What it would really take to make poverty history
Recently I was part of an audience for a channel 4 programme on the bigger issues surrounding the Tsunami disaster, obviously a lot of the talking head discussion that pulled in commentators from Oxfam, The African Congress, The UK Labour Party An economic development professor from LSE, the US State Department, a senior advisor to the Bush Administration and, for some variety, a musician involved in promoting Fair Trade.
"Tsunami every five days in Africa"
A lot of the talk talked about the "Tsunami every five days in Africa" which based on the 30,000 people that die in Africa every day, most of them children, most of them from preventable diseases. The solution talked about for the majority of the programme was how doubling aid, and how we wouldn't have to pay an extra penny in our taxes to pay for it, just divert money from the extortionate amount spent in the war on Iraq (which spends the entire annual aid budget in a week). Given the likelihood that alleviating global poverty is likely to be much more cost effective (in terms of money and lives) than invasions in regards to winning the war on terror, diverting money from defence in favour of aid and development has to be such a winner. In fact, as the program and its speakers pointed out, such aid and debt relief programs were absolutely bargain basement in terms of lives saved, development and the breaking of the poverty trap, and decisive benefits to the environment through cleaner, more sustainable development.
Bill Gates shows the way
My theory is that the solution ties in a dual measure of short and long term solutions;
The short term solution is targeted aid programs that are very professional and scrupulously audited in their set up that focus on programs that get the most bang for their buck. Bill Gates has shown the way with his charity which is focussed on providing vaccines for the poorest nations to save millions from easily preventable diseases, especially children. The way he and his wife have set up his charity also has a number of other advantages which can act as a guideline for governments and private individuals looking to follow suit. Long term solutions focus on debt relief, fair trade and then assistance to develop liberal democracies and political systems.
Insistence on governance misses the point
I would make the suggestion that Bush drops promoting liberty and freedom and democracy the only way to beat terrorism, and focuses on alleviating poverty through short term alleviation in aid, and long term alleviation through fair trade and debt relief. Bush's advisor insisted that the problem was the corruption and cronyism that was the corrupt governments running these countries were in, and assisted that little or no aid or debt relief should go to these countries until such time as their governments that had got them into trouble in the first place with proliferate borrowing and corrupt spending practices either changed their ways or were replaced with more accountable administrations. The problem with that argument is that while people, everywhere, wants to be free, they value other things just as important first, such as security, order, food, water and other basic amenities, elevation from crippling poverty and disease and some sense of an intact society. Then, only when these basic necessities of life have been elevated.
The tradegy of CAP for the 3rd world
One key area that requires drastic reform is the Common Agricultural Policy of the European Union. For well over a decade New Zealand farmers have survived on zero government subsidies, and after an initial period of painful readjustment after subsidies were removed has gone from strength to strength and is now flourishing as a nation of agricultural innovators, it's economic gains built on the back of significant increases in productivity due to massive efficiency gains, a developing culture of relentless innovation (necessity being the mother of invention and all that) and improving environmental conditions due to a move away from over-grazing and unsustainable agricultural practices. It has made New Zealand one of the most competitive agricultural countries in the world in regards to the quality and diversity of its products however it, like many other countries, has struggled to make the most of it's comparative advantage due to the trade distortions on world markets due to CAP, a distortion which not only makes access into the European markets difficult but also affected other markets where dumping of its surplus was a favoured EU strategy. New Zealand came to be one of the leaders of the Cairns group as a result of this dumping and incidentally acts a bridge between Europe and the developing world, as one of the few first countries to still primarily rely on its agricultural products.
It is the developing world of course who suffer the most from CAP and its series of related trade distortions. It remains one of the great ironies that those nations who receive mealy mouthed trade 'concessions' from the EU under the Cotonou agreement have been doing worse than those countries outside the agreement who have negotiated their own trade agreements without having to go through the rigmarole of satisfying human rights clauses which are only half heartedly pursued by the EU. I am also hugely sceptical of the so called "reforms" of the CAP which will not be implemented all the time France continues to be French. And while tying subsidies to "Green" practices maybe a noble theory I'm also sceptical that it can really bring about its stated aims even without the presence of the French. There is just something innately distorting about subsidies, no matter how well intentioned, and as New Zealand has demonstrated, removing subsidies is the most effective way to become both competitive and environmentally friendly.
As for the worlds superpower?
The USA is hardly much better in this regard, it's farming community relies heavily on government subsidies and handouts, and the US government has, despite it's lofty rhetoric on free trade, shown a regular tendency to give in to its powerful farming lobby and set up trade barriers on lamb or metal etc etc It also uses its economic power to lever free trade agreements with developing countries that while technically "free" are hardly "fair" due to various clauses that are often built in (or left out) to prevent true competition impacting on US farming while taking full advantage of access to the internal markets of the junior partner. In practice, the US (like any other country) does not pursue free trade in the pursuit of lofty aims, but rather in the pursuit of national economic interests, and while there are some agreements that have proven to be mutually beneficially, there have been plenty that haven’t. In addition, although America doesn’t have a domestic trade policy as comprehensively as bad as the CAP it does through veto control and largest voting and member bloc, have the largest say over the policies of the global financial institutions such as the IMF and the World Bank. In fact, due to the size of its voting bloc have control over every decision made in this bloc as it has enough numbers to block every single decision it doesn’t agree with, meaning that it guarantees that it gets to set the agenda for international financial and monetary decisions, but also, through them, most of the economies and markets of many developing nations. The US therefore, also has a large responsibility for the current plight of the developing world, ensuring crippling debt levels while demanding unrealistic political reform and market reform that is best placed to advantage American companies which in return, demand that American administrations place crippling tariffs on “key industries” such as agriculture (which has it own inefficient and heavily subsided producers), the latest example being heavy shrimp tariffs on nations such as India and Indonesia which have just been devastated by the Tsunami, and the metal industries. The EU and US has to accept the responsibility that what they are currently, what they are giving on one hand, in the form of aid and development packages, they are taking away with trade policies and counter-productive debt programmes via the world banking and loan agencies. There’s little long-term point to equipping the African farmer with the means to grow and sell their own produce, if barriers imposed by the developed economies prevent them from a fair chance of selling their own goods as anything more than cash crops, and their governments are bankrupted from crippling debt repayment obligations.
Make history poverty
The make history poverty campaign is a good start to the efforts made, in a year where the UK chairs the G8 and the EU, to address the fundamental causes that perpetuate mass poverty and follow through on the trade, aid, deft-relief and development measures required to lift entire peoples out of the poverty trap. There is no easy short-term solution, and substantive infrastructural changes in global trade and debt relief procedures needs to be followed by diplomatic measures as an extension of political will that assist impoverished nations to assist themselves because never has the expression “hand-up, as opposed to a hand-out” been more appropriate than in the plight of developing nations in Africa.
"Tsunami every five days in Africa"
A lot of the talk talked about the "Tsunami every five days in Africa" which based on the 30,000 people that die in Africa every day, most of them children, most of them from preventable diseases. The solution talked about for the majority of the programme was how doubling aid, and how we wouldn't have to pay an extra penny in our taxes to pay for it, just divert money from the extortionate amount spent in the war on Iraq (which spends the entire annual aid budget in a week). Given the likelihood that alleviating global poverty is likely to be much more cost effective (in terms of money and lives) than invasions in regards to winning the war on terror, diverting money from defence in favour of aid and development has to be such a winner. In fact, as the program and its speakers pointed out, such aid and debt relief programs were absolutely bargain basement in terms of lives saved, development and the breaking of the poverty trap, and decisive benefits to the environment through cleaner, more sustainable development.
Bill Gates shows the way
My theory is that the solution ties in a dual measure of short and long term solutions;
The short term solution is targeted aid programs that are very professional and scrupulously audited in their set up that focus on programs that get the most bang for their buck. Bill Gates has shown the way with his charity which is focussed on providing vaccines for the poorest nations to save millions from easily preventable diseases, especially children. The way he and his wife have set up his charity also has a number of other advantages which can act as a guideline for governments and private individuals looking to follow suit. Long term solutions focus on debt relief, fair trade and then assistance to develop liberal democracies and political systems.
Insistence on governance misses the point
I would make the suggestion that Bush drops promoting liberty and freedom and democracy the only way to beat terrorism, and focuses on alleviating poverty through short term alleviation in aid, and long term alleviation through fair trade and debt relief. Bush's advisor insisted that the problem was the corruption and cronyism that was the corrupt governments running these countries were in, and assisted that little or no aid or debt relief should go to these countries until such time as their governments that had got them into trouble in the first place with proliferate borrowing and corrupt spending practices either changed their ways or were replaced with more accountable administrations. The problem with that argument is that while people, everywhere, wants to be free, they value other things just as important first, such as security, order, food, water and other basic amenities, elevation from crippling poverty and disease and some sense of an intact society. Then, only when these basic necessities of life have been elevated.
The tradegy of CAP for the 3rd world
One key area that requires drastic reform is the Common Agricultural Policy of the European Union. For well over a decade New Zealand farmers have survived on zero government subsidies, and after an initial period of painful readjustment after subsidies were removed has gone from strength to strength and is now flourishing as a nation of agricultural innovators, it's economic gains built on the back of significant increases in productivity due to massive efficiency gains, a developing culture of relentless innovation (necessity being the mother of invention and all that) and improving environmental conditions due to a move away from over-grazing and unsustainable agricultural practices. It has made New Zealand one of the most competitive agricultural countries in the world in regards to the quality and diversity of its products however it, like many other countries, has struggled to make the most of it's comparative advantage due to the trade distortions on world markets due to CAP, a distortion which not only makes access into the European markets difficult but also affected other markets where dumping of its surplus was a favoured EU strategy. New Zealand came to be one of the leaders of the Cairns group as a result of this dumping and incidentally acts a bridge between Europe and the developing world, as one of the few first countries to still primarily rely on its agricultural products.
It is the developing world of course who suffer the most from CAP and its series of related trade distortions. It remains one of the great ironies that those nations who receive mealy mouthed trade 'concessions' from the EU under the Cotonou agreement have been doing worse than those countries outside the agreement who have negotiated their own trade agreements without having to go through the rigmarole of satisfying human rights clauses which are only half heartedly pursued by the EU. I am also hugely sceptical of the so called "reforms" of the CAP which will not be implemented all the time France continues to be French. And while tying subsidies to "Green" practices maybe a noble theory I'm also sceptical that it can really bring about its stated aims even without the presence of the French. There is just something innately distorting about subsidies, no matter how well intentioned, and as New Zealand has demonstrated, removing subsidies is the most effective way to become both competitive and environmentally friendly.
As for the worlds superpower?
The USA is hardly much better in this regard, it's farming community relies heavily on government subsidies and handouts, and the US government has, despite it's lofty rhetoric on free trade, shown a regular tendency to give in to its powerful farming lobby and set up trade barriers on lamb or metal etc etc It also uses its economic power to lever free trade agreements with developing countries that while technically "free" are hardly "fair" due to various clauses that are often built in (or left out) to prevent true competition impacting on US farming while taking full advantage of access to the internal markets of the junior partner. In practice, the US (like any other country) does not pursue free trade in the pursuit of lofty aims, but rather in the pursuit of national economic interests, and while there are some agreements that have proven to be mutually beneficially, there have been plenty that haven’t. In addition, although America doesn’t have a domestic trade policy as comprehensively as bad as the CAP it does through veto control and largest voting and member bloc, have the largest say over the policies of the global financial institutions such as the IMF and the World Bank. In fact, due to the size of its voting bloc have control over every decision made in this bloc as it has enough numbers to block every single decision it doesn’t agree with, meaning that it guarantees that it gets to set the agenda for international financial and monetary decisions, but also, through them, most of the economies and markets of many developing nations. The US therefore, also has a large responsibility for the current plight of the developing world, ensuring crippling debt levels while demanding unrealistic political reform and market reform that is best placed to advantage American companies which in return, demand that American administrations place crippling tariffs on “key industries” such as agriculture (which has it own inefficient and heavily subsided producers), the latest example being heavy shrimp tariffs on nations such as India and Indonesia which have just been devastated by the Tsunami, and the metal industries. The EU and US has to accept the responsibility that what they are currently, what they are giving on one hand, in the form of aid and development packages, they are taking away with trade policies and counter-productive debt programmes via the world banking and loan agencies. There’s little long-term point to equipping the African farmer with the means to grow and sell their own produce, if barriers imposed by the developed economies prevent them from a fair chance of selling their own goods as anything more than cash crops, and their governments are bankrupted from crippling debt repayment obligations.
Make history poverty
The make history poverty campaign is a good start to the efforts made, in a year where the UK chairs the G8 and the EU, to address the fundamental causes that perpetuate mass poverty and follow through on the trade, aid, deft-relief and development measures required to lift entire peoples out of the poverty trap. There is no easy short-term solution, and substantive infrastructural changes in global trade and debt relief procedures needs to be followed by diplomatic measures as an extension of political will that assist impoverished nations to assist themselves because never has the expression “hand-up, as opposed to a hand-out” been more appropriate than in the plight of developing nations in Africa.
posted by Anthony Burn at 5:17 pm
