Business Recorder Editorial July 23, 2020

An unjust, unequal world

UN Secretary General Antonio Guterres, speaking on the 102^ndbirth anniversary of the late Nelson Mandela, has delivered a devastating indictment of the present world order. He said the coronavirus pandemic has served as an x-ray to reveal the fractures in the fragile skeleton of the societies we have built, shone a spotlight on global injustice, and could push 100 million people into extreme poverty. In Guterres’ view, entire regions that were making progress on eradicating poverty and narrowing inequality have been set back years in a matter of months. The economic fallout of the pandemic that has infected over 14 million people and killed close to 600,000 worldwide is being disproportionately felt among informal workers, small businesses and women. We face the deepest global recession since World War II. Guterres shone his own spotlight on the crisis having revealed unequal healthcare provision, unpaid care work, income and wealth disparity, and climate change. He also said the pandemic is exposing fallacies and falsehoods everywhere: the delusion that we live in a post-racist world (badly exposed by the global anti-racist movement after the death of George Floyd in the US), and that we are all in the same boat (some are in super yachts and others clinging to floating debris). Guterres pointed out that the world’s 26 richest people hold as much wealth as half the global population. Between 1980 and 2016, the world’s richest one percent captured 27 percent of the total cumulative growth in income. But income and wealth are not the only measure of inequality. People’s chances in life depend on their gender, family and ethnic background, race, whether or not they have a disability, and other factors. Multiple inequalities intersect and reinforce each other across the generations, defining the lives and expectations of millions of people before they are even born. Guterres proposes a new social contract and a new global deal to meet these deep rooted problems. This would include making education and digital technology two great enablers and equalisers by providing lifelong opportunities to learn, adapt, and acquire new skills for the knowledge economy. Fair taxation of income and wealth, a new generation of social protection policies with safety nets including universal health coverage and a universal basic income are essential. A fair globalisation is required to ensure that power, wealth and opportunities are shared more broadly at the international level, the rights and dignity of every human being are guaranteed, living is in balance and harmony with nature, the rights of future generations are respected and success measured in human rather than purely economic terms. Global structures of governance must be democratised, the global debt architecture reformed and fiscal space created for a green, equitable economy.

Guterres has put his finger on what ailed the world even before the pandemic, which has exacerbated those trends and exposed the dark underbelly of global inequality and injustice. Perhaps what could be added to his penetrating analysis and well intentioned solutions is the fact that for at least three decades, the world has been hurtling pell-mell down the slippery slope of a neo-liberal paradigm that saw the free market and private capitalism as the panacea of the world’s problems. But unfortunately, the unbridled recourse to this paradigm has increased already existing inequalities and injustices while adding new forms to the list, including the devastation of nature by rapacious capitalism wedded to profit above all else. Poor societies such as Vietnam, Laos and Cuba have handled the pandemic with remarkable success. The difference lies in their continued adherence to social safety nets espoused by communism, which places the welfare of the people above all other considerations. Even if other societies do not choose to embrace their system in its entirety, it has become crystal clear after the pandemic, even if it was not before, that private capitalism cannot be left unfettered and society cannot be left bereft of social safety nets. The wholesale faith in free markets and private capitalism needs, at a minimum, reform in the direction of taking care of those members and aspects of society that this system signally fails to do.