The mighty fall... at the poor's expense

  • October 3, 2008
{mosimage}While global capitalism went into convulsions at the Wall Street end of Manhattan Island, Archbishop Celestino Migliore was at the midtown headquarters of the United Nations wondering about the economic fate of 1.4 billion people who live on less than a dollar a day.

“How are we able to find funds to save a broken financial system yet remain unable to find the resources necessary to invest in the development of all regions of the world, beginning with the most destitute?” Migliore, the Holy See’s representative at the United Nations, asked delegates to a high level meeting on the Millennium Development Goals Sept. 27.
The question is neither naive nor foolish, said Roy Culpeper, president of Canada's North South Institute. There are real connections between the economics of Third World development and the economics fuelling the U.S. banking crisis, he said.

Progress slow on Millennium Development Goals


The eight Millennium Development Goals were adopted by the United Nations Oct. 6, 2000. Canada is among the 191 nations formally committed to achieving the goals by 2015. While Wall Street went through contortions over the debt crisis, and Washington pledged then failed to pass a $700-billion rescue, international aid experts and politicians were gathered halfway up Manhattan Island discussing the MDGs at UN headquarters Sept. 25 to 27.

Internationally, governments devoted $107.1 billion to development assistance in 2005. As Wall Street soared that figure dropped to $103.7 billion in 2007. Five nations have met or exceeded the 0.7 per cent of Gross National Income target for foreign aid. It would cost $6 billion to stop women dying in child birth (the current rate is one per minute every day of the year), according to Thoraya Obaid, head of the United Nations Population Fund.

Below are the eight goals and the progress so far.

1. Cut in half the population living on less than $1 a day:

Before radical price rises in basic food and energy hit the poor hard the last two years there was reason to believe this goal would be reached " even if most of the progress was in Asia, leaving Africa still far behind. Given the rise in commodity prices, the basic standard for destitution is now $1.25 a day.

2. Put all children, both boys and girls, in school to complete primary education:

Fifty-eight countries are going to miss this goal at their current rate of progress. International aid targeting education has increased from $1.6 billion in 1999 to $5 billion in 2006, but the best estimates are that it would take $11 billion a year to reach the goal.

3. Make sure girls get the same opportunity for education and employment as boys:

There has been progress, but schools lack girls washrooms and as women move into the work force they get stuck in the most unstable, low-paid work. Women now occupy 40 per cent of all non-agricultural jobs, compared to 35 per cent in 1990. Violence against women is a major obstacle, according the the UN.

4. Reduce child mortality by two-thirds:

Sixty-two countries are on track to miss this goal. There are 27 countries that have the same or worse mortality rates for children under five compared with 1999. In 2006 international development aid spent $3.5 billion on maternal, newborn and child health care.

5. Cut the number of women who die during pregnancy or child birth by three quarters:

The UN is seeking an extra $5 billion to $6 billion to meet this target.

6. Stop and reverse the spread of HIV and AIDS and provide universal access to treatment, including antiretroviral drugs, and cut rates of malaria and other major killers:

Access to antiretroviral drugs has increased to about a third of those who need them in developing countries. The world now spends $10 billion a year on HIV and AIDS programs, but developing countries need another $8 billion to do the job properly.

7. Halve the number of people without access to safe drinking water and basic sanitation and halt the erosion of the environment:

About half the world's population does not have secure access to safe drinking water and one billion have no safe drinking water at all. Climate change is altering this picture much faster than anyone predicted 10 years ago.

8. Open up the world's trading system to the world's least developed nations, cut their debt and give them access to technology:

The cell phone is now everywhere in Africa, Asia and Latin America. Electricity, schools and clean water are not.

The Doha Development Round of negotiations at the World Trade Organization has stalled.

"If the U.S. and the global economy plunge into a major depression that's going to be bad for the global south. There's no question about that," Culpeper said. "The real question is how can you prevent a depression or even a serious recession from taking place? How can that be done without rewarding the profligate, or even seeming to reward the profligate?"

At The Register's press time the U.S. Congress had failed to pass a $700-billion rescue package for American financial institutes and world stock markets were plunging.

At the Canadian Catholic Organization for Development and Peace the worry is that Canada's political leadership lacks the will to do much of anything about the poverty and underdevelopment which poisons the global economy.

"Canada is not showing very much initiative or leadership in this," said Development and Peace executive director Michael Casey.

If the crisis south of the border swamps the Canadian economy Casey worries there will be even less money available for overseas development assistance in the federal budget.

"It might be at the expense of our aid programs," he said. "Nobody has said anything to that effect yet, but it certainly is a concern."

Canada's contributions to development aid have fallen over the last three years to 0.28 per cent of our Gross National Income " meaning that Canadians give 28 cents out of every $100 they earn to help resolve the problems of global poverty. That's down from 0.33 per cent in 2005, when the House of Commons passed a resolution to increase foreign aid to 0.5 per cent in 2010 and 0.7-per-cent by 2015.

Canada, the country that first proposed the 0.7 per cent standard in 1970, now ranks 16th among the 22 OECD nations in foreign aid.

The obvious contrast between a $700-billion rescue plan for a banking system that traded billions in overpriced mortgages like bubble gum cards and how the world's development agencies have to scrounge to provide basic health care and education may be stark, but there's more to development economics than just funding aid projects, said Casey.

"It's not just the amount of money that gets poured in. It's not just an increase in aid that is going to resolve the issues," he said. "There are a number of structural injustices that are involved."

Talks aimed at writing fair trade rules that would give farmers in Africa, Latin America and Asia access to world markets have been frozen the last two years at the Doha Round of the World Trade Organization. Casey believes Canadian diplomacy could help unblock those talks, but said there seems to be no political will.

"We certainly do have weight behind our voice, should we decide to use it," he said. "But we tend to be silent."

Casey doesn't believe the world will reach any of the eight Millennium Development Goals by the 2015 deadline (see sidebar for the eight goals), though he does see progress in terms of the issues of women and education. Culpeper is hopeful the first goal, cutting global poverty in half, is in our sights. But progress has been lopsided, he said.

"Reducing global poverty by half seemed likely to be achieved largely through the incredible efforts or achievements of China, India and the Asian countries," said Culpeper. "That concealed the failure of much of sub-Saharan Africa to achieve anything on any of the Millennium Development Goals."

As we approach 2015, Culpeper expects to see the problems in Africa unabated or get even worse.

In New York, Migliore revived the late Pope John Paul II's call for "the globalization of solidarity." That's not the kind of globalization that's been on Wall Street's agenda, said Culpeper.

"The kind of globalization we've had, which is essentially market driven, is one that really put most of its emphasis on individual initiative and enterprise, rather than on solidarity," he said.

Though Development and Peace often points to the failings of capitalism, and by helping set up co-operatives around the world promotes an approach to markets based on collective rather than individual initiative, Casey is not ready to say capitalism failed.

"Capitalism is not a bad mechanism. It's not a bad system on its own. It's just where abuses are made and it causes these kinds of issues," he said. "Looking at more equitable structures would certainly be more beneficial to more people " and probably more stable."

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