THE EVER INCREASING CYCLE OF POVERTY

CHILD MORTALITY AND THE EVER INCREASING CYCLE OF POVERTY

Stes de Necker

Economic development has been on the agendas of just about all countries in the world since decades ago. Yet to date none of them have managed to successfully achieve these objectives.

Why?

The main drivers of poverty

Introduction    

Almost half the world — over 3 billion people — live on less than $2.50 a day.

The GDP (Gross Domestic Product) of the 41 Heavily Indebted Poor Countries (567 million people) is less than the wealth of the world’s 7 richest people combined.

Nearly a billion people entered the 21st century unable to read a book or sign their names.

Less than one per cent of what the world spent every year on weapons can put every child into school and yet it will never happen.

1 billion children live in poverty (1 in 2 children in the world). 640 million live without adequate shelter, 400 million have no access to safe water, 270 million have no access to health services. 12 million died in 2010 before they reached the age of 5 (or roughly 33,000 children per day).

Poverty is the state for the majority of the world’s people and nations. Why is this? Is it enough to blame poor people for their own predicament? Have they been lazy, made poor decisions, and been solely responsible for their plight? What about their governments? Have they pursued policies that actually harm successful development? Such causes of poverty and inequality are no doubt real. But deeper and more global causes of poverty are often less discussed.

Behind the increasing interconnectedness promised by globalization are global decisions, policies, and practices. These are typically influenced, driven, or formulated by the rich and powerful. These can be leaders of rich countries or other global actors such as multinational corporations, institutions, and influential people.

In the face of such enormous external influence, the governments of poor nations and their people are often powerless. As a result, in the global context, a few get wealthy while the majority struggle.

Most of humanity lives on just a few dollars a day. Whether you live in the wealthiest nations in the world or the poorest, you will see high levels of inequality.

Access to services

The poorest people will also have less access to health, education and other services. Problems of hunger, malnutrition and disease afflict the poorest in society. The poorest are also typically marginalized from society and have little representation or voice in public and political debates, making it even harder to escape poverty.

By contrast, the wealthier you are, the more likely you are to benefit from economic or political policies. The amount the world spends on military, financial bailouts and other areas that benefit the wealthy, compared to the amount spent to address the daily crisis of poverty and related problems are often staggering.

Cutbacks in health, education and other vital social services around the world have resulted from structural adjustment policies prescribed by the International Monetary Fund (IMF) and the World Bank as conditions for loans and repayment. In addition, developing nation governments are required to open their economies to compete with each other and with more powerful and established industrialized nations. To attract investment, poor countries enter a spiralling race to the bottom to see who can provide lower standards, reduced wages and cheaper resources. This has increased poverty and inequality for most people. It also forms a backbone to what we today call globalization. As a result, it maintains the historic unequal rules of trade.

Around the world, in rich or poor nations, poverty has always been present.

In most nations today, inequality—the gap between the rich and the poor—is quite high and often widening.

The causes are numerous, including a lack of individual responsibility, bad government policy, exploitation by people and businesses with power and influence, or some combination of these and other factors.

Inequality

Many feel that high levels of inequality will affect social cohesion and lead to problems such as increasing crime and violence.

Inequality is often a measure of relative poverty. Absolute poverty, however, is also a concern. World Bank figures for world poverty reveals a higher number of people live in poverty than previously thought.

For example, the new poverty line is defined as living on the equivalent of $1.25 a day. With that measure based on latest data available (2005), 1.4 billion people live on or below that line.

Furthermore, almost half the world—over three billion people—live on less than $2.50 a day and at least 80% of humanity lives on less than $10 a day:

Around 33,000 children die every day around the world.

That is equivalent to:

16 children dying every minute

A further 92 million children died between 2000 and 2010 because of conflict and natural disasters.

The silent killers are poverty, easily preventable diseases and illnesses, and other related causes. 

Despite the scale of this daily/ongoing catastrophe, it rarely manages to achieve, much less sustain, prime-time, headline coverage.

Food security

Meaningful long-term alleviation of hunger is rooted in the alleviation of poverty, as poverty leads to hunger. World hunger is a terrible symptom of world poverty. If efforts are only directed at providing food, or improving food production or distribution, then the structural root causes that create hunger, poverty and dependency would still remain. While resources and energies are deployed to relieve hunger through technical measures such as improving agriculture, and as important as these are, inter-related issues such as poverty means that political solutions are likely required as well for meaningful and long term hunger alleviation.

Food aid (when not for emergency relief) can actually be very destructive on the economy of the recipient nation and contribute to more hunger and poverty in the long term. Free, subsidized, or cheap food, below market prices undercuts local farmers, who cannot compete and are driven out of jobs and into poverty, further slanting the market share of the larger producers such as those from the US and Europe. Many poor nations are dependent on farming, and so such food aid amounts to food dumping. In the past few decades, more powerful nations have used this as a foreign policy tool for dominance rather than for real aid.

Food and agriculture goes to the heart of our civilizations. Religions, cultures and even modern civilization have food and agriculture at their core. For an issue that goes to the heart of humanity it also has its ugly side.

Corruption

We often hear leaders from rich countries telling poor countries that aid and loans will only be given when they show they are stamping out corruption.

While that definitely needs to happen, the rich countries themselves are often active in the largest forms of corruption in those poor countries, and many economic policies they prescribe have exacerbated the problem.

Corruption in developing countries definitely must be high on the priority lists (and is increasingly becoming so in the wake of the global financial crisis), but so too must it be on the priority lists of rich countries.

Taxes

Through tax havens, transfer pricing and many other policies — both legal and illegal — billions of dollars of tax are avoided. The much-needed money would helped developing (and developed) countries provide important social services for their populations.

Some tax avoidance, regardless of how morally objectionable it may be to some people, is perfectly legal, and the global super elite are able to hide away trillions of dollars, resulting in massive losses of tax revenues for cash-strapped governments who then burden ordinary citizens further with austerity measures during economic crisis, for example. Yet these super elite are often very influential in politics and business. In effect, they are able to undermine democracy and capitalism at the same time.

As the global financial crisis has affected many countries, tackling tax avoidance would help target those more likely to have contributed to the problem while avoid many unnecessary austerity measures that hit the poorest so hard. But despite rhetoric stating otherwise, it does not seem to high on the agenda of many governments as you might think.

Foreign Aid

In 1970, the world’s rich countries agreed to give 0.7% of their gross national income as official international development aid, annually.

Since that time, billions have certainly been given each year, but rarely have the rich nations actually met their promised target.

For example, the US is often the largest donor in dollar terms, but ranks amongst the lowest in terms of meeting the stated 0.7% target.

Furthermore, aid has often come with a price of its own for the developing nations. Common criticisms, for many years, of foreign aid, have included the following:

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• Aid is often wasted on conditions that the recipient must use overpriced goods and services from donor countries
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• Most aid does not actually go to the poorest who would need it the most
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• Aid amounts are dwarfed by rich country protectionism that denies market access for poor country products while rich nations use aid as a lever to open poor country markets to their products
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• Large projects or massive grand strategies often fail to help the vulnerable; money can often be embezzled away.

Inter related issues

There are many inter-related issues causing hunger, which are related to economics and other factors that cause poverty. They include land rights and ownership, diversion of land use to non-productive use, increasing emphasis on export-oriented agriculture, inefficient agricultural practices, war, famine, drought, over-fishing, poor crop yields, etc. This section introduces some of these issues.

The UN World Summit for September 2005 is supposed to review progress since the Millennium Declaration, adopted by all Member States in 2000. However, the US has proposed enormous changes to an outcome document that is to be signed by all members. There are changes on almost all accounts, including striking any mention of the Millennium Development Goals that aim for example, to halve poverty and world hunger by 2015. This has led to concerns that the outcome document will be weakened. Developing countries are also worried about stronger text on human rights and about giving the UN Security Council more powers.

Sustainable Development

The idea of sustainable development grew from numerous environmental movements in earlier decades. Summits such as the Earth Summit in Rio, Brazil, 1992, were major international meetings to bring sustainable development to the mainstream.

However, the record on moving towards sustainability so far appears to have been quite poor. The concept of sustainability means many different things to different people, and a large part of humanity around the world still live without access to basic necessities.

HOW CORRUPTION IN SOUTH AFRICA AFFECTS EVERYONE

HOW CORRUPTION IN SOUTH AFRICA AFFECTS EVERYONE

Stes de Necker

Corruption affects us all.

It threatens sustainable economic development, ethical values and justice; it destabilises our society and endangers the rule of law. It undermines the institutions and values of our democracy. But because public policies and public resources are largely beneficial to poor people, it is they who suffer the harmful effects of corruption most grievously.

To be dependent on the government for housing, healthcare, education, security and welfare, makes the poor most vulnerable to corruption since it makes effective service delivery impossible. Delays in infrastructure development, poor building quality and layers of additional costs are all consequences of corruption.

Many acts of corruption deprive our citizens of their constitutional and human rights.

Economic implications

Corruption and international perceptions of corruption in South Africa has been damaging to the country’s reputation and has created obstacles to local and foreign direct investment, flows to the stock market, global competitiveness, economic growth and has ultimately distorted the development and the upliftment of our people.

Public money is for government services and projects. Taxes collected, bonds issued, income from government investments and other means of financing government expenditure are meant for social grants, education, hospitals, roads, the supply of power and water and to ensure the personal security of our citizens.

Corruption and bad management practices eat into the nation’s wealth, channelling money away from such projects and the very people most dependent on government for support.

Countless studies around the world have shown how corruption can interrupt investment, restrict trade, reduce economic growth and distort the facts and figures associated with government expenditure. But the most alarming studies are the ones directly linking corruption in certain countries to increasing levels of poverty and income inequality.

Because corruption creates fiscal distortions and redirects money allocated to income grants, eligibility for housing or pensions and weakens service delivery, it is usually the poor who suffer most. Income inequality has increased in most countries experiencing high levels of corruption.

The need for good governance

Adherence to good governance creates an environment where corruption cannot flourish.

Failure to adhere to the practices of good governance means stakeholders increasingly demand accountability.

Mass action and strikes are organised in protest as citizens begin to lose faith in the ability or willingness of their elected officials. Political instability increases. Investment declines. The sale of shares by investors decreases the value and rating of companies. Their regulators can deny them licences, a stock exchange listing or the ability to sell products and services. Other organisations refuse to do business with them. And donors or economic organisations grant fewer loans or aid to nations whose governance is murky.

Key principles of good governance include:

Honesty – Organisations are the sum of their parts. Employees and managers who operate in good faith, with integrity and no conflicts of interest, will underpin the governance cornerstone of honesty and elicit trust from stakeholders.

Transparency – Decisions made, action taken and how it is reported to stakeholders must be communicated clearly and made easily available for those affected by the organisation.

Responsiveness – Listening to stakeholders, taking action or reporting transparently should be done within a reasonable time of a request, complaint or concern.

Management independent of governing bodies – There must be a separation of powers and chain of accountability. Friends and family members, or suspected conflicts of interests cannot overlap between layers of management and directors, boards or senior politicians. Independence ensures better judgement, assessment of risk and optimum performance.

Rule of law – Institutions must comply with the laws, codes, guidelines and regulations of the nations in which they operate.

Effectiveness and efficiency – Good governance is also delivering to mandates, meeting the needs of stakeholders, curtailing expenditure, streamlining decision-making and action, and making the best use of available resources.

Fairness – Good governance entrenches the principle of fairness, and treating stakeholders equally.

Justice – Justice and governance concerns the moral responsibility and integrity of individuals within an organisation and the behaviour of the organisation itself.

Accountability – Ensuring that public and private institutions, corporations and individuals entrusted with public resources and civil society are held to account, means they are answerable to their stakeholders.

INTERNATIONAL AGREEMENTS AND TREATIES IMPOSING RIGHTS AND OBLIGATIONS ON MEMBER STATES

INTERNATIONAL AGREEMENTS AND TREATIES

IMPOSING RIGHTS AND OBLIGATIONS ON MEMBER STATES

Stes de Necker

An International Agreement or Treaty, is an agreement under international law entered into by actors in international law, namely sovereign states and international organizations. An International Treaties or Agreements may also be known as international conventions, international agreements, covenants, charters, memorandums of understandings (MOUs), protocols, pacts, accords, and constitutions for international organizations. Regardless of terminology, all of these forms of agreements are, under international law, equally considered treaties and the rules are the same.

Agreements and Treaties can be loosely compared to contracts: both are means of willing parties assuming obligations among themselves, and a party to either that fails to live up to their obligations can be held liable under international law.

A treaty is an official, express written agreement that states use to legally bind themselves. A treaty is the official document which expresses that agreement in words; and it is also the objective outcome of a ceremonial occasion which acknowledges the parties and their defined relationships.

The agreements assume a variety of form and style, but they are all governed by the law of treaties, which is part of customary international law.

Multilateral agreements are usually open to all nations, plurilateral agreements involve a restricted number of nations, while bilateral agreements are usually arrangements between two nations.

A treaty, the typical instrument of international relations, is defined by the 1969 Vienna Convention on the Law of Treaties as an “agreement concluded between States in written form and governed by international law, whether embodied in a single instrument or in two or more related instruments and whatever its particular designation.

Although considered binding, international agreements may lapse on expiration, through war or denunciation, or when a fundamental change in circumstances occurs.

Treaties may be seen as 'self-executing', in that merely becoming a party puts the treaty and all of its obligations in action. Other treaties may be non-self-executing and require 'implementing legislation'—a change in the domestic law of a state party that will direct or enable it to fulfil the treaty obligations. An example of a treaty requiring such legislation would be one mandating local prosecution by a party for particular crimes. An agreement "enters into force" when the terms for entry into force as specified in the agreement are met.

The ratification of international treaties is usually accomplished by filing instruments of ratification as provided for in the treaty.

The division between the two is often not clear and is often politicized in disagreements within a government over a treaty, since a non-self-executing treaty cannot be acted on without the proper change in domestic law. If a treaty requires implementing legislation, a state may be in default of its obligations by the failure of its legislature to pass the necessary domestic laws.

One significant part of an International Agreement is that signing a agreement implies recognition that the other side is a sovereign state and that the agreement being considered is enforceable under international law. If an act or lack thereof is condemned under international law, the act will not assume international legality even if approved by internal law. This means that in case of a conflict with domestic law, international law will always prevail.

The language of treaties, like that of any law or contract, must be interpreted when the wording does not seem clear or it is not immediately apparent how it should be applied in a perhaps unforeseen circumstance.

The Vienna Convention states that treaties are to be interpreted "in good faith" according to the "ordinary meaning given to the terms of the treaty in their context and in the light of its object and purpose." International legal experts also often invoke the 'principle of maximum effectiveness,' which interprets treaty language as having the fullest force and effect possible to establish obligations between the parties.

Treaties are not necessarily permanently binding upon the signatory parties. As obligations in international law are traditionally viewed as arising only from the consent of states, many treaties expressly allow a state to withdraw as long as it follows certain procedures of notification.

For example, the Single Convention on Narcotic Drugs provides that the treaty will terminate if, as a result of denunciations, the number of parties falls below 40.

Many treaties expressly forbid withdrawal. Article 56 of the Vienna Convention on the Law of Treaties provides that where a treaty is silent over whether or not it can be denounced there is a rebuttable presumption that it cannot be unilaterally denounced unless:

(a) it can be shown that the parties intended to admit the possibility, or

(b) the right of withdrawal can be implied into the terms of the treaty.

The biggest threat of International Agreements to society is its inherent assault on democracy.

In a Constitutional State like South Africa, any law which may confer any rights and/or obligations on its citizens, must follow a very clear legal process before that law can be promulgated. From its initiation to the point of the President signing a Bill into law, is prescribed by the Constitution. This process allows for proper and sufficient consultation and transparency throughout the whole process.

In the case of entering into International Agreements or Treaties, no such consultative processes are followed, leaving the majority of the citizens in the dark as to its contents and implications.

For example, one of the main aims of the TTIP (Trans-Atlantic Partnership Agreement) is the introduction of Investor-State Dispute Settlements (ISDS), which allow companies to sue governments if those governments’ policies cause a loss of profits. In effect it means unelected transnational corporations can dictate the policies of democratically elected governments.

ISDSs are already in place in other bi-lateral trade agreements around the world and have led to such injustices as in Germany where Swedish energy company Vattenfall is suing the German government for billions of dollars over its decision to phase out nuclear power plants in the wake of the Fukushima disaster in Japan. Here we see a public health policy put into place by a democratically elected government being threatened by an energy giant because of a potential loss of profit. Nothing could be more cynically anti-democratic.

There are around 500 similar cases of businesses versus nations going on around the world at the moment and they are all taking place before ‘arbitration tribunals’ made up of corporate lawyers appointed on an ad hoc basis, which are little more than kangaroo courts with a vested interest in ruling in favour of business.

Many International Agreements signed by the South African Government, including the so-called BRICS Agreement, are little more than part of the ANC’s policy of brown-nosing the communist regimes of Russia, China and Brazil.

If BRICS was such a good deal for South Africa, the ANC Government should have had the courage to show the South African people exactly what is in this deal, instead of keeping the content of the agreement under wraps until it was signed by the President.

The major risk with respect to multilateralism derives from the fact that in an age of an uncertain globalization process and an unclear “new world order,” many International Agreements like BRICS and others, could actually exacerbate the rivalry of economic blocs and thus deepen the present economic and institutional global crisis.