“A Recovery for All”: A fresh analysis on the crisis that suggests solutions
Published on Tue, 2012-07-10 09:28
“Children and poor families were left behind before the crisis, they have been severely affected by the multitude of global shocks since 2008, and that, although they were briefly supported during the first phase of the crisis (2008-09), they were again left behind in 2010 despite their significant needs and increasing vulnerability,” wrote Isabel Ortiz and Matthew Cummins in the first pages of “A recovery for all: Rethinking socio-economic policies for children and poor households”, a book recently edited by UNICEF.
“This book further argues that there are alternatives: there is a range of options to expand fiscal space and support investments for a socially-responsive economic recovery, even in the poorest countries,” added Ortiz and Cummins, who edited this more than 300 pages length publication.
According to the authors, “high food and commodity prices, unemployment and austerity measures have aggravated persistent inequalities and contributed to a substantial rise in hunger and social tensions.”
“Now, more than ever, investments for the world’s poor are needed to recover lost ground in pursuit of development objectives. People everywhere are demanding change. This book describes the social impacts of the crisis, policy responses to date and United Nations alternative proposals for ‘A Recovery for All’,” wrote Ortiz and Cummins.
“It is time for global leaders to think about the longer term—about the future we want for our children—and to turn the current vicious circle into a virtuous circle that effectively links economic and human development. Today, another New Deal is warranted, a fair social contract for the 21st century that includes all countries —both high income and low-income— and all persons —both rich and poor— through increased public investments to boost aggregate demand, catalyze sustainable development and political stability, and achieve long-term global prosperity for all. Ultimately, an inclusive recovery is a matter of social and economic justice: nobody should be left behind,” the authors concluded
“A recovery that leaves children behind is not only ethically unacceptable, but will also be economically damaging,” wrote Roberto Bissio, international coordinator of Social Watch, about the book. “With rigorous analysis of the available options and passionate defense of the rights of children, UNICEF demonstrates that a ‘Recovery for All’ is at the same time the morally just policy and the economic framework that makes sense. A must-read for the policy-makers and the policy-sufferers, all of us, citizens.”
“This book offers a critical review of the social effects of the ongoing crisis and underscores the need to prioritize children and vulnerable groups not only in social but also in macroeconomic decision making,” according to José Antonio Ocampo, former United Nations Under-Secretary-General for Economic and Social Affairs.
“This book combines academic rigour and human compassion to reveal the multiple channels through which the global financial crisis has affected poor children and households around the world. It argues that such crises also represent moments of opportunity for progressive reform, and shows what needs to happen to end child poverty and tackle inequality,” said Duncan Green, Head of Research of Oxfam GB.
“This outstanding and well-researched book will tell you what [the crisis] means for poor children across the world and for plain citizens such as you. Most importantly, it will tell you what are the alternative economic policies that can make a difference and support a ‘Recovery for All’,” wrote Nuria Molina, Director of Policy and Research of Save the Children
Following the introduction, the book opens with Chapter II, “A Recovery with a Human Face? Insights into the global crisis”. This chapter is based on an e-discussion that was hosted by UNICEF during 2010-12 and provides a snapshot of the latest thinking on inclusive policies in the context of the economic recovery.
Contributors include Nobel Laureate Paul Krugman; former UN Under- Secretary-General José Antonio Ocampo and many other prominent global thinkers from academia and civil society, including Sir Richard Jolly, Dani Rodrik, Nora Lustig, Martin Khor, Duncan Green, Ha-Joon Chang and Nouriel Roubini, among many others.
By weaving the main points raised by some of the world’s eminent development thought leaders, this chapter offers a chronological narrative of the global economic crisis along with discussion of the key thematic issues of the crisis.
Chapter III, “The Food Price Surge,” takes a close look at the first major threat posed by the global economic crisis: unaffordable food. The chapter develops a local food price index for nearly 60 developing countries in order to gauge the micro level impacts of food price changes on children and poor families. It also reviews the possible causes of the food price upswing that began in mid-2010 along with international and domestic policy responses to the 2007-08 price spike through a three-pillar analytical framework (supporting consumption, boosting production and managing food markets).
Chapter III ultimately calls for urgent and coordinated policy actions by national governments and the international community to ensure that vulnerable populations have access to affordable and nutritious food at all times.
In Chapter IV, “The Jobs Crisis,” the book moves on to discuss unemployment, which is the second major household level threat originating from the global economic crisis. The chapter focuses on the ongoing jobs crisis and the dangers of high unemployment among youth and adult workers. Analysis of recent labour market trends, including the implications of the demographic phenomenon known as the ‘youth bulge,’ is followed by an in-depth discussion of the household level impacts, with particular attention to the risks posed to children and young workers. The discussion closes by summarizing employment generating policies and encouraging policymakers to place jobs, especially for youth, at the center of recovery efforts.
Chapter V, “Austerity Measures and the Risks to Children and Poor Households,” offers an in-depth examination of the latest household danger that has been proliferating across developing and developed countries since 2010: fiscal austerity. The chapter sets out to understand how fiscal consolidation impacts levels of social assistance and other public spending decisions and ultimately affects the wellbeing of vulnerable populations.
It starts with an empirical analysis of government expenditure projections in 179 countries. By looking at three distinct periods (pre-crisis: 2005-07; crisis phase I, fiscal expansion: 2008-09; and crisis phase II, fiscal contraction: 2010- ), it identifies the depth and breadth of ongoing budget cuts along with a series of countries that may be undergoing excessive contraction, defined as cutting expenditures below pre-crisis levels in terms of gross domestic product (GDP).
Next, it presents a detailed assessment of the most common adjustment measures being considered by governments during 2010-12 and their potentially adverse impacts on children and poor households. To conclude, Chapter V questions whether the projected fiscal contraction trajectory and the different policy options being discussed worldwide are conducive to adequately protecting vulnerable households and fostering an inclusive recovery.
The book next moves away from analyzing the different shocks of the crisis to address questions related to resources and political will. In Chapter VI, “Fiscal Space: Options for social and economic development for children and poor households,” it is argued that expenditure cuts are not inevitable during adjustment periods, and that investments to protect vulnerable populations are possible even in the poorest countries.
The chapter reviews all of the available opportunities, which include: re-allocating public expenditures; increasing tax revenues; lobbying for increased aid and transfers; tapping into fiscal and foreign exchange reserves; borrowing and restructuring existing debt; and adopting a more accommodative macroeconomic framework.
Given the significance of public investment in enhancing the prospects for inclusive economic growth and social development, Chapter VI argues that it is critical that governments explore these options to ramp up social and employment-generating investments in support of a ‘Recovery for All.’
The book concludes with Chapter VII, which summarizes the main empirical findings of the persisting threats of the crisis on children and households worldwide, along with policy and resource options to achieve food security, full and decent employment, and a socially responsive economic recovery.