Assessments Populism Repackaged: The World Banks Perspective on Equity and Youth

Sangeeta Kamat
World Development Report 2006: Equity and Development. Washington, DC: The World Bank; Oxford: Oxford University Press, 2006. xiv + 320 pp. US$ 26.00 paperback. World Development Report 2007: Development and the Next Generation. Washington, DC: The World Bank, 2007. xvii + 317 pp. US$ 26.00 paperback. The World Development Reports 2006 and 2007 (hereafter referred to as WDR 2006 and WDR 2007) set a strikingly different tone in their cover designs, while their content remains fairly pedantic and in line with traditional World Bank analysis.1 The cover of WDR 2006: Equity and Development shows a 1948 mural by communist artist Diego Rivera titled Dream of a Sunday Afternoon in Almaeda Park and is a fantastic representation of the inequalities in Mexican society, of aristocratic men and women enjoying the park oblivious to poor workers and peasants around them, while state police are shown pushing away poor country folk to clear the park for the enjoyment of the rich. Lenins lookalike peers at the scene from above. An ironic though refreshing choice for the cover of a World Bank report. One must mention here that in 1934 Diego Riveras depiction of a similar Lenin likeness in his mural Man at the Crossroads in the lobby of the Rockefeller Center in New York City created such controversy that the large mural was taken apart and destroyed overnight. In the absence of the communist threat, the World Bank appreciates Riveras painting as just that, as art sans ideology. The cover of WDR 2007 is less direct in its irony but no less contradictory in terms of the perspective presented in the report. The cover shows a painting by a nineteen-year-old from Uganda and represents the young artists dream of a youthful and healthy African society. The author blurb mentions that

1.

For images of the two covers, see the webites: http://web.worldbank.org/WBSITE/ EXTERNAL/EXTDEC/EXTRESEARCH/EXTWDRS/EXTWDR2006/0,,menuPK: 477658pagePK:64167702piPK:64167676theSitePK:477642,00.html and http://web. worldbank.org/WBSITE/EXTERNAL/EXTDEC/EXTRESEARCH/EXTWDRS/ EXTWDR2007/0,,menuPK:1489865pagePK:64167702piPK:64167676theSitePK: 1489834,00.html

Development and Change 38(6): 12091218 (2007). C Institute of Social Studies 2007. Published by Blackwell Publishing, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main St., Malden, MA 02148, USA

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the artist wishes to use his art to help the people of his continent. Ironically the main thrust of WDR 2007: Development and the Next Generation is skills training to ensure that youth are employable in a fast changing and highly competitive economy. That the narrow focus on employability and work in the new economy has little place for nurturing the creative arts and young artists is a contradiction entirely ignored in the report. In 1934 Diego Riveras artwork was erased with chisels and axes, while the WDR 2007 accomplishes this silently through its discourse on training youth for work in the new economy. These apparent paradoxes become clear as one examines the contents of the reports. Here I summarize the salient aspects of each report and provide a critical review of the analysis and policy recommendations in the context of current debates on development. I conclude with a comment on the implications of the reports for development thought and practice and the populist turn in the World Banks discourse on development as reflected in these reports.

WDR 2006: EQUITY AND DEVELOPMENT

The WDR 2006: Equity and Development has three main sections. The first focuses on the extent of inequality within and between countries and provides four indices by which to measure equity education, health, income and political power of individual citizens and nation states. This section also discusses three possible ways to measure inequality: inequality between countries (termed international inequality), inequality within a country (termed intra-country) and global inequality (the cumulative figure of the first two measures). The second section asks the question Why Does Equity Matter? and includes a discussion on the philosophical traditions that have produced a consensus on the intrinsic worth of equity, then goes on to make a case for the instrumental value of equity for economic growth and the detrimental impact of inequality on investment behaviour. The third and final section focuses on Leveling the Economic and Political Playing Fields and takes on several contentious political issues that structure the unequal relations between developed and developing countries. In this section, the World Bank adopts a timid and non-committal stance on vital policy issues that unfairly impact developing countries, such as the undemocratic process of macro economic reform and inequalities in trade relations, and shows itself to be an unabashed advocate for the interests of developed countries. There are signs of the biased position of the World Bank throughout the report, albeit couched in language of impartial empiricism and positivism. To begin with, the report takes a tentative position on whether inequality has increased or decreased over the decades even while it presents statistics on the growth in inequality within and between countries. The report states that, [w]hile there is some consensus that inequalities in health, education, income

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and voice are large globally, there is much less agreement on whether things have been getting better or worse (p. 56). The authors adopt the measure of international inequality in the report as the most appropriate measure of tracking equity globally, while acknowledging that interpreting this measure is fraught with difficulties. For instance, using international inequality as the measure, the authors contend that inequality has declined since the end of World War II, adding the caveat that growth rates of China and India, the two most populous countries in the world, are responsible for the decline. There is sizable literature on the difficulties of measuring inequality across countries, since some countries use household consumption expenditure data while others use income data. However, a recent book by Bronco Milanovic, the leading economist in the World Banks own research department, examines these very debates and concludes unequivocally that inequality between individuals globally is staggering and the differences between the poorest and richest persons in the world are huge and growing (Milanovic, 2005). It is surprising that the WDR authors do not endorse Milanovics conclusions on this debate and instead adopt an ambivalent stance on the inequality debate (Milanovic is cited in passing as one point of view on the debate on globalization and inequality). Their position that the story of income inequality in the world has been a story of falling international inequalities and rising within-country inequalities (p. 68) sets the stage for the rest of the book to examine the frailties of national economies with a focus on developing nations and to prescribe national level policy changes while minimizing the role of international relations in maintaining inequalities. Having declared their indecisiveness about whether things are getting better or worse globally, the authors of the report tackle another tricky issue the source of inequalities and here conclude that it makes more sense to focus on education, health and political participation rather than income per se as areas of intervention. Income inequality is seen as an inequality outcome and the authors state a preference for interventions at the opportunities stage rather than target outcomes. This serves to justify the authors focus on fair process and provision of opportunities at the national level. The authors also refer to the World Values survey on equity that asks a sample of people from sixty-nine countries whether incomes should be made more equal or whether larger income differences are incentives for individual effort. As might be predicted, rich people and respondents from developed countries were more inclined to agree with the second statement while poor people and respondents from countries with high levels of income inequality, such as Latin America, were inclined to choose the first statement. Citing these data, the authors conclude that the results caution against any preconceived notion that income inequality is viewed everywhere as inherently undesirable and that there is no worldwide agreement that income inequalities should be reduced everywhere (p. 84). The disregard for fundamental structural issues is pervasive throughout the report, including in the final section on levelling the playing field in which some structural reforms are

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discussed but dismissed almost immediately (such as land reforms) and in other instances not discussed at all (such as changes in global governance structures). As with most World Bank reports, the presentation of data in WDR 2006 is largely ahistorical and one is pleasantly surprised when historical analysis does appear in certain sections of the report. In the discussion in Part II on Why Does Equity Matter?, a subsection focuses on the importance of institutions for equity, and the enduring impact of bad political institutions for growth and equity (pp. 10925). Here the authors dwell upon how certain countries have a historical record of establishing good political institutions where democratic norms are in place, the judiciary and law are effective in ensuring due process and elite capture has been successfully avoided. They ask why certain countries have bad institutions in place and then point to colonialism as the primary cause for bad political institutions that continue to exist in Africa, and in most of Latin America and Asia. The argument is that in these regions, exploitation of resources and indigenous labour through direct expropriation and rent extraction ensured high levels of capital accumulation for the colonial nations. Thus there was no incentive for the colonial government to establish broad-based property rights, promote equality or greater political participation. This was not the case in countries like Australia and the US, where the objective was the building of nation states rather than merely wealth accumulation through rentier capitalism and exploitation of indigenous labour. In these countries there was an incentive to establish good institutions that would serve the settler population well. The authors also assert that economic growth with bad political institutions is usually short lived as in the case of Cote dIvoire and Colombia. In their discussion of the lessons to be learnt from the history of how bad political institutions are replaced by good institutions, they summarize three key lessons changes in the economy, change via external coercion and force, and the emergence of credible national leadership. Interestingly, in this historical review of transitions to good governance and functioning democracies, the role of civil society and popular political organizing in enabling such transitions is not mentioned even in passing. The silence of the report on the role of popular power in bringing about institutional change and accountability in political institutions not only misrepresents the historical record in the Third World but is also inconsistent with the World Banks own recent emphasis on the vital role of civil society organizations as harbingers of democracy and good governance. In several places in the report, the authors discuss the larger structural issue of inequalities in power between nation states. For instance, they critique the undemocratic character of the World Trade Organization (WTO), pointing out that the capacity of a country to weigh in on the negotiations in the WTO depends upon the number of resident delegates it has in Geneva. Poor countries can barely afford to have even one resident delegate in Geneva. The

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authors cite the shocking statistic that half the countries of sub-Saharan Africa nineteen out of thirty-eight have no delegate at the WTO headquarters (p. 67). This paragraph is followed by data that correlate voice and income levels of countries and it is concluded that no consistent relation can be found between these two indicators. Voice here does not refer to the countrys capacity to participate in the WTO negotiations, but refers to citizen voice based on indices such as a free press and elections. Similarly, in the final sections of the report on Achieving Greater Global Equity the authors mention that inequities in the trade arena are well known: rich countries protect their markets with tariff and non-tariff barriers on goods that poor countries produce more advantageously. They provide handsome subsidies to their farmers, subsidize their exports and discourage value added processing in developing countries (p. 210). The remainder of the section, however, is an argument in support of the WTO and multilateral negotiations as offering the best alternative to poor countries. These are just two examples of a pattern that recurs throughout the report: fundamental inequalities in power are identified and the injustice of the international order is mentioned, but then glossed over and dismissed as if not critical to answering the question posed in the report, What can be done to reduce the huge inequities we experience today?. The answer to reducing inequities is neither here nor there. The magic mantra reiterated in the report is the need for balance and flexibility in implementing market reforms. The authors express caution about the mixed and uncertain effects of liberalization yet remain firm advocates of liberalization policies. They acknowledge that rapid and premature liberalization has caused problems in several countries including Russia, Chile and Mexico where elite families captured the assets and benefits came to be concentrated among a small section of society. Labour market reforms that improve incomes and working conditions are suggested but in ways that are not at the expense of efficiency (ibid.). Here the authors cite data on some Indian states that reinforced the rights of workers and instituted pro-labour measures which they argue led to lower productivity and output compared to manufacturing units that made labour regulations more flexible (ibid.). Flexibility, the code word for subcontracting, easy hire and fire policies, jobs without benefits or unions, is advocated in the report and examples of teachers unions and energy sector unions in developing countries are provided as obstacles to growth and equity (here unions are said to represent politically powerful groups and therefore to contribute to inequity!). The explicit message is that equity is to be sacrificed if it undermines efficiency and growth objectives and equity that is attuned toward growth and efficiency goals is the only equity worth having. Interestingly, the report uses the language of pathologies to describe the underlying causes of an unequal playing field (p. 178). The pathologies, however, do not refer to the global or international inequalities that severely

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limit the options of poor and developing countries but to internal domestic pathologies such as outright predation by political elites and state protection of middle class and elite interests. These pathologies are even more deeply entrenched in the international sphere and developed countries in the global international order play a fundamental role in maintaining national inequalities. While compelled to acknowledge global inequalities, the continuous emphasis on domestic irregularities and lacunae represents a strategic response of the World Bank to shift the onus onto national governments and thus explain the horrendous inequalities as pathologies of developing countries. The report therefore gives the appearance of being bold and honest when unequal political arrangements between developed and developing countries are named, but the analysis and implications of these unequal relations are not followed through and instead the discussion moves to the level of the nation state and the trade-offs that developing countries need to negotiate and balance. Here too, the analysis is in the form of scattered examples of the impact of market reforms or protectionism with no coherent reform agenda explained for any single country or economy. Moreover, in a context where the sovereignty and autonomy of nation states is severely eroded by market liberalization and macroeconomic reforms pushed through by the World Bank for over two decades, assigning responsibility to national governments to strive for equitable reform seems a cruel joke on the worlds poor (Premnath, 2003). There are some glaring gaps in the report such as the complete neglect of sectoral inequalities that pose a serious challenge to developing economies. The agricultural and peasant populations in developing and emerging economies suffer the worst impact of market liberalization and there has been no effective resolution or response from national governments to the economic crisis impacting this segment of the population (Ghosh, 2005). In WDR 2006 sectoral inequalities between agriculture, manufacturing and services and how to address these inequalities receive no attention. Vital questions are not asked, let alone answered in the report questions such as, what are the possibilities and the requirements for the redistribution of political power and resources and the rethinking of macroeconomic reform in particular sectors to balance the inequities between sectors? This would require a more comprehensive review of the economy that takes into account the uneven articulation between sectors and advocates for strong corrective redistributional measures a path the World Bank is unlikely to take given its commitment to neoliberal market reforms.

WDR 2007: DEVELOPMENT AND THE NEXT GENERATION

The focus on youth is the first ever by the World Bank and reflects the attention to changing demographics in developing countries. The economic and to some extent social implications of the youth bulge in developing

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and emerging economies are examined in this report. Youth bulge affords a certain comparative advantage to countries, the assumption being that such countries will by default become the major suppliers of skilled and unskilled labour in the global economy. As the introduction of the book states, the 1.3 billion youth (aged twelve to twenty-four years) make up the largest youth cohort in history. The aim of the report is to document the status of youth, especially in developing and middle income countries and to put youth development on the policy agenda of these countries. It is noteworthy that countries such as China and India, which were singled out for the hysteria over the so-called population bomb and were the primary targets for population control programmes as a poverty reduction strategy by the World Bank and the international institutions, are now being described as having a window of opportunity for growth and poverty reduction owing to the youth bulge in these countries. The first section of the report makes the argument for why youth are important to poverty reduction and economic growth and therefore deserve consideration in development policy. Next, the report identifies five main transition points in the lives of young people learning for work and life, employment, health, forming families and exercising citizenship summarizing the situation of youth at each of these stages and providing recommendations that will enable young people to play a positive role in national development. The final section of the WDR 2007 emphasizes the importance of a national youth policy for countries (a recommendation implicitly directed at middle and low income countries only). The report is replete with statistics and cross-national and gendersegregated data on the extent to which todays youth are well informed and independent minded, their interest in civic and political affairs of the country, and the extent to which they are entrepreneurial and risk taking. The report also has many quotes from young people, most of which are poignant in their honesty and directness of expression. There is a curious disconnect between the survey data presented and direct quotes from young people that identify the main issues affecting them. For instance, survey data record who has had the most influence on their decisions related to schooling, marriage and work the options are myself, family, government or other. Meanwhile, the quotes from young people point to the economic circumstances of their families that leave them no choice but to drop out of school and take up menial jobs at an early age. For example, a young person from Vietnam says, I cant go to school because I am the main breadwinner of my family (p. 18) or a young person in Togo says Most pupils dont leave school on their own. It is due to lack of financial support (p. 50). Similarly a young person in Nepal is quoted as saying, studying is only for the people of higher castes, not for ones of lower caste like me (p. 82). These and many more are presented as stand-alone quotes alongside the main text and are not discussed as such. The survey data, on the other hand, depict issues of schooling and other life choices within a liberal

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framework of choice and autonomy and as pertaining to social norms and culture rather than a matter of economics. The report utilizes a human capital approach to youth issues where the primary objective is for youth to become productive and responsible citizens and contributors to the development of the economy. Health, autonomy and education are defined in narrow terms without reference to broader social and economic conditions and policies that impact youth. For instance, the heightened competition in education and insecurity over ones future has detrimental effects on the physical and mental health of young people today and is expressed in suicides by students, and the increased incidence of depression and other mental illnesses among youth. However, health is discussed narrowly as being able to protect oneself from sexually transmitted diseases, being informed about AIDS and family planning methods. Even within this limited definition of health needs of young people, there is no reference to the structural adjustment programmes that instituted significant cuts in the health and education budgets of governments in Asia, Latin America and Africa which have had a direct impact on access to and affordability of basic health and education services for the rural and poor in these countries. Equally, it is impossible to explain the high incarceration rates of delinquent youth in the US (pp. 1789) without relating it to the growth of the prison industry as a commercial and profitable enterprise during the same period. In this and so many ways, the neoliberal trend in national and global policy imposes an enormous constraint on the lives of young people in the choices available to them. Is it any surprise that this overwhelming real condition is not referenced in the report given that the World Bank has spent the last two decades advocating divestment from public education and health services? To then write a report that advocates for the health and education needs of young people in developing countries is populist at best a slogan with no mandate. The report is valuable in so far as it draws attention to a neglected constituency in world affairs, but it also does a disservice to the authentic concerns of young people who seek a better world the report offers no hope in this direction and instead positions young people as a valuable resource that nations can leverage to build competitiveness in the global economy. While youth activists press for a rights-based policy framework on health, education and job security, the WDR 2007 uses the framework of needs and how best these can be fulfilled through private, community and public services and self-motivated action. The report identifies access to information to make reasonable choices as the main area of intervention and the provision of actual services is barely addressed as an issue. This approach is in line with the neoliberal framework that emphasizes personal responsibility over public provision, and community-based and private initiatives over any organized state effort as the optimal way to address the social and political aspirations of a society.

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What Next is the title of a three-volume report commissioned by the Dag Hammerskjold Foundation and provides a refreshing counterpoint to the World Development Reports. The What Next project engages with many of the same questions taken up by the WDRs 2006 and 2007, but its approach to addressing issues of inequality, uneven development and growth, the future of citizenship and technology is radically different from that of the World Bank. The objective analysis of issues and the tenor of the What Next project publications are best expressed in the words of the editors: The What Next project has not aimed for a watered down consensus on each and every issue, or for any kind of monolithic blueprint, but rather to bring to the fore the many vibrant and crucial debates and the possible future directions that need to be considered (Hallstrom et al., 2006:). The World Banks WDRs assume that the current economic and political arrangements are part of the natural evolution of society and not conscious acts of history. Equally, the assumption is that these arrangements are immutable and non-negotiable and need only be tinkered with in minor ways. In contrast, the What Next project publications confront the critical and seemingly intractable problems of our century environmental destruction, massive inequity, social unrest and insecurity to ask what policy shifts are required to change direction towards another, more humane world. The WDRs are concerned with resolving these problems within the existing political and economic order and therefore it comes as no surprise that they are unable to provide a way forward. The vague appeals to balance and flexibility only reflect the dead end we have reached in addressing the fundamental crises of our times within the existing policy framework. The What Next project publications perform a far more vital service by bringing to the table the urgency for new insights and fresh thinking on public policy, an initiative that is lacking in the WDRs. The What Next project publications are an interesting and illuminating read on the developments of the past thirty years and on future trends in international relations, media and communications, human rights, and economic, political and religious fundamentalisms. Essays debate the relevance of alternative development concepts for a globalized world, the contribution of the United Nations to world governance, the importance of civil society for social change, new technologies, and understanding of human rights all with the objective of exploring new ways of addressing old issues of security, well-being, internationalism, governance and citizenship. The publications engage in the useful exercise of scenario building including a pessimistic but realistic scenario of business as usual, a world in 2035 in which China shares super-power status with the US, ecology and human health are increasingly at risk, technology effects cannot be predicted or controlled, and democracy and citizenship rights are severely curtailed. A second scenario imagines a more humane world in which sustainable

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development, equity and security are within reach of our civilization and not impossible ideals. The essays outline the ideological and policy changes that are necessary to move from the present neoliberal hyper-consumptive and overproductive economy. The authors argue that the alternative scenario is not an implausible one but requires a new consensus, parts of which are present in institutions such as the UN and NGOs, peoples movements and the alternative media. The What Next project takes on the contradictions of global and national policies, and presents us with possible futures and very real choices. It convincingly argues that only drastic changes in international relations and modes of governance and most importantly an ideological shift in which neoliberal market economics is no longer the hegemonic principle of societies and economies can alter the highly unequal and impoverished futures faced by the vast majority of the worlds population. For the discerning student of development studies, the What Next series is an essential read while the WDRs can be safely given a miss.
REFERENCES
Ghosh, J. (2005) Trade Liberalization in Agriculture: An Examination of the Impact and Policy Strategies with Special Reference to India. Background Paper for the Human Development Report 2005. Geneva: UNDP. Hallstrom, N., O. Nordberg and R. Osterbergh (eds) (2006) What Next Volume I: Setting the Context, Development Dialogue 47. Uppsala: Dag Hammerskjold Foundation. Milanovic, B. (2005) Worlds Apart: Measuring International and Global Inequality. Princeton, NJ: Princeton University Press. Premnath, G. (2003) The Weak Sovereignty of the Postcolonial Nation-State, in A. Kumar (ed.) World Bank Literature, pp. 25364. Minneapolis, MN: University of Minnesota Press.

Sangeeta Kamat is Associate Professor, International Education and Education Policy Studies, School of Education, 254 Hills South, University of Massachusetts at Amherst, Amherst, MA 01003, USA.