Participation by Richard Kozul-Wright - Social Watch Report 2009 – Launch in New York

Social Watch Report 2009 – Launch in New York

The launch of the annual Social Watch report entitled People First, took place on September 25, 2009 in New York during the high level segment of the United Nations General Assembly.  The event was followed by a lively discussion about the effects of the crisis at the global level.  In this presentation Richard Kozul-Wright —Chief Development Strategy and Policy Analysis Unit of the United Nations Department of Economic and Social Affairs—discusses the contributions of People First to the analysis of poverty, redistribution, and monitoring policies.

listen to the audio file (mp3)

Richard Kozul-Wright: I’m just resurfacing from producing our own report on climate change and development, so I probably won’t do full justice to Roberto’s report, I’m still recovering from my experience, which is not one I’m familiar with. And I’m happy to get back into this kind of topic, which is where I did most of my work before joining DESA, but also it is a much more familiar DESA topic.

There’s no doubt that the report is both relevant and timely. It’s relevant because, despite of all the talk of “green shoots” that one has been hearing in recent weeks, there remains a lot of doubts about the direction that the economies both North and South are moving in. I think a very important point the report insists on is that essentially we are in the middle of what looks more like a permanent crisis. This is not something that has suddenly happened with the collapse of Lehman Brothers or that that has exaggerated or intensified a number of destructive processes. This very much feels like a permanent crisis for many countries and many communities across the world and I think making that point in the way the report does, is very relevant. And it’s timely, at least from the UN point of view, because there are a series of UN processes to which the Report speaks, in a sense; there’s the follow-up processes to the UN conferences and it’s very important that civil society continues to follow that and to try and push those processes in the right direction. And as Roberto said, there’s the beginning of an exercise by the UN Secretary to monitor itself the impact and consequences of the crisis. We have set up something called GIVAS, which I always thought was a brand of Scottish whisky, but turns out to stand for the Global ImpactandVulnerabilityAlertSystem. And as Roberto also said, we have already Voices of the Vulnerable that was published last week or the week before. I guess that is work in progress but it will be very important for institutions and networks like Social Watch to follow that and to also make sure that continues in the right track, you know, just so that we don’t hear extremist speeches from Bono and other characters and believe that’s the way in which that kind of report should go.

There are three things I liked in particular about the Report and let me just say them quickly, and then three concerns that I’ll finish on. First, it is clear that the Report does not see the problem as the challenge of the bottom billion, which often is presented in this kind of challenges approach. It is conscious of the fact that we are talking about systemic problems and that we need to understand the kinds of pressures and vulnerabilities and threats that countries and communities face as systemic problems. And those are not problems that come only to developing countries. It’s very pleasing to see in the Report that developed and developing countries are treated as a whole and the problems that they face are in many respects common problems. It’s refreshing to see that in a report on this subject. That getting away from the narrow definition of poverty, the bottom billion and the informal economy, and thinking systemically is very important.

The second area where I think the Report makes an important contribution is that it clearly recognizes that distribution matters; and the links between distribution and other economic processes are going to be the key to finding solutions. People often forget that financialization and rising inequality were mutually supportive processes over the course of the last two decades. There’s a tendency to see that inequality is somehow an unfortunate consequence or side-effect of good things that were happening in the global economy over the last two decades. We’ve never seen it in those terms, certainly not in UNCTAD. The rise of international finance, and the growing inequality that was intimately connected to it, we now realize was not only unfair but was unsustainable too. And the need to recognize the mutually destructive elements of financialization and rising inequality, which I think the Report does, is an important contribution.

The third thing I like about the Report is that it was not so much concerned about counting poor people and monitoring poverty; it was about monitoring policies. If you’re going to come up with a serious analysis of what went wrong and what needs to be done you need to examine very carefully the kinds of policies that are being introduced at both the national and international level. I think the Report makes a significant contribution in that area.

So those are the three things I very much appreciated from the Report. I have some worries which I think are imbedded in the Report and I’d just like to flag them to Roberto and to the audience. They are not so much criticisms but things that [drew my attention] as I read the Report as best I could in the time I had.

The first worry that I have is that, despite the ideological defensiveness of market fundamentalists – and the last 20 years has been an era of market fundamentalism, in my opinion – there’s not really an alternative out there. Keynes has made a comeback; Minsky, who is an easy (missing)  economist even among economists, has made a comeback; (missing)  is now on (missing) University Social Science reading list; even Marx has made a kind of a comeback, at least in some countries. So there’s a broadening of the ideological spectrum; there’s still a sense that finances got away with its behaviour. There’s still not the sense that there’s really an alternative to the kinds of policies and strategies that were pushed over the course of the last couple of decades. And when people now are talking about reining back excesses, they are as much worried about government spending as about the behaviour of international financial markets and institutions. The worry now is that in 20 years’ time we’ll have an unsustainable deficit; therefore we’d better start planning to cut back that through a predictable series of responses in terms of worrying about the size and sustainability of the pension system, and various other social provisions.

So that’s a big worry. I must say, for a non orthodox economist it’s always pleasing to see when the heterodox economists are at least taken seriously, but it’s not clear that we, as non orthodox economists yet have an alternative. There are elements that the Report points to, policies based, for example; and the need for policy experimentation is now recognized as a necessary part of any sort of reasonable strategy. At the same time, there are not local solutions to systemic problems. (missing) you take more seriously the local pressures and conditions that politicians and policy makers face – that is incredibly important and certainly the Washington Consensus denied it – but there are not local solutions to systemic problems, and we still don’t have the systemic alternatives in place.

There’s obviously a lot of talk in the Report about human development and human rights, and that’s important though I have my doubts about basing an alternative around that. But that’s a larger discussion that we might have somewhere else. There’s also talk about regional responses; south-south cooperation is obviously back on the agenda, particularly for developing countries, and there’s the beginning of an interesting discussion about policy alternatives around that. But it doesn’t really coalesce into a real systematic alternative. And that remains a worry for me.

The obvious one in terms of an analogy in my second point is, of course, people talking about a “new deal”. And that’s become a popular rhetoric in newspapers and among politicians. The three elements of the old New Deal were: reflation, redistribution and regulation. Those are the three Rs that made up the New Deal. It’s not clear to me that there is political pressure (missing) in the advanced countries that are really pushing for those elements to coalesce into an alternative strategy; the䀠stimulus packag䁥s are themselves defined in those terms, but I don’t think it’s on the kind of scale that you saw in the United States in the 1930s, and it doesn’t coalesce in to an alternative yet. And that’s because there’s something missing, not only at the ideological level but also at the political level.

And the third point I would make – and I guess it’s a question that’s around civil society more generally – is that despite the fact that civil society is stronger today than it’s ever been, at least in my memory, it doesn’t provide the countervailing power to beat politics and disconnect the politicians. Despite the work that’s being done by civil society, despite the attention it draws to things that would otherwise go neglected I don’t think it’s capable of providing that countervailing political power. And that is a big worry, given that countervailing political power is what is now needed to push alternatives to getting back to a “business as usual” strategy, which is where I fear we might be in two or three years’ time.