally rooted practice', as Mark Lilla outlines here in talking about the impact of liberal individualism.

Here, the Economist, asks 'what's gone wrong' and why? The piece was written before both the Brexit vote and other recent elections in the US and elsewhere, highlighting the fact that current situation has been some time in the brewing - as does this far-sighted piece from John Gray speaking not long after the onset of the 2007-8 financial crisis.

More recently, Martin Wolf of the Financial Times has addressed the same question - 'Elites vs 'The People': Rise of Populism and the Crisis of Democratic Capitalism.' You can watch this talk here. You can also hear him speaking about the crisis of democratic capitalism here.

Meanwhile, here, Pankaj Mishra casts a highly critical eye over a clutch of recent books that seek to provide an explanation of what is happening, raising a question as to who is best placed to do so. Christopher de Bellaigue's assessment of Mishra's own disturbing take on events can be found here.

A numerous possible causes have been identified including globalisation, inequality, the effect of 'neoliberal' capitalism, liberalism itself and the impact of living in a 'post truth' environment. To explore further what is being said about these, see below.


  • Is it the result of globalisation?

Dani Rodrik presents us with a trilemma here: democracy, national sovereignty and global economic integration may not be compatible with each other.They need to be balanced.

Here, he applies that reasoning to the UK's decision to leave the European Union, looking at the perceived democratic defecit in the latter.

This study by the International Monetary Fund investigates economic globalisation and its effects on incomes, finding that gains are concentrated at the top of national income distributions resulting in rising inequality. 


  • Is it inequality?

Is it possible to sustain democracy in a country where there are high levels of inequality and, if not, is there the political will to address it? Here, Victoria Bateman considers the sobering assessment of Walter Scheidel in his recent book 'The Great Leveler: Violence and the History of Inequality', contrasting it with the more optimistic views of Branko Milanovic (at least viewed at an international level) in another recent book 'Global Inequality: A New Approach for the Age of Globalization.'

If you want to hear more from Walter Scheidel, it's here, or from Branko Milanovic on income inequality, it's here.

While not a piece of economic or sociological analysis, this cry of the heart from Scott Stephens (Religious Editor for the Australian Broadcasting Corporation), argues for the importance of recovering a sense of common life as part of the process of seeking to address inequality.

In a similar vein, Philip North argues that it's about relationships, more than the economy. You can read this here.

  • Is it neoliberal capitalism?

The expression 'neoliberal' may be wearing thin. Read more here.

However, according to Wendy Brown, neoliberalism is part of the issue - see this review of her book on the subject by Nicholas Gane.

These survey results from the Legatum think tank suggest that the current state of capitalism is certainly a focus for discontent.

This would come as no surprise to Wolfgang Streeck, critic of contemporary capitalism.There are various forms of capitalism, but he singles out neoliberal capitalism for particular attention, here.

  • Is it to do with the way liberalism has evolved?

The question is posed here, by the New Statesman.

At the 2017 Theos lecture, MP and former leader of the Liberal Democrats, Tim Farron, argues that we need to stop the tyranny of liberalism in order to preserve liberalism itself. Read his speech here.

  • Is it the impact of a 'post-truth' environment?

Or is 'post-truth' more about the inability of a 'liberal elite' to accept that not everyone sees it the way they do? Here, John Gray reviews Matthew D'Ancona and Evan Davis on post-truth tracing the origins of a loss of trust in political elites much further back, but directing us back to economic marginalisation as a more potent source.

Economics and Finance and the Common Good

There is a growing recognition that financial and economic globalisation has lost its way, with adverse impacts for nation states and their peoples.At a macro level, Dani Rodrik talks here about the need to rebalance globalisation with a greater role for nation states, looking particularly at the inter-play between free movement of people and capital.

By contrast, this speech from Mario Draghi (president of the European Central Bank) advances the argument for expanding openness based on the need for economic growth, considering how to sustain it politically.

Meanwhile, Joseph Stiglitz sees a need to direct the global economy back towards needs and expectations of the societies within and across which it operates. Read his thoughts here.

Profound questions are also being asked about the relationship between economics and societal outcomes in the world of economics as a discipline. Here, for example, Jean Tirole talks about economics for the common good (although having sought to define the idea of a 'common good' at the start - using a Rawlsian 'contractual' approach, different from the summary definition above - he seems not always apply the idea that there is a good end that transcends economic measures to what he says about the discipline.)

Free movement of people and the common good

This report from the Oxford Migration Observatory at Oxford University looks at the determinants of migration to the UK since the early 1990s.

And this, also from the Oxford Migration Observatory, seeks to assess how British people feel about it and why.

Meanwhile this report from NatCen Social Research seeks to analyse the social distribution of differing views on immigration.

Canon Mark Oakley's Church Times piece on detention of migrants can be found here.

An earlier project by the Joseph Rowntree Foundation had sought to understand the relationship between immigration and other factors in undermining social cohesion, concluding that a range of other factors not directly connected with immigration also needs to be taken into account. Read it here.

In understanding peoples' responses to migration, this report from the International Migration Organization identifies cultural factors (i.e. factors pertaining to the identity of particular groups of people) as being more potent than economic factors. Here, Eric Kaufmann draws out some of the possible implications of that.

The UK Parliament's Home Affairs Committee has been looking at the question of immigration following the Brexit vote, concluding that reform and public involvement is needed to restore confidence in the immigration system. Find their report here.

A number of bodies have also advanced proposals as to how free movement of people might operate in the UK post-Brexit. They include this from Jonathan Portes of UK in Changing Europe and this from the Policy Exchange.

Free movement of capital

The impact of the free movement of capital can be considered from various perspectives. The materials below do cover two of them:

  • International capital flows between countries.
  • How capital is allocated to (ie moves from) one economic activity to another.

International capital flows

It is important to draw a distinction between foreign 'direct investment' ('FDI') in a country (for example, in terms of plant and machinery) and foreign 'portfolio investment' (for example, in securities issued by companies in a particular country). The latter is essentially a financial market activity and more volatile.

Jagdish Bhagwati's 1998 piece on the positives and negatives of free capital movement, and crucially whom it benefits, remains a significant contribution to the debate on how far free movement of capital internationally is desirable. It was written in the aftermath of the 1997 Asian financial crisis and began top raise concerns.

The Economist, responding to Bhagwati, was less sceptical. You can read their reply here.

However, openness to capital controls has increased, particularly in the aftermath of the financial crisis that started in 2007-8. This, from The Economist's 'Free Exchange', provides a useful summary.

A key issue is the balance between national controls and global governance for capital controls, as seen here.

Maurice Obstfeld offers his post-millennium reflection on Bhagwati's piece above here.

More recently, the growing openness can be seen in this 2016 IMF policy document.

This OECD literature review on international capital flows provides a useful, if rather technical, snapshot of the current state of play.

As does this feedback from an OECD 2016 policy seminar.

Meanwhile, in practice, there is some suggestion that some of the more volatile forms of cross-border capital flows may have reduced (so that less volatile foreign direct investment comprises a greater proportionate share).See this report from the McKinsey Global Institute.

How capital is allocated

The reason usually given for wanting the free movement of capital is to make sure that it is allocated in the most economically efficient manner to the business enterprises that need it. However, questions are increasingly being asked about how those allocation decisions get made:

  • Should capital flow only to those activities that are going to generate the most money for the capital owner, regardless of whether they add anything to humanity or could even be destructive (for example, in terms of the environment)?
  • In any event, in the long-term, are financial return and these broader human factors necessarily incompatible?
An important issue is, therefore, (a) what is the purpose of those who invest in companies and (b) how do those companies decide how to use the investment - i.e. how they will allocate the capital to different business activities. A further issue concerns 'speculative' financial activities (i.e. financial activity largely unconnected to any investment purpose, resembling instead a form of gambling to win money using financial instruments); if we accept that the free movement of capital is intended to support human flourishing, could activities of this sort damage true investment activity and, if so, should they be discouraged? Finally, what measures are used to make investment and capital allocation decisions? The use of GDP is considered below as an example.

  • Investment purpose

UK Government work is ongoing on whether to revise the duties of pension fund trustees so as to encourage more extensive 'social investment', potentially introducing a more explicit 'common good' dimension to investment activity depending upon the direction the reforms take. You can read their publication here.

Here, Howard Davies compares allocation of capital to financial activity with direct investment in economic activity. See also speculation below.

  • Corporate purpose

A company's sense of purpose will affect how it allocates capital that is invested in it. Is the purpose of a company to generate returns for shareholders? Milton Freeman has been (mis)understood as saying yes, which you can read here.

However, there is a growing recognition that corporate purpose needs to take account of the social function and impacts of a business.See for example, this UK Government consultation on the future of the company.

Part of this work involves this consultation on the UK's Corporate Governance Code (including on the role of purpose), this from the British Academy and this from the Big Innovation Centre.

  • Investment versus speculation

Here, Michael Sandel considers the relationship between investment and speculation.

Some of the post-crisis reforms have made it possible to regulate speculative activity more effectively. However, there is a question as to whether it should go further.

For restrictions

Against (Darrell Duffie)

But as Raghuram Rajan highlights here, it is very challenging to separate speculative from economically purposive activity.

  • What measures should we use in deciding how capital should be allocated - the case of GDP

David Pilling is one of the more recent of a number of thinkers who have highlighted the shortcomings of GDP as a measure.Others include Diane Coyle and Dan O'Neill, but Robert Kennedy famously spoke on the issue in 1968.

Here is Pilling talking about whether GDP has outgrown its use.

And here is Diane Coyle commenting on Pilling's most recent book.


Free movement of people and capital - what does the law say? 

The movement of people and capital across national borders is not just something to do with the European Union. In part at least, it is subject to national, regional and international legal controls. This brief guide provides an outline of how it works at present. The fact that free movement operates within these national, regional and international frameworks serves to emphasise, first, that we have scope to change it and, secondly and more subtly, that its operation has implicitly been recognised as something that is relevant to some notion of what is a good end. But what are those ends?