Letting go of Amartya Sen (a brief explanation)

If you studied politics at York, then your early political enlightenment probably involved a massive dollop of Amartya Sen. I always used to say that you could pass any exam, so long as you said ‘neo-liberalism is rubbish’ and threw in something about Sen.

 

On first encounter, as a young student, Sen seems like a breath of fresh air, shaking up the notion that the poor simply have less wealth than the rich. From Sen’s perspective, an individual who suffers poverty or disadvantage lacks the capacity to aspire or to achieve; opportunities are closed to her in virtue of her social or environmental circumstances.

 

The idea that to develop is to increase the freedoms, or life-choices, available to the worst-off is an appealing one, and one that informed much of my development theorising over the years. I still hold that a recognition that the poor lack social capital as well as material goods is vital to a solid conception of poverty and underdevelopment.

 

However, the point at which Sen and I must now part ways here: Sen’s theory suggests that development means reducing obstacles that prevent some people from having the opportunity or capacity to achieve the kinds of things they aspire to. I object that this individualistic approach to poverty reduction does not address the relational nature of poverty, or the injustice of hierarchical social and labour structures in which power and capital are inherently unequal.

 

By ‘poverty is relational’ I mean that to be poor is not to simply fall below a quantifiable level of material or even social goods, but to be in a disadvantageous relationship to others; there is only poverty if there is wealth. For Sen, development is about levelling the playing field so that everyone has the tools at their disposal to have a chance of achieving their heterogenous goals. Whilst this is fairer than a situation where some have many and varied opportunities and others have very little hope of agency in the shape of their lives, it does not change the fact that in a capitalist, patriarchal structure there will always be some who are better off than others.

 

At it’s core, capitalist structure requires that some sell their labour a low wage and others profit from those people’s labour. In a patriarchal structure, women are poor in relation to men, as their unpaid labour is needed to reproduce the household. Sen’s approach allows some people the opportunity to change their position in relations of wealth and poverty, power and disempowerment, but he does not challenge the structures that mean wealth and power cannot be attained by all, simultaneously.

 

A real development vision would seek to reduce relational poverty, not simply increase ability for persons to change their positions within unequal relations.

 

So, Sen, I have to let you go. Whist it is brilliant that you ushered into the mainstream a more nuanced understanding of what it means to be poor, it is not enough to address the agency of individuals without addressing the context of injustice within which they operate.

And from the taps flowed Coca Cola…

Lets play a game of word association. I’ll say a word, you say the first thing that comes into your head.

Water.

Nestle.

Coca Cola.

Water: ‘basic need’. Nestle: you’d be forgiven for thinking ‘mm chocolate’, but you might also have thought ‘boycott‘. Coca Cola:  ‘mm sugar’? ‘Santa‘? What about ‘scandal’? (I’m thinking of the allegation that Coca Cola sold pesticide-poisoned drinks to the Indian public).

Now imagine you are the World Bank. You are planning a water initiative (the 2030 Water Resources Group Phase 2)and you are looking for partners. Who do you choose?

Coca Cola and Nestle might not be the most obvious choices, but you are the World Bank, and Coca Cola and Nestle, amongst others, are exactly who invite to join you to “transform” the water sector.

The initiative will bring private enterprises with huge investment into the water sector in developing countries, “transforming” the predominantly public provision of water into a private business. John Skinner, of Stop Corporate Abuse notes that this partnership “is part of a broader trend of industry collusion to influence global water policy”.

Since its announcement in October 2011, the water initiative has already attracted $15 million in funding from the International Finance Corporation, the private sector finance wing of the World Bank. That’s $15 million in public development money supporting the expansion of super-rich corporations.

Thinking back to our word game, it seems incredible that it is organisations such as Coca Cola and Nestle that are being invited to influence water governance. These are corporations which have been plagued by accusations that they have profited from human and environmental exploitation. It has widely been claimed that Coca Cola ventures have depleted ground water in drought-stricken regions of India and Nestle has become notorious for allegedly causing malnourishment in babies in developing countries by encouraging mothers to use Nestle milk formula. If pressed to choose a company that could be trusted to distribute vital resources then these two would doubtless be low on your list.

But, of course the real issue here not which companies are involved in water governance, but the policy of privatisation of water. In the past privatisation of water supplies has been associated with price hikes and erratic service. Even if the service is reliable and affordable, the water-user framed as consumer is vulnerable. As a consumer of a private good the water-user has no guarantee of security and no rights or meaningful tools of accountability with which to make demands on the service-provider.

In market theory, the consumer’s power derives from the power to choose another provider. In real life, factors such as information inequalities undermine the consumer’s ”rational” choice between providers. In the case of privatised water provision, the capacity of consumers to change supplier is incredibly limited by the small number of alternatives and the unavoidable dependency that every human has on (ideally clean) water.

Within an ideological framework which favours privatisation, it makes perfect sense to for firms like Coca Cola and Nestle to be at the centre of water-reform. Voices which argue for privatisation claim that private enterprises are more efficient than public providers, and Coca Cola and Nestle are nothing if not efficient.

But what if it is efficient for private providers to charge the absolute upper limit for water, or to charge a higher price than many marginalised people can afford? What if it is efficient for private providers to take control of local water sources, selling the water back to the local people? What if the private provider finds it efficient to provide consumers with an insecure and unreliable service? Or if the amount the consumer can pay is not makes selling to her inefficient? In the eyes of a business person the interests of the public are only as valuable as they are profitable.

We should, therefore, be alarmed that the World Bank chooses to encourage unaccountable corporations to control fundamental resources. Human needs are politically powerless when posed as consumer demands, and inequalities between those who can and can’t pay will serve to increase relational poverty.

Whether or not it is contaminated with pesticides, water in a Coca Cola bottle will be socially and politically poisonous.

Now, to continue the interactive theme: what do you think?

The World Bank is “updating” its safeguard policies. Should we be worried?

The World Bank’s environment and social safeguard policies are to be subject to “updating and consolidating” over the next two years, as the Bank seeks to compete with the China Development Bank and the Brazilian development Bank, both of which now have larger lending budgets the World Bank. The Bank claims that safeguard policies, which accompany many of their development packages, are having a “chilling effect”, deterring potential development partners from working with the World Bank over its competitors.

The Bank’s current safeguard policies aim to offer guarantees that projects will not contravene certain environmental and social standards. These include a policy that ensures that indigenous peoples give free, informed, prior consent to any projects that affect them. NGOs and activists who fought hard for these policies are horrified by the prospect that the safeguards will be amalgamated into just one, less specific, policy.

Safeguard-avoidance strategies

According to the World Bank, safeguards are increasingly being circumnavigated under the current system. Category A “high risk” projects are subject to the most rigorous standards. According to a Bank report, its staff survey showed that “almost a fifth of team leaders had encountered a situation where the team revised the scope or design of a project to avoid being classified as category A because this high-risk category leads to higher levels of scrutiny and higher costs”.

However, rather than clamp down on this safeguard-avoidance the World Bank appears to be making it considerably easier to access safeguard-free finance. The Bank is developing a new lending instrument ‘Program for Results’ (‘P4R’) which will not be subject to safeguards. According to the Guardian, International Rivers, Friends of the Earth US and Bank Information Centre all agree that the P4R is intended specifically to enable countries to sidestep safeguards.

More finance less development?

The development of an allegedly safeguard-free P4R and the ‘streamlining’ of present safeguards represent a significant step backwards for development. Rather than leading the way in responsible and responsive development, the Bank appears to be engaging in a race to the bottom with its top two competitors.

The need to have social or environmental safeguards at all, demonstrates that the core philosophy underpinning the Bank’s policies cannot have these priorities at its heart. The World Bank’s conception of development is focused on market-led economic growth; when development is equated with an ideal model of the state, the individual becomes a means to this end. This puts the individual (or environment) at risk of harm or exploitation. Safeguards are vital to mitigate the potential harm to those whose well-being could be sacrificed in the pursuit of some ideological greater good.

The Bank, of course, would argue that it is necessary to drop safeguards in order to disseminate more finance. However, without robust safeguards which protect vulnerable individuals or valuable environments, more money may not equate to more development, in any rich or meaningful sense of the term. A rich conception of development may value, for example, participation, bottom-up development, individual integrity, reduction of inequalities, personal dignity and long-term sustainability. A reduction in safeguards tends away from such any such holistic view of development.

Furthermore, if the Bank begins a race to the bottom in terms of social and environmental protection, other development banks may lower their standards further to compete for custom. The meaning of development, in the context of lending, could become progressively thinner until it means little more than directing money towards poor countries. As the primary goal of much international development lending is market-led growth not justice, this could put more and more people at risk of being sacrificed to development projects in which they are afforded less and less space for resistance and negotiation.

What now?

Having extended the time-scale for the safeguard review, the Bank plans to have completed the ‘update and consolidation’ process by the end of 2013.

Last year, over 130 indigenous peoples representatives and support NGOs signed an open letter to Joachim von Amsberg, Vice President of the World Bank and Head of Operations Policy and Country Services, protesting the lack of consultation with indigenous peoples in the safeguard review process and registering their alarm at the expected limited application of safeguards under the new P4R programme.

It is vital that the Bank is pressured every step of the way to not only maintain safeguards, but to extend them to ensure that all of their projects include comprehensive and consistent protection of the environment and social justice. The value of the individual and long-term sustainability needs more not less space in global development.

Did someone say ‘governance’?

Governance. There, I said it. But I would rather not have said it. I would rather that word was phased out of the development lexicon.

‘Governance’ just isn’t a word your can trust. It is an inoffensive-sounding term which implies technicality not politics. Thus ‘governance’ is often to be found colluding with distinctly political policies to make them seem neutral, inoffensive, not-worth-debating or basic common-sense.

‘Governance’ tends to crop up in two forms. It is used to refer to institutions of ‘global governance’ such as the World Trade Organisation (WTO) or the International Monetary Fund (IMF), and it is repeated over and over and over again under the ‘good governance’ agenda.

The term emerged in development discourse because the Bretton Woods Institutions (the World Bank Group and the IMF) were “not mandated to challenge the primary position of state actors”, to borrow the words of Shireen Rai(1). The term reflects the attempts of the global ‘governance’ institutions to disaggregate the political from the economic and state capacity from policy-making in order to legitimise their undemocratic interventions.

‘Good governance’ is a concept which repeatedly reappears in World Bank and IMF conditionalities, Conditionalities are conditions for finance, to which aid or loan receiving countries must agree. They have been heavily criticised for reflecting the agendas of the donors and making country governments accountable to donors rather than their citizens. ‘Good governance’ policies slot into a wider rhetoric of ‘getting the institutions right’, with the language of ‘right’ reinforcing the idea that there is only one way to organise a state. Thus, in this discourse ‘good governance’ and the establishing of the right institutions are framed as a purely technical endeavours.

But, ‘good-governance’ policies are political. They are political in the power relations they produce by imposing external ideals of government onto a sovereign state. They are political in the ideology that they perpetuate through a model of the state in which the government’s role is to establish an appropriate environment for markets to grow. Good-governance principles constructed by World Bank researchers include a lack of market regulation and a rule of law which protects property rights. Both policies are designed to facilitate orthodox market-led development.

And what about those ‘global-governance’ institutions? They certainly do a lot of governing. WTO free-trade regulations, for example, prevent developing-country governments from attempting protectionist development approaches which use controls on imports to protect domestic infant industries. Now tell me that isn’t political.

The IMF and World Bank’s conditionality approach also represents a form of international policy making. The introduction, in 1999, of nationally-designed Poverty Reduction Strategy Papers (PRSPs) was supposed to usher-in a new era of recipient country-led conditionalities. However, it quickly became apparent that, as debt relief and access to finance is tied to the the production of a PRSP, they tend to reflect donor agendas. It is not necessary to be passionately defensive of the sovereignty of states to agree that supra-national and highly influential decision-making bodies should have a clear source of legitimacy.

The big decisions pressed by global governance institutions are decisions that ordinary people expect to have a say over if made at a national level. Good-governance policies pushed by international actors should also be seen as politically charged and up for debate.

Yet, did all the people impacted by IMF conditionalities select Christine Lagarde? Did they have a say over IMF policy? I hear the clang of a resounding ‘no’.

The World Bank president, Bob Zoellick is approaching the end of his term. If he resigns, as the rumour mill predicts, his successor will be ‘selected’ by the Bank’s executive directors. The Bank admits that “elections have reflected certain understandings among Bank and Fund members about the nationality of the heads of the International Financial Institutions”. Those ‘certain understandings’ are that the head of the IMF is always European and the head of the World Bank is always American.

Another barrier to the legitimacy of the World Bank and IMF, is that influence in these institutions is relative to monetary contributions. This skews the agenda-setting massively in favour of rich nations. The USA has veto power over major decisions in both the Bank and the IMF.

The WTO is another governance institution that disproportionately represents the interests of rich countries, yet those negatively affected by WTO agreements also have no mechanisms for holding such global-governance institutions to account.

So might I suggest that we start talking about ‘government’? Government is what is happening when ‘global governance’ institutions are involved in policy-making that affects the lives of people across the world. Government is what is happening when a state agrees to an internationally-set agenda and changes its institutions in away that reshapes the state-citizen relationship.

By saying ‘government’ not ‘governance’ we re-politicise the activities of global institutions. When we recognise that something is political, we recognise the rights of state-citizens or global-citizens, to choose, mandate and reject the decision-makers and their decisions. Similarly, if an the World Bank, say, presses conditionalities on a country for good-government, it is apparent that they are impinging upon that state’s political sovereignty.

Every-time we use the language of ‘governance’ we recognise and reproduce the false neutrality of that ‘governance’ and acknowledge a distinction between a-political governance activities and political government activities. By rejecting this discourse we can begin to challenge our relationship with global decision-making bodies and the local and global public’s right to engagement with global policy-setting.

If we all started talking about ‘good-government’ and ‘global-government’, it wouldn’t be long until mainstream voices were asking ‘who voted?’.

(1) Rai, S., (2004), ‘Gendering Global Governance’, International Feminist Journal of Politics, 6(4):,pp. 579-601.