Sunday, February 14, 2010

The End of Poverty?

The End Of Poverty? from Philippe Diaz on Vimeo.

This Saturday I went to Radical Living for a New York Faith & Justice house gathering/film screening to watch The End of Poverty? This film doesn't just give us the sobering statistics about global poverty, but also tells us how economic disparities came about and many ideas for what needs to be done to fix the situation. I won't bore you with too many statistics, but just some overall things to think about. Poverty as the world knows it today comes from structural injustices that allow big, multinational corporations to exert an unfair influence on developing countries. As the film points out the Global South is actually financing the North "to the tune of about $200 billion every year." Crops and resources are grown and taken from developing countries (the growers being paid way under the cost of production for these goods), brought to developed countries like the US for processing, and then shipped back out to other countries. When the product gets back to developing countries that import goods from the US, it is still cheaper to buy than from growers who try to make a living off of selling crops directly to their countrymen. This is exactly what had led to developing countries becoming dependent on imports from places like the US, and is exactly what happened in Haiti with the rice crop (here's a video).

Why don't governments say no to these trade agreements? I've heard from several people who have worked and lived in Africa that there is no government accountability and regulations are not enforced. However, as I learned today representatives from large multinational corporations (of course, Monsanto comes to mind) insidiously make deals with politicians, promising them money and threatening them to not carry out their campaign platforms. This leads to poor accountability for everyone in the country and lets the big corporations privatize and monopolize the country and its resources.

Additionally, as pointed out in the film, many agricultural practices today are the same as slavery used to be – except today, the workers haven't rebelled, and their employers aren't responsible for them. "Back then, the boss was the slave's owner. He had to take care of the slave's health and food. He had to take care of shelter, even if it was the slave's quarters. Today the boss has no such concerns."

The End of Poverty? focused a lot on the history of colonialism and capitalism as a central cause of poverty, and explains how in order to have wealth in capitalist societies, we have to create poverty in the south. "There is no other way." And unfortunately in the past 25 years or so economic disparities have been getting wider. Not only that, but the countries with the biggest income disparities are also the ones with the highest rates of violence. We do not see this violence in the poorest of the poor countries.

The existence of the poor, underserved workers means that we can buy products for 10% of the cost of production – an issue which has far-reaching implications for the health of consumers and the environment. We are currently using 30% more than what the earth can regenerate; in order for everyone to live like we do in America, we would need six planets; while if everyone were living like people in Burkina Faso, we would only need 1/10 of the planet. As an example of what goes on with the food industry in America, watch The True Cost of Food.

Some other discussion which came about from watching the film included a discussion about the term "developing." Did the film glorify indigenous peoples? I thought this was similar to Avatar. How much should we really be encouraging "developing" countries to become more industrialized? What third world countries need is a means to have their needs met: clean water, public health measures, adaptation to climate change, and ownership of land so they can grow food for themselves. Yes, some countries need roads and education and sustainable technology, but we need to make sure we don't push the development of industrialization in the same way the "developed" countries of the Global North came about. Poor use of resources is exactly what has led to the social injustices and climate change issues we worry about today. Perhaps we need a new term to clarify meeting the needs of poor countries. And of course, these needs need to be identified by the community in question. Telling people what they need without understanding their situation doesn't help anyone and is disrespectful.

With that said, there are some changes to be made which can indeed help bring many people out of poverty. Some solutions for ending poverty pointed out in the film (listed out clearly in a space where you can sign a petition to mobilize support for change) include ending the monopoly over natural resources and at least 51% local communal ownership in corporations, redistribution of land to farmers, a cap on exports, a worldwide subsidy for organic agriculture, and cancellation of third world debt (such as that vowed by the G7 in cancelling Haiti's debt). Others include ending child labor under the age of 16 with a creation of a subsidy for scholarship, getting rid of the tax on basic consumption and labor and instead having a 2% worldwide tax on property ownership (except basic habitation for the poor), ensuring an equal voting system in international organizations such as IMF, World Bank, WTO, and of course a commitment by industrialized countries to decrease carbon emission by 50% over a ten-year period.

How can this all be funded? I vote for everyone chipping in to the first non-for-profit global lottery dedicated to sustainability – multinational corporations included.

I also vote for new accountability for multinational corporations – such as limiting the reach of Monsanto, the global fishing industry (which has overstepped its boundaries so much that many of the world's fish are in danger of extinction – no more fish by 2048), fast food and junk food companies (which have already contributed to the nutrition transition – obesity occurring in the hungry even in third world countries), and infant formula companies (the last thing third world countries need is to be told their breastmilk isn't good enough. Breastmilk has so many more benefits than infant formula it's unbelievable. In Ghana they have a saying that goes something like "bottle fed babies are stupid, breastfed babies are smart." Instead money could be given to mothers so they can grow and buy food for themselves – the only reason breastfed infants would be malnourished is because the mother is malnourished. And money could be given to mothers in the form of conditional cash transfers which would ensure children were educated and kept healthy, in exchange for money for food).

6 comments:

David said...

How can "capitalism" be a major "cause" of poverty? The persons who object to trade can abstain from it, but they engage in it because they're better off as a result. It's delusive to suppose that if all Western investment were stricken from impoverished lands, the economies of those lands would thereby become richer. They'll become richer to the extent that they liberalize their economies, safeguarding property rights and allowing people to keep what they earn...as opposed to systematically pilfering and destroying it.

Kelly said...

I'm not an economist and don't know much about politics, but from the film I can tell you the trade system doesn't work to people's advantage in poor countries the way it stands now. Perhaps it would if the people in these countries were paid a fair price for their labor, and if money given to governments for various initiatives was actually used to benefit the people - but unfortunately it seems many governments are corrupted. True, the persons who engage in trade may be better off - but these are politicians, not the general public.

mjs said...

David,

Capitalism as we know it (whether it is actually capitalism is another question) causes poverty because it is designed to get core resource materials for as little as possible. So the West designs trade deals that ensures us getting tea or sugar or fish or oil or coltan or mangos etc... for a song and we hold an economic gun to their collective heads. Trade on these terms or don't trade at all.

Your statement about western investment is ill-informed. Our investments largely flow back to our companies and consultants. "Oh, you want a deep water port to trade more? Sure, we'll loan you a billion dollars to do that as long as you hire Halliburton to do the project." Happens all the time.

The productivity of Western countries depends on the cheap resources of the global South. If the west stopped investing those countries would not get richer because they still have trillions in debt (collectively) to pay back to us for road projects, logging projects et al.

As for you final notions - liberalizing economies have been definitely shown as not being associated with growth in any way for real wealth but it does help with stock market numbers. You have a point about property rights indeed. Hernando de Soto has much to say about this. But in short if a government can move a person from their productive land to a famine prone area because there is no title, or no respected title then there is no hope. Your point about allowing people to keep what they earn is a great idea - reforming tax codes so that they don't fall primarily on the poor through wage and consumption is really important. Most taxation should fall on property ownership which is where most wealth is concentrated.

The West is the one pilfering and corrupting. We play both sides of the field. We supply weapons to the rebels and the government in Congo. We did the same in Haiti and the Philippines and Nicaragua etc...happy to talk about this more here or offline.

mstillman at gmail dot com. i am in new york city.

best,

Matt Stillman
conceiver of and co-producer of "The End of Poverty?"

LVTfan said...

You might explore two websites: http://povertythinkagain.com/ and http://whyglobalpoverty.com/ as well as some of the writings of Henry George (1839-1897), including "The Crime of Poverty" and "Thou Shalt Not Steal," found at http://www.wealthandwant.com/

saul said...

1. The argument that the ‘Global South is actually financing the North "to the tune of about $200 billion every year"’ is an illogical one, as the GDP of the US alone was $14.2 trillion as of 2009, 7,100% of 200 billion. What exactly is this $200 billion financing? It can’t be our agriculture, as that alone is about $130 billion (http://en.wikipedia.org/wiki/Economy_of_the_United_States), leaving only $70 billion for the rest of the entire industrialized world to be ‘financed’.
2. Multinational trade agreements and globalization help more than they hurt. Do they have unintended consequences? Of course. Everything does. Is increased poverty one of those consequences? Absolutely not. Here’s why:
a. Ever since global poverty rates have been tracked, every single region the world has gotten richer, not poorer. Go here http://en.wikipedia.org/wiki/Poverty , and scroll down to the table in the Absolute Poverty section to see exact rates by world region.
b. Global Life Expectancy, a metric used by economist as a proxy to poverty, has steadily increased every year since 1980: http://www.google.com/publicdata?ds=wb-wdi&met=sp_dyn_le00_in&tdim=true&dl=en&hl=en&q=global+life+expectancy+trends
c. Global GDP, the value of the sum of all the goods and services the world makes, has increased every year since the end of WWII http://en.wikipedia.org/wiki/File:World_GDP_per_capita_1500_to_2003.png
These are all facts, and not disputed opinions. By all objective, measurable indicators, things around the world have never been better in the history of mankind.
3. Globalization, if anything, may hurt developed nations more than developing nations. Since trade agreements like NAFTA and EU were created, millions of Americans and Europeans have lost manufacturing and low skilled jobs to their less expensive counterparts in developing nations. Just ask the people laid off by GM, Chrysler and Ford if they think they can compete with the lower costs imports. http://www.buzzle.com/articles/pros-and-cons-of-globalization.html
4. Globalization fuels growth in the BRIC countries. Where’s the fastest growing middle class on Earth? China and India (http://www.wikinvest.com/concept/Rise_of_China%27s_Middle_Class http://en.wikipedia.org/wiki/Standard_of_living_in_India ). Russia and Brazil have seen great growth as well. Companies like Microsoft, Cisco and Google find millions of employees in China and Microsoft for lower absolute costs than in the U.S. And with lower costs of living, they’re actually wealthier than their U.S. counterparts.
With a growing middle class, there are more people to spend on things like food, clothing, healthcare, cars, entertainment, that helps the entire economy. It also creates many more jobs indirectly.

My opinion on all this is as follows…

The reason many of these countries and compete in a global economy, is those countries themselves and not the U.S.

Here’s the list of the top GDPs on Earth: http://en.wikipedia.org/wiki/List_of_countries_by_future_GDP_%28nominal%29_estimates
Here’s a map and ranking of countries based of the perception of corruption: http://en.wikipedia.org/wiki/Corruption_Perceptions_Index

And here’s a ranking of competitive economies, based on things like innovation, research and development and its scientific infrastructure (all things government have an important role in): http://www.weforum.org/en/initiatives/gcp/Global%20Competitiveness%20Report/index.htm

See a trend?

saul said...

The U.S. is a great economic power because we have created an infrastructure of entrepreneurship. I created and registered a business here in 24 hours. It took me 8 months to do the same in Dominican Republic, mainly because I refused to pay a bribe.

More businesses = more jobs = more tax revenues for the country.

But its short-sided countries that stifle innovation with a system of corruption and instability that make the best and the brightest want to leave to go to a place they can actually make their ideas and dreams a reality.

Sergey Brin, one of the founders of Google, has repeatedly been cited as thanking his parents for taking them out of an oppressive Russia. He knows he couldn’t have founded Google there. Andy Grove, the leader credited with making Intel the world’s top microprocessor manufacturer, has said similar statements. And that’s only 2 companies, founded by immigrants that have resulted in the creation of hundreds of billions in wealth, hundreds of thousands of jobs, and arguably completely new industries. All that could’ve gone to a developing nation, if the infrastructure for innovation existed.

It’s not the fault of big corporations or northern countries that a lot of these people can’t compete. It’s the fault of oppressive corrupt governments. And personally, I believe everyone has the government they deserve.

And should the U.S. do something to help these people be more competitive? Frankly, I don’t know. It seems whenever the U.S. intervenes somewhere, even with the best of intentions to help the people as a whole, we’re an oppressive empire looking for a new colony. When we don’t do anything, we’re irresponsible.

Where’s the line? Where do people take responsibility for their own fates?