A new financial policy for the United States

People around the world were impacted by the 2008 financial crisis which stemmed from the US´s financial policies.  The key human rights lesson from the crisis is that the economic and social rights of people and nations everywhere are interconnected.  In our inter-connected world, the US must make economic decisions that respect the human rights of all individuals who will be impacted by national, economic, financial and fiscal policy.

At one level, economic policy in the United States should be guided by the principle of progressive realization and non-retrogression.Progressive realization recognizes that the resources at the disposition of a government are limited; nevertheless, a government must take specific steps to ensure that the enjoyment of economic and social rights improves over time. Non-retrogression means that once a particular level of enjoyment of rights has been realized, it should be maintained.

At another level, the right to non-discrimination and equality intersects all other human rights and is an essential component of the governments´ obligation to protect. The economic downturn destroyed jobs reduced standards of living, heightened risks for ordinary people and drove families deeper into poverty, especially women and other minorities. At every turn since, the right to non-discrimination and equality has been threatened.Examples where the principles of progressive realization, non-retrogression and non-discrimination and equality were violated in the design, implementation, or outcomes of macroeconomic and financial policy decisions include:

The right to an adequate standard of living

• As a result of the crisis women continue to experience higher rates of poverty and the gender poverty gap increased.  For example, the Special Supplemental Nutrition Program for Women, Infants and Children was reduced by USD 333 million despite the serious issue of food insecurity in the USA. In 2012, 14.5 per cent of US households were insecure at some point during the year and of the majority of families affected were minorities. Within those households, single-mother households experienced a disproportionate higher rate of food insecurity (34.5 per cent of these households) than households headed by single men (23.6 per cent).

The right to work

• Unemployment rates rose dramatically at the beginning of the crisis but have failed to return to pre-2008 levels. Underemployment rates continue to be four points higher than the average rate in 2007. In addition the types of jobs created since 2010 have been on the whole lower paying or part-time positions, 1.85 million more people are employed in low-paying jobs than in 2008. African-American and Latino men and women faced higher rates of unemployment during the recession.

The right to non-discrimination/equality

• Across professional fields, female workers make less than their male counterparts. In 2014, women continue to make only 77 cents for every dollar that their equally qualified male counterparts make.

There is clearly a need for the US to recognize and take responsibility for the failure to meet human rights obligations for the use of maximum available resources and progressive realization of economic and social rights that cross national boundaries. These obligations will include the conduct of macro policy in such areas as government spending, tax policy, public debt, and the role of development assistance and monetary policy. If human rights are to be observed this framework must be applicable to all global financial actors, including private sector actors.

By Radhika Balakrishnan. Radhika Balakrishnan is Faculty Director and former Executive Director of the Center for Women’s Global Leadership. She is also an Advisory Board member of RightingFinance. This piece is taken from CWGL´s Brief: Lessons from the 2008 Economic Crisis.

Source: RightingFinance.