4.2 UVM Scheduling Semantics
4.2.6 Observed Region
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UNIT 2 WHY THE INEQUALITIES CAUSED BY
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the case of Venezuela, Paraguay (with a new president known as the bishop of the poor) and Bolivia (Eva Morales, the first endogenous president of the country). A different range of experience of the neoliberal agenda exist in relation to those societies which have not been able to ‘fully’ embrace the required reforms due to the inapplicability of the policies in their social and political context. These societies under those policies have extremely exploited their human and natural resources, became paralysed under a heavy foreign debt, or lacked the necessary infrastructures or strong political governance (Many cases can be found in Africa).
In contrast, we may refer to some other few cases that are considered as the successful examples of economic globalisation. Among them are:
South East Asian societies and the most recent and prominent one, i.e.
China. A closer look at these cases like China that have shown a long term growth will reveal that these cases have started their growth at least one decade earlier before adopting neoliberal policies, by heavily investing on education, infrastructures while pursuing a rather equal distribution of wealth/land. Even later after shifting toward economic liberalisation, they have implemented these neoliberal policies very gradually and cautiously with significant government-led financial regulations, not to only attract investments, but also to avoid them from leaving the country in the difficult times. In terms of outcome, although the economic growth rate has been high and some sections of their population are lifted out of absolute poverty, there are so many ifs and buts around the consequences of economic changes for different groups of society. Why do we need to Address Global Inequality?
There are also a couple of points that need to be mentioned:
While quantitative studies can show us the scales and extents of inequality and poverty in terms of the number of people and severity of gaps, they disguise many practical, emotional, and humane aspects of reality. No matter how accurate are the data, the ‘quality of life’ is a quality issue rather than a quantity issue (that is why it is called ‘quality of life’ rather than ‘quantity of life’. Have we ever spent one day with a poor slum dweller family in India, with an Afghani household in a refugee camp in Pakistan, or with a Nigerian slum dweller in Ajegunle or Mushin; or with an Iranian asylum seeker in a detention centre or an Iraqi family desperate for medication for their child during the 1990s US-led UN sanctions of Iraq that caused hundreds of thousands of Iraqi children simply perish?
Behind inequality is the big question of power – usually exercised through policies and coercive action. Many studies, especially those implemented by powerful capitalist institutions and think tanks, do not
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In order to add clarifications to our arguments, we may also need to raise the question of “inequality of/in what?” The answer is inequality in income, health, education, welfare, rights, etc. Neoliberal policies have increased inequality though have improved the average basic living standard and created a new middle class around the newly growing metropolitan areas. During the pre-liberalisation period, the majority of people in these societies were equally depressed by their ruling (communist or nationalist) elite. However, after shifting towards market capitalism, the elite have distributed the new opportunities (mostly through uneven privatisation processes), giving privilege to party loyalists, friends and relatives. This also creates a rent-seeking syndrome that does not allow the poor to escape poverty. Therefore, a new urban middle class has emerged in these countries. Otherwise, the rest of society is pushed back to a more unsecured unsustainable life. Global Changes and their impacts have truly brought about inequality and poverty. Expanding space for poverty is synonymous with expanding space for insecurity, strained societies and opportunities for violence.
These are critical reasons why global inequality has to be addressed Address the issue of (political and economic) power relations. Many of these studies are blind to the uneven and unfair nature of the capitalist economic system that is supposed to be the most reliable system.
Similarly, they are blind to the historical roots of inequality and poverty in the low-income societies and assume that these societies can improve their situation through a more efficient integration with the world capitalist economic system. The MDGs have made bold attempt to redress inequality caused by globalisation in a way. Yet as we approach the end of the programme in 2015, a post MDGs needs to be crated almost immediately.
An economic policy system that encourages more and more consumption in order to stimulate more and more production and thereby greater levels of growth is a system that ends up in dis-empowering and disharmonies relationship between those who can afford the consumption of luxurious goods and those who cannot afford them. Data are not free from flaws. UNDP published a report in 2007 which presented an estimation of world wealth inequality by adopting a new notion of inequality. This new concept is argued to represent
‘global’ inequality by comparing the households’ wealth across regardless of their nationality. Therefore, unlike the earlier measurements of world inequality, which were based on the nation-state as the unit of analysis, the new notion considers households as its unit.
The advantage of using this new notion is in its ability to include inequality within the nation states which used to be concealed behind the national averages (consult the following two figures)
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Neoliberal globalist argues that growth caused by globalisation (integration into the world free market system) will improve within-country equality. However, the World Bank development indicators reported in 2007 clearly shows that growth does not necessarily result in less domestic inequality. In 1996 for the first time, the UN University developed a standardised data base for comparing countries in terms of their internal inequalities. According to the recent studies based on this database, most of the countries have shown rather constant levels of internal inequality over the last four decades, except the Eastern European societies with a rising inequality but still less than the developed societies, while China has the highest rate of increase in inequality (see the following figure)
4.0 CONCLUSION
Liberals have long established that global economic cooperation among states is capable of transforming international politics, such that, trade is not only promoted but also the mitigation of conflict or adversarial relationship.
Montesquieu (1989), Kant (1957) and Smith (1979) offer arguments concerning economic commerce with political cooperation among states. They insist that cross-border investment and trade including cordial political relationship can discourage aggression. Such cooperation is not so much of mere economic cooperation, but real intention to transfer wealth to poorer countries so as to reduce pressure and fragmentation caused by poverty in developing states. These are
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indirect pay-offs, but the reality is well known on the long-run.
However, the very reason why inequalities caused by globalisation among states must be addressed lie in the fact that a small conflicts that generates from local misallocation of resource, lack of access, opportunities to domestic and international markets can metamorphosed into regional conflict that may threaten global peace. Conflict is not necessarily a situation or war – where machine guns must be deployed.
For example, the south believes that the advanced north – the OECD countries are responsible for the economic quagmire developing countries have found themselves. Neo-colonialism and then globalisation are seen as manipulative tools being used by the north to hold back the economies of the south. Neo-colonialism involve the establishment of structures that influences public policies and infrastructure to the advantage of western capitals and globalisation seeks to open up markets, trade and investment for easy entry and exit among states. But the reality is that weaker economies shrink far more that they are able to gain because of their competitive inequality with huge capitals and advanced technologically – ready states. Moreover, western markets are not accessible to poorer states. Even where opportunities are given to access western markets, subsidies to farmers in developed countries put African goods on inferior status.
These inequalities and lack of opportunities must be re-examined and addressed. China and India have recently improve on their growth rate and GDP as a result of access to African and western markets. Thus poverty is easing up in these countries and domestic conflicts and pressure on local population are diminishing. Addressing the ills of globalisation will enable people to live responsible lifestyles, especially in weaker and poor states.
More transparency and accountability are needed in the globalisation process. In fact, those are two variables that are needed to address the inequalities caused by globalisation be addressed. It must be addressed because it is directly or indirectly one of the major causes of economic weaknesses of citizens of developing states especially Africa. Economic weaknesses can cause frustration. And frustration is a source of weakness or threat – just as the attack on the U.S. trade house in September 11 2001 has shown. Lack of access and opportunities can cause domestic conflict. And domestic conflict is a source of regional conflict that may worry the international community. Unfortunately, there is little or no morality in economics. This is the problem of addressing inequalities in globalisation process.
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5.0 SUMMARY
Generally, it has been argued that higher degrees of political and economic freedom in the form of democracy and capitalism in the developed world are ends in themselves and also produce higher levels of material wealth. They see globalization as the beneficial spread of liberty and capitalism. Marshall McLuhan popularised the term Global Village beginning in 1962 His view suggested that globalisation would lead to a world ,where people from all countries will become more integrated and aware of common interests and shared humanity.
Supporters of democratic globalisation believe that the economic development was the first phase of globalisation, and should be followed by a phase of building global political institutions. Dr. Francesco Stipo, Director of the United States Association of the Club of Rome, advocated for unifying nations under a world government, suggesting that it "should reflect the political and economic balances of world nations.
A world confederation would not supersede the authority of the State governments but rather complement it, as both the States and the world authority would have power within their sphere of competence. Former Canadian Senator Douglas Roche , viewed globalisation as inevitable and advocated creating institutions such as a directly elected United Nations Parliamentary Assembly to exercise oversight over unelected international bodies.[ Economist Paul Krugman is a staunch supporter of globalisation and free trade and has a record of disagreement with many critics of globalisation. He argues that many of them lack a basic understanding of what comparative advantage is in a package
6.0 TUTOR-MARKED ASSIGNMENT
1. Why must inequalities in globalisation be addressed.
2. Why would it be difficult to address the inequalities in globalisation process?
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7.0 REFERENCES/FURTHER READING
Frank, T. (2002). One Market under God. Extreme Capitalism, Market Populism and the end of Economic Democracy. London:
Vintage.
Held, D. & Kaya, A. (2007). (Eds). Global Inequality: Patterns and Explanations. Malden; Cambridge: Polity Press.
Kaplan, S. (2006) West African Integration: New Development Paradigm. Washington: Autumn
Schifferes, S. (2008). World Poverty ‘more widespread.’ BBC Economic Report, BBC News (consulted 27 August, 2008).
UNDP (2007) ‘Making Globalisation Work for All: United Nations Development Program Annual Report.’
UNDP (2008).The Bumpy Road to Globalisation. In: Japan Echo, Vol.2, February.
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