2.3. Sustainability and the economy

In addition to the unsustainability and high risk of our present way of living, it is also grossly unjust. Virtually every dimension of human and institutional activity must be changed and reoriented to reduce our impact on the planet to levels which allow natural systems to regenerate and still provide sufficient resources for everyone’s basic needs. (See preparatory paper: Social and Environmental Dimensions of Trade Liberalization: Some Early Reflections on the World Trade Organization. Mariama Marjorie Williams.)

This is a period of unprecedented accumulation of wealth and unparalleled economic growth across the globe coupled with rising poverty, hunger and homelessness. Over 120 million people are officially classified as unemployed worldwide Many others are underemployed, and vast unrecorded numbers are outside employment systems entirely. Approximately 1 billion children women, and men go to bed hungry every night. [UNRISD 1994.] Their plight is largely the result of the rising cost of debt service in developing countries and of failed macroeconomic policies such as structural adjustment programs (SAPs), restrictive fiscal and monetary policies.section headings:

Developing countries have external debt of over $1.9 trillion (March 1995) "owed" to international commercial banks and OECD governments. Nearly 2 trillion dollars is exacting a terrible toll on the people in these economies who did not even benefit from the loans. Jamaica, for example, must send over 40% of its export revenues abroad to service debt. To facilitate this process, Jamaica and other heavily indebted countries are forced to undergo IMF SAPs which require elimination of government subsidies, removal of price supports and price controls on basic food items; devaluation of exchange rates, which results in high inflation further raising the cost of food. SAPs have resulted in the widespread impoverishment of women and children and have increased unemployment as government budgets are slashed and workers are laid off.

After fifteen years of SAPs the promised benefits of economic growth and prosperity have not arrived. Only the elite and international capital have benefited from the re-organization of economic and social priorities. In most countries the poor’s access to food, clothes and shelter has rapidly worsened. Today, " within developing and developed nations the poorest of the poor share less than 5% of national income while the richest fifth claim 40-60%". [UNRISD 1994]

In the OECD countries 35 million people are unemployed and living in poverty, comprising 8% of the workforce. Factors contributing to this phenomenon are the restructuring of national and international economies, rapid technological changes and the rise in income inequality worldwide. The rise in poverty and unemployment is accompanied by a host of social and health problems, including an upsurge in psychosomatic and psychological problems, alcoholism, use of narcotics, as well as burglaries and theft. [OECD Observer 1994. The report further points out that narcotic usage amounts to $500 billion yearly in Europe and North America.]

Mounting economic insecurity and its consequential pressures on the fabric of society have led both to a backlash against environmental protection and a dramatic rise of xenophobia. This in turn has resulted in racist and ethnically-based physical attacks and increased structural violence against people based on color or ethnicity. Globally, people of color are disproportionately affected by global economic restructuring, with resulting rapid growth in unemployment among their ranks. At the bottom of the labor market in OECD countries, they are among the category of last-hired-first-fired. As immigrants many have been forced to live and work there at the margins of society, where they perform the most unpleasant tasks. Recent immigration reform and migrant bashing furthers their marginalisation and social exclusion.

According to UN report States of Disarray the widening gulf between the rich and the poor is reflected in the fact that a fifth of the world’s poor now share less than 1.5% of the world’s income. While countless numbers of people are being impoverished in rich and poor countries alike, transnational corporations account for over $5.5 trillion dollars in earnings from ownership of 33% of the world’s stock of productive assets. Financial interests dominate and largely determine national economic and social policy. Speculation in foreign exchange markets amounts to a trillion dollars per day. In the derivatives market, $16 billion dollars is turned over on any given day. [UNRISD 1994.] Over 80% of these funds are diverted from productive purposes that would employ workers, pay for social development programs or clean-up environmental degradation.

Technological innovations both reduce jobs and make it easier for financial interests to move assets across borders rapidly, de-stabilizing economies at the whim of the bond and money markets. This intensifies unstable domestic economies, resulting in layoffs, poverty and consequently mass immigration. Today over 100 million people, the majority of whom are women and children, live outside their country of citizenship. [UNRISD 1994.]

Excessive military expenditures and the arms trade, along with rising economic insecurity which exacerbate ethnic tensions resulting in armed conflicts and violence, have contributed to 52 major conflicts in 42 countries in East and Central Europe, Africa, Asia and Latin America. These conflicts place an incalculable burden on the environment and have led 16 million people to flee their homes; countless millions of others are left maimed or killed.

Food still comes out of the earth, and sustainable agriculture cannot be based on the industrial model or global agro-business. Agriculture must come before industry. Local and regional food security and small peasants must be strengthened, and many more people can work in agriculture than are doing so at present. Land reform is urgently needed, in combination with ecological considerations. Producer-Consumer Cooperatives can provide regular income to small producers and can reduce use of ecologically dangerous agricultural inputs, such as herbicides and pesticides.

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