The Universal Declaration of Human Rights is one of the most translated and celebrated documents in the world, marking its 70th anniversary this year. But relatively few people are aware of the significance of its 25th Article, which proclaims the right of everyone to an adequate standard of living—including food, housing, healthcare, social services and basic financial security.[1] As our campaign group Share The World’s Resources (STWR) has long proposed, it is high time that activists for global justice reclaim the vision that is spelled out in those few simple sentences. For in order to implement Article 25 into a set of binding, enforceable obligations through domestic and international laws, the implications are potentially revolutionary.

To appreciate the truth of this assertion, it is necessary to outline some brief history. Since the Universal Declaration was adopted by the General Assembly in 1948, the United Nations never promised to do anything more than “promote” and “encourage respect for” human rights, without explicit legal force. The Universal Declaration may form part of so-called binding customary international law, laying out a value-based framework that can be used to exert moral pressure on governments who violate any of its articles. But in the past 70 years, no government has seriously attempted to adapt its behaviour in line with the Declaration’s far-reaching requirements.

An International Bill of Human Rights was eventually agreed by the General Assembly in 1966,[2] which comprised the Universal Declaration and its two main “implementing” treaties—the International Covenant on Civil and Political Rights (ICCPR), and the International Covenant on Economic, Social and Cultural Rights (ICESCR). The latter Covenant elaborated in greater detail the economic and social rights previously laid out in the Universal Declaration (as largely reflected in Articles 22 to 26, especially Article 25), and it was intended to form the basis of a binding legal obligation under international law. Still, both Covenants lacked any serious enforcement machinery, and were ratified by States parties under the sole proviso that they would submit periodic reports on steps taken and “progress achieved”.[3]

Marginalising economic and social rights

While civil and political rights have enjoyed an increasing degree of implementation throughout the world (albeit partially and fitfully), the historical record on economic and social rights is far less sanguine. This is forcefully illustrated by the UN’s current Special Rapporteur on extreme poverty and human rights, Philip Alston. In his first report submitted to the Human Rights Council, he argues that economic and social rights are marginalised in most contexts, without proper legal recognition and accountability mechanisms in place.[4] Indeed, he even questions the extent to which States treat them as human rights at all, and not just desirable long-term goals.

Despite the widespread constitutional recognition of economic and social rights, as well as an abundant scholarship on their fundamental importance, they nevertheless “remain largely invisible in the law of and institutions of the great majority of States”, according to Alston. Even many of the States that enjoy the world’s highest living standards have disregarded proposals to recognise these rights in legislative or constitutional form.[5]

Most of all, the United States has persistently rejected the idea that economic and social rights are full-fledged human rights,[6] in the sense of “rights” that might be amenable to any method of enforcement. Some of its past administrations have notoriously even challenged the “soft law” status of the ICESCR treaty, regardless that it was signed (yet not ratified) by Jimmy Carter in 1977.[7] Although the United States has ratified other treaties that clearly recognise economic and social rights,[8] it is the only developed country to insist that, in effect, its government has no obligation to safeguard the rights of citizens to jobs, housing, education and an adequate standard of living.

In their defence, governments may point out the historical progress made in reducing extreme poverty across the world, which has generally been achieved without adopting a strategy based on the full recognition of economic and social rights. But the extent to which these rights remain unmet for millions of people today is unconscionable from any kind of moral perspective. Consider that more than 60 percent of the world population struggles to live on less than $5 per day, an amount which the United Nations Conference on Trade and Development (UNCTAD) has considered the minimum daily income which could reasonably be regarded as fulfilling the right to “a standard of living adequate for… health and well-being” (as stipulated in Article 25).[9]

The International Labour Organisation of the United Nations also estimates that only 27 percent of people worldwide have access to comprehensive social security systems, notwithstanding the fact that virtually every government recognises the fundamental right to social security, as also enshrined in Article 25.[10] The fact that many thousands of people continue to die each day from poverty-related causes,[11]while the number of chronically undernourished people increases once again,[12] is an affront to the very idea that everyone has the right to an adequate standard of living. Also in the most affluent nations, of course, millions of people have limited access to essential services and social protection, and vast numbers of families are homeless or seeking emergency food assistance.

Such facts demonstrate how far we have strayed from realising the modest aspiration expressed in Article 25. Gross inequalities of wealth and power are seemingly built into the structures and operations of the world economy, which gives the least priority and concern to the world’s majority poor. Its design is determined in international negotiations which are dominated by rich industrialised nations, who ensure that the major beneficiaries of global economic growth are the powerful corporate and elite interests that they basically function on behalf of.[13] Consequently, the number of billionaires continues to grow at an unprecedented rate, with combined annual increases in wealth that would be enough to end extreme poverty many times over.[14]

The duty of States to respect and support the achievement of socioeconomic rights outside of their borders may be anchored in international law, but the most influential multilateral organisations are not challenged to adhere to these agreed norms and standards. A rich literature examines the impact on less developed countries of this virtual system of global economic governance,[15] as principally upheld by the Bretton Woods Institutions, the World Trade Organisation and the Group of 7 nations. For example, most countries of the global South have been pressured to service their debt burdens by making structural adjustments at the expense of the most disadvantaged segments of society. Through such policies as privatisation, deregulation of markets and cutbacks in social services, the harsh conditionalities of the International Monetary Fund and World Bank’s lending programmes have widely hindered the ability of State’s to fulfil their human rights obligations.[16]

At the same time, many of the thousands of bilateral international treaties and free trade agreements of recent decades are incompatible with basic human rights standards in some fundamental respects.[17] In particular, the current international investment system creates rights to multinational corporations to challenge the legal and policy decisions of governments through “investor-state dispute settlement”,[18]even when those decisions are taken to meet social needs and pursue sustainable development objectives, such as reducing inequality.

Formidable obstacles

All of this points to the formidable political obstacles to implementing Article 25 through an enforceable system of international law that can offset the damaging social effects of deregulated, market-led globalisation. The challenge is well recognised by civil society groups that advocate for a new direction in economic policymaking, beginning with a reversal of the austerity measures that are now expected to affect nearly 80 percent of the global population within a couple of years.[19]

Rendering Article 25 into a truly “indivisible”, “inalienable” and “universal” human right therefore means, for example, reforming unfair tax policies that undermine the capacity of countries to invest in universal social protection systems.[20] It means rolling back the wave of commercialisation that is increasingly entering the health sector and other essential public services, with extremely negative consequences for human wellbeing.[21] And it means regulatory oversight to hold the out-of-control finance sector to account,[22] and domestic legislative action in support of a living wage and labour rights, as well as fair and progressive tax systems.

It also means, in short, a redistribution of wealth, power and income on an unprecedented scale within every society, in contradistinction to the prevailing economic ideology of our time—an ideology that falsely views economic and social rights as inimical to “wealth creation”, “economic growth” and “international competitiveness”.

But the scale of that redistribution must extend beyond national borders alone, considering the reality that developing nations are unable to fulfil the socioeconomic rights of their citizens without greater access to wealth and resources. That depends on substantial coordination and assistance from the international community, which must come in the form of bilateral aid that is no longer disbursed on the basis of geo-strategic considerations, or with a preference for privatisation and “free market” models of development.[23] At present, low-income countries are able to devote, at most, only 15 percent of gross domestic product towards meeting the basic needs of their citizenry.[24] Yet donor governments are far from helping to bridge the gap in public finances through more effective aid, despite the agreed global target of achieving “zero” extreme poverty by 2030.[25]

This only serves to underline the enormous political implications of achieving Article 25. For it is clear that rich countries prefer to extract wealth from the global South, rather than share their wealth in any meaningful way through a redistribution of resources. Yet we know the resources are available, if government priorities are fundamentally reoriented towards safeguarding the minimal guarantees of Article 25 for all peoples everywhere.[26]

To be sure, just a fraction of the amount spent on a recent US arms deal with Saudi Arabia, estimated at over $110 billion, would be enough to lift everyone above the extreme poverty line as defined by the World Bank.[27] And if concerted action was taken by the international community to phase out tax havens and prevent tax dodging by large corporations, then developing countries could recover trillions of dollars each year for human rights protection and spending on public services.[28] Achieving Article 25, therefore, is not about merely upscaling aid as a form of charity; it is about the kind of structural transformations that are necessary for everyone to enjoy dignified lives in more equal societies with economic justice.

Towards a people’s strategy

The most radical article of the Universal Declaration, in this respect, is not only Article 25 but also Article 28, which refers to the necessary arrangements of the “social and international order” wherein all the rights and freedoms set forth in the Declaration “can be fully realised”. In other words, it is impossible to achieve a more social regulation of the world economy without dramatic adjustments in the relations between States and regions, which also needs to be reflected in more democratic structures of global governance.

For how can States implement a new global social contract, rooted in a respect for socioeconomic rights and the imperative role of international law, unless normative considerations of justice and human rights are given precedence over strategic alignments in foreign policy affairs?[29] And how can global public goods be made equitably accessible to all citizens of the world, unless the United Nations is significantly reformed and empowered to fulfil its original mandate?

As spelled out in the preamble of its Charter, the UN was always intended “to employ international machinery for the promotion of the economic and social advancement of all peoples.” However, its role in that regard has been severely curtailed by the Permanent Five and other major powers, who mainly use the United Nations as a “vehicle for the aggregation of national interests”, while constantly preventing significant reform within the Organisation.[30]

Its role in global economic governance was purposefully weakened from the outset; all the important financial and trade negotiations take place outside the UN system. And as we have seen, the policy priorities of the Bretton Woods Institutions and World Trade Organisation have grown increasingly distinct from the basic human values of the UN’s economic and social programs.[31] At the same time, the UN’s ability to hold States accountable for human rights and international law standards is severely limited by a lack of financial independence, with a budget too small to enable it to be truly effective.[32]

These are just some of the reasons why the human rights of Article 25, however simply worded and unassuming, hold the potential to revolutionise the unfair structures and rules of our unequal world. Because if those rights are vociferously advocated by enough of the world’s people, there is no gainsaying the political transformations that will unfold. That is why STWR calls on global activists to jointly herald Article 25 through massive and continual demonstrations in all countries, as set out in our flagship publication.[33]

At the least, it behoves us to contemplate the urgent necessity of achieving Article 25 as the highest international priority, which is a responsibility that obviously cannot be left to individual governments. The UN Charter famously invokes “We the Peoples”, but it is now up to us to resurrect the UN’s foundational ideal to promote social progress and better standards of life for everyone in the world. It is high time we seized upon Article 25 and reclaimed its stipulations as “a law of the will of the people”,[34] until governments finally begin to take seriously the full realisation of their pledge set forth in the Universal Declaration.

Image credit: riacale, flickr creative commons

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Media reporting that heralds the success of global poverty reduction strategies making claims such as “the number of people living in extreme poverty ($1.90 per person per day) has tumbled by half in two decades” is still very much routine. However, articles like Nicholas Kristof’s recent piece in the New York Times, entitled The Best News You Don’t Know that suggests that “historians may conclude that the most important thing going on in the world in the early 21st century was a stunning decline in human suffering’ accepts doctored UN numbers at face value, misguidedly casting them as if they were news.

Much as we all naturally want to believe Mr Kristoff’s rendering of reality, it masks some far deeper, more depressing truths.

We can and should recognise that there has, indeed, been some remarkable progress on some fronts, but the idea that this warrants an overall “the world is getting better” diagnosis is, we’re sorry to say, untruthful, as it is based on a very partial reading of some fundamentally unsound data. In truth, the number of people living in poverty (as measured by the $5 a day mark, which UNCTAD defines as the absolute minimum for living a healthy life) has increased by 10% since the 1980s, and hunger by 9%. This, during a period in which global GDP increased an astonishing 271%.

Right now, according to the World Bank’s database, 4.1 billion people – more than half of humanity – are living in a state of poverty. So whose pockets are really being lined with all this aggregate economic growth?

This narrative also masks the fact that this growth has been dependent on economic activity that is destroying the environment wholesale, laying bear-traps for people living in poverty long into the future. The worst aspect of this narrative is not, ultimately, its empirical dishonesty, but what it hides. It gets people believing that everything is getting better, therefore we just need more of the same to end poverty. More of the same being the neoliberal ‘capital growth at all costs’ system that got us here, into the anthropocene, with its unfolding 6th mass extinction event, its massively centralising patterns of wealth and power distribution, and its deep, structural poverty and inequality.

No thanks.

Far better to fess up to the whole truth, as that is far more likely to focus attention where it’s needed to actually overcome poverty: the fundamental operating principles of the economic system, starting with, ‘material growth everywhere, all the time, at all costs’.

Unfortunately, generating a political and social imperative to do that is just the sort of thing Mr Kristof’s faux ‘everything’s great and getting greater’ narrative works against.

Find out more about how poverty is created on The Rules website: https://therules.org

Further resources:

Exposing the great ‘poverty reduction’ lie, Al Jazeera

Could you live on $1.90 a day? That’s the international poverty line, The Guardian

The hunger numbers: are we counting right? The Guardian

Photo credit: psd, flickr creative commons

The post ‘Good news’ claiming ‘falling global poverty’ isn’t news at all appeared first on P2P Foundation.

This brilliant analysis by Herman Daly, brings the two factors together, i.e. how the specific function of interest (money theory) is related to the function of capital (economic theory) and how both are embedded in a real physical world (thermo-dynamic theory).

In addition, it also explains the fundamental role of supra-national institutions of capital, the World Bank, in driving the whole system at the service of capital (institutional theory).

A must read, really!!

By Herman Daly:

“”When I was in graduate school in economics in the early 1960s we were taught that capital was the limiting factor in growth and development. Just inject capital into the economy and it would grow. As the economy grew, you could then re-invest the growth increment as new capital and make it grow exponentially. Eventually the economy would be rich. Originally, to get things started, capital came from savings, from confiscation, or from foreign aid or investment, but later out of the national growth increment itself. Capital embodied technology, the source of its power. Capital was magic stuff, but scarce. It all seemed convincing at the time.

Many years later when I worked for the World Bank it was evident that capital was no longer the limiting factor, if indeed it ever had been. Trillions of dollars of capital was circling the globe looking for projects in which to become invested so it could grow. The World Bank understood that the limiting factor was what they called “bankable projects” — concrete investments that could embody abstract financial capital and make its value grow at an acceptable rate, usually ten percent per annum or more, doubling every seven years. Since there were not enough bankable projects to absorb the available financial capital the WB decided to stimulate the creation of such projects with “country development teams” set up in the borrowing countries, but with WB technical assistance. No doubt many such projects were useful, but it was still hard to grow at ten percent without involuntarily displacing people, or running down natural capital and counting it as income, both of which were done on a grand scale. And the loans had to be repaid. Of course they did get repaid, frequently not out of the earnings of the projects which were often disappointing, but out of the general tax revenues of the borrowing governments. Lending to sovereign governments with the ability to tax greatly increases the likelihood of being repaid — and perhaps encourages a bit of laxity in approving projects.

Where did all this excess financial capital come from? Not from savings (China excepted), but from new money and easy credit generated by our fractional reserve banking system, amplified by increased leverage in the purchase of stocks. Recipients of new money bid resources away from existing uses by offering a higher price. If there are unemployed resources and if the new uses are profitable then the temporary rise in prices is offset by new production — by growth. But resource and environmental scarcity, along with a shortage of bankable projects, put the brakes on this growth, and resulted in too much financial capital trying to become incarnate in too few bankable projects.

So the WB had to figure out why its projects yielded low returns. The answer sketched above was ideologically unacceptable because it hinted at ecological limits to growth. A more acceptable answer soon became clear to WB economists — micro level projects could not be productive in a macro environment of irrational and inefficient government policy. The solution was to restructure the macro economies by “structural adjustment” — free trade, export-led growth, balanced budgets, strict control of inflation, elimination of social subsidies, deregulation, suspension of labor and environmental protection laws — the so-called Washington Consensus. How to convince borrowing countries to make these painful “structural adjustments” at the macro level to create the environment in which WB financed projects would be productive? The answer was, conveniently, a new form of lending, structural adjustment loans, to encourage or bribe the policy reforms stipulated by the term “structural adjustment.” An added reason for structural adjustment, or “policy lending,” was to move lots of dollars quickly to countries like Mexico to ease their balance of payments difficulty in repaying loans they had received from private US banks. Also, policy loans, now about half of WB lending, require no lengthy and expensive project planning and supervision the way project loans do. The money moves quickly. The WB definition of efficiency became, it seemed, “moving the maximum amount of money with the minimum amount of thought.”

Why, one might ask, would a country borrow money at interest to make policy changes that it could make on its own without any loans, if it thought the policies were good ones? Maybe they did not really favor the policies, and therefore needed a bribe to do what was in their own best interests. Maybe the goal of the current borrowing government was simply to get the new loan, splash the money around among friends and relatives, and leave the next government to pay it back with interest.

Such thoughts got little attention at the WB which was haunted by the specter of an impending “negative payments flow,” that is, repayments of old loans plus interest greater than the volume of new loans. Would the WB eventually shrink and disappear as unnecessary? A horrible thought for any bureaucracy! But the alternative to a negative payments flow for the WB is ever-increasing debt for the borrowing countries. Of course the WB did not claim to be in the business of increasing the debt of poor countries. Rather it was fostering growth by injecting capital and increasing the debtor countries’ capacity to absorb capital from outside. So what if the debt grew, as long as GDP was growing. The assumption was that the real sector could grow as fast as the financial sector — that physical wealth could grow as fast as monetary debt.

The main goal of the WB is to make loans, to push the money out the door, to be a money pump. If financial capital were really the limiting factor countries would line up with good projects and the WB would ration capital among countries. But financial capital is superabundant and good projects are scarce, so the WB had to actively push the money. To speed up the pump they send country development teams out to invent projects; if the projects fail, then they invent structural adjustment loans to induce a more favorable macro environment; if structural adjustment loans are treated as bribes by corrupt borrowing governments, the WB does not complain too much for fear of slowing the money pump and incurring a “negative payments flow.”

If capital is no longer the magic limiting factor whose presence unleashes economic growth, then what is it?

“Capital,” says Frederick Soddy,”merely means unearned income divided by the rate of interest and multiplied by 100” (Cartesian Economics, p. 27). He further explains that, “Although it may comfort the lender to think that his wealth still exists somewhere in the form of “capital,” it has been or is being used up by the borrower either in consumption or investment, and no more than food or fuel can it be used again later. Rather it has become debt, an indent on future revenues…”

In other words capital in the financial sense is the future expected net revenue from a project divided by the rate of interest and multiplied by 100. Rather than magic stuff it is an indent, a lien, on the future real production of the economy — in a word it is a debt to be repaid, or alternatively, and perhaps preferably, to not be repaid but kept as the source of interest payments far into the future.

Of course debt is incurred in exchange for real resources to be used now, which as Soddy says cannot be used again in the future. But if the financed project can extract more resources employing more labor in the future to increase the total revenue of society, then the debt can be paid off with interest, and with some of the extra revenue left over as profit. But this requires an increased throughput of matter and energy, and increased labor — in other words it requires physical growth of the economy. Such growth in yesterday’s empty-world economy was reasonable — in today’s full-world economy it is not. It is now generally recognized that there is too much debt worldwide, both public and private. The reason so much debt was incurred is that we have had absurdly unrealistic expectations about growth. We never expected that growth itself would begin to cost us more than it was worth, making us poorer, not richer. But it did. And the only solution our economists, bankers, and politicians have come up with is more of the same! Could we not at least take a short time-out to discuss the idea of a steady-state economy?”

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