Good Countries, Bad Countries…

Growing xenophobia, islamophobia, racism and communalism do not sit well in an increasingly connected and globalised world – especially where challenges like climate change, air pollution, depleting fresh water resources, and disaster management require a transnational and multinational response. And any attempts to go it alone only end up dividing a nation, as the British have recently found out…

Simon Anholt is a British researcher and independent policy adviser, who believes that leaders across the world must be accountable not only for what they do within their national borders, but for the good or harm they do to the greater global community. To provide a quantifiable and comparable tool for the assessment of countries in the good/harm they do globally, he came up with the Good Country Index in 2014. This index concerns itself with the balance sheet of each of the 163 countries (for whom data are available) in terms of what it takes from others, and what its global contribution is, as reflected in these 7 essential indicators:

  1. SCIENCE AND TECHNOLOGY, measured by the number of international students, journal exports, international publications, Nobel Prizes, patents
  2. CULTURE, measured by creative goods exports, creative services exports, UNESCO dues in arrears as percentage of contribution, freedom of movement, press freedom
  3. INTERNATIONAL PEACE AND SECURITY, measured by peace-keeping troops, dues in arrears to UN peace keeping budgets, international violent conflict, arms exports, internet security
  4. WORLD ORDER, measured by charity given, refugees hosted, refugees generated, birth rate, UN treaties signed
  5. PLANET AND CLIMATE, measured by ecological footprint, reforestation since 1992, hazardous pesticides exports, CO2 emissions, ozone
  6. PROSPERITY AND EQUALITY, measured by open trading, UN volunteers abroad, Fairtrade market size, FDI outflows, development assistance
  7. HEALTH AND WELLBEING, measured by food aid, pharmaceutical exports, voluntary excess donations to the WHO, humanitarian aid donations

Not surprisingly, the top 10 in the latest rankings are: Sweden, Denmark, Netherlands, UK, Switzerland, Germany, Finland, France, Austria and Canada – the high resourced and low population countries, which have done all they can to ensure the best quality of life for their own people, and can now afford to look elsewhere and do some good at the global level.

However, if we take a detailed look at what the BRICS countries contribute to the greater good of humanity, per this index, we come across plenty of surprises:

BRICS GOOD COUNTRY INDEX

Firstly, it’s a pleasant surprise that all BRICS countries are in the upper half of global Good Country rankings but that Brazil fares the best and Russia the worst, is rather surprising. Another encouraging fact is that BRICS as a whole is doing reasonably well in the health and well-being sector globally, even when their domestic health services are often downright abysmal and inequitable. But that’s the way the indicator is designed. For instance, Indian pharmaceutical companies have fought restrictive trade practices to reverse engineer several life-saving drugs, making them available cheaply for the worst affected areas, as in the case of HIV drugs in Africa.

That South Africa ranks as the number one contributor to international peace and security is indeed a matter of pride, and China, India and Brazil all do well in this regard. Russia is again the odd man out – but being the world’s second largest arms exporter, that is hardly surprising!

The fact that Brazil has at last got its environmental act together is a relief for the whole planet, but the world’s most polluted cities and reckless mining continue to give India, China and South Africa low rankings on this count.

Finally, the saddest performance of BRICS as a whole is in their failure to eradicate (or even reduce) poverty among their citizens, and narrow the growing divide between rich and poor – BRICS has among the highest Gini Coefficients of any group of countries. This makes them net consumers, rather than contributors of development aid and brings down their ranking (with Russia as an exception in this instance).


Globalisation is inescapable and has both negative and positive fallouts: who would have believed that a blog, essentially on governance and development in India, would be read in 111 countries within a year of its inception? But that’s global connectivity for you. So why not a new paradigm of governance based upon global participation, global accountability and global responsibility?

After all Rabindranath Tagore’s prayer for his beloved country ran:

“Where the mind is without fear and the head is held high…

Where knowledge is free.

Where the world has not been broken up into fragments

By narrow domestic walls…”

 

Populations are also people…

As Mrs Indira Gandhi, late Prime Minister of India, once remarked, ‘the world media are interested in reporting on developing countries, only when there’s a coup or an earthquake.’ Of course, in the age of global connectivity and the internet, this tendency gets a hundred-fold exaggerated.

I was struck by this ‘list’ I saw on a website, incongruously squeezed between something as banal and ridiculous as the world’s 10 richest cats, or the 20 worst gowns on the red carpet, or whatever. Except, this was a list of the 50 most violent cities in the world. And the writer of that particular post couldn’t be more off-hand:

“Murder is more common in Latin America than any other part of the world… Thirty four of the fifty worst cities were located in the region, including repeat murder capital of the world – San Pedro Sula, Honduras – which saw 187 homicides per 100,000 inhabitants in 2013, and is getting steadily worse. Drug trafficking, gang wars, political instability, corruption, and poverty combine to cause the region’s elevated violence.”

And in less than 70 words, do we dismiss the hopes, fears, dreams and reality of 588 million people – almost a tenth of humanity!

This disregard for those who ‘do not really matter’ as much as one’s own social class, caste, compatriots, co-religionists, brotherhoods and sororities, is a universal trait. And as Foucault so beautifully explained, the modern State has lost its moral purpose and it suits those who govern to put a label on the governed, or ‘populations’ as he called them – forever diminished, devoiced, defanged, and disempowered.

In fact, marketers and campaigners in the US have honed this to an art, when they talk of a product or candidate appealing to X, Y, Z ‘demographic’.

If, like me, you found this list profoundly disturbing and dug a little deeper, what would you find? A region which has known the worst of colonial excesses, the decimation of indigenous populations, slavery, and the systematic plundering of its natural resources. South America, because of an accident of geography, became a battlefield for the superpowers during the Cold War in the late twentieth century, and in the 1960s and 1970s, the governments of Argentina, Brazil, Chile, and Uruguay were overthrown or displaced by US-aligned military dictatorships. These regimes detained tens of thousands of political prisoners, many of whom were tortured and/or killed. Economically, they began a transition to neo-liberal economic policies, in tune with the Washington Consensus, resulting in international indebtedness, widening gaps between the rich and poor, and one deep economic crisis after another.

The legacy of these years was stark : rampant corruption, weakening of civil society, growing poverty and ever increasing economic disparity, where a few controlled the many. As any social scientist will tell you, corruption, poverty and disparity are the three major forces behind urban crime, and Latin American cities had well and truly begun their slide downhill, with violent crime receiving a boost from the easy availability of cheap handguns across the border, in the USA.

Add to that the lack of opportunity in declining economies, where the only way out of a favela was football – no wonder then, that every Brazilian star from Pele to Neymar has a rags-to-riches story to tell. And where would the unsuccessful aspirants go but into the criminal underworld?

The UN-Habitat’s ‘State of the World’s Cities 2012-13’ illustrates this point quite well, by quantifying the barriers to achieving greater social equity in a city:

Social Equity LAC

As expected, the chief barriers to greater equity in Latin American cities are: weak civil society, corruption, ineffective governments, historic patterns of inequality, public institutions controlled by ruling elite, and lack of interest from ruling elites.

You see the pattern emerging?

However, there is hope…

Beginning with Hugo Chávez’s victory in the 1998 Presidential Election in Venezuela, South America has seen no less than 15 left-wing Presidents voted into office in Chile, Brazil, Ecuador, Argentina, Uruguay, Bolivia, Paraguay and Peru. And their pro-poor policies targeting the disempowered and marginalized – like systematic vocational training, direct aid transfers, and guaranteed food security – are beginning to make an impact.

A 2013 UNDP Report by Lustig et al has heartening news: Inequality in Latin America has unambiguously declined in the 2000s, with the Gini Coefficient (a measure of disparity – the higher the Gini, the greater the inequality) decreasing significantly in 14 of the 17 Latin American countries studied, while steadily increasing in China, South Africa, India, and USA:

Gini LAC

So next time you are tempted to brand a people as lazy, or a country as corrupt, or an entire religion as terrorist; take pause and spare a few moments to find out their history and where they are coming from… Remember, someone somewhere is pigeonholing and labelling you in exactly the same way…

Political Capture and Growing Disparity

In the 1960s and 1970s, cold and hot wars were fought to push the idea of benevolent capitalism – believing that creation of wealth at the top of the pyramid would ‘trickle down’ and eradicate extreme poverty across the world. That did not happen.

Since the 1990s, the mantra of globalisation has been that high rates of economic growth will greatly reduce the incidence of poverty worldwide. That has not happened either.

In reality, the globalised world economy has deeply fragmented production processes, labour markets, political entities and societies, creating a plethora of interest groups and lobbies which have undermined the integrity of civil society and its rights and entitlements across the world. This is becoming increasingly visible in rich and poor countries in the form of growing disparity between places, people and groups. In particular, it is manifested in much greater income inequalities.

While a small but economically powerful section are now true global citizens and look outward for direction, the majority survive day to day, with ever reducing options and choices, pushed deeper and deeper into the world they once knew, but which is fast disappearing. The centrifugal forces of the one and the centripetal forces of the other will one day tear society apart. The cracks are already beginning to show – religious extremism, communal strife, growing racism and violence against women, more conspiracy theories and paranoia, more and more right-wing governments… The sorry stuff of headlines every day, everywhere…


An interconnected global economy has resulted not only in greater corruption and clientelism but also political capture, where the laws of the land increasingly favour the rich over the poor. (See my earlier post: The 3 Cs…)

Oxfam set the cat among the pigeons when it put out the following figures:

  • Almost half of the world’s wealth is now owned by just one percent of the population.
  • The wealth of the one percent richest people in the world amounts to $110 trillion. That’s 65 times the total wealth of the bottom half of the world’s population, which owns the same as the richest 85 people in the world.
  • Seven out of ten people live in countries where economic inequality has increased in the last 30 years.
  • The richest one percent increased their share of income in 24 out of 26 countries, for which Oxfam have data, between 1980 and 2012.
  • In the US, the wealthiest one percent captured 95 percent of post-financial crisis growth since 2009, while the bottom 90 percent became poorer.

image

Measuring Disparity

The Gini Coefficient is a measure of statistical dispersion developed by the Italian statistician and sociologist Corrado Gini and published in 1912. It measures the inequality among values of a frequency distribution, for example levels of income. A Gini Coefficient of zero expresses perfect equality, where all values are the same e.g. where everyone has an exactly equal income; while a Gini coefficient of 1 expresses maximal inequality among values e.g. where only one person has all the income. Some Gini Indices are expressed as percentages, as in the chart below:

Income_Gini_Coefficient_World_Map

Looking at a select few countries representative of the global economy, the following picture emerges:

Gini coefficient

It is interesting to note that out of the BRICS countries in the above graph, South Africa demonstrates the highest inequality of incomes, perhaps a reflection of its largely natural resource based economy (gold and diamonds), which has traditionally been developed by a rich white minority during the long years of apartheid.

Brazil too has a long history of military juntas which allowed a class of the super-rich with immense land holdings to flourish. It is only recently, that concerns of the poor have moved centrestage in Brazilian politics, and with the re-election of President Rousseff, are likely to remain there.

The growing disparity in China is indeed a surprise, especially because it is the last surviving communist regime of any consequence in the world. Perhaps the unnaturally rapid urbanisation and industrialisation in a traditionally agrarian society has allowed individual entrepreneurs to accumulate immense fortunes in a relatively short period of time.

The majority of the countries in the world have a Gini coefficient between 0.3 and 0.4. In the case of developing countries like India and Egypt, it is a reflection of the growing middle class post-globalisation; while in the case of USA and UK, it is a testament to their relatively secure health and income safety nets, which prevent extreme deprivation and hardship in the population.

News just in: A Credit Suisse Report says that disparity is growing rapidly in India, with the top 10% now holding 74% of the country’s total wealth, while the bottom 10% hold just 0.2%. The share of the top 1% (nearly half the country’s wealth) has always been lower than the share of the global 1%, but is now growing faster than the rest of the world. Yet Indians make up nearly 20% of the world’s poorest 10%!

Not surprisingly, Sweden repeatedly tops the charts for both highest Human Development and lowest disparity, clearly demonstrating the inverse relationship between disparity and human well-being.

Oxfam recommends that governments wishing to reduce the income disparity in their countries as a means of tackling poverty should consider:

  • Cracking down on financial secrecy and tax dodging
  • Redistributive transfers and strengthening of social protection schemes
  • Investment in universal access to healthcare and education
  • Progressive taxation
  • Strengthening wage floors and worker rights
  • Removing the barriers to equal rights and opportunities for women

Going by the experience and the professed policies of the new government in India, is any of this likely to happen soon? I think not.

Maybe after 5 years, the most tangible legacy of this government will be an India with a higher Gini coefficient.

And that may get the voters rethinking the promised ‘good times’…