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Austerity, the New Normal
by Isabel Ortiz, Matthew Cummins
Initiative for Policy Dialogue at Columbia University
While this week (11/10/19) Ministers of Finance and economists meet in Washington to confront global economic challenges at the IMF and World Bank Annual Meetings, the majority of the world population lives with austerity cuts and see their living standards deteriorating. World leaders must reverse this trend.
Since 2010, most governments in both high income and developing counties have been implementing austerity policies, cutting public expenditures. Surprisingly, this trend is expected to continue at least until 2024, according to a global study just published by the Initiative for Policy Dialogue at Columbia University, global trade unions and civil society organizations. Austerity has become “the new normal.”
Based on IMF fiscal projections, the study finds that a new fiscal adjustment shock will start in 2020. By 2021, government expenditures as a share of GDP will be declining in 130 countries, nearly three-fourths of which are in the developing world. The reach of austerity is staggering: nearly 6 billion persons will be affected by 2021.
How are governments cutting their budgets and implementing austerity reforms? In practice, the most commonly considered adjustment measures in 2018-19 include: pension and social security reforms (in 86 countries); cutting or capping the public sector wage bill, including the number and salaries of teachers, health workers and civil servants delivering public services (in 80 countries); labor flexibilization reforms (in 79 countries); reducing or eliminating subsidies (in 78 countries); rationalizing and/or further targeting social assistance or safety nets (in 77 countries); increasing regressive consumption taxes, such as sales and value added taxes (in 73 countries); strengthening public-private partnerships (PPPs) (in 60 countries); privatizing public assets/services (in 59 countries); and healthcare reforms (in 33 countries).
All of these measures have negative social impacts. As a result, in many countries older persons have lower pensions; there are not sufficient teachers, medical and care staff, and the quality of public services suffers; there are less jobs, and people work under more precarious conditions; prices increase while wages are stagnant; and the low and middle classes are squeezed and under pressure.
In perspective, the macroeconomic and fiscal choices made by governments over the last decade are alarming. The G20 alone committed US$10 trillion to support the financial sector in response to the global financial crisis, and then passed the costs of adjustment to populations, with millions of people being pushed into poverty and lower living standards.
The worldwide drive toward austerity or fiscal consolidation can be expected to aggravate the growth and employment crisis and diminish public support at a time of high development needs, soaring inequalities and social discontent.
Austerity is also being used as a trojan horse to induce “Washington Consensus” policies to cut back on public policies and the welfare state. Once budgets are contracting, governments must look at policies that minimize the public sector and expand private sector delivery, including PPPs. There are clear winners and losers from this renewed Washington Consensus, and governments must effectively assess and question these policies.
Austerity and budget cuts do not need to be “the new normal.” There are alternatives, even in the poorest countries. Governments can find additional fiscal space to fund public services and development policies through at least eight options, which range from increasing progressive tax revenues, cracking down on illicit financial flows, improving debt management and using fiscal and foreign exchange reserves, to adopting more accommodative macroeconomic frameworks, reprioritizing public expenditures and -for lower income countries- lobbying for greater aid. All these options are endorsed by the United Nations and the international financial institutions.
It is time for world leaders to abandon the myopic scope of macroeconomic and fiscal policy decisions that benefit few and, instead, look for new fiscal space and financing opportunities to foster a robust global recovery and the achievement of long-term global prosperity for all.
* Isabel Ortiz is Director of the Global Social Justice Program at the Initiative for Policy Dialogue at Columbia University. Matthew Cummins is an economist who has worked at UNDP, UNICEF and the World Bank.
* Access the global study - Austerity, the New Normal (80pp) :
* Fiscal Space for Social Protection and the SDGs: Options to Expand Social Investments in 187 Countries 2017 (80pp):
* The World Bank recently issued a white paper on rethinking social protection systems proposing a rollback of existing rights and protections for workers. Leo Baunach, Evelyn Astor and Stephen Kidd for Development Pathways argue that this approach would increase inequality and undermine poverty reduction:
Nov. 2019
No Democracy without Economic and Social Justice, by Ignacio Saiz - Centre for Economic & Social Rights
In recent weeks, an extraordinary wave of mass protests has swept the globe. While their specific causes and contexts vary, many can be seen as part of a worldwide revolt against extreme inequality and the unjust economic and political systems driving it.
A common weave running through many of the protests is widespread indignation against austerity– the package of debt-reduction policies that scores of governments are now implementing.
In Ecuador, indigenous-led protests compelled the government to reconsider an austerity package agreed with the International Monetary Fund (IMF) that included public sector wage cuts and fuel price hikes. Chile has seen million-strong protests against low wages, costly social services and the most extreme levels of economic inequality of any OECD country.
In Lebanon, a third of the population is estimated to have taken to the streets since the latest round of austerity; while Iraq has been rocked by mass protests against high unemployment, ailing public services and economic mismanagement.
These events follow large-scale demonstrations earlier this year against austerity in countries including Argentina, Honduras, Egypt, Sudan and Zimbabwe.
Many of the protests have been triggered by a specific fiscal measure–a tax on messaging apps in Lebanon or an increase in Santiago metro fares–perceived as emblematic of attempts by governing elites to foist the burden of national belt-tightening on ordinary working people and the already disadvantaged.
But what has often begun as a spontaneous stand against fiscal injustice has burgeoned into a mass mobilization against the structural inequities underpinning it: political systems seen as corrupt, captured and unaccountable, and economic systems seen as generating inequality by privileging private profit over the public good.
Demonstrations in Chile and Lebanon, for example, have continued far beyond the repeal of the offending measures or even the resignation of senior government figures, insisting on a more fundamental economic and political overhaul.
Another alarmingly common feature has been the repressive response of the authorities, who in most cases have addressed the protests as a threat to public security rather than a clamor for social justice. From Quito to Cairo and from Santiago to Baghdad, security forces stand accused of excessive use of force, killings, ill-treatment and arbitrary arrest of demonstrators.
It is somewhat understandable, then, that where prominent international human rights actors have spoken up about these protests, it has largely been with respect to these abuses. The Office of the High Commissioner for Human Rights, for example, has sent a team to Chile to investigate breaches of international standards related to the use of force by security personnel. A recently-concluded Inter-American Commission on Human Rights mission has gathered numerous testimonies of similar alleged abuses in Ecuador.
Amnesty International and Human Rights Watch have done important work documenting excessive force against protestors in Baghdad, Beirut and elsewhere. Abuses by the security forces have also been the primary if not sole focus of investigations by national human rights institutions such as the Instituto Nacional de Derechos Humanos in Chile or the Ecuadorian Defensoría del Pueblo.
Each of these organizations has, to different degrees, acknowledged that the protestors’ socio-economic grievances are also human rights concerns. But the economic and social rights dimensions of these crises have generally been relegated to the background and are yet to meaningfully inform their analysis and recommendations.
While the acute repression of civil and political rights in the wake of these protests clearly merits urgent scrutiny, the chronic denial of social and economic rights motivating them must also be addressed as a central human rights concern. International human rights standards apply equally to governments’ use of fiscal policy as to their use of force.
Where austerity policies result in widening gender or racial disparities, push people into poverty or lead to avoidable backsliding in access to health or housing, they also breach international legal obligations on economic, social and cultural rights.
To relegate these violations to the margins of human rights concerns serves only to perpetuate the lack of accountability that has brought millions out on the streets.
The mass mobilizations against extreme inequality, like those against the closely-related crisis of climate change, beg a holistic approach to the human rights claims underpinning them. They should also prompt human rights actors to rethink their traditional agnosticism with regard to economic systems, and adopt a more frontal critique of neoliberal economic orthodoxy.
The protests demand that we call out the ravages of neoliberalism as human rights deprivations, challenge the fallacies sustaining this ideology and envision rights-centered alternatives.
Recent developments have consolidated the normative and methodological foundations for such a critique. For example, earlier this year the UN Human Rights Council adopted Guiding Principles for Human Rights Impact Assessments for Economic Reform Policies, which set out the human rights standards that should anchor economic policymaking, including fiscal adjustment. These are informed by the practical experience of civil society organizations such as CESR in assessing austerity and its human rights impacts in numerous countries, as well the work of progressive economists bringing a human rights lens to challenge dominant economic paradigms.
Such efforts have focused on fiscal policy as a critical entry point for addressing structural injustice, as reducing inequality and fulfilling human rights are simply not possible without a radical redistribution of resources, wealth and power.
Systemic approaches to economic and social rights accountability are also targeting the responsibilities of international financial institutions and corporate actors in maintaining the unjust economic status quo. CESR’s efforts have been aimed at the IMF, whose complicity in prescribing austerity has fanned the flames of crises in many of the countries where protests have erupted.
For example, just last month the IMF pressed Lebanon to apply even more regressive adjustment measures, minimizing concerns about the potential for social tensions. Ongoing initiatives to codify the binding human rights obligations of business actors and overhaul the rules of international corporate taxation are equally critical fronts for systemically hard-wiring corporate accountability.
Of course, a truly “eco-systemic” human rights practice needs to go beyond normative elaboration and international policy reform. A challenge for those working internationally is to build stronger links between norm development, policy critique, context-specific advocacy and movement building, supporting the efforts of national human rights activists who are drawing attention to the structural and social rights dimensions of the crises.
We can likely expect more protests of this kind in 2020, as fiscal contraction spikes, the global economy slackens, and traditional spaces for civic engagement shrink. There is a clear message emerging from the streets that human rights actors should get behind: there can be no democracy without economic and social justice. For this reason, any durable resolution to the current unrest must have economic and social rights accountability at its core.

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Women demand inclusion in South Sudan peace process
by OCHA, UN Mission in South Sudan, agencies
Oct. 2019 (UN Mission in South Sudan)
South Sudanese women are calling for political leaders to meet their commitment to ensuring 35 percent representation in the new transitional government and are urging each other to actively participate in the peace process to protect their collective interests.
That call came during a ‘women to women’ dialogue forum hosted by the United Nations Mission in South Sudan and the Gender, Child and Social Welfare Ministry in the capital Juba. About 60 participants, including local authorities, faith-based groups, civil society and political parties took part.
The group discussed the development of a road map for ensuring that the provision for 35 percent representation of women in the unified transitional government, due to formed on November 12, becomes a reality.
A prominent political leader and South Sudanese representative to the East African Parliament, Dr. Ann Itto, told the group that strong action needed to be taken by women themselves if they wanted the 35 percent target to be realized.
She encouraged women to join political parties and pressure groups as well as the security sector to challenge the patriarchal society that dominates South Sudan. Dr. Itto also reminded the group of their power and influence, particularly during elections and referendums, given women make up the majority of the population.
“A party is where they cook the soup and it is served to the people. They can fight for your rights, and there are many things that you can achieve through being in the party,” she said. “You need to fight for the policies including electoral laws, that protect the interest of women when you become part of these organizations.”
Dr. Itto said it was vital that women took a unified approach to the peace process, including issues such as securing accountability for crimes committed during conflict.
“You must walk back to the women at grassroots level and move forward with them to translate the 35 percent into reality,” she said. “Also, for us to bring peace to ourselves, we need to respect the transitional justice process so we can tackle ruining cases like rape.”
A participant representing women with disabilities called for specific reference to the most vulnerable in the peace agreement.
“As we hear from the media that challenges facing the formation of a unity government will be fixed after it’s formed, and all will be well, there is need for us people with disability to work together with others and be represented as women of South Sudan,” said Zekia Reida who has a visual impairment. “Although the peace agreement never talked specifically about us, we are South Sudanese.”
Minister of Gender, Child and Social Welfare, Rose Paulino Lisok, told the participants they should submit recommendations from the forum to the Government so that an action plan could be development and implemented, including translating the agreement into various languages and brail.
UNMISS Gender Affairs Unit representative, Gladys Jambi, said the Mission was working with authorities to promote gender provisions within the revitalized peace agreement and to identify any gaps that may hinder women’s full participation in governance.
“UNMISS will continue to lead peacebuilding engagement across the country, including promoting gender inclusivity, with the support of civil society organizations, faith-based groups and government officials,” she said.
Sep. 2019
South Sudan displacement crisis still desperate, one year after peace deal reports the Norwegian Refugee Council.
One year on from the signing of the peace agreement, millions of South Sudanese remain displaced as the country continues to face a humanitarian crisis and people fear that peace may not last, according to a new report published today.
Women, who lead the vast majority of displaced households, may be especially vulnerable, including facing the threat of sexual violence. While some women have begun returning to South Sudan, many are not going back to their homes but seeking a safer and better place to live.
The report, No Simple Solutions: Women, Displacement and Durable Solutions in South Sudan, is by Oxfam, Norwegian Refugee Council (NRC), Care Foundation, Danish Refugee Council, and South Sudanese organizations, Nile Hope and Titi Foundation. It highlights the experiences of women in transit and the conditions they need in order to return home.
After five years of brutal conflict, more than seven million South Sudanese – over half the country’s population – are in need of humanitarian assistance. Homes, schools and hospitals have been destroyed and it will take years for essential infrastructure and services to recover.
The conflict created the largest displacement crisis in Africa with over 4.3 million people forced to flee their homes; 1.8 million people are internally displaced and there are 2.3 million refugees in the region.
Elysia Buchanan, South Sudan policy lead, Oxfam said: “Since the signing of the revitalized peace deal, armed clashes between parties have reduced, bringing tentative hope to many. But because of the slow implementation of the deal, many women told us they are still not sure if lasting peace is at hand.”
The civil war also fueled the rise of sexual violence, including rape as a weapon of war, and the abduction of women and girls who were forced into sexual slavery.
With the sheer scale of the crisis, and endemic levels of sexual and gender-based violence, a South Sudanese woman activist quoted in the report warned humanitarian agencies against rushing to support people to return home.
“This would be like throwing people from one frying pan to another. Humanitarian actors should take things slow, until refugees and internally displaced people can move themselves.”
Due to the ongoing humanitarian crisis, people returning from neighboring countries often find themselves in more difficult conditions than when they were displaced, including struggling to find somewhere to live.
Connolly Butterfield, Protection and Gender Specialist of NRC, said: “Time and again, women spoke to us of the challenges they face in returning to their homes. They make the journey back, only to find that their houses and properties were completely destroyed, or had already been occupied by strangers, sometimes soldiers. Some of the women said that if they try to reclaim their properties, they have no means of support. They are more likely to be threatened or exposed to physical or sexual assault.”
Because the context still poses risks, all actors should take a long-term, community-driven vision around supporting the conditions required to deliver a lasting end to the displacement crisis, to mitigate the risk of people falling into an endless cycle of movement. It is estimated some 60 percent of displaced South Sudanese have been displaced more than once, and one in 10 have been displaced more than five times.
Buchanan said: “Helping people return to their homes and rebuild their lives is our goal. But by ignoring or downplaying the issues that make returning dangerous, or not ensuring people have adequate information on what they are coming home to, humanitarian agencies could inadvertently endanger people or make their lives worse.
The international community must only support the return of internally displaced people if conditions are safe and dignified, and the decision to return is informed and voluntary. The humanitarian response must be sensitive to the needs of women and girls, taking into consideration the country’s harmful gender norms.
Martha Nyakueka, Gender and Protection Coordinatior of the national NGO Nile Hope, said: “After years of conflict, it will take time for the country to recover. The warring parties who signed the peace deal must ensure that the agreement leads to lasting changes on the ground, not just in terms of security, but also in terms of improving the lives of the South Sudanese people.”
June 2019
Record number of people facing critical lack of food in South Sudan. (WFP, Unicef, FAO)
The number of people facing a critical lack of food in South Sudan is the highest ever, three United Nations agencies warned today.
According to the Integrated Food Security Phase Classification (IPC) update released today by the Government of South Sudan in collaboration with the Food and Agriculture Organization of the United Nations (FAO), the United Nations Children''s Fund (UNICEF) and the World Food Programme (WFP), an estimated 6.96 million South Sudanese will face acute levels of food insecurity or worse (IPC Phases 3, 4 and 5) by the end of July.
An estimated 21,000 people will likely face a catastrophic lack of food access (IPC Phase 5, the highest level in the five-step classification), while about 1.82 million will face Emergency (IPC Phase 4) and another 5.12 million people will face Crisis (IPC Phase 3) levels of food insecurity. Compared to last January''s forecast for the period May - July 2019, 81,000 more people than originally projected are facing IPC Phase 3 or worse, particularly in the Jonglei, Lakes, Unity and Northern Bahr el Gazal states.
The ongoing lean season started early following record low stocks from the poor 2018 harvest and has been further extended by the delayed onset of 2019 seasonal rains. This, combined with persistent economic instability, the effects of previous years of conflict and related asset depletion and population displacements, have contributed to the disruption of livelihoods and has reduced people''s ability to access food.
High food prices caused by last year''s poor harvests, market disruptions due to insecurity, high transport costs and a depreciated currency are also contributing to the high levels of acute food insecurity.
The effective implementation of the peace agreement and political stability are imperative to allow urgent and scaled-up humanitarian assistance to protect livelihoods and boost agricultural production across the country to save lives.
May 2019
South Sudanese people long for peace as key deadline passes. (NRC, ReliefWeb)
South Sudan’s leaders must ensure a power-sharing government is in place within the new extended timeframe as millions of war-weary citizens cannot afford any more delays to the peace process, the Norwegian Refugee Council has warned.
“Another important deadline has passed, and a lasting peace is no closer to becoming a reality. At the same time, this extension is an opportunity for all parties to continue negotiating and to crucially move forward with the peace agreement’s most contentious clauses. It is imperative that they engage in dialogue, make compromises, and deliver on the promises of peace,” said Miklos Gosztonyi, Policy Advisor with the NRC.
A six-month extension was granted to give the parties more time for the formation of a transitional government of national unity after they failed to resolve issues by this weekend´s May 12 deadline – the date initially agreed when the peace agreement was signed last September.
While the signing of the fragile peace deal eight months ago has seen a reduction in fighting among the signatories, violence continues in some areas. There has been inter-communal fighting, cattle raiding, and clashes involving groups that did not sign the peace agreement.
Meanwhile, the humanitarian situation continues to deteriorate with millions of people facing a growing food crisis as a result of the conflict.
“The food security situation continues to deteriorate mainly due to families fleeing conflict, low crop production, and humanitarian access challenges. Around 80 per cent of people in South Sudan are living below the absolute poverty line. Insecurity also stands in the way of the safe and dignified return for refugees who sought shelter in neighbouring countries, and for internally displaced persons,” Gosztonyi said.
“Now that power-sharing arrangements have been agreed towards the formation of the unity government, the parties should engage with the clauses of the agreement and agree to address the root causes of the conflict. The people of South Sudan have been living on the edge for too long and cannot afford any more delays to the peace they were promised,” he added.
# Around 6.4 million people are currently at risk of hunger according to the Integrated Food Security Phase Classification (IPC)report into the escalating food crisis in South Sudan. Out of those, an estimated 1.6 million people are already facing extreme hunger. By July, a total of 6.8 million people, 60 per cent of the population, could face acute food insecurity.
It is estimated that 45,000 people in former Jonglei, Lakes and Unity are suffering catastrophic levels of hunger and could worsen to famine-like conditions if humanitarian aid isn´t received within the next couple of months.
Around 860,000 children are likely to be acutely malnourished, with conflict-driven displacement among the main reasons for mothers having reduced access to food, nutrition and health services.
An estimated 1.9 million people are currently displaced in South Sudan (OCHA) with 2.3 million people living as refugees in neighbouring countries like Ethiopia and Uganda (UNHCR).


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