I fail to understand this: If poverty reduction, elimination of global hunger and removing inequality remains the three most important challenges the world faces today, why do the world leaders need to show up at the lavish annual World Economic Forum (WEF) jamboree at the picturesque town of Davos in Switzerland?
Isn’t it ironic that to reiterate their commitment towards a more equal world, they need a platform that is basically looking to grab every possibility to multiply business and profits? For several years now, I thought the international charity Oxfam has very loudly conveyed how the worsening inequality was the outcome of a very neoliberal economics that actually sucks wealth from the bottom into the pockets of the top 1%.
With each passing year, inequality has been only worsening. In its latest report—released a few days before the who's who of the world’s richest assembled for the WEF 2018 at Davos once again—Oxfam told us that in 2017, the year that just passed by, 82 per cent of the wealth generated globally was cornered by the top 1%.
In India, a Credit Suisse report had shown that 73 per cent of the wealth generated was gobbled by the top 1%. In a country, where 290 million people officially live in poverty, this shocking data should have swayed the dominant narrative on how to reduce the growing inequality and ensure the fruits of economic growth are equally distributed. Instead, in the quest to race towards a higher GDP growth, more of the same remains the economic prescription.
In 2013, Oxfam told us that the world’s richest 100 families in 2012 earned $240 billion more that particular year, which was good enough to wipe out global poverty four times over. In other words, removing global poverty and hunger, which was always on the top of WEF rhetoric, required only $60 billion. I thought this can be better achieved by launching a frontal attack on poverty eradication rather than pumping more money into the hands of rich corporations by way of tax cuts as well as by providing direct financial stimulus and then waiting endlessly for the money to trickle down.
What to talk of $240 billion to remove poverty four times over, the world doesn’t even have $60 billion to eradicate poverty from the face of the planet, we are repeatedly told. But over the years, especially after the economic meltdown in 2008-09, the United States and the European Union have been aggressively printing money through a very sophisticated process of Quantitative Easing (QE), a term that camouflages printing of surplus money to buy government debt.
Knowing how a staggering amount of surplus money is being printed, I tweeted that year to the then US president Barack Obama to print an additional $120 billion and give it to a group of international organisations (with backing from G-20 countries) to launch a time-bound programme to remove poverty two times over. As expected, I didn’t get any response, but later I learnt that more than 65 economists had launched a campaign for ‘Quantitative Easing for People’ in 2015. That’s the way it should have been. Poverty and hunger could have become history by now.
Although there are different estimates of how much of surplus money has been printed since the economic meltdown, in September 2017, the US Federal Reserve began cutting down on its $4.5 trillion portfolio of bonds and other securities. In the EU, between March 2015 and March 2016, a total of euro 700 billion was pumped in the economy at interest rates of 0.2 to 2 per cent. The European Central Bank will now resort to reducing the bond-buying spree from euro 60 billion to euro 30 billion a month. The Bank of England too has meanwhile pumped in 445 billion pound Sterling. Much of this easy money is invested in the stock markets in the developing economies. How easy it is can be gauged from a statement of the US Fed chairperson, who said that as long as everyone is having a good time, there is no plan to withdraw it.
Now, let us look at global warming. The accumulation of wealth into the hands of a few is also the reason for the global climate going topsy-turvy. Author Amitabh Ghosh tells us that there is a direct correlation between wealth and emissions. “The West’s wealth is fundamentally built on greenhouse gas emissions.” He thinks the Paris Agreement is trying to do a few minor fixes while preserving the status quo. He is so right.
Greenhouse gas emissions emanating from an industrial model of economic growth that the world has been blindly following has led to forests disappearing at an alarming rate, oceans being exhausted of the fish stocks, crop fields turning barren and sick, water becoming scarce, and environment being polluted beyond redemption.
Several studies show that as much as 41% greenhouse gas emissions come from intensive agriculture, livestock and forestry. Undeterred by the massive damage already inflicted by intensive farming practices, and to ensure that the world does not see a repeat of the 2007 food crisis, business leaders from 17 private companies had announced at the 2009 World Economic Forum the launch of a global initiative—New Vision for Agriculture—that sets ambitious targets for increasing food production by 20 per cent, decreasing greenhouse gas emissions per ton by 20 per cent, and reducing rural poverty by 20 per cent every decade.
The 17 agribusiness giants are Archer Daniels Midland, BASF, Bunge Limited, Cargill, Coca-Cola, DuPont, General Mills, Kraft Foods, Metro AG, Monsanto Company, Nestlé, PepsiCo, SABMiller, Syngenta, Unilever, Wal-Mart and Yara International.
It is therefore quite apparent that at the global level, both the political as well as the business leadership is looking at the business opportunities that the crisis offers. Corporate agriculture coupled with free trade, again designed to benefit the top 1%, has already displaced millions of small-scale farmers in developing countries, forcing them to swarm into the cities, looking for menial jobs.
UN General Secretary Ban Ki-moon had the courage to say at a panel in WEF 2011: “The world’s current economic model is an environmental suicide. Climate change is showing us that the old model is more than obsolete. We need a revolution on how best to make the global economy sustainable.”
His clarion call went unheeded, and expectedly so. After all, WEF is not the forum for global governance.
(Devinder Sharma is a food policy analyst.)
