Economic Policies for Social Justice (1)

Social Justice with its political and economic relevance are at the core of politics in the Arab world today. The uprisings of 2010/11, while not bringing about lasting political change to the region, have nonetheless exposed the ultimate need for political and especially economic reforms. Since the uprisings it has become more and more obvious, that the current economic order of the Arab World is not sustainable, neither socially, economically or ecologically. The need for economic policies for Social Justice is pressing – and growing.

An overstretched public sector has been unable to absorb the growing number of unemployed and public budgets are consumed by largely ineffective subsidies, while corruption and a rent-seeking economy limit innovation and investment in the private sector. In this situation, International Financial Institutions continue to call for structural adjustment programs and economic liberalization. Such policies have been implemented for many decades now, and economic growth in the region was mostly produced by a mixture of neoliberal and crony-capitalist economic policies. However, this growth only benefited a small elite and created sharp social inequalities. The increasing privatization of public goods and services, such as healthcare and education, have further cemented these inequalities. Further inequalities in terms of public services, investment and employment persist between the center and the periphery in all countries of the region.

In the absence of politically accountable governments, social injustice has contributed to protests, political instability and, in the worst cases, to armed conflicts and wars. For many countries of the region, reconstruction will be a decisive issue over the coming years. Choices towards social justice in reconstruction will be crucial to ensure sustainable peace and development.
In the light of these developments, it is safe to say that neoliberal policies have dramatically failed the Arab world. However, in a political environment increasingly dominated by securitization, political and religious extremism, the crucial debate on causes and effects of economic policies and its alternatives is bitterly absent, yet more necessary than ever before.

The realization of human rights cannot be separated from broader questions of economic and social justice. Global financial and economic crises, armed conflct and militarism, dangers to public health, gender based and other forms of violence, food insecurity and climate change have intensified vulnerabilities and have threatened the realization of rights. Within this constellation of factors affecting the realization of rights, inequality in income and wealth has emerged globally as an area of growing concern. The human rights framework has started to engage with the question of inequalities in income and wealth, offering partial guidance on the implications of increasingly polarized societies and what obligations governments have to address this issue. Given the rise in inequality, it is critical to more fully understand the connections between realization of human rights and inequality.
Current levels of inequality are extreme and, in many countries around the world, there has been an upward trend in income and wealth inequality since the 1980s. A 2014 study found that nearly half of the world’s wealth was owned by just one percent of the population, and the wealth of the richest one percent amounted to $110 trillion, or about 65 times that of the bottom half.

The extent of income and wealth inequality at both the national and global levels has potentially important implications for the realization of human rights. But equally important, expanding inequalities raise important questions of what is fair and just. The human rights framework, as one approach to evaluating economic and social outcomes with regard to social justice, must engage with the question of inequality—how much, if any, inequality is acceptable, and what limits does growing inequality place on the fulfillment of basic rights?

Understanding inequality

When people speak of inequality, they often have in mind an unequal distribution of income or wealth. However, people experience inequalities across a number of dimensions. There are inequalities in educational attainment, in health, and in the distribution of power. The free time men and women have is unequally distributed, once all demands for work, both paid work on the job and unpaid work at home, are taken into account. Inequalities in income and wealth are associated with other disparities. For instance, low-income households have worse health outcomes on average.
Furthermore, inequalities can be measured with respect to different units of society— between individuals, between households, between social groups (e.g. race, gender, and ethnicity), and between countries. The emphasis is on inequalities in income and wealth between individuals, households, social groups, and countries—and the relationship of these inequalities to human rights.
Inequality can be defined in various ways and the generic term “inequality” actually reflects a range of distinct inequalities. One important distinction is between “horizontal inequality” and “vertical inequality.”

Horizontal inequality is defined as inequality between culturally defi ned or socially constructed groups. Inequalities with respect to gender, race, ethnicity, religion, caste, and sexuality are all examples of horizontal inequalities. Vertical inequality refers to inequality between individuals or between households. The overall income or wealth distribution of an economy reflects vertical inequality, as do commonly used measurements of inequality. The distinction between horizontal and vertical inequality is particularly salient when considering the human rights framework, since the issues around horizontal inequality are much more developed in discussions of economic and social rights than are issues around vertical inequality.

However, there is growing concern about what is an acceptable level of inequality in society. It is generally agreed that inequalities are important to take into account when deciding whether societies are just or fair, but neoclassical economic theory does not seriously contend with the question of inequality. Values about inequality and redistribution are not simply about an individual’s current position in the economy, with poorer households more critical about an unequal distribution of resources. A number of factors shape these values: culture, personal history, family, education, social norms, and perceptions of economic mobility, among others. This indicates that people routinely make interpersonal comparisons of well-being, and these comparisons are central for assessing the fairness of a situation. Unlike neoclassical economics, any framework for social justice which features concern over inequality must allow for some comparison of well-being across individuals. Inequality raises the consideration of welfare to the social level. Instead of using a concept based on a narrow idea of individual satisfaction or prescribed tastes, comparisons of well-being between individuals and between groups allow us to consider the issue of fairness.
In considering questions of fairness and justice, a distinction is often made between equality of opportunity and equality of outcome. Equality of opportunity typically means that all people are treated identically, for instance, in the application of the law, when making employment or credit decisions, or in determining access to education or health care. The idea of equality of opportunity is closely linked to the concept of meritocracy and is perfectly consistent with inequalities in income and wealth outcomes. It typically assumes that societies will be stratified—with some people occupying more privileged positions than others.

In this situation, there must be a mechanism for allocating the better social and economic positions to individuals in a way that is fair and unbiased. If there is equality of opportunity, then equivalently qualified individuals will have the same chance of securing a favorable position in society and will not be excluded on the basis of arbitrary criteria such as gender, race, or the socio-economic standing of their parents. Equality of opportunity stresses that people should have similar choices available to them, although they may have different talents, skills, and abilities that make them more suited to certain pursuits than others. If equality of opportunities is secured, then inequalities in income and wealth are a result of the choices people make and the endowments they happen to have as individuals.

source: sudanvision