Resources Research

Why are people unbanked? The Global Findex shows 3/4 of the world’s poor do not have a bank account, not only because of poverty, but also due to costs, travel distance and paper work involved. Graphic: The World Bank / Global Findex project

The World Bank’s Global Findex (global financial inclusion index) project has said that worldwide, approximately 2.5 billion people do not have a formal account at a financial institution.

“Access to affordable financial services is linked to overcoming poverty, reducing income disparities, and increasing economic growth,” explained the World Bank in its usual ponderous manner – and with its flair for linking the unlinked.

Alarmed by the number of people who apparently have neither credit nor any wish to, the World Bank has created the Global Findex, described in glowing terms as “a new global financial inclusion database to measure the use of financial services and identify those with the greatest barriers to access”.

The graphics are useful, so here are the rest:

Who are the unbanked? The Global Findex shows gaps in financial inclusion across demographics, with women, the poor, youth, and rural residents at the greatest disadvantage. Graphic: The World Bank / Global Findex project

Regional differences in banking. In sub-Saharan Africa 16% Have used a mobile phone to pay bills, send or receive money in the past 12 months. Graphic: The World Bank / Global Findex project

Going mobile. The Global Findex shows mobile banking may help historically unbanked regions gain financial access. Graphic: The World Bank / Global Findex project

More information on the Global Findex project and data is available here.

How much damage do the financial and ruling elites of the western power blocs think they can get away with? A great deal, it is clear, judging from the stoutness of the defences raised to protect the UNCTAD (United Nations Conference on Trade and Development) and its analytical mandate.

One of the less conspicuous UN agencies, UNCTAD was set up in 1964 to support developing countries to strengthen their weak position in international economic structures, and to design national development strategies. As Martin Khor, Executive Director of the South Centre, explained, it became a kind of secretariat on behalf of developing countries, providing a small pro-development balance to the huge organisations dominated by the developed countries, such as the OECD, the IMF and World Bank.

In the past 20 years, the developed countries (OECD) have tried to curb the pro-South orientation of the UNCTAD secretariat and its many reports. The inter-governmental discussions became less significant, while UNCTAD’s pro-development mission was increasingly challenged by the developed countries.

What is this mission? UNCTAD says it promotes the development-friendly integration of developing countries into the world economy, that it has progressively evolved into an authoritative knowledge-based institution whose work aims to help shape current policy debates and thinking on development, with a particular focus on ensuring that domestic policies and international action are mutually supportive in bringing about sustainable development.

Note the stress on development, and not market, not trade and not finance. This is the problem for those who would seek to scuttle UNCTAD. It is a trend that seemed to have subsided in the past decade, but in the past two months, the meetings in Geneva to prepare for UNCTAD XIII, some developed countries have reportedly attempted to dilute the areas of future work of UNCTAD, to the frustration of the G77 and China.

Hence the statement, which is now widely available on the internet, by civil society organisations which have gathered in Doha, Qatar, for UNCTAD XIII meeting (21-26 April), which has said:

“The importance of UNCTAD’s work has been highlighted by the global financial and economic crisis and its continuing catastrophic effects on peoples and economies. Over the years while the Bretton Woods twins led the cheerleading for unbridled liberalisation and deregulation of markets and finances which produced the crisis, UNCTAD’s analysis consistently pointed out the dangers of these policies. The economic turmoil provoked by the crisis makes UNCTAD’s mandate and work even more relevant.”

“CSOs in Doha demand that UNCTAD’s crucial research and analytical work especially on 1) the global financial crisis, and 2) other development challenges including those arising from globalisation be maintained. UNCTAD serves as an important countervailing forum where the interests of developing countries can be paramount when trade, development and interrelated issues are being discussed. This value and its proven track record is why the attack on UNCTAD’s mandate has to be resisted.”

The CSOs in Doha are concerned that group of countries which includes Japan, USA, Switzerland, Canada, South Korea, Australia, New Zealand and which also includes the European Union (EU) are so opposed to UNCTAD’s vital analytical and advisory work on finance and responses to the crisis that they are refusing to even reaffirm UNCTAD’s mandate as agreed in Accra.

What is clear is that this group now sees UNCTAD’s work as a global defence against the effects of new economic policies, which in their many mutations have since the early 1980s heaped unspeakable misery on hundreds of millions around the world, in the South. These policies, as UNCTAD has also helped show, have led directly and indirectly to pervasive and chronic economic inequality, insecurity, unemployment and under-employment, casualisation, informalisation, a heightened level of labour exploitation, the emasculation of protective factory acts and labour laws.

That is why the civil society organisations present in Doha for UNCTAD XIII contrasted the interest the major powers have shown in strengthening the IMF and World Bank (and in using bodies of questionable accountability such as the G20 to block truly multilateral responses to the crisis of neoliberalism) with their negative attitude to UNCTAD. They noted that the IMF and World Bank continue to peddle policies which caused and have been discredited by the crisis. And they have demanded that the OECD-oriented group of would-be UNCTAD wreckers keep their hands off the organisation.

UN Millennium Development Goals 1 to 4

Who will head the World Bank after 2012 June? A global coalition of development activists and non-governmental organisations is calling on the World Bank’s governors to ensure that Bank President Robert Zoellick’s successor is chosen in an “open and merit-based process” that will give borrowing countries a major say in the selection.

In an open letter released shortly after the Bank’s announcement this week that Zoellick will step down at the end of his five-year term in June, some 60 groups and activists from around the world said any candidate should gain the “open support” of at least the majority of World Bank member countries and of the majority of low- and middle-income countries that make up most of its borrowers.

IPS News has reported that the arrangement which currently exists is absurdly called an informal “gentlemen’s agreement” (there are no gentlemen in this matter, now 68 years old, of leading poor countries into irredeemable debt and condemning their citizens to hardship and poverty). This agreement of exploitation, for that is what it is, exists between the USA and the countries of western Europe – specifically Britain, France and Germany – and provides that a national of USA will hold the top position at the World Bank Group, and that a national of Europe will hold the managing directorship of its sister institution, the International Monetary Fund (IMF).

“It’s a World Bank, not a US Bank. It needs the best candidate to get the job with support of wide Bank membership, not just the US,” IPS reported Collins Magalasi as having said. Magalasi is executive director of Afrodad, one of the lead NGOs which released the open letter calling for a change in the way the World Bank Group’s leader is chosen. The coalition includes Oxfam International, Civicus, and the African Forum and Network on Debt and Development (Afrodad).

The open letter has said: “The candidate must gain the open support from at least the majority of World Bank member countries, and from the majority of low and middle-income countries. As the Bank only operates in developing countries, and has most impact in low-income countries, any candidate that was not supported by these countries would seriously lack legitimacy. In addition to encouraging developing countries to nominate their own candidates, the best way to ensure that developing countries play a central role throughout the selection process is for the successful candidate to be required to gain the support of a majority of both voting shares and member countries.”

UN Millennium Development Goals 5 to 8

“This need not require any formal changes to the Bank’s articles of agreement, but could simply be agreed by the Board, to build on the limited proposals agreed in April 2011. To make this work, countries would need to vote independently, not through their constituencies, and declare their support publicly. It is time for the US to publicly announce that it will no longer seek to monopolise the Presidential position.” You can read the full letter at the website of the European Network on Debt and Development (Eurodad).

Bloomberg Businessweek has reported that China has called for the next World Bank chief to be picked based on merit. The next leader should be selected “based on the merit principle and open competition,” Foreign Ministry spokesman Liu Weimin said at a briefing in Beijing. Liu was apparently responding to a question on whether the next head should be from a developing nation. Since according to the US Treasury, the largest foreign holder of US debt is China, which owns about US$1.2 trillion in bills, notes and bonds, that sounds like an ungentle nudge from across the Pacific that it’s time the old order was scrapped.

The World Bank Group is quite top heavy. As its senior management the WB Group has: one president, three managing directors, a chief financial officer, two senior vice presidents, six vice presidents for the World Bank Group’s six operational regions, seventeen vice presidents for the Group’s divisions and departments, one director general. The IFC (International Finance Corporation) has one executive vice president and chief executive officer, nine vice presidents. The MIGA (Multilateral Investment Guarantee Agency) has one executive vice president, one vice president and chief operating officer, five directors.

While from the three managing directors downwards it may look like the WB Group senior management is representative of the variety of countries to which it lends, this is illusory – these people are financiers first and are free-market standard-bearers and privatisation evangelists. At those positions in the World Bank, as in the IMF, there are no nationalities – there is only capitalism.

As African civil society, global South movements and international allies protested right through COP17 in Durban, South Africa. They rejected the call of many developed countries for a so-called 'Durban mandate' to launch new negotiations for a future climate framework. Photo: Orin Langelle/GJEP

COP17 is over in Durban and some positions have now become clear. From a reading of the independent accounts of the negotiations and the long-winded statements issued by governments, this is what has happened:

1) Actual action to reduce carbon emissions and greenhouse gases has been pushed back by years, probably five and maybe even 10. A new treaty will take several years to negotiate and a few more to get it ratified by enough countries so that it makes a difference. Even then, major polluters like the USA (especially the USA but also China, India, Russia, Brazil, Indonesia and South Africa) may not ratify it. We don’t know – since it wasn’t spelt out in Durban – that any new agreement won’t be a weak and useless ‘pledge and review’ system.

2) Developed countries want to end the Kyoto Protocol. But they also want to retain and expand parts of the Kyoto Protocol they like. This includes the CDM (Clean Development Mechanism). The European Union (EU) is most keen on this. By doing this they want to continue to transfer their responsibilities to developing countries. Since Durban ended with no legally binding emission reductions (under the expiring Kyoto Protocol or under any sort of successor to it) there is no rationale for any carbon market. But the big carbon brokers and traders of the EU want the carbon market, the continuation of the CDM and even the creation of new ‘market mechanisms’.

3) The hold of global finance and banking over climate negotiations is strong. The World Bank and the Global Climate Fund mean that any climate fund linked to a post-Kyoto deal will be managed by an anti-democratic entity that is responsible for much of the climate disruption and poverty in the world. The World Bank together with support from the European Union will block any attempt at participatory governance of such a fund. This means the Global Climate Fund will be set up to funnel more profits – under the guise of mitigation and adaptation – to the private sector.

This much is clear to me. That is why I see one more outcome:

4) Large and influential advocacy groups such as India’s Centre for Science and Environment (CSE) will support the position their government’s take even what that position is going to hurt the poor in the country. In a briefing titled ‘The final outcome of the Durban Conference on Climate Change’ the CSE provided its assessment:

Developed countries are committing themselves to reduce only 13 to 17 percent by the year 2020. This will lead the world to an increase in the temperature of more than four degrees Celsius. Photo: Orin Langelle/GJEP

“The Durban Conference is a turning point in the climate change negotiations as even though developing countries have won victories, these have come after much acrimony and fight. At Durban the world has agreed to urgent action, but now it is critical that this action to reduce emissions must be based on equity. India’s proposal on equity has been included in the work plan for the next conference. It is clear from this conference that the fight to reduce emissions effectively in an unequal world will be even more difficult in the years to come. But it is a conference which has put the issue of equity back into the negotiations. It is for this reason an important move ahead.”

But – COP17 saw no turning point, although India’s government and its media supporters are saying so at home. Developing countries have won no victories and the poor in those developing countries must bear the brunt of the environmental impacts of business as usual. There was no agreement to urgent action – in fact exactly the opposite. India has no proposal on equity – it has none at home and therefore none to offer any climate negotiations. There is no move ahead except for finance, carbon markets and tech transfer brokers.

That’s that, as I see it. Here is some material worth consulting to learn more about the ideas of equity and justice under the subject of climate change.

In Triple Crisis, Martin Khor wrote: “The United Nations Climate Change Conference in Durban ended on Sunday morning with the launch of negotiations for a new global climate deal to be completed in 2015. The new deal aims to ensure “the highest possible mitigation efforts by all Parties”, meaning that the countries should undertake deep Greenhouse Gas emissions cuts, or lower the growth rates of their emissions. It will take the form of either “a protocol, another legal instrument or an agreed outcome with legal force”. In a night of high drama, the European Union tried to pressurize India and China to agree to commit to a legally binding treaty such as a protocol, and to agree to cancel the term “legal outcome” from the list of three possible results, as they said this was too weak an option.”

In Project Syndicate, Mary Robinson, a former President of Ireland, is President of the Mary Robinson Foundation for Climate Justice, and Archbishop Desmond Tutu, Archbishop Emeritus of Cape Town and a Nobel Peace Laureate, have written about climate justice:

“The first commitment period of the Kyoto Protocol expires at the end of 2012. So the European Union and the other Kyoto parties (the United States never ratified the agreement, and the Protocol’s terms asked little of China, India, and other emerging powers) must commit to a second commitment period, in order to ensure that this legal framework is maintained.”

“At the same time, all countries must acknowledge that extending the lifespan of the Kyoto Protocol will not solve the problem of climate change, and that a new or additional legal framework that covers all countries is needed. The Durban meeting must agree to initiate negotiations towards this end – with a view to concluding a new legal instrument by 2015 at the latest. All of this is not only possible, but also necessary, because the transition to a low-carbon, climate-resilient economy makes economic, social, and environmental sense. The problem is that making it happen requires political will, which, unfortunately, seems in short supply. Climate change is a matter of justice. The richest countries caused the problem, but it is the world’s poorest who are already suffering from its effects. In Durban, the international community must commit to righting that wrong.”

Protesters block the halls at the Durban International Conference Centre, December 9, 2011. Photo: Earth Negotiations Bulletin

In Real Climate Economics, Frank Ackerman said about the USA: “While others are not blameless, the United States is the leader of the do-nothings, the country whose inaction ensures a global climate stalemate. As long as the world’s largest economy, with the largest cumulative emissions and the greatest resources to tackle the climate crisis, refuses to act, others are not likely to move forward on their own. Yet there is not a snowball’s chance in Texas that any significant climate policy will survive the current U.S. Congress. Thus the global failure to protect the earth’s climate can be traced back to the dysfunctional state of American politics. With the Republicans increasingly committed to science denial and the Democrats unable or unwilling to challenge them, climate policy is going nowhere.”

Several more points on subjects that have much to do with climate change.

On technology – “The technology discussions have been hijacked by industrialised countries speaking on behalf of their transnational corporations”, said Silvia Ribeiro from the international organisation ETC Group. Critique of monopoly patents on technologies and the environmental, social and cultural evaluation of technologies have been taken out of the Durban outcome. Without addressing these fundamental concerns, the new technology mechanism will merely be a global marketing arm to increase the profit of transnational corporations by selling dangerous technologies to countries of the South, such as nanotechnology, synthetic biology or geoengineering technologies.

On agriculture – “The only way forward for agriculture is to support agro-ecological solutions, and to keep agriculture out of the carbon market”, said Alberto Gomez, North American Coordinator for La Via Campesina, the world’s largest movement of peasant farmers. “Corporate agribusiness, through its social, economic and cultural model of production, is one of the principal causes of climate change and increased hunger. We therefore reject free trade agreements, association agreements and all forms of the application of intellectual property rights to life, current technological packages (agrochemicals, genetic modification) and those that offer false solutions (biofuels, nanotechnology and climate smart agriculture) that only exacerbate the current crisis.”

According to Pablo Solón, Bolivia’s former ambassador to the UN and Bolivia’s former chief negotiator on climate change, "The USA blackmails developing countries. They cut aid when a developing country raises its hands and does discourse against their proposals. This happened to Bolivia two years ago: after Copenhagen, they cut aid of $3 million." Photo: Petermann/GJEP-GFC

On REDD + and forest carbon projects – “REDD (Reducing Emissions from Deforestation and Forest Degradation)+ threatens the survival of Indigenous peoples and forest-dependent communities. Mounting evidence shows that Indigenous peoples are being subjected to violations of their rights as a result of the implementation of REDD+-type programs and policies”, declared the Global Alliance of Indigenous Peoples and Local Communities against REDD and for Life. Their statement, released during the first week of COP17, declares that “REDD+ and the Clean Development Mechanism (CDM) promote the privatisation and commodification of forests, trees and air through carbon markets and offsets from forests, soils, agriculture and could even include the oceans. We denounce carbon markets as a hypocrisy that will not stop global warming.”

On the green economy – “We need a climate fund that provides finance for peoples of developing countries that is fully independent from undemocratic institutions like the World Bank. The bank has a long track record of financing projects that exacerbate climate disruption and poverty”, said Lidy Nacpil of Jubilee South. “The fund is being hijacked by the rich countries, setting up the World Bank as interim trustee and providing direct access to money meant for developing countries to the private sector. It should be called the Greedy Corporate Fund!” Climate policy is making a radical shift towards the so-called “green economy”, dangerously reducing ethical commitments and historical responsibility to an economic calculation on cost-effectiveness, trade and investment opportunities. Mitigation and adaption should not be treated as a business nor have its financing conditioned by private sector and profit-oriented logic. Life is not for sale.

On climate debt – “Industrialised Northern countries are morally and legally obligated to repay their climate debt”, said Janet Redman, co-director of the Sustainable Energy and Economy Network at the Institute for Policy Studies. “Developed countries grew rich at the expense of the planet and the future all people by exploiting cheap coal and oil. They must pay for the resulting loss and damages, dramatically reduce emissions now, and financially support developing countries to shift to clean energy pathways.” Developed countries, in assuming their historical responsibility, must honour their climate debt in all its dimensions as the basis for a just, effective and scientific solution. The focus must not be only on financial compensation, but also on restorative justice, understood as the restitution of integrity to our Mother Earth and all its beings. We call on developed countries to commit themselves to action. Only this could perhaps rebuild the trust that has been broken and enable the process to move forward.

A closed chips stall called 'La Reine des Fritures' ('The Queen of French Fries') in French Flanders. Photo: Stephan Vanfleteren / Panos Pictures

Le Monde Diplomatique, that fearless critic of globalisation and the tyranny of the multilateral lending institutions, has said in its 2011 December issue that in November, the Franco-German directorate of the European Union, the European Central Bank and the International Monetary Fund — the ‘troika’ — were furious when the Greek prime minister, George Papandreou, announced plans to hold a referendum.

Absolute oligarchs dislike referendums because the idea has a great deal to do with consultation – not a favourite subject for the IMF in the 67 years it has claimed to shape the global economy. That is why, summoned to Cannes for an interview during a summit that his country was too small to attend, kept waiting, and publicly upbraided by Angela Merkel and Nicolas Sarkozy (who were responsible for exacerbating the crisis), Papandreou was forced to abandon the plan for a referendum and resign. His successor, a former vice-president of the ECB, promptly decided to include in the Athens government a far-right organisation banned since the Greek colonels lost power in 1974.

In ‘Europe in crisis, rule by troika’, Serge Halimi has written in LMD that the European project was supposed to secure prosperity, strengthen democracy in states formerly ruled by juntas (Greece, Spain, Portugal), and defuse “nationalism as a source of war”. But it is having the opposite effect, with drastic cuts, puppet governments at the call of the brokers, and renewed strife between nations. Everything, in short, that the IMF and the World Bank have pursued since 1944 mostly successfully in Asia, Africa and South America.

Former bankers Lucas Papademos and Mario Monti have taken over in Athens and Rome, exploiting the threat of bankruptcy and the fear of chaos. They are not apolitical technicians but men of the right, members of the Trilateral Commission that blamed western societies for being too democratic. “Having crushed Greece and Italy, the EU and the IMF have now set their sights on Hungary and Spain,” Halimi has written, and it is a grim warning.

A ferris wheel runs in the centre of Brussels next to an old building advertising Martini and Zanussi. Photo: Stephan Vanfleteren / Panos Pictures

Red Pepper has more on the ways and means of the IMF.

“It’s stripped millions of people of their livelihoods, but the global economic crisis has brought one institution back from the dead: the International Monetary Fund. Two years ago, the IMF looked to be on its last legs. It had got to the stage where nobody wanted to borrow its money. Many developing countries started accumulating reserves to avoid ever having to go to the IMF loan shark. Developed countries in trouble would go just about anywhere – China, Russia, Saudi Arabia – to avoid the IMF.”

Then came the meltdown. “The IMF failed to see it coming – pretty damning for a body supposed to oversee global financial stability – but bankrupt countries suddenly had no choice but to come begging.” Exactly the point – the IMF did see it coming because this is what its prescriptions for the previous decade were aimed at in the first place. In April last year, the G20 pumped the organisation with £330 billion of new funds. Uruguayan writer Eduardo Galeano called the decision ‘black humour’, saying it would ‘rub salt in the wound’ of countries hit by a crisis they did not create. The IMF is now re-armed and doubly dangerous, with large new areas in what was formerly the Eurozone to subjugate.

Not quietly by any means. After all, the Greeks are Greeks first and then, perhaps, Europeans. Ditto with the Italians, Portuguese, Hungarians, Spaniards and Latvians. It is looking rather like the Germans and the French (elite, mind you, not the labour, the unemployed, the migrants and the armies of informal workers struggling on 25 euros a day) are the last Europeans left.

But this is why major protests have been convulsing Greece throughout the autumn with strikes, and occupations of the main squares in many towns. Civil servants blockaded their ministries, preventing ministers from accessing their departments in September and October. The early November surprise announcement of a popular referendum in Greece on the EU-IMF loan terms and conditions would have marked the first time an IMF lending package was subjected to a test of popular ownership. In the end the political pressure heaped on the Greek prime minister by other European countries, the Greek political opposition and factions from within his own government forced him to back down and resign as prime minister.

After the collapse of the Greek government, Elena Papadopoulou of the Athens-based Nicos Poulantzas Institute said: “Despite the proclaimed enthusiasm, there is no realistic reason to believe that the new coalition government – with the participation of the extreme right – will follow anything other than the socially destructive policies applied according to IMF recipes with the agreement of the European elites.”

The Occupy Wall St movement is spreading quickly across the USA. Mother Jones magazine has put together an interactive map on where the protests are spreading to, and at last count there were over 60 locations!

An Occupy Wall Street protester yells at police officers as they make arrests in New York, Wednesday, Oct. 5, 2011. Protesters in suits and T-shirts with union slogans left work early to march with activists who have been camped out in Zuccotti Park for days. Photo: Seth Wenig

The ‘Occupy’ demonstrations are the blowback – long overdue – of the foreign-plus-financial policy of a great power which has for long dampened criticsm and fair a representative politics at home.

The ‘Occupy’ demonstrations express a broader public understanding that the basic source of the crisis facing millions of people lies in the social interests of the sprawling and powerful global financial system – of which Wall St is one symbol; a powerful symbol but nevertheless one amongst many similar symbols.

Dogged by debt and haunted by ever newer forms of deprivation, the American protesters have ‘taken’ Wall St to call and end to the reign of the giant banks that dominate the US and world economy. Their politics is determined not by the popular will, but by the interests of a cunning financial aristocracy ruthlessly absorbed with defending its wealth by impoverishing the majority of their fellow citizens.

The answer – Occupy Everywhere!

Mother Jones has provided a very useful timeline of the Occupy Wall Street movement:

• July 13: The Canadian magazine Adbusters makes a call to Occupy Wall Street.
• August 30: The hacktivist collective known as Anonymous releases a video answering the call and encouraging others to follow suit.
• September 17: Nearly 1,000 gather to protest corporate greed and begin occupying the financial district in New York City.
• September 19: Roseanne Barr is the first celebrity to lend support to the so-called NYC General Assembly.
• September 20: The NYPD starts arresting protestors for wearing masks, citing an arcane law that prohibits masked gatherings of two or more people with an exception: “a masquerade party or like entertainment.”  The police soon become more forceful.
• September 22: Demonstrators interrupt a Sotheby’s Auction, “in a show of solidarity with the art handler’s union that had been locked out.” This is the first instance of labor unions and the movement locking step.
• September 24: 80 protestors are arrested during a peaceful march; a video of a police officer pepper-spraying a nonthreatening woman goes viral.
• September 26: Anonymous allegedly leaks the name and details of the police officer who wielded the pepper spray.
• September 27: The Occupy Wall Street campaign comes out in support of postal workers who are protesting their reduced five-day work week.
• September 28: Transport Workers Union votes to support Occupy Wall Street; over 700 Continental and United Airline pilots demonstrate in front of Wall Street.
• September 30: More than 1,000 demonstrators march on NYPD headquarters, protesting the police response against the demonstrators.
• October 1: Over 700 demonstrators are arrested for marching across the Brooklyn Bridge and blocking traffic.
• October 5: Major labor unions endorse the movement and join in a march on New York’s financial district. According to ABC News, as many as 15,000 participate in the march.

The New York Observer has 50 portraits of people who have been in on the action in New York City. The Nation‘s Greg Mitchell is blogging “Occupy USA” developments daily. The Guardian is also producing ongoing coverage.

How the Occupy Wall Street movement uses social media:

• Live footage of Zuccotti Park can be found at the protest epicenter’s viral webstream, Global Revolution.
• The #occupywallstreet hashtag (as well as #ows and #occupywallst) has been the main engine on Twitter.
• OccupyTogether.org supplies a range of DIY downloadable posters.
• There is an Occupy Wall Street social app called The Vibe, which allows demonstrators to communicate anonymously.
• An Occupy Wall Street publication was launched on Kickstarter, originally asking for $12,000 in seed money to get the publication rolling. The project surpassed its funding goal and has now raised over $40,000.
• A Tumblr account, We Are the 99%, allows users to post personal anecdotes and stories about why they consider themselves part of the economically disaffected majority.

This is a document which does much to ensure that there is a North-South development divide and which also ensures that the flow of ‘aid’, of ‘development’ theory and of ‘development’ competence is one way only – North to South.

In the World Risk Report 2011, the philosophy of this view of the world is as much political as it is racially biased. I’m sorry for having to say that as bluntly as that, but there’s no getting around it or away from it. You can’t dress it up in pseudo-scientific gibberish and expect readers in the Brown and Black Two-Thirds World not to notice.

This philosophy is contained in the six maps that describe, in this strange way, ‘risk’ to the countries of the world. As you can see, the pinks which represent risk are overwhelmingly in Africa and Asia and in general in countries of the South. The green hues represent little or no ‘risk’ and are used to shade the countries of the North – USA, western Europe, the OECD countries.

I have extracted the maps and provide their titles so as to better understand why ‘aid’, ‘development’, ‘technical assistance’ and ‘knowledge’ flows the way it does, helped along its magnetic North-to-South channels by arm-twisting, by WTO, by the World bank and International Monetary Fund and their lesser lending cousins in all continents, and particularly by the thousands of economists who have been installed in the countries of the South, who have been trained and programmed by these institutions, and who are the purveyors of disastrous neo-liberal economics and social destruction from Manila to Morocco.

Internationial aid agencies and their partners large and small will use documents such as this and indices of misery such as this to deepen the dependencies of the poor, the marginalised, the vulnerable and the voiceless in the South, photographs of whom in poster size will nevertheless adorn the walls of Northern exhibitions and collaborationist Southern conclaves.

On to the maps. These are captioned with their titles and followed by short commentaries guided by the experiences of our ‘developing’ peoples and their tribal roots.

Map 1 – “susceptibility, dependent on public infrastructure, nutrition, income and the general economic framework”. What we say: True, true, public infrastructure in the Brown and Black Two-Thirds World is lousy, fly-ridden and stinks. But, comrades, have you noticed how the working classes of the First World have, for well over a decade now, been complaining mightily about privatisation and its ills? Susceptibility to nutrition? Why, now, we didn’t invent Starbucks and KFC did we? We’re the ones who like our indigenous millets and tasteful tubers to be untouched by GM. Income? No we’re flat broke. But listen to the moanings of the European Central Bank these days and you’ll notice we’ve plenty of company.

Map 2 – “lack of coping capacities, dependent on governance, medical care and material security”. What we say: Let’s take this governance thing first shall we. You comrades in the First World long ago, for reasons unknown to us but risky in the extreme, ditched your tribal roots and turned to markets and finance and supermarket shopping carts. Shame you did, for that was the abandoning, the throwing away, of the original caring sharing wise governance that’s brought humans through generations. Coping capacities is a good one. We hereby solemnly invite all friendly First World comrades to come and spend a week in our shanty towns, our barrios and our favelas where they can learn what coping is and how to go about it. For medical care we recommend to you a journey to Havana, Cuba. For material security we recommend to you a rereading of any holy book of your choice.

Map 3 – “lack of adaptive capacities, related to future natural events and climate change”. What we say: Comrades and friends, we don’t sadly have as many shamans, diviners and ancient wise folk as we used to, but we can surely tell you this: future natural events and climate change is not going to choose between us and you, and you and them. We’re all in this together, you with your food coupons and us with our kitchen gardens. Adaptive? I do think we’ve got that covered good and proper.

Map 4 – “exposure, of the population to the natural hazards, earthquakes, storms, floods, droughts and sea level rise”. What we say: Friends and fellow inhabitants of Gaia, if we stop making Mother Earth angry every single day, She may relent. It’s up to you too. Oh and as for exposure, we’re used to it, you’re not, sad but true.

Map 5 – “vulnerability, of society as the sum of susceptibility, lack of coping capacities and lack of adaptive capacities”. What we say: Well, we’ve had quite enough of these colour combinations now. Our sincere and heartfelt advice is that you turn us all the same shade of pink, or turn us all the same shade of green. But that will ruin the difference between Us and Those Danged Others, you protest. Dear comrades, we do share the same air, water and sky. It’s about time you stopped seeing people coloured differently and started seeing people.

Map 6 – “world risk index as the result of exposure and vulnerability”. What we say: We must correct you. The real risk is to your perception, friends, which you can remedy by coming to live with us and learning our ways.

More about the World Risk Report 2011 – “The Bündnis Entwicklung Hilft (Alliance Development Works) publishes the World Risk Report to examine these issues at the global level and to draw conclusions for future actions in assistance, policy and reporting. The core of the World Risk Report is the World Risk Index, which was developed on behalf of the Bündnis Entwicklung Hilft by the United Nations University Institute for Environment and Human Security in Bonn, Germany. The World Risk Index indicates the probability that a country or region will be affected by a disaster. The index is the result of close cooperation between scientists and practitioners. Experts in the analysis of natural hazards and vulnerability research as well as practitioners of development cooperation and humanitarian aid have discussed and developed the concept of the index. Globally available data are used to represent the disaster risk for the countries concerned.”

“In the framework of the World Risk Index, disaster risk is analysed as a complex interplay of natural hazards and social, political and environmental factors. Unlike current approaches that focus strongly on the analysis of the various natural hazards, the World Risk Index, in addition to exposure analysis, focuses on the vulnerability of the population, i.e. its susceptibility, its capacities to cope with and to adapt to future natural events as well as the consequences of climate change. Disaster risk is seen as a function of exposure and vulnerability. The national states are the frame of reference for the analysis.”

[World Risk Report 2011, Published by Bündnis Entwicklung Hilft (Alliance Development Works) of Germany in cooperation with: United Nations University, Institute for Environment and Human Security, Bonn (UNU-EHS)]

Inequality is a lifelong experience for girls and women, says a World Bank microsite. It has asked: Do men and women have equal rights? There’s an interesting short poll (results available as soon as you finish!). Have a look at this quick preview of what World Development Report 2012: Gender Equality and Development is all about.

Do men and women have equal rights? The poll results after 5,720 votes is 51 (men have more) : 5 (women have more) : 44 (equal)

There’s a flurry of activity around the start of the G20 and the IMF-World Bank meetings. Some of this activity has to do with food and agriculture, and with the agricultural commodity markets and its ties to the financial markets. While the G20 has a lot to do with the growing strength of the BRICS bloc and the IMF, what stands out is a trenchant and insightful commentary by Unctad’s Trade and Development Report 2011 on the matter of agricultural commodities and the markets (exchanges rather) which control them.

Financial investment in commodities as a proportion of global oil production, 2001–2010. Chart: Unctad Trade and Development Report 2011

It has attracted the attention of Emerging Markets, a periodical (online too) which talked about food price and agricultural commodities markets with Joerg Mayer, senior economic affairs Officer at Unctad. Emerging Markets has quoted Mayer as having said that the risk management strategies promoted by the World Bank “only make sense if you assume that exchanges are working well for hedging purposes – and our research shows that, when large numbers of financial investors are present, they don’t work well“. Hear, hear.

Mayer said that the World Bank’s approach would also be logical “if you assume that financial investors have no impact on prices, or that their presence improves [pricing]“. Of course to make such an assumption is to agree with an untruth, for Unctad’s Trade and Development Report 2011 has said quite plainly that strong investment across agricultural commodities markets mean that they have “followed more the logic of financial markets than that of a typical goods market”.

The chapter ‘Financialized Commodity Markets: Recent Developments and Policy Issues’ from the report is worth reading closely and in full. Here is an indicative paragraph:

“The commodity price boom between 2002 and mid-2008 and the renewed price rise of many commodities since mid-2009 have coincided with major shifts in commodity market fundamentals. These shifts include rapid output growth and structural changes, both economic and social, in emerging-market economies, the increasing use of certain food crops in the production of biofuels and slower growth in the supply of agricultural commodities. However, these factors alone are insufficient to explain recent commodity price developments. Since commodity prices have moved largely in tandem across all major categories over the past decade, the question arises as to whether the very functioning of commodity markets has changed.”

Prices and net long financial positions, by trader category, selected commodities, June 2006–June 2011 (CIT = commodity index traders; PMPU = producers, merchants, processors, users). Chart: Unctad Trade and Development Report 2011

Unctad’s research on the subject has shown that investors are motivated by “factors totally unrelated to commodity market fundamentals”. This is as bald an assessment of the behaviour of investors as you can hope to see from an inter-governmental organisation (the World Bank and International Monetary Fund are incapable of stating truths like this one).

“Against this background, the French Presidency of the G-20 has made the issue of commodity price volatility a priority of the G-20 agenda for 2011, since excessive fluctuations in commodity prices undermine world growth and threaten the food security of populations around the world (G20-G8, 2011). These fluctuations are seen as being related to the functioning of financial markets and the regulation of commodity derivatives markets.”

Unctad’s Trade and Development Report 2011 has argued for tighter regulation of financial investors, including limits on the positions taken by individual market participants; a rule to prevent banks that have insider information about commercially based market sentiment undertaking hedging operations for clients; a similar rule to prevent physical traders betting on outcomes they are able to influence; and a transaction tax or a requirement to hold positions for a minimum amount of time.

Instead, the World Bank’s analysts have generally argued that price volatility is driven by fundamentals, such as input costs, which other economists have failed to include in their calculations. This is an argument that cannot stand up to the merest suggestion of an examination of the cost of cultivation for, while inputs do cost more from one year to another in high-input farming (in Asia and Africa and South America, even with smallholders who are held to ransom by industrial agriculture companies) these are not the “fundamentals” the Bank-IMF crowd insist are responsible. The trouble is, they won’t admit to any others. Worse, they have enfleshed this delusionary tack with the help of their old collaborators, such as JP Morgan, which now has a hedging business that works on agricultural commodities markets and this year joined the World Bank/International Finance Corporation to launch an Agricultural Price Risk Management Facility, “designed to fund small players to hedge more effectively” (nudge, nudge, wink, wink, etc).

Correlation between commodity and equity indexes, 1986–2011 (The data reflect one-year rolling correlations of returns on the respective indexes on a daily basis). Chart: Unctad Trade and Development Report 2011

Said the chapter ‘Financialized Commodity Markets: Recent Developments and Policy Issues’ from the Trade and Development Report, 2011:

“Indeed, a major new element in commodity markets over the past few years is the greater presence of financial investors, who consider commodity futures as an alternative to financial assets in their portfolio management decisions. While these market participants have no interest in the physical commodity, and do not trade on the basis of fundamental supply and demand relationships, they may hold – individually or as a group – very large positions in commodity markets, and can thereby exert considerable influence on the functioning of those markets. This financialization of commodity markets has accelerated significantly since about 2002–2004, as reflected in the rising volumes of financial investments in commodity derivatives markets – both at exchanges and over the counter (OTC).”

We think the G20 participants (finance ministers, central bank administrators and similarly high-powered persons) ought to have mentioned the matter. Instead, this is what they said.

“The BRICS countries, represent quite a big share of the global economy. In today’s crisis period, internal demand of each economy is important, and we should find a way to enlarge internal demand in our economy.” – China Central Bank chief Zhou Xiaochuan. “We represent a group of countries where there is (an) enormous amount of demand for resources at home for poverty reduction … so there is going to be big, big tension between giving money to a multilateral institution for the purpose of restoring global stability and meeting our own aspirations at home.” – Reserve Bank of India governor Duvvuri Subbarao.

“Enlarge internal demand” and “enormous amount of demand for resources at home”? Isn’t that exactly the sort of prognosis the World Bank, IMF and IFC will happily enlist as fundamentals of food prince index drivers? As for the rest of us, it’s back to promoting and practicing ecological economics.

The concerns about recession and its impacts on poverty are seen commonly as a question mark over household incomes, over food security and often involve debates about social protection. An aspect that all too often gets ignored in this equation – no doubt because of its complexity – is health and in particular the health of women and children.

Changes in neonatal mortality rates between 1990 and 2009. The map illustrates the change in NMR between the years 1990 and 2009 for each of the 193 countries estimated. PLoS Medicine 8(8): e1001080

This is linked very closely to poverty, however we measure it, and the conditions that either cause poverty to persist (leading to chronic poverty) or cause households at risk to lapse into poverty every now and then (shock). The human development index methodolgy, which is from this year using multi-dimensional indices for poverty for the first time, helps us link health, poverty, income and economic growth (or its opposite).

The question is: is this new understanding, which is more in tune with the way households actually carry on with their lives and are actually affected by wider trends concerning economy, helping integrate the connections? If there is one good reason to ask this question, it is the new study on ‘Neonatal Mortality Levels for 193 Countries in 2009 with Trends since 1990: A Systematic Analysis of Progress, Projections, and Priorities’.

[The World Health Organization (WHO) has a report and summary of the study on this page - 'Newborn deaths decrease but account for higher share of global child deaths']
[The full study is available on PLoS Medicine, 1 August 2011 (Volume 8, Issue 8)]

This has shown that every year, more than 8 million children die before their fifth birthday. Most of these deaths occur in developing countries and most are caused by preventable or treatable diseases. In 2000, world leaders set a target of reducing child mortality to one-third of its 1990 level by 2015 as Millennium Development Goal 4 (MDG4). This goal, together with seven others, is designed to help improve the social, economic, and health conditions in the world’s poorest countries. In recent years, progress towards reducing child mortality has accelerated but remains insufficient to achieve MDG4.

“In particular, progress towards reducing neonatal deaths – deaths during the first 28 days of life – has been slow and neonatal deaths now account for a greater proportion of global child deaths than in 1990. Currently, nearly 41% of all deaths among children under the age of 5 years occur during the neonatal period. The major causes of neonatal deaths are complications of preterm delivery, breathing problems during or after delivery (birth asphyxia), and infections of the blood (sepsis) and lungs (pneumonia). Simple interventions such as improved hygiene at birth and advice on breastfeeding can substantially reduce neonatal deaths.”

Neonatal mortality rates in 2009. The map illustrates the NMR in year 2009 for each of the 193 countries estimated. PLoS Medicine 8(8): e1001080

The researchers used civil registration systems, household surveys, and other sources to compile a database of deaths among neonates and children under 5 years old for 193 countries between 1990 and 2009. They estimated NMRs for 38 countries from reliable vital registration data and developed a statistical model to estimate NMRs for the remaining 155 countries (in which 92% of global live births occurred).

They found that in 2009, 3.3 million babies died during their first month of life compared to 4.6 million in 1990. More than half the neonatal deaths in 2009 occurred in five countries – India, Nigeria, Pakistan, China, and the Democratic Republic of Congo. India had the largest number of neonatal deaths throughout the study. Between 1990 and 2009, although the global NMR decreased from 33.2 to 23.9 deaths per 1,000 live births (a decrease of 28%), NMRs increased in eight countries, five of which were in Africa. Moreover, in Africa as a whole, the NMR only decreased by 17.6%, from 43.6 per 1,000 live births in 1990 to 35.9 per 1,000 live births in 2009.

To return to my question concerning the understanding of economics, income, health and poverty, does most current analysis see to integrate these elements, or is it still GDP-income driven? A new (2011 May) paper released by the Brookings Institution indicates that the GDP-income route is still favoured. The paper, ‘Two Trends in Global Poverty’, Geoffrey Gertz and Laurence Chandy, has said that while the overall prevalence of poverty is in retreat, the global poverty landscape is changing. “This transformation is captured by two distinct trends: poor people are increasingly found in middle-income countries and in fragile states. Both trends – and their intersection – present important new questions for how the international community tackles global poverty reduction.”

The two charts show the trajectory of 20 developing countries along three dimensions: number of poor people, degree of fragility and real income per capita. These 20 countries collectively account for 90 percent of the world’s poor in 2005, and thus largely define the evolving state of global poverty. Graphic: Brookings Institution

“The increased prevalence of poverty in middle-income countries is in many ways a trend of success. Over the past decade, the number of countries classified as low-income has fallen by two fifths, from 66 to 40, while the number of middle-income countries has ballooned to over 100. This means 26 poor countries have grown sufficiently rich to surpass the middle-income threshold. Among those countries that have recently made the leap into middle-income status are a group of countries  -  India, Nigeria and Pakistan  – containing large populations of poor people. It  is their “graduation” which has brought about the apparent shift in poverty from the low-income to middle-income country category.”

This categorisation of middle, low and high income was to an extent useful in the 1970s, when the idea of a human development index was being discussed, but we’ve come a long way since. We know that even in smaller countries (rather, countries with populations that are relatively small compared to those whic bear the sort of burdens studied in the PLoS Medicine research) there is a great deal of income disparity. ‘Income’ itself is a condition with a bewildering number of inputs – social science is quite inadequate to the task of being able to recognise all of these, let alone quantify them and rationalise them across countries and regions – which is exactly what studies like this try to do unfortunately.

“In 2005, when more than half the world’s poor lived in such countries, it made some sense to think about fighting poverty in terms of a single developing country paradigm, based on what worked in countries such as Ghana, Tanzania, Mozambique or Vietnam,” Gertz and Chandy have said. “This logic was evident in two of the major events of that year which continue to shape today’s development agenda: the G8 meeting at Gleneagles and the High Level Forum on Aid Effectiveness in Paris. It was also apparent in Jeffrey Sachs’ influential 2005 best-seller, ‘The End of Poverty’. The legacy of these ideas is scattered throughout the work of the international development community in the design of traditional aid instruments and the standard methods of country engagement.”

The authors of the Brookings paper have said that this approach remains relevant for some countries, but with 90 percent of the world’s poor living in different settings today, its broader application can no longer be justified. Yet they have found that such an admission poses a dilemma. The dilemma exists because one of the reasons the stable low-income paradigm has persisted is because it characterizes an environment in which the international development community feels most comfortable and has the most experience. “The role of external actors in supporting poverty reduction in stable low-income countries is well understood and the standard tools of external assistance – financial and technical assistance – are well suited to them.”

Maplecroft's 2011 food security risk index

What does this mean? Does it give us a hitherto obscured insight into the inner world of aid agencies and international development departments and how they see ‘poor’ countries’ populations? Does it mean that we are burdened with three decades worth of simplistic labelling of populations at risk simply because labelling them any other way makes it difficult to help them? That’s what it looks like to me and I’d like to thank Gertz and Chandy for revealing this. But it’s way past high time this sort of categorisation was ditched, once and for all. It would do us and the battalions of development professionals a huge amount of good to simply be able to say, every so often, “we don’t know enough”.

It is worth being honest about the state of our knowledge concerning the lives of the the majority of households in ‘developing’ countries. Some of the reasons why such honesty will help in the long term are contained in a thoughtful new publication from the World Bank (whose army of development professionals will benefit from its reading). This collection is entitled ‘No Small Matter: The Impact of Poverty, Shocks, and Human Capital Investments in Early Childhood Development’ (The World Bank, 2011) and it has said that, as the 2008 global financial crisis has again demonstrated, economic crises are an unfortunate recurring event in the world and can have severe consequences for household livelihoods.

Progress in key health indicators, UN Human Development Report 2010

‘No Small Matter’ defines economic crises as sharp, negative fluctuations in aggregate income, these being especially common in developing countries, and the frequency with which they occur has been increasing in recent history. We know that declines in household and community resources are not the only risks that arise from an economic crisis because of its aggregate nature. We also know – from fieldwork and by hearing those whom we would wish to help – that at the same time as households cope with the possibility of reduced income from aggregate economic contractions, vital public services may also experience a decline in quality or availability, which in turn may have an additional impact on skill development among children. This is happening now, in more countries than ever before. The economic crisis that hit Latin America in 1982 led to a decrease in public health spending and had a disproportionate effect on the poorest groups. In 2011, the decrease in public health spending exists in many more countries.

A chapter in ‘No Small Matter’, ‘The Influence of Economic Crisis on Early Childhood Development: A Review of Pathways and Measured Impact’, by Jed Friedman and Jennifer Sturdy, is particularly useful.

This has said that “conservative estimates suggest that over 200 million children under five years of age living in developing countries fail to reach their cognitive development potential because of a range of factors, including poverty, poor health and nutrition, and lack of stimulation in home environments”. It is possible, the chapter’s authors have said, that this burden increases during times of crisis as poverty increases and food security is threatened. However, to investigate this claim more carefully it is necessary to understand the pathways through which poverty influences skill acquisition in children.

“The most severe condition affecting ECD (Early Childhood Development) is infant and early child mortality. Sharp economic downturns were associated with increases in infant mortality in Mexico, Peru and India. The mortality of children born to rural and less educated women is more sensitive to economic shocks, which suggests that the poor are disproportionately affected during most economic crises, and perhaps the poor face important credit constraints that bind in tragic ways during large contractions.

Weak relationship between economic growth and changes in health and education, UN Human Development Report 2010

The mortality of girls is also significantly more sensitive to aggregate economic shocks than that of boys. This gender differential exists even in regions such as Sub-Saharan Africa that are not particularly known for son preference and indicates a behavioral dimension where households conserve resources to better protect young sons at the expense of daughters.”

Finally, a further note about the extremely valuable PLoS Medicine study ‘Neonatal Mortality Levels for 193 Countries in 2009 with Trends since 1990: A Systematic Analysis of Progress, Projections, and Priorities’. The authors are: Mikkel Zahle Oestergaard1, Mie Inoue1, Sachiyo Yoshida, Wahyu Retno Mahanani, Fiona M. Gore1, Simon Cousens, Joy E. Lawn and Colin Douglas Mathers (on behalf of the United Nations Inter-agency Group for Child Mortality Estimation and the Child Health Epidemiology Reference Group – World Health Organization, Department of Health Statistics and Informatics; World Health Organization, Department of Child and Adolescent Health and Development; London School of Hygiene & Tropical Medicine; Saving Newborn Lives/Save the Children).

Children of poor households are more likely to die, UN Human Development Report 2010

The study found that of the 40 countries with the highest NMRs in 2009, only six are from outside the African continent (Afghanistan, Pakistan, India, Bhutan, Myanmar, and Cambodia). Among the 15 countries with the highest NMRs (all above 39), 12 were from the African region (Democratic Republic of the Congo, Mali, Sierra Leone, Guinea-Bissau, Chad, Central African Republic, Burundi, Angola, Mauritania, Mozambique, Guinea, and Equatorial Guinea), and three were from the Eastern Mediterranean (Afghanistan, Somalia, and Pakistan). Throughout the period 1990–2009, India has been the country with largest number of neonatal deaths. In 2009, the five countries with most deaths accounted for more than half of all neonatal deaths (1.7 million deaths = 52%), and 44% of global livebirths: India (27.8% of deaths, 19.6% of global livebirths), Nigeria (7.2%, 4.5%), Pakistan (6.9%, 4.0%), China (6.4%, 13.4%), and Democratic Republic of the Congo (4.6%, 2.1%). The top five contributors to the 4.6 million neonatal deaths in 1990 were: India (29.5% of deaths, 19.8% of global livebirths), China (12.3%, 18.0%), Pakistan (5.4%, 3.4%), Bangladesh (5.0%, 2.9%), and Nigeria (4.8%, 3.3%).

As the risk of children dying before the age of five has fallen, the proportion of child deaths that occur in the neonatal period has increased. This increase is primarily a consequence of decreasing non-neonatal mortality in children under five from infectious diseases such as measles, pneumonia, diarrhea, malaria, and AIDS. Globally, 41% of under-five deaths now occur in the neonatal period. Over the 20 y between 1990 and 2009, the proportion of global neonatal deaths that occurred in Africa increased. Although Africa is now the region with the highest NMR, the proportion of under-five child deaths that are neonatal remains relatively low in Africa—the fraction increased from 26% to 29% between 1990 and 2009. This apparent anomaly reflects the fact that Africa accounts for approximately 90% of child deaths due to malaria (0.7 million under-five deaths) and HIV/AIDS (0.2 million under-five deaths), resulting in relatively higher post-neonatal child mortality than other regions.