Economic Policy for Human Rights
By Radhika Balakrishnan
The author, director of the Center for Women’s Global Leadership and a professor in Women’s and Gender Studies at Rutgers University, was a featured speaker July 24 at a forum in Atlanta sponsored by the Carter Center on “Restoring Faith in Freedom”. She spoke after opening remarks by former President Jimmy Carter, founder of the center. This article is based on a transcript of her remarks.
Radhika worked in the Asia and Pacific program of the Ford Foundation from 1992 to 1995, and has a doctorate in economics. She is a member of the Commission for Gender Equity for the City of New York and co-chair of the Civil Society Advisory Committee for the United Nations Development Program.
We’re living in a time of extreme inequality, as President Carter has already talked about. An Oxfam report in 2018 said that 82 percent of the wealth globally is in the hands of the richest 1 percent.
What’s interesting about that number is that in 2017, 42 people—42 individuals—held the same wealth as half the world’s population. That’s 2017. In 2016, that number was 66. And in 2009, around the financial crisis, that number was 366. So the concentration of wealth is getting narrower and narrower every year we go on. The concentration of wealth is also taking place in the United States, not just globally. The United States is now one of the worst, most unequal societies that we’ve seen.
One of the interesting things is that from the late 1940s to 1980 there was shared prosperity. The bottom 20 percent of the population increased their real income by over 100 percent. The middle class grew at fairly equal amounts, and the top 5 percent also increased, by about 86 percent. There was shared prosperity.
And then my favorite president didn’t win the election in 1981. Things changed. There were consequences. What we see from about the early 1980s is an incredible increase in the concentration of income and wealth by the top 1 percent, whose income increased by huge amounts....
As an economist, you always look at graphs, and so you see this increase in the concentration of wealth of the top 1 percent while the rest are pretty stagnant—not moving and at times going below zero. When the wealth is concentrated in the hands of a few and the rest of the economy has stagnated, as over the last 30 years, there are consequences.
And globally we see similar levels. Inequality is increasing in almost all parts of the world with very few exceptions. Even organizations like the International Monetary Fund (IMF)—not known for redistributive policies—have been warning that this level of inequality is unsustainable for the kind of economy we live in. So it’s not just that this is bad, it’s really not sustainable.
But they don’t offer alternatives to the existing paradigm. So you have the IMF and everyone, really, issuing this rallying cry that this level of inequality is unsustainable. But what’s the answer to that concentration of wealth? What new paradigm are they offering us besides the kind of economic policies we’ve seen since the 1980s?
One of the consequences of this concentration of wealth is also the rise of right-wing nationalist governments and xenophobia. These are not an accident but really a consequence of the kind of economic policies that we’ve been following. In the U.S., in Italy, in Hungary, in the Philippines and in India we see the rise of right-wing nationalist governments. So something is not working.
The question I have—and it seems like a simple question, but I think it’s really a radical question—is what is the economy for? Why do we participate in it? We all participate. We work, we buy things, we eat breakfast, we buy coffees. What is the purpose of the economy? Is it to make sure that our 1 percent gets wealthier? Or is there some other purpose?
And so the work that I’ve been doing with my colleagues is really trying to address that question, to assess a normative framework for what the economy is for. Economists like to pretend that we’re some positivist science that’s focused on data, but we all are normative. We wish for something in the world. The work that we’ve been doing is to say: What if the purpose of the economy was to fulfill human rights? What would happen? What if we assess the economy in terms of its obligation to fulfill human rights? What do we see as a result of that policy?
What if we look to fulfill human rights, such as the right to health, the right to education, the right to an adequate standard of living, the right to food? If these were the rights that were held as a normative framework to assess how economic policy is made, what kind of economic policy would we see? Human rights norms and standards can be that alternative evaluative and ethical framework for assessing economic policy. Not just policies, but also the outcomes of those policies. Do people actually have the right to food? Can we look at that as a way to see if economic policy is working?
We need to look at the basic principles of the Universal Declaration of Human Rights, especially the absolute indivisibility of rights. For many years, the work on economic and social rights has been looked at sort of secondarily. But the indivisibility of rights, which is at the heart of the U.N. declaration, is critical when we look at economic policymaking. And President Carter signed the Covenant on Civil and Political Rights and the Covenant on Economic and Social Rights, which most people forget. Those covenants together give us the normative framework in which to assess economic policy.
And what this gives us in terms of economic policy is a collective responsibility to ensure an individual right. And so it’s critical because a lot of people criticize human rights as being too individualistic. It’s not too individualistic. It’s a collective responsibility! But we’re making sure that individuals in all their complexity are taken care of.
Now, to turn to civil and political rights. We’ve heard over the last three days from the human rights defenders who are being attacked around the world why civil and political rights are very integral to the support of economic, social and cultural rights. You cannot have one without the other. We need to remember that policymaking is a political process, especially economic policy making. It’s not a technocratic process.
In our work, we use an idea that we hope will catch: TINTA, which means, There Is No Technocratic Answer. Human rights gives us an evaluative framework by which we can judge economic policy. The human rights principles of accountability, transparency and participation are critical for economic policy making. We use these a lot in terms of civil and political rights, but not in terms of economic policy making. Using a human rights framework does not provide a blueprint. What it does is give us a process by which to evaluate the economy.
Many times, people from the human rights movement say, “Okay, you’re the economist. So what does a human rights economy look like?” Well, there is no answer. But what it does is give us a process and a certain evaluative framework by which to judge economic policy.
In the human rights framework, the duty-bearer is the state. And the state is paradoxical. The state can deny rights, but the power of the state can also be harnessed to realize rights. That’s the aspect of economic policy making that I would like to focus on.
It requires collective action to ensure accountability. Human rights requires that collective action hold the state accountable and that this state accountability is an open-ended process that allows for ongoing discussion and deliberation. It does not say what the distributive outcomes should be, but it gives us a normative idea by which to look at what they could be.
We also need to look at inequality in terms of race, gender, sexuality and all other intersections of those identities. I don’t have the numbers in terms of inequality, but we know that there are incredible levels of inequality both in the United States and around the world. The principle of non-discrimination and equality within the human rights framework is one of the really important aspects for trying to tackle these issues. The principles of non-discrimination and equality, unlike other rights that are progressively realized, are an immediate obligation. So we can really hold states to account when we can show that there are discriminatory policies in terms of the economic policy.
Going back to the question, “what is the economy for?”, the economic policy that would come out of a human rights framework is one that is grounded in substantive freedoms and equality for realized outcomes, not just opportunities. A democratic economy also requires global coordination and governance. The economy is no longer just about the pursuit of economic growth, but really about a shared prosperity.
But it is also about institutions and faith in institutions. We can’t overstate the importance of institutions, mechanisms and structures to hold policymaking accountable. Democratic economic policy makes requiring accountability, participation and transparency to allow people to exercise their civil and political rights in support of a more just economy.