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African-Americans’ Wealth A Fraction That Of Whites Due To Systematic Inequality

 

This year marks the 400th anniversary of the arrival of captive Africans to Virginia, where they were sold into slavery. February marks Black History month — a time when Americans reflect on the legacy and ongoing contributions African-Americans have provided to our country’s success. Despite racism and the systematic obstacles placed in front of African-Americans they continue to achieve greatness. However, even today, 400 years later with much progress accomplished, African-Americans still lack the same opportunities of economic security and mobility as their white counterparts.

The massive wealth gap between African-Americans and whites starkly illustrates this. African-Americans only have a fraction of the wealth that whites have . This leaves them much less prepared for an emergency and with fewer resources to invest in their own future such as moving to a good neighborhood, starting a business, and sending their children to college. African-American economic mobility consequently remains well below that of whites. And they tend to face more struggles in old age with less wealth.

Wealth – the difference between what families own such as a house, a business, retirement savings and bank accounts, among others, minus what they owe in mortgages, credit cards and student loans, for example – serves several purposes. First, families can dip into their savings such as checking and savings accounts, but also their retirement savings, when they face an emergency such as an unexpected illness, a layoff or a divorce. Their savings serve as a backstop when incomes abruptly fall and costs rise. Second, wealth is also a means to invest in a family’s future. They can use savings for the down payment on a house, to start a business, to move to a new job when a better one comes along and to help pay for their children’s education. Wealth is a crucial way for families to gain more economic opportunities. And third, wealth is a means to enjoy a secure retirement, to decide when to leave the labor force, for example due to ill health or family obligations and to pursue volunteer opportunities.

Yet, wealth is highly and increasingly unequally distributed, especially between African-Americans and whites. At the median, non-retired African-Americans had $13,460 in wealth in 2016 or only 9.5% of the median wealth of $142,180 that whites had at that time . The racial wealth gap in fact widened in the wake of the Great Recession. In 2007, just before the recession started, median African-American wealth was 13.7% of the median white wealth — $25,841 compared to $188,756 (in 2016 dollars). This gap was also abysmal, just not as bad as the difference in more recent years. In fact, over the past 30 years, African-American wealth at the median never amounted to more than about one-fifth of white wealth.

The racial wealth gap is the result of systematic disadvantages that African-Americans face on a regular basis. A substantial racial wealth difference persists by education, income, age and marital status. African-Americans with a college degree had less median wealth in 2016 than whites without a college degree – $57,250 compared to $81,650. That is, standard economic and demographic factors often used to explain wealth differences do not explain the massive wealth between African-Americans and whites. Other factors such as occupational steering, residential segregation and outright discrimination are also regularly at play and substantially contribute to the wealth differences between African-Americans and whites.

The disproportionately larger drop in African-American wealth during the economic and financial crisis from 2007 to 2009 also shows that they encounter systematic obstacles in building and maintaining wealth. African-American wealth fell more precipitously during the economic and financial crisis because their wealth was more concentrated in home equity. That is, African-Americans had fewer financial reserves outside of their house than whites did, often because they work in jobs that pay less and have fewer retirement and other benefits than is the case for whites. And, African-Americans regularly suffered from much worse unemployment rates sooner and longer than was the case for whites. They then had to rely on their savings to a larger degree and for longer, making it harder to rebuild their wealth after the crisis.

The wealth gap between African-Americans and whites is so large that it will require sustained, large and targeted policy interventions. Otherwise, the promise of equal opportunity will remain an empty one for African-Americans.

 

Christian Weller: I am a professor of public policy at the University of Massachusetts Boston and a senior fellow at the Center for American Progress. I joined academia in 2007 after working full time in Washington, DC, think tanks for almost a decade. My research has focused on retirement issues, including Social Security, private and public pensions and retirement savings such as 401(k) accounts for the past two decades. I have written and published extensively on retirement issues, including my recent book Retirement on the Rocks. My goal is to support retirement policy through meaningful research, especially in a time of growing economic risks that both increase the need for more savings and make it harder for people to save. I regularly speak to a wide variety of audiences such as financial service providers, union leaders and retirement activists and I frequently appear on national radio and TV.

 

 

By : Christian Weller
Date : February 14, 2019
Source : Forbes
https://www.forbes.com/sites/christianweller/2019/02/14/african-americans-wealth-a-fraction-that-of-whites-due-to-systematic-inequality/#12a39f304554

 

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Who knows best? Cities consult citizens for fresh ideas

 

Barcelona residents had until the end of January to submit suggestions for a plan to redevelop the green spaces of Montjuic, an iconic hill overlooking the Catalan capital.

Few people live on Montjuic itself, which sports a stadium built for the 1992 Olympic Games alongside museums, a castle and recreational areas, but there are dense residential streets at the bottom of the hill.

Inhabitants of those neighbourhoods were given the chance to add their ideas on things like transport and environmental protection – both online and at meetings – to a draft of the city council’s action plan for Montjuic.

Barcelona often uses inclusive processes like this to gather citizens’ input on municipal projects – a trend that is growing worldwide at municipal and national levels.

Recent surveys in Barcelona, Spain’s second-largest city, demonstrate that people want, and are able, to take part in shaping urban development.

But with municipal elections to be held in May, Fernando Pindado, commissioner for democracy and active participation at Barcelona City Council, said working methods needed to be strengthened so they remain consistent, no matter which political party is in charge.

And the city is still looking for the best ways to incorporate the views of a wider range of people, he added.

“Not all citizens are the same – there are lots of foreigners, some have kids, some don’t,” he said.

“The internet is very useful for extending social debates … but not everyone has internet access.”

BERLIN’S REFUGEES

Participatory processes are gradually emerging in cities around the world, as digital technology makes them simpler and faster for local authorities to implement.

Getting them to work effectively, however, can be challenging for governments and citizens alike, said Birgit zur Nieden, a commissioner in the Senate of Berlin, which governs the German city.

That was the case when the senate trialled a new way of designing a programme to improve the lives of refugees in the capital, she said.

“In 2015, many such people came – and Berlin failed in some regards to attend to their needs well,” she told the Thomson Reuters Foundation.

The process, which lasted about nine months, involved inviting NGOs and other organisations that interact with migrants to take part in working groups on relevant topics.

The goal was to infuse their knowledge and understanding of refugees’ needs into the city programme, she explained.

In practice, the design was complex, and the administration and civil society groups did not find it easy to work productively together, she said.

Nonetheless, it was useful to get to know each other and exchange expertise, she added.

YOUTHFUL EDGE

Beth Noveck, director of the Governance Lab at New York University, said harnessing new technology to engage the wider public in drafting laws was “a global phenomenon”.

But previously authoritarian states like Taiwan and Brazil are experimenting with it the most, she added.

“In countries that have long-established and highly rule-based legislative practices, innovation can be difficult in contrast to countries with younger democratic institutions,” she said.

In Taiwan, artificial intelligence and other technology was used to engage 200,000 people in crafting legislation on company shareholder requirements and internet alcohol sales, for instance, Noveck said.

The government uses an open source tool called Polis, which makes it possible to take the pulse of a large group using an algorithm that clusters their responses.

Brazil is using an app called Mudamos to allow ordinary people to digitally sign proposed bills relating to popular issues such as public cleanliness and municipal transport.

Meanwhile, in January, French President Emmanuel Macron launched a two-month “great national debate”, in response to ongoing “yellow vest” protests largely rooted in dissatisfaction over growing social inequalities.

Through a series of internet-based consultations, workshops and regional conferences, the government is canvassing citizens’ views on key themes including environmental policy, taxation, democracy and public services.

TRANSPARENCY

In general, participatory processes are being used more at the local level because party politics are less dominant here, with cities like Reykjavik, Barcelona and Bogota pioneering the use of online engagement, Noveck said.

People also find it easier to spot problems, identify solutions and evaluate legislation that directly affects their daily lives, she noted.

But in Barcelona, for example, there is still a lack of transparency over how the proposals gathered are used, according to a research project into participatory processes called CrowdLaw Catalog, led by the Governance Lab.

In recent years, which ideas made it into the Municipal Action Plan and why has not been clear, the Catalog said, noting a statistical model could be used in future to measure this.

Barcelona City Council’s Pindado said the Spanish city had found it useful to set up an independent body to monitor citizen consultations, boosting confidence they would be protected from political interference.

While the level of public interest always depends on the topic, “we’re getting to a point where these participatory processes are no longer dependent on the government’s will”, he added.

 

By : Sophie Davies
Date : February 12, 2019
Source : Thomson Reuters Foundation News
http://news.trust.org/item/20190212005100-02ad5

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Economic Inequality: Who Cares?

 

Concern with economic inequality is a defining feature of the current era. Prominent international public figures, ranging from Pope Francis to International Monetary Fund’s Chairwoman Christine Lagarde, have declared global economic inequality to be the top priority.

What are the preconditions for moving from talk to action? Relevant information, effective policy instruments, and the necessary political will stand out as key elements.

There is no lack of relevant information. Excellent data is being regularly published by French political economist Thomas Piketty and his colleagues at World Inequality Lab. A new report from U.K.-based international aid agency Oxfam links key information with a program for action.

Oxfam has a long track record of campaigning in this area, emphasizing the connection between global poverty and economic inequality. Its new report includes some jaw-dropping information.

For example, the world’s richest 26 people now own the same amount of wealth as the poorest half of humanity. During 2018, billionaires around the world increased their combined fortunes by a daily average of $2.5 billion. Meanwhile, nearly half of humanity languishes on incomes below $5.50 per day or its equivalent in local spending power. Inequalities according to race and gender are interwoven throughout.

These are the features of a grossly, some would say grotesquely, unequal world.

Extreme Inequality: a Necessary Price?

 Does it matter? Some say not, arguing that extreme inequality is a necessary price to be paid for giving “wealth-creators” the necessary “economic freedoms.” Winners in the marketplace prosper, others miss out. Trying to level the playing field would undermine economic incentives, reduce economic growth and lower average living standards.

The Oxfam report points to the flaws in this conservative complacency. It cites the results of research undertaken at the International Monetary Fund (IMF), showing that inequality is not conducive to good economic performance in practice. More egalitarian nations tend to do better than the more unequal ones. That this research finding comes from a generally conservative institution like the IMF is significant.

Oxfam‘s report also cites other social science research, showing significant correlations between inequality and the incidence of social problems. The more unequal nations have generally poorer physical and mental health, higher rates of crime and incarceration, inferior rates of educational attainment, and weaker environmental protection policies. As British epidemiologists Richard G. Wilkinson and Kate Pickett point out, anything that undermines social cohesion and public trust tends to reduce both individual and social wellbeing.

How Can Inequality be Reduced?

 The inference is that reduction of inequality, both within nations and worldwide, is necessary. Poverty cannot be eliminated without simultaneously addressing the structures and processes that facilitate extreme concentration of wealth.

Waiting for the wealth to “trickle down” is a discredited strategy, little more than an ideological excuse for policy inaction. Piecemeal redistribution from rich to poor is not adequate either. The challenge is to develop institutional arrangements that make more equitable outcomes a normal feature of the political-economic system.

There are plenty of policies suitable for this purpose, given the political will to use them. Minimum wages can be raised. Taxes can be made more progressive and more focussed on accumulated wealth. These tax revenues could finance guaranteed basic income for all households, thereby setting a floor to distributional inequality. Or they could fund improvements in public infrastructure and services.

The willingness of governments to embrace redistributive policies varies considerably, of course. Among the more economically developed nations, there are two broad clusters. One, headed by the United States, has high inequality of income, wealth and power and current political leaders committed to their perpetuation. The trickle-down myth lives on, despite all empirical evidence to the contrary. In the other cluster, including the European nations and the Nordic states especially, there is more emphasis on the role of progressive taxation and welfare state expenditures as a means of countering the tendencies towards greater inequality.

Among the poorer nations, there is also a great diversity of experience. China and India, the world’s two most populous nations, have had outstanding macroeconomic performance over the last three decades, but internal economic inequalities have risen sharply.

Elsewhere, especially in many of the countries of sub-Saharan Africa, the problems of poverty have become yet more intense and widespread.

Reward Work, Not Wealth

Oxfam is to be applauded for drawing attention to these inequalities and the resulting problems. But parading the latest data on growing economic inequalities and showing the adverse social consequences is evidently not enough. Indeed, the numbers alone may tend to engender more fatigue than outrage, especially in the light of the apparent incapacity or unwillingness of current international institutions to turn the situation around.

Recognizing this, the title of the latest Oxfam report – “Public Good or Private Wealth?” – seems to signal a fundamental re-think. Its dominant message is the need for a social provision of public goods. This links the rich-poor inequality to the inequality between public and private wealth.

Indeed, societies with more wealth in public rather than private hands are better able to provide social services – public housing, public education, public health, public transport, and public childcare, for example – and to do so freely or at low prices that poor people may afford. Public provision of this sort can ensure that all people have the basics for a decent existence even if their money incomes are meager. Thus, social provision, funded by taxing wealth, can create fairer societies.

Could it also create more fairness worldwide?

The poorer nations would only be able to undertake the social provision of this sort if international development aid were to be markedly increased. The affluent nations currently have a formal commitment to allocating 0.7 percent of their GDP for this purpose, but only five currently hit this target. The U.S. and Australia give only about a quarter of their due share. Meeting the international aid commitment, and targeting its allocation to the social provision of public goods, is crucial if the global situation is to improve.

It is ultimately in the interests of all of us all – rich and poor, within and across nations – to pursue social justice, economic security, ecological sustainability, and peace. Equity is integral to all these goals. Are the world’s leaders listening?

 

Frank Stilwell: Emeritus Professor of Political Economy at the University of Sydney, Australia, and author of the book ‘The Political Economy of inequality’ which will be published this year by Polity Press

 

By : Frank Stilwell
Date : February 6, 2019
Source : The Globe Post

Economic Inequality: Who Cares?

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Africa: Economic Crisis Can Trigger World War

 

Kuala Lumpur and Berlin — Economic recovery efforts since the 2008-2009 global financial crisis have mainly depended on unconventional monetary policies. As fears rise of yet another international financial crisis, there are growing concerns about the increased possibility of large-scale military conflict.

More worryingly, in the current political landscape, prolonged economic crisis, combined with rising economic inequality, chauvinistic ethno-populism as well as aggressive jingoist rhetoric, including threats, could easily spin out of control and ‘morph’ into military conflict, and worse, world war.

Crisis responses limited

The 2008-2009 global financial crisis almost ‘bankrupted’ governments and caused systemic collapse. Policymakers managed to pull the world economy from the brink, but soon switched from counter-cyclical fiscal efforts to unconventional monetary measures, primarily ‘quantitative easing’ and very low, if not negative real interest rates.

But while these monetary interventions averted realization of the worst fears at the time by turning the US economy around, they did little to address underlying economic weaknesses, largely due to the ascendance of finance in recent decades at the expense of the real economy. Since then, despite promising to do so, policymakers have not seriously pursued, let alone achieved, such needed reforms.

Instead, ostensible structural reformers have taken advantage of the crisis to pursue largely irrelevant efforts to further ‘casualize’ labour markets. This lack of structural reform has meant that the unprecedented liquidity central banks injected into economies has not been well allocated to stimulate resurgence of the real economy.

From bust to bubble

Instead, easy credit raised asset prices to levels even higher than those prevailing before 2008. US house prices are now 8% more than at the peak of the property bubble in 2006, while its price-to-earnings ratio in late 2018 was even higher than in 2008 and in 1929, when the Wall Street Crash precipitated the Great Depression.

As monetary tightening checks asset price bubbles, another economic crisis — possibly more severe than the last, as the economy has become less responsive to such blunt monetary interventions — is considered likely. A decade of such unconventional monetary policies, with very low interest rates, has greatly depleted their ability to revive the economy.

The implications beyond the economy of such developments and policy responses are already being seen. Prolonged economic distress has worsened public antipathy towards the culturally alien — not only abroad, but also within. Thus, another round of economic stress is deemed likely to foment unrest, conflict, even war as it is blamed on the foreign.

International trade shrank by two-thirds within half a decade after the US passed the Smoot-Hawley Tariff Act in 1930, at the start of the Great Depression, ostensibly to protect American workers and farmers from foreign competition!

Liberalization’s discontents

Rising economic insecurity, inequalities and deprivation are expected to strengthen ethno-populist and jingoistic nationalist sentiments, and increase social tensions and turmoil, especially among the growing precariat and others who feel vulnerable or threatened.

Thus, ethno-populist inspired chauvinistic nationalism may exacerbate tensions, leading to conflicts and tensions among countries, as in the 1930s. Opportunistic leaders have been blaming such misfortunes on outsiders and may seek to reverse policies associated with the perceived causes, such as ‘globalist’ economic liberalization.

Policies which successfully check such problems may reduce social tensions, as well as the likelihood of social turmoil and conflict, including among countries. However, these may also inadvertently exacerbate problems. The recent spread of anti-globalization sentiment appears correlated to slow, if not negative per capita income growth and increased economic inequality.

To be sure, globalization and liberalization are statistically associated with growing economic inequality and rising ethno-populism. Declining real incomes and growing economic insecurity have apparently strengthened ethno-populism and nationalistic chauvinism, threatening economic liberalization itself, both within and among countries.

Insecurity, populism, conflict

Thomas Piketty has argued that a sudden increase in income inequality is often followed by a great crisis. Although causality is difficult to prove, with wealth and income inequality now at historical highs, this should give cause for concern.

Of course, other factors also contribute to or exacerbate civil and international tensions, with some due to policies intended for other purposes. Nevertheless, even if unintended, such developments could inadvertently catalyse future crises and conflicts.

Publics often have good reason to be restless, if not angry, but the emotional appeals of ethno-populism and jingoistic nationalism are leading to chauvinistic policy measures which only make things worse.

At the international level, despite the world’s unprecedented and still growing interconnectedness, multilateralism is increasingly being eschewed as the US increasingly resorts to unilateral, sovereigntist policies without bothering to even build coalitions with its usual allies.

Avoiding Thucydides’ iceberg

Thus, protracted economic distress, economic conflicts or another financial crisis could lead to military confrontation by the protagonists, even if unintended. Less than a decade after the Great Depression started, the Second World War had begun as the Axis powers challenged the earlier entrenched colonial powers.

They patently ignored Thucydides’ warning, in chronicling the Peloponnesian wars over two millennia before, when the rise of Athens threatened the established dominance of Sparta!

Anticipating and addressing such possibilities may well serve to help avoid otherwise imminent disasters by undertaking pre-emptive collective action, as difficult as that may be.

The international community has no excuse for being like the owners and captain of the Titanic, conceitedly convinced that no iceberg could possibly sink the great ship.

 

 Jomo Kwame Sundaram, a former economics professor, was United Nations Assistant Secretary-General for Economic Development, and received the Wassily Leontief Prize for Advancing the Frontiers of Economic Thought in 2007.

Vladimir Popov, a former senior economics researcher in the Soviet Union, Russia and the United Nations Secretariat, is now Research Director at the Dialogue of Civilizations Research Institute in Berlin

 

By : Jomo Kwame Sundaram and Vladimir Popov
Date : February 12, 2019
Source : AllAfrica
https://allafrica.com/stories/201902130630.html

 

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The root cause of corruption

 

If we want to cut down on corruption, we will have to start working more seriously on reducing the huge chasm between the rich and the poor

Transparency International, a global anti-corruption coalition, ranked India 81 out of 180 countries in its corruption index of 2017. The least corrupt nations were New Zealand, Denmark, Finland, Norway, Switzerland, Singapore, Sweden, Canada, Luxembourg, the Netherlands, and the U.K. Just above India in the list were China, Serbia, Suriname, Trinidad and Tobago, and Ghana (less corrupt). And below India were Morocco, Turkey, Argentina, Benin, and Kosovo (as corrupt or more corrupt).

Now, 81 out of 180 might not seem too bad, especially to sceptical Indians, but it is misleading: often the same rank is occupied by as many as three countries (for instance, rank 71). As such, in terms of numbers, India is placed in the bottom third of the list, if not the last quarter. This should not surprise sceptical Indians.

However, ranking the corruption level of a country is less of a science and more of an art. And it is an art that naturally occludes the advantages — which others might see in terms of invisible corruption — of rich First World nations, where polity and economy, Parliament and corporation often have long-established and uncontroverted relationships. This does not mean that nations like Ghana, India, Morocco and Turkey do not have considerably more corruption than nations like New Zealand and Denmark. What it means is that the ranking game is not sufficient to understand corruption at the global, national and local levels.

Cultural and historical factors

How, then, can we understand the corruption that we find in nations like India? One common option is to employ a cultural perspective. It is attributed to something like national character. For instance, it seems suggestive that all the least corrupt nations listed above, with the exception of Singapore, are European or European-settler states. Even Singapore has a highly ‘Europeanised’ structure, in all regards except that of some citizen rights. Another common explanation is basically historical: for instance, by referring to the top-down power structures of feudal or colonial regimes in places like Morocco, China and India until just a few decades ago.

I will not deny that cultural ethos and historical precedence play a role. After all, both abiding by the law and lawlessness have a domino effect: if you follow the law, other people around you are more likely to do so; if you break the law, other people around you are also more likely to do so. A history of unresponsive authoritarianism might increase the tendency to break laws, if one can get away with it, because the citizen has nothing invested in the status quo. Only fear upholds the law, and the moment the citizen can get away with it, he or she breaks the law. This can also lead to a greater tendency towards corruption.

The most important factor

But culture and history are misleading as primary explanations. Far more important is another factor that few people talk about. If you look at India and the countries around it on the index, and at the top 10 (least corrupt) countries, you realise that the former group contains nations with huge socio-economic inequalities, and the latter contains nations with a high degree of social and economic justice. In that sense, Singapore belongs with the European and European-settler countries ranked as the 10 least corrupt nations. In short, corruption is directly proportionate to the socio-economic gap in a nation. Cultural and historical factors add to this or subtract from this, but the greater the socio-economic disparities, the greater the incentive towards corruption.

This happens in many ways, both among the rich and the poor. For instance, in a country where, say, ₹10,000 is nothing for the rich, it is easy for the rich to offer a bribe of that sum. But if, in the same country, ₹10,000 is what a poor man may earn in an entire month, it is difficult for him to refuse a bribe of that sum. This leads to the gradual erosion of morality and ethics on both sides: some find it easy to spend money to get things done, others find it difficult to refuse to accept that money. On both sides, there builds up a disrespect for the system and for each other. The system itself is seen as thoroughly corrupt because of such individual acts of corruption. This further ‘justifies’ the corruption on both sides. Moreover, the poor look at the affluence of the rich as basically a consequence of corruption, which is by no means the case all the time. And the rich look at the vulnerability of the poor as the consequence of a corrupt morality, which is again by no means the case all the time. Such a nexus saps the entire social fabric of a country, also creating apathy towards demands for greater transparency in the corridors of power. This further leads to the spread of corruption.

If we in India want to cut down on corruption, we will have to start working far more seriously on reducing the huge (and some say, widening) chasm between the rich and the poor.

 

By: Tabish Khair
Date: January 20, 2019
Source: The Hindu
https://www.thehindu.com/opinion/columns/the-root-cause-of-corruption/article26038081.ece

 

 

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Millennials, Gen X, Gen Z, baby boomers: how generation labels cloud issues of inequality

 

Generations can be defined by family structure, stage of life or historical events. But most often, they’re categorised as “cohorts” of people born during a particular period in time. Catchy labels such as baby boomers, millennials and Gen X and Gen Z tend to stick with each cohort, which are assumed to have shared experiences, behaviours and ideals. This is known as a “cohort effect”.

But common generalisations – for example, that baby boomers are hoarding housing, while millennials have no hope of buying a home – can distort or mask the inequalities that exist within and across generations. So rather than pitching the generations against one another, perhaps it’s time to unpack some common assumptions, and question how much one generation really benefits at another’s expense.

The name game

Popular labels are applied to the generations currently living. The “silent generation” are those born from 1925 to 1945 – so called because they were raised during a period of war and economic depression. The “baby boomers” came next from 1945 to 1964, the result of an increase in births following the end of World War II.

After the baby boomers came “Generation X”, from around 1965 to 1976. The term coined by Charles Hamlett and Jane Deverson (originally referring to the Baby Boomers in their teenage years), was made popular by Douglas Coupland’s eponymous 1991 novel. The label reflected the counterculture of a rebellious generation, distrustful of the establishment and keen to find their own voice.

The cohort known as millennials – originally Generation Y – were identified by American authors William Strauss and Neil Howe as those graduating high school in the year 2000. With the popular focus on the millennium at the time, the name stuck. Although the birth date of this cohort can start from as early as the late 1970s, by some accounts, it generally ranges from the early 1980s to the mid-1990s or early 2000s.

“Generation Z” is the current name for the cohort born from the mid-1990s, though iGen, centennials, post-millennials are further possible labels for a generation that has grown up in a hyper connected world. A “new silent generation” is emerging for those born during the early 2000s, since like their great grandparents in the silent generation, their childhood is also deemed to be marked by war and economic recession.

From needy to greedy

Social and political conflict between generations often boils down to the seemingly unfair consumption of resources by the old. During the 1940s, the “needy” older generation were seen as a burden on the tax-paying younger generation. From the 1950s, older people were blocking beds in hospitals, when they should be in their own homes. More recently, older people are being told that they should move out of their homes and stop hoarding family housing.

Today, it’s often said that baby boomers benefited most from the welfare state, during a period when healthcare and education were free, jobs plentiful and housing affordable. There is also a fear that this generation will be the last to have good pensions.

But all of these arguments conveniently ignore the inequalities within generations, which are greater than the inequalities between them. Not only is there considerable inequality within cohorts, even greater divides are created by gender, ethnicity, disability, housing tenure and class.

Take housing, for example. While baby boomers are often accused of hoarding housing, the accumulation of housing wealth is more often a reflection of income and regional variances, rather than age differences. Between 20% and 25% of the housing wealth in the UK is owned by those under the age of 65, who are in the top 20% of the population in terms of income.

Society’s limits

Another example is education. While baby boomers and Gen X may not have paid for their university education, very few were actually able to take advantage. In England and Wales, participation was at 8.4% in 1970 compared to 33% in 2000. Overall levels of education have actually improved over time.

The problems facing younger cohorts have more to do with the social limits to growth than the cost of education. In 1976, sociologist Fred Hirsch suggested that while the economy continues to grow, enabling ever greater consumption, society’s social structures will remain limited.

So, though more people are gaining degrees, only one person can get the job or the promotion. Standing out from the crowd requires ever increasing educational qualifications, work experience or skills training. In Hirsch’s words, “if everyone stands on tiptoe, no one gets a better view”.

With limited opportunities in society, rationing is achieved through higher entry requirements to both the labour and housing markets. The extent to which people can meet those requirements is still a matter of where they were born in the social hierarchy, rather than when they were born.

Indeed, wealth is generally transferred from older to younger generations via inheritance, rather than withheld: the problem is that this reinforces inequalities within cohorts, as richer people benefit more from transfers of family wealth. People’s access to health care, education and housing are determined by policy and the economy, not their date of birth, and the hype about generational conflict only serves to mask the real inequalities in society.

 

By: Beverley Searley (Senior Lecturer in Human Geography, University of Dundee)
Date: January 16, 2019
Source: The Conversation
http://theconversation.com/millennials-gen-x-gen-z-baby-boomers-how-generation-labels-cloud-issues-of-inequality-106892

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Is internationalisation creating inequality in higher education?

 

Inequality is a word that has recently dominated public discourse, mainly with regard to its economic meaning of income and wealth inequality, but also in terms of social and educational inequality. Many researchers and organisations around the world have addressed the subject of inequality, and its reduction within and among countries is one of the United Nations’ Sustainable Development Goals (SDG 10).

Education and higher education in particular have long been considered a means to reduce social and economic inequality. Higher education enables individuals to gain knowledge, skills and competences that allow them to access better paid jobs and positions that are higher up the social ladder.

What do the results of the 5th Global Survey on Internationalization of Higher Education, an online survey conducted by the International Association of Universities (IAU) in 2018, which received replies from 907 higher education institutions from 126 countries around the world, tell us about this topic?

Internationalisation and inequality

Inequality is difficult to measure; data is scarce, difficult to interpret and the subject is sensitive. Sometimes interpretations of data trends are based more on political convictions than on objective analysis.

This is particularly true when analysing the effects of globalisation on inequality, with some researchers pointing out that globalisation has helped reduce inequality in the world (especially between countries), while others claim it has helped increase inequalities in the world (especially within countries); still others argue that the impact of globalisation on inequalities is negligible.

Internationalisation of higher education can be seen as both a reaction to and an active participation by higher education institutions in the changes brought about by globalisation.

Statistics show that internationalisation of higher education in its narrow form of student mobility is highly unequal, for two reasons:

  • Only about 2% of the world student population can benefit from a period of study abroad.
  • The global flux of mobile students is highly unbalanced, with clearly identifiable sending and receiving countries and therefore a transfer of skilled human capital from some countries to others.

There have been different responses to this problem – in particular internationalisation of the curriculum or internationalisation at home – and awareness of the necessity for internationalisation of higher education to be more inclusive is rising among the higher education community.

A recent updated definition of internationalisation of higher education published by the European Parliament clearly points out this mission for internationalisation to be inclusive, fair and equal.

It says internationalisation of higher education is “the intentional process of integrating an international, intercultural or global dimension into the purpose, functions and delivery of post-secondary education, in order to enhance the quality of education and research for all students and staff, and to make a meaningful contribution to society”.

However, beside the well-studied role of student mobility, not much data is available on the relationship between the whole process of internationalisation in its different aspects and inequality. Could there also be increasing inequality between the internationalisation policies of higher education institutions around the world?

An increasing divide in importance of internationalisation

In the 5th IAU Global Survey, higher education institutions were asked to identify how important internationalisation was to their academic leadership.

Two-thirds of respondents indicated that internationalisation was of high importance to their academic leadership. A quarter replied that internationalisation was of a medium level of importance, and a very low percentage, only 5%, indicated that internationalisation is of low or no importance.

Higher education institutions were also asked to identify how the level of importance of internationalisation has changed for their academic leadership over the past three years. More than 84% replied that the level has increased, with 34% saying that it has “substantially increased” and 50% claiming that it has “increased”.

Comparing this result with the data of the previous IAU Global Survey (conducted in 2013), the result might be puzzling at first glance. In fact, around the same number of higher education institutions considered internationalisation important as in the 4th Global Survey. However, 84% of higher education institutions in the 5th Global Survey claim that the level of importance has increased since 2013.

Further analysis suggested that this increase in the level of importance over the past three years has happened mainly at higher education institutions for which the level of importance was already high. These constitute the majority of respondents (68%). However, it has not happened at institutions where the level of importance of internationalisation was low.

This result is very interesting, as it suggests the importance of internationalisation is increasing at higher education institutions that already consider it important. This trend could have a negative consequence in terms of equality as it could create a gap between higher education institutions and their separation into two different groups: those that consider internationalisation a priority, and will be even more active with regard to internationalisation, and those for which internationalisation is not a priority.

Even for those, like the authors of this article, who believe that internationalisation of higher education is not generating inequality ‘per se’ and who see it is as a means to improve the quality of higher education for all students and staff, this trend is worrisome.

If we assume that internationalisation of higher education improves the quality of education and research and if this process is undertaken only by higher education institutions that are already engaged in it and not by those that are not and are therefore more in need of it, the result can only be growing inequality between higher education institutions.

The importance of internationalisation by region

We also looked at geographical factors. In other words: do we see inequality in the importance placed on internationalisation by higher education institutions in different regions of the world?

The results show that the level of importance is not the same in all regions of the world.

Internationalisation is highly important for higher education institutions in Africa and especially the Middle East, where 83% report ‘high’ importance, but it is less important than the global average for higher education institutions in Latin America and the Caribbean and especially in North America, where only 53% of higher education institutions report that it is given ‘high’ importance.

Higher education institutions in Asia and the Pacific and Europe follow the global trend of tending to give internationalisation ever greater importance.

North America is the only region where a non-negligible percentage of higher education institutions report a decrease in the importance given to internationalisation in the past three years – 10% of institutions, with 8% reporting a substantial decrease – while other regions follow more or less the upward global trend.

However, these regional results must be interpreted with some caution because their statistical relevance is not the same for all regions. The response rates for the Middle East and North America in particular are lower than for other regions.

The number of higher education institutions that reported medium and especially low levels of importance given to internationalisation is too small for a reliable analysis of the change of importance in the different regions. However, the results suggest that the global trend of higher education institutions that already consider internationalisation very important giving it even more importance seems to be present in all regions of the world.

The reasons for such a divide between higher education institutions that consider internationalisation extremely important and those that do not is worth reflecting on and deserves to be studied in more depth, especially if one considers internationalisation to be an essential part of all higher education institutions’ mission and a sign of quality.

 

Giorgio Marinoni is manager for higher education and internationalisation policy and projects at the International Association of Universities (IAU). Email: g.marinoni@iau-aiu.net. Hans de Wit is director of the Center for International Higher Education at Boston College, United States, and a member of the IAU advisory committee for the 5th IAU Global Survey on Internationalization of Higher Education. Email: dewitj@bc.edu.

 

By: Giorgio Marinoni and Hans de Wit
Date: January 11, 2019
Source: University World News
https://www.universityworldnews.com/post.php?story=20190109100925536

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Rethinking Singapore’s approach to diversity and social inclusion

 

In a context where far right political parties and movements are stoking xenophobic sentiments in Europe and the United States, Singapore remains a bastion for liberal mobilities and cultural tolerance.

This is one of the most important reasons why Singapore has been able to attract not just the talented and highly skilled, but also those seeking to escape economic hardship and discrimination because of their gender, race, or religious affiliation.

In order to maintain that global reputation as a city-state that is welcoming of foreigners, we must not simply continue to provide economic opportunities for potential migrants and immigrants, but also build a social and cultural landscape that is more inclusive of difference and recognises the inequalities that these differences may engender.

With rising levels of economic inequality, combined with the changing cultural demographics of the citizen population, there is a need to rethink approaches to diversity and the ways in which social inclusion is configured within our city-state.

Post-independence, the Chinese, Malay, Indian, Other (CMIO) categorisations have defined much of Singapore’s approach to migration and diversity. This recognition of different ethnic communities and the intention to provide equitable resources through those categorisations proved largely successful in creating a nation tolerant to diversity.

However, the effects of these CMIO policies can also be felt in more visceral terms – Singaporeans now see themselves and others in prescribed racial terms. This means that difference rather than commonality as co-citizens is what is foremost in this politics of recognition.

Those who fall outside or elide such racialised categorisations may be left out of the system by which the state recognises cultural traditions or disburses social support.

This mode of seeing people within the nation by whether they are racial and cultural strangers or affiliates also affects how temporary migrants and immigrants are perceived.

Singapore’s exclusion of low-wage migrant labour from a route to attaining permanent residency or citizenship does not look set to change.

Despite their permanently temporary nature, low-wage migrants often stay for long periods in Singapore, taking on circular routes of migration that entail a regular back and forth between home and host countries.

Many who work in Singapore for decades describe strong feelings of belonging and emotional attachment to a nation that has been a home for much of their adult lives. How can we acknowledge the contributions of these temporary migrants to our nation?

Ground sentiment with regard to low-wage migrants is fast changing.

Thanks to the work of non-government organisations (NGOs) that cater to the welfare of migrant workers and generate coverage of their lives in the local media, there is now far more sympathy for these men and women than there was even a decade ago.

There is greater acknowledgement of the important work that they do in building and maintaining the material fabric of our city and in taking care of our children and senior citizens.

In response to these shifting mindsets, we must explore ways in which we can enhance how these men and women can be made to feel included in the social fabric of Singapore.

This should not be left only to NGOs or individual employers. The judicial system and policymakers should take on the task of changing the social structures that pertain to temporary migrant work.

Penalties for abuse of migrants, whether physical, verbal, or in terms of the late or non-payment of wages for instance, should be far harsher and better enforced.

Sending a signal that these crimes and practices are unacceptable assures temporary migrants that they are valued as equal, contributing members of our society.

In the past 20 years, Singapore has seen a very different wave of immigration compared to the movements of the pre-war years.

Our total population has grown by almost a fifth, and much of this is due to the expansion of immigration and naturalisation to augment the effects of ultra-low fertility rates.

These immigrants have been overwhelmingly from other Asian countries, although there are rising numbers of Singaporeans who are not of Asian ethnicity, and who do not fit easily into the CMIO categorisations.

What is of particular significance is that many (im)migrants who have been presumed to fit within the Chinese and Indian labels, being of East Asian or South Asian ancestry, are without the same cultural and national histories of second, third and later generation Singaporeans.

What do these changing demographics mean for Singapore’s national identity?

The inclusion of Indians and Chinese born outside Singapore within the same labels that define Singapore-born individuals of Chinese and Indian ethnicity have created some tensions within these two communities.

This needs to be addressed better by integration efforts that do not take affinity within groups as a priori. This means that we should not assume that just because people share similar phenotype characteristics, or even a shared ancestry, that they will share other characteristics, and act as a group.

ENCOURAGING INTEGRATION

Singapore has been highly successful in attracting highly educated Asians who see Singapore as a happy middle ground between East and West.

This group with high cultural capital often finds the city of Singapore an easy place to adapt to because of its Asian character.

However, in many cases, this has not entailed meaningful interaction with Singaporeans, as they maintain exclusive social networks and often self-segregate even in residential areas.

This mode of living “parallel lives” — side by side but without meaningful interaction — is a sign of the increasingly divided society that Singapore is becoming, along lines of socio-economic status, not race.

We should not ignore changing demographic realities on the ground.

One of the most significant trends that is emerging is the intersection of socio-economic status with immigration status, where highly-skilled employment pass holders and low-wage domestic, construction and service sector workers lead very separate lives from middle-class Singaporeans.

Attempts should be made for greater grassroots reach into condominiums and private developments where there is evidence of immigrant communities self-segregating.

More effort should also be made to ensure neighbourhoods are composed of a mix of housing types.

In addition, organic, bottom-up expressions of identity that are inclusive and bind people across racial and class differences should also be encouraged.

The politics of recognition that the post-independence Government adopted, which ensured the representation of the four major ethnic groups in Singapore across many spheres, has worked well on many counts.

We have a largely bilingual population, there is a high level of residential desegregation and Singaporeans, on most counts, are tolerant of difference in everyday life.

However, the CMIO system of dividing and catering to the welfare of the population along lines of race, seems to have reached the extent of its utility.

The divisions between socio-economic class and between local and foreigner/new immigrant now seem to have superseded the divisions once thought to be the most insurmountable – those between the different races.

Perhaps it is time to move towards a post-recognition politics; one that is inclusive and that resists labelling or categorisation.

This is almost an imperative given that one out of every four marriages here is between a Singaporean and a non-Singaporean. Current and future generations will comprise a significant proportion of bicultural individuals who will not easily fit into ethnic labels or even national categories.

These shifts in thinking about diversity should come together with a widening of perspective on who needs to be included within the nation.

Together with efforts to integrate immigrants, we should also consider how we can acknowledge the labour and contributions of temporary migrants to the nation.

After all, our collective dependence on migrants is not diminishing. In fact, with Singaporeans increasingly shifting to white-collar work, our reliance on a migrant pool doing blue collar jobs is growing.

Given these circumstances, it would be of mutual benefit if we develop better welfare mechanisms and frameworks to deal with issues that low-wage migrants regularly face such as overwork and lack of representation against errant employers.

Temporary migrants should also be integrated into mainstream Singaporean society through their inclusion in neighbourhood level activities, and the labour protections and rights that Singaporeans and middle-class workers enjoy should be extended to them.

Tangibly, this could mean, for example, extending to foreign domestic workers the benefits and protection prescribed under the Employment Act.

If we want multiracial cultural diversity to be one of our greatest strengths, Singapore’s leaders should rethink the traditional ways in which diversity has been defined and managed, taking into account the issues arising from migration that have been discussed. It is time for change.

 

Laavanya Kathiravelu is an Assistant Professor of Sociology at the College of Humanities, Arts, & Social Sciences, Nanyang Technological University. This is adapted from a piece which first appeared in the latest volume of Commentary, a journal from the National University of Singapore Society.

 

By: Laavanya Kathiravelu
Date: January 16, 2019
Source: Today
https://www.todayonline.com/commentary/re-thinking-singapores-approach-diversity-and-social-inclusion

Posted in Latest Post, Social and Economic Inequalities | Leave a comment

Should We Care About Inequality?

 

Since Occupy Wall Street, “inequality” has emerged as a central theme of progressive politics. Is that a good thing?

Following the sensational success of Thomas Piketty’s Capital in the Twenty-First Century, with no less than 2.5 million copies of the book sold worldwide, inequality is now widely perceived, to quote Bernie Sanders, as “the great moral issue of our time.” Clearly the shift is part of a wider transformation of American and European politics in the wake the 2008 crash that has turned the “1%” into an object of increasing attention. Marx’s Capital is now a bestseller in the “free enterprise” section of the Kindle store, Jacobin is considered a respectable place to be published, and socialism no longer looks like a failed rock band trying to climb on stage when the “party” is already over. On the contrary, if we are to believe Gloria Steinem, a Bernie Sanders rally is now the “place to be,” even “for the girls.”

On closer scrutiny, however, it’s not entirely clear how well our current interest in inequality (especially income inequality) rhymes with Marx’s own theory, or the ideas that dominated social-policy debates in decades following the Second World War. In fact, one could even argue that our current focus on income and wealth inequality, while crucial to any progressive agenda, also misses some of the most important aspects of the nineteenth-century critique of capitalism. At that time, “income inequality” was an elusive and at best ancillary term. In fact, the “monetization” of inequality is actually a relatively recent way of seeing the world — and, aside from its obvious strengths, it is also a way of seeing that, as the historian Pedro Ramos Pinto noted, has considerably “narrowed” the way we think about social justice.

The Lost Word in Capital

There may be no better way to gauge this difference than simply by looking at one of socialism’s classics itself: Capital. As surprising as it may seem, the term “inequality” per se was never a crucial category for Marx — or for nineteenth-century socialists, for that matter. Interestingly, the word itself, depending on the translation, appears fewer than five times in Marx’s voluminous masterpiece.

Our own conception of inequality, as something measured by the dispersion of income and wealth among individuals rather than between factors of production, such as labor and capital, became widespread only decades after Marx’s death in 1883. As Branko Milanovic argued, for a long time, if you assumed that “all workers are at subsistence, all capitalists rich, and all landlords even richer,” it simply did not make sense to think about inequality at an inter-individual level. No thinker until the late nineteenth century had ever thought to rank every single individual by total income to measure its distribution. For them, differences between classes, rather than between individuals, were what mattered. Only with the work of the Italian sociologist Vilfredo Pareto (later a fascist sympathizer) did proper tools to measure inequality as we know it today really emerge.

Obviously, Marx thought capitalism was a system that allocated society’s resources in a dramatically unequal fashion. In chapter 25 of Capital, where he deals with the “law of capitalist accumulation,” the philosopher famously wrote that the “accumulation of wealth at one pole” is “at the same time accumulation of misery, agony of toil slavery, ignorance, brutality, mental degradation, at the opposite pole.” Along the same lines, Marx thought that capitalism could only exist in a society where “two very different kinds of commodity-possessors must come face to face and into contact”; on the one hand the owners of the “means of production” and “subsistence,” and on the other, “free laborers,” those who have only “their own labor power” to sell. In other words, capitalism presupposes “the complete separation of the laborers from all property in the means by which they can realize their labour.” From that perspective, capitalism itself, for Marx, was built on a primordial inequality in access to property, achieved through a violent expropriation that he famously called “primitive accumulation.”

Even here, however, Marx still thought of inequality in terms of classes that were produced by capitalism, rather than in individual terms. For Marx, it seems, the problem was not exactly how income was distributed among people but how capitalism itself tended inherently toward the immiseration of workers and the production of “a relatively redundant population of laborers.” In that sense, as Samuel Moyn has observed, it is quite clear that Marx never really embraced any conception of “distributional equality” because, within capitalism, it would always be “hostage to class rule.” Rather, he tried to imagine a post-market society. Of course, Marx’s ideal never fully came into existence in Western Europe or the United States, but his analysis of the causes of inequality, rooted in a rich literature of nineteenth-century thinkers and economists like Eugène Buret or Charles Fourier, would prove an enduring influence on how to think about inequality, well beyond the circle of self-proclaimed Marxists.

The Capitalist War Against Equality

After the Second World War, if the question of equality mattered for policymakers and thinkers, none of them really separated it from the question of the market. Not because it was a secondary issue for them — quite the opposite. Rather, it was simply due to the fact that “inequality” was rarely thought of independently from the question of what role the market would be given in society.

This understanding was hardly new. Already in 1841, when the French journalist and economist Eugène Buret wrote one of the first general analyses of the causes of poverty within the rising industrial order, he famously argued that “if misery exists,” it progresses “at the same pace as wealth”; it grows “under the influence of the same causes.” For him, it was clear that an economic order where the principle of “laissez-faire” was dominant shaped a society in which “the extreme freedom of the rich and the strong” is paid at the cost of the “servitude of the poor and the weak.” His book, entitled De la misère des classes laborieuses en Angleterre et en France, would become extremely influential, advocating the creation of “fair institutions” that would seek to limit the principle of laissez-faire and put an end to what he called the “hopeless” and “cruel” “theory of work as a commodity.”

It would therefore be quite unsurprising, more than a century later, to read the British sociologist T.H. Marshall arguing that “basic equality” can’t be “created and preserved without invading the freedom of the competitive market.” For Marshall, who never was a Marxist — though unlike Keynes or Beveridge he was a member of the Labour Party — it was clear even throughout the twentieth century that “citizenship and the capitalist class system have been at war.”

The discrediting of nineteenth-century economic liberalism was so profound that the idea of equality was always embedded within a larger framework of a post-laissez-faire world. Therefore, the institutions that constituted the basis of our modern welfare states were, from their very inception, in fact committed to limiting the sphere of the market in order to produce a more egalitarian society. Under that framework, to quote Steven Fraser, what was then understood as the “labor question” meant “not only to permanently alter the relationship between labor and capital, but in so doing to eliminate the immorality of exploitation, the social inequality and antagonism fostered by great aggregations of wealth, the threat to democratic politics represented by overbearing corporate power and pelf, and even the causes of global and imperialist war.”

Saving Man’s Soul

The problem identified by Fraser — extending the question of inequality beyond monetary concerns — also had a deeply moral and political dimension. For a significant number of the progressive thinkers who had experienced the social dislocations provoked by the birth of a “market society” in the nineteenth century, creating institutions designed to limit it was also a way to preserve a truly democratic order and some fundamental human values.

As the historian Tim Rogan notes in The Moral Economists, it was only very recently that “concerns about inequality” took central stage in arguments against capitalism. In fact, he contends, “for most of the nineteenth and twentieth centuries” what mattered most for figures like Polanyi, R.H. Tawney or even E.P. Thompson was capitalism’s “moral or spiritual desolation.” To these thinkers, the totalized laissez-faire society had not only removed the allocation of wealth and resources from political deliberation but also altered the nature of social transactions as such. The expansion of the economic sphere had “broken” all relations and ties not conducted in the terms of the “naked self-interest” of “cash payment” and “drowned”, as Marx once wrote, “the most heavenly ecstasies of religious fervor … in the icy water of egotistical calculation.”

Even the experience of time, as shown in the writings of E.P. Thompson, underwent a profound change. Rather than time “going by,” as in pre-capitalist economies, it is now “spent” and can therefore be “wasted.” Working hours not only increased considerably — more than doubling compared to the peasants of the Middle Ages — but the standard of living would also, at first, deteriorate with the great exodus to the urban centers where the work force was piling up in infamous conditions. Finally, in order to increase productivity the quality of work itself that would deteriorate considerably: Taylorization transformed man into a simple “accessory to the machine,” as in Charlie Chaplin’s Modern Times, where his entire body is subjected to the temporality of the factory for comic effect.

Whether it concerned production, work, or human relations more generally, “market society,” as Polanyi argued, was seen as a threat to democratic politics by letting the market shape the social order rather than the other way around. More than a mere rhetorical trick, this political and “moral critique” profoundly impacted policymakers and thinkers; the welfare state had to be more than a simple tool for redistribution.

It was for this precise reason that thinkers like Richard Titmuss could argue that the aim of a European welfare state would be to inculcate and preserve the so-called “Dunkirk spirit.” The rescue of thousands of British soldiers from the French coast in May–June 1940 by a flotilla of hundreds of civilian ships had a tremendous impact on the British people. Titmuss, a British social scientist and founder of the study of “social policy,” saw in this “spirit” the seeds of an upcoming “generous society.” As he wrote in the summer of 1940, with Dunkirk, “the mood of the people changed and, in sympathetic response, values changed as well. If dangers were to be shared, then resources should also be shared.”

However, the new order was not just about simple redistribution, but about creating democratic institutions to abolish what Beveridge called the five “giant evils” (want, ignorance, disease, squalor, and idleness) and promoting solidarity beyond the context of war. The welfare state was therefore supposed to offer not only a powerful tool for egalitarianism, but also the promise of a radically new society, closing the chapter of the horrors of the war and of nineteenth-century exploitation.

A New Form of Property

The “Dunkirk Spirit” bestowed on the state a tremendous role in guaranteeing fundamental social rights to its population (rights to health care, to education, to work, and so on). A growing share of wages were now socialized to finance large-scale protection schemes and high tax rates were imposed on the wealthiest members of society, with the revenues allocated to creating public services that would constitute a new “social property.” This notion, in use in France by the end of the nineteenth century, was seen as the solution to the dangers of civil war threatening a society where only property owners were granted full citizenship. As shown by the French sociologist Robert Castel, the aim was to build, alongside existing “private” property, a form of “social” property, which would render “available to non-owners a type of resources that is not the direct possession of a private patrimony, but a right of access to collective goods and services which have a social purpose.”

As Castel argued, one of the most original aspects of these new institutions of social protection and public service was that “this form of ownership is not constituted and does not circulate in the context of market exchanges.” It was also subject to democratic rule. In a sense, then, it’s important to understand welfare state institutions as an extension of the democratic imperative, making the physical reproduction of individuals a matter of political choice. It made it possible to decide collectively what kind of humanity society would create.

Of course, the labor-centered orientation of these new institutions relied essentially on the unpaid labor of women as domestic workers in households sustained by the “Fordist family wage.” Consequently, to various degrees depending on the country, it shaped a model of citizenship with significant exclusionary features for women or the immigrant labor force. However, in contrast to nineteenth-century poor relief systems, this new categorical architecture was, importantly, to be organized against the market rather than acting upon its margins. More importantly, demands and struggles for its effective universalization intensified in the decades following the war, slowly extending its benefits to a larger part of the population.

This perspective would gradually grow in Europe (and to a lesser extent the United States) and constitute the basis of what T.H. Marshall called a “social citizenship.” These institutions, he thought, would not have as their purpose to simply “abate the obvious nuisance of destitution in the lowest ranks of society,” but assumed “the guise of action modifying the whole pattern of social inequality.” “It is no longer content to raise the floor-level in the basement of the social edifice,” he continued, “leaving the superstructure as it was. It has begun to remodel the whole building.” Such a new understanding of the role of the state was promoted throughout the world.

In 1944, the Declaration of Philadelphia, which restated the objectives of the International Labour Organization, declared that “labor is not a commodity” and that “the extension of social security” was a fundamental aim. By 1946, the constitution of the World Health Organization mentioned the “highest attainable level of health as a right,” and by the late fifties, the Swedish economist and Nobel Prize winner Gunnar Myrdal was calling for the establishment of a “Welfare World.” As Samuel Moyn argues in his most recent book, while decolonization continued apace, “the new states born of the struggle against empire tended to dream bigger when it came to their own national welfare, invoking egalitarian ideals.” Postcolonial leaders like Jawaharlal Nehru, Kwame Nkrumah, or Leopold Sedar Senghor were committed to building the promise of welfare beyond the borders of the imperial world.

While hardly spared from criticism, the ideal of the universalization of these institutions remained dominant until the mid-sixties. The commitment to equality was therefore strongly embedded within the more general framework of “social rights” and citizenship rather through the sole lens of income distribution.

However, with the advent of the so-called “affluent society” and the excessive illusions it sustained concerning the shared benefits of growth slowly set aside inequality as a political issue. In his 1958 bestseller The Affluent Society even John K. Galbraith noted the “evident … decline of interest in inequality as an economic issue.” The stunning increase in production had, he thought, functioned as “alternative to redistribution.” What was going to capture public attention by the early sixties was rather the remaining poverty “within affluence.” This surge of concern for poverty would not, however, revive nineteenth-century commitments against the market. Rather, it would radically reshape ideas about social justice. The big issue was no longer inequality, but poverty alone.

The Turn to “Poverty”

When Michael Harrington published what would become his most popular book, The Other America, in March 1962, its purpose was essentially to contest the premises of postwar social policies and categorizations. For Harrington, whose book sold more than a million copies, America’s poor had “missed the social and political gains of the 1930s.” Welfare state programs, he claimed, were no longer the solution but rather part of the problem. Against the dominant view of the time, he thought the postwar institutions of welfare, minimum wages, labor laws, or unions were not designed for the poor and even contributed to their “rejection.” His “other” America was “beyond the welfare state.”

What was at first a statistical account of the persistence of poverty in “abundant” America published in a 1959 issue of Commentary rapidly became a more profound criticism of how poverty had been conceptualized since the nineteenth century. The idea popularized by the book was that “poverty” was now a “specific” condition, detached from the questions of labor, inequality, or the market. This argument was rather new, since in the 1950s nobody really imagined the “poor” as a group of citizens with its own dynamic. Echoing the work of anthropologist Oscar Lewis, Harrington argued that being poor was like being “an internal alien, to grow up in a culture that is radically different from the one that dominates society.” It was, he thought, “the most important analytic point” of the book.

In that sense, the issue of poverty, as it emerged in the early 1960s, would prove qualitatively different from the way it was posed in the nineteenth century. It appeared, above all, not as intrinsically, but rather extrinsically linked to the older divide of the capital-labor relationship.

The question of poverty was decoupled from the question of exploitation. It is no accident that the words “exploitation,” “market,” “socialism,” or even “inequality” barely appear in Harrington’s book — a clear break from nineteenth-century thinkers who never dissociated these questions. But, of course, if the poor constitute a group that “forms a distinct system,” that group also represents a specific problem. Now, as Dwight Macdonald argued in his seminal 1963 review of the book, “inequality of wealth is not necessarily a major social problem per se”; “poverty is.” For McDonald it was clear that the main concern was now to “provide a floor,” and not a system like Social Security that, he thought, simply perpetuated “the inequalities” keeping “the poor forever poor.”

By the early 1970s, in both the US and Europe, the spectacular emergence of the “poverty issue” would strongly encourage a vision of social justice focused on a monetary conception of poverty. Indeed, the focus on the establishment of a “floor” below which nobody could fall rapidly pushed aside any discussion of building ceilings or reducing market dependency. Guaranteed income proposals and negative-income-tax programs became widely popular among policymakers and political parties across the political spectrum, as a way to finally fight poverty while shedding any emphasis on large macroeconomic interventionism and complicated welfare schemes.

There was a flourishing of debates in this period about definitions of poverty and “needs,” opening the way for ambitious programs to measure and compare poverty levels around the planet. In France, the civil servant Lionel Stoléru, who had studied Milton Friedman’s idea of a negative income tax at the Brookings Institution in the early 1970s, offered an apt summary of this shift. In his view, a focus on “poverty” was the only reasonable social policy within a free market system. If we followed a policy that tended to reduce inequality we would inevitably affect “the heart of the dynamism of the market economy.” A program directed specifically against poverty, on the other hand, as argued by Friedman himself, “while operating through the market” would “not distort the market or impede its functioning,” as did Keynesian programs.

In this new conception of social justice, preserving market and price mechanisms was a central concern. If markets created an undesirable outcome, like poor housing, the solution had to be restricted to cash transfers rather than public services (social housing) or state regulations (rent control). As Friedman argued at a time when he still admitted to having “strong egalitarian leanings,” what people “ordinarily attributed to poor housing” and therefore to the market, is “really the social costs of poverty.” The general principle, then, was to rely completely on the “use [of] the price system for distribution of goods” and, when necessary, to “achieve changes in the distribution of income.”

Poverty, Worldwide

At the global level, this “free market compatible” vision of poverty was enthusiastically diffused through international institutions. One of the central architects of this evolution was Robert McNamara. Secretary of Defense under Kennedy and Johnson, he was appointed head of the World Bank in 1968, after playing a decisive role in the escalation of the Vietnam War.

While president of the institution, McNamara articulated an anti-poverty strategy that significantly differed from previous visions. In his view, poverty could be an integral part of the Bank’s strategy if it focused not in redistribution per se, but rather on “helping the poor to reach their productive potential.” “Social justice was globalized and minimized,” Moyn argues, favoring the establishment of a floor under which “no one is allowed to sink,” yet in strong opposition to the egalitarian narratives of postcolonial leaders.

By the eighties, McNamara’s approach had spread to other international institutions. The OECD, for example, called for an end to the extension of social programs and avoiding making equality “an end in itself,” since it should only be considered “a tool to struggle against poverty.” By the nineties, the UN, which in 1996 decreed the first international year for the eradication of poverty, was also very careful to frame its anti-poverty agenda within the larger aim of creating a “growth-friendly economic environment.” What that meant, as stated in the recommendations of the 1996 World Summit for Social Development, was the establishment of “a stable macroeconomic policy framework … which will include controlling inflation, liberalizing trade, promoting agricultural production, freeing prices of agricultural products, encouraging the rural sector, removing constraints on labor markets such as restrictions on labor mobility and ensuring that subsidy systems benefit the needy.”

In reality, the implementation of these “anti-poverty” policies was often accompanied by “structural adjustment” plans and calls for the privatization of public services that had been seen, just decades before, as a crucial dimension of a fairer society. Social justice would henceforth be conceived not as a form of protection against the inequalities generated by the free play of the market but as an intervention aimed at enabling everyone to be part of it. The fight against poverty has thus functioned mainly as a policy for the management of mounting inequalities, rather than trying to limit those inequalities themselves. Unsurprisingly, then, it became the privileged social policy of our contemporary neoliberal era.

In that perspective, what has happened in the 1970s was more than a simple side-lining of considerations related to income inequality. The very basis of how we thought about it was profoundly affected. With the rise of a targeted concern for “poverty,” criticism of the market progressively disappeared as an inherent part of our vision of social justice.

Inequality, Rediscovered?

This long disappearance of inequality as a central concern came to an end during Occupy Wall Street with the striking use of the data collected and “stylized” over the previous years by scholars like Tony Atkinson, Thomas Piketty, or Emmanuel Saez. Indeed, the extent of inequality itself had long been known, yet, as Atossa Araxia Abrahamian recently pointed out, it “wasn’t keeping a lot of scholars up at night.”

The success of the “99%” slogan changed the mood and captured the public imagination, creating the conditions for our current fascination with inequality. However, as argued by Ramos Pinto, this success did not signal a rupture with the focus on quantitative and economic aspects of inequality. On the contrary, while inequality represents an improvement over the previous focus on poverty, it stills narrows our horizon to “personal attributes” and their “relation to the potential for income mobility” rather than looking at more political categories and relations. The discussion remains stuck, looking at “the effect, rather than searching for causes.”

The question we face, then, becomes how should we care about inequality? Indeed, depending on how we think about it, the solutions we could imagine might be very different. If we stick to a vision confined to the effects, and therefore one that is focused on strict income inequality, we might increase equality by reducing the gap between rich and poor.

However, this could perfectly well be done without affecting the market itself — the point being to enhance market opportunities for everyone, to enable people to make the most of it. The only difference now is that the rich won’t be able to spend millions of dollars on solid-gold toilets. This would certainly offer a better world, but still one where we all depend on the market to purchase the goods we need or desire; a world where the economic game is still ruthless but where none of us would fear material deprivation. Not exactly the “Dunkirk Spirit.” This is a world that, in fact, none of the nineteenth-century socialist thinkers ever would have imagined because of their strong belief that inequality was a problem of laissez faire.

This world would differ enormously from one where equality was reached mainly through the decommodification and democratization of goods like health care, education, public transportation, energy, and so on — a world that, by socializing and guaranteeing access to the most important aspects of our existence, would reduce market dependence and therefore attack the source that created inequality in the first place. For a long time, this project had not been seen as outrageously utopian, even by the most moderate reformers. To the contrary, for most of them progressive politics was not only about improving the material condition of workers but, more importantly, about providing the promise of a more democratic and humane society. And it was no doubt this promising vision of the future that in December 1942 motived thousands of people to queue in the cold to buy the copies of the dry and technical document known as the “Beveridge Report,” with sales reaching no less than 635,000 copies.

One might wonder, of course, why we should ask for more than reducing income inequality at a time when even this modest aim seems impossible to reach. Yet, in the aftermath of the “end of history,” ideological boldness has made a stunning comeback — mostly in right-wing and xenophobic guise. Amid this dramatic shift, the Left may have to transcend its narrow commitment to income equality, and promote a bolder vision of a world beyond market utopianism. The power of “big ideas” is that they do not aim to simply redistribute some cards, but to profoundly alter the rules of the game. “A revolutionary moment in the world’s history,” Beveridge noted, is “a time for revolutions, not for patching.”

 

Daniel Zamora is a postdoctoral sociologist at the Université Libre de Bruxelles and Cambridge University.

 

By : Danie; Zamaro
Date : November 1, 2018
Source : Jacobin Magazine
https://jacobinmag.com/2018/11/inequality-capitalism-markets-marx-political-economy

Posted in Latest Post, Politics, Social and Economic Inequalities | Leave a comment

Do schools help or hinder social mobility?

 

Do schools help social mobility and fairness? Or do they give even more advantages to the better-off?

Even if they can’t make up for all inequalities, at least we might expect them to make the playing field more level.

But a major international study on social mobility from the OECD economics think tank shows a more sobering picture.

Each year that a child spends in education, the gap between rich and poor grows wider.

On average, across more than 60 countries, that difference between the richest and poorest is the equivalent to three years of schooling by the age of 15.

Only about one in 10 children from poor backgrounds will achieve the same results at those from wealthy backgrounds.

Gap getting wider

The study tracked test results taken by 10-year-olds in 1995, 15-year-olds in 2000 and then a decade later for young adults in their mid-20s.

At each point the social divide, with few exceptions, tended to widen.

It’s not that difficult to see how this happens.

The children of more prosperous families are travelling in an educational fast lane, with more support from home, a higher chance of getting into a good school and university, and benefiting from the interventions of better-educated parents.

The accumulation of advantages will amplify differences.

According to the study, on average by the age of 15 about 13% of the variation in students’ performance will be determined by their social background.

This varies between countries. In the UK, it’s below average at 11%, with Norway and Estonia lower at 8%. In France it’s 20% and in Germany and Switzerland it’s 16%.

Defying the odds

But it’s not all pessimism. The OECD’s head of education Andreas Schleicher, argues there is also plenty of evidence to say that “poverty need not be destiny”.

There are school systems where many more disadvantaged children do well.

n countries such as Singapore, Japan and Finland, the test results of the poorest 20% are higher than the richest 20% in the Slovak Republic, Uruguay, Brazil and Bulgaria.

The UK does quite well on this measure, with the median point for UK students being above the wealthiest 20% in Italy and not far behind those similarly advantaged students in Spain.

“It shows that students from very similar backgrounds can have very different outcomes,” says Mr Schleicher.

He says it’s a cause for optimism that some countries have made sure that “excellent teaching” is available for rich and poor pupils.

The study also found other factors associated with disadvantaged pupils defying the odds, including in Vietnam and China.

One pattern that emerged strongly was the importance of the social profile of the school they attended.

In many countries, disadvantaged students tend to be clustered together in schools with other similarly disadvantaged students.

If this can be prevented, the study shows that disadvantaged students taught in schools with a wealthier intake tend to have much higher results.

More places, fewer choices

But the research also shows how easily inequality can be absorbed into education systems.

“A rising tide doesn’t automatically lift all boats,” says Mr Schleicher.

Numbers going into university have increased – but that doesn’t necessarily make it a fairer system.

In Singapore, many going to university will be the first in their families to get a degree. It’s an example of social mobility and widening doors.

But in Italy, wealthier families have been much more likely to benefit from extra university places, widening the education gap.

In terms of “equity”, Italy has been going backwards, says Mr Schleicher.

There are also generational divides.

In the US, looking at people between 26 and 65, the older age groups are much more likely than the younger ones to have advanced further in education than their parents.

You can see educational mobility withering through the more recent decades.

Social division

The big picture is the struggle to kick-start social mobility in Western democracies.

A report earlier this year from the OECD showed that in the UK, social mobility was so frozen that it would take five generations for poorer families to reach the average income.

“Meritocracy is the big promise of our democracies, and social mobility is the truth test for meritocracy,” says Mr Schleicher.

“So, yes, I think we need to worry if social mobility is limited or slowing down.”

He says the slowdown is not simply a case of there being many more people with higher qualifications competing with each other, because the demand for graduates and skilled workers has increased at least as rapidly.

Instead he warns of a system in which social division becomes embedded.

“Lower social mobility and higher income inequality tend to go together,” he says.

As the wealthiest families accelerate even further ahead, it’s likely to even further narrow the chances for “talented yet underprivileged individuals” who are being left behind.

“It’s a worry, because it shows our education systems have not been able to moderate social inequality. Instead social inequality has grown,” says Mr Schleicher.

 

By : Sean Coughlan
Date : October 31, 2018
Source : BBC
https://www.bbc.com/news/business-46013665

Posted in Education, Latest Post, Social and Economic Inequalities | Leave a comment
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