Transcript Demystifying Economics: Macroeconomic Policy

September 24, 2012
Radhika Balakrishnan, Center for Women’s Global Leadership, Rutgers University
James Heintz, Political Economy Research Institute, University of Massachusetts
Introduction
Economic and Social Rights
Fiscal Policy and Human Rights
Feminist Analysis
• Creates strong policy arguments, which can more
effectively inform the formulation of legislation,
regulations, and budgets to address human rights.
• Committed to sustainable change by focusing on
process, rule of law, and the democratic functioning of
society.
• Standards that allow all people to live with dignity,
freedom, equality, justice, peace.
• Set of principles that apply to universal, inalienable,
interconnected, indivisible, non-discriminatory.
Universal Declaration
of Human Rights,
1948
International
Covenant on
Economic, Social and
Cultural Rights, 1966
International
Covenant on Civil and
Political Rights, 1966
Food
Work
Health
Housing
Water and sanitation
Adequate standard of living
Requirement for progressive realization
Use of maximum available resources
Avoidance of retrogression
Non-discrimination and equality
Participation, transparency and accountability
• The obligation of conduct requires action
reasonably calculated to realize the enjoyment
of a particular right.
– Ex. Expenditures on health
• The obligation of result requires States to
achieve specific targets to satisfy a detailed
substantive standard.
– Ex. Health outcomes
Fiscal Policy
• Government Expenditure
• Government Revenue
Monetary Policy
C+I+G+X-M
[consumption + investment + government
spending + (exports-imports)]
• The use of government expenditure and
revenue collection to influence the economy.
• Deficit – Excess of spending over revenues in a given period.
• Debt – A deficit in one period adds to accumulated debt that period;
a surplus reduces debt.
• Spending – Government spending two types – current spending
and investment.
• Investment – Usually creates a long-term capability and gives a
return in terms of greater income or lower costs.
• Government revenues – Taxes, fees, royalties from minerals,
operating surpluses from government enterprises.
• Government borrowing –Bonds sold by governments to financial
institutions usually in your own currency; loans are frequently in
foreign currency from World Bank, regional development banks,
and commercial banks.
450
400
350
300
250
200
150
100
50
0
1990
1991
1992
1993
Argentina
1994
1995
Brasil
1996
1997
Chile
1998
1999
2000
Costa Rica
2001
2002
Cuba
2003
2004
2005
México
Source: Balakrishnan and Elson (2011), Economic Policy and Human Rights, Figure 3.4
• Conduct does not always yield results therefore we
need to look at both.
• Guyana: Health spending per person grew from from
$79 in 1995 to $189 in 2010 (expressed in the value
of the dollar in 2005).
• South Africa: Spending increased from $425 to $935
(in $2005).
• Maternal mortality rates INCREASED:
– In Guyana from 170 to 280 (per 100,000 live births)
– In South Africa from 260 to 300 (per 100,000 live births)
• Governments receive revenue from many
sources including, taxation, royalties paid for
utilization of natural resources, and profits
from public enterprises.
• We focus on taxation as this is typically the
most important way in which governments
mobilize domestic resources.
Source: Balakrishnan and Elson (2011), Economic Policy and Human Rights, Figure 6.1
1.8
1.6
% GDP
1.4
1.2
1
0.8
0.6
0.4
0.2
0
Corporative
Individuals
Source: Balakrishnan and Elson (2011), Economic Policy and Human Rights, Figure 5.16
• Gender equality and tax policy can be examined
from several perspectives.
– Explicit and implicit bias.
• CEDAW requires that families be based on
‘principles of equity, justice and individual
fulfillment for each member’ (General
Recommendation 21, para. 4).
– It implies that women be treated as equal to men in
tax laws: as individual, autonomous citizens, rather
than as dependents of men.
• Deficit: difference between current
government spending on goods and services
and total current revenue.
– When a government runs a deficit, it must borrow
to make up the difference.
• Debt: the total amount of borrowing by the
government.
– Forms of debt: government bonds, external debt
• The public debt is very important in terms of its
effect on realization of social and economic rights
• But the relationship is complex
– Can protect rights during economic downturns
– But high levels of debt may compromise future rights
• Many factors influence the sustainability of debt
–
–
–
–
Domestic policy, exchange rates, interest rates
International policies
Power dynamics in the global economy
Not all countries face the same constraints
• Who benefits from high debt servicing payments?
– The owners of the debt (the people who own bonds or the
external debt)
– Represents an outflow of resources
• Global inequalities
– Some countries can borrow on more favorable terms than
others.
– Example: U.S. and U.K. have growing levels of debt but low debt
servicing costs.
• Bond markets and financiers
– Borrowing can give financial interests power over domestic
policy.
• Reform needed at the global level
• The debate: is government spending
sustainable in a crisis?
– United States of America: Stimulus of $757 billion.
Example: job creation, but this part was gender
biased. Also, about 1/3 was tax cuts.
– China: $586 billion. Including, housing, rural
infrastructure, transportation, health and
education.
– Greece: no stimulus. Austerity in the face of crisis.
Massive cutbacks to government spending.
• Utilize international human rights mechanisms
such as the Universal Periodic Review, CEDAW,
CESCR, CERD, etc.
• Review your government’s human rights
obligations.
• Monitor local and national budgets, and find out if
your country conducts gender budgeting.
• Find out the size of your country’s debt and how is
it constraining/facilitating human rights.
• Learn more about what the IMF is doing in your
country.
Nexus: Shaping Feminist Visions in the 21st Century
http://cwgl.rutgers.edu/resources/publications/economic-a-social-rights/nexus
Rethinking Macro Economic Strategies from a Human Rights Perspective:
Why MES with Human Rights II
http://cwgl.rutgers.edu/globalcenter/publications/whymes2.pdf
Auditing Economic Policy in the Light of Obligations on Economic and Social Rights
http://cwgl.rutgers.edu/globalcenter/publications/auditing.pdf
Macroeconomics and the Human Rights to Water and Sanitation
http://cwgl.rutgers.edu/globalcenter/publications/Rights%20to%20Water%20and%20Sanitation.pdf
Maximum Available Resources & Human Rights
http://www.cwgl.rutgers.edu/globalcenter/publications/marreport.pdf
The Right to Food, Gender Equality and Economic Policy
http://cwgl.rutgers.edu/globalcenter/publications/Right%20to%20Food.pdf
Email: [email protected]
Website: www.cwgl.rutgers.edu ,
http://www.peri.umass.edu/
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