No. 6: “The Global Economic Crisis through a Human Rights Lens”

Interview with Daniel Seymour, Chief, Gender and Rights Unit Division of Policy and Practice UNICEF New York and Professor Radhika Balakrishnan, Professor of Economics and International Studies at Marymount Manhattan College, US.

Background

The current global economic crisis poses a severe threat to the enjoyment of human rights. It is the world’s poor and the marginalised, especially women, children, youth and minorities that are particularly vulnerable to the impact of the crisis. They are likely to suffer disproportionately from the increases in poverty, loss of jobs and access to social safety nets and services. Discrimination and xenophobia towards minorities and migrant workers, who could be accused of stealing jobs or competing unfairly, also risks increasing. It is not only the impact of the crisis that risks negatively impacting human rights, but also the response of governments to the crisis.

Addressing the global economic crisis, the UN Human Rights Council in its 10th special session’ recently adopted a resolution that stressed the need to set up an equitable, transparent and democratic international system to broaden developing nations’ participation in decisions regarding the economy. This article delves further into this issue. Looking at both the national and international level, it explores what type of economic model from a human rights perspective, can best deliver a prosperous and accountable society.  It seeks to identify how States and the UN systems can best support such a model.

As little attention to date has been given to the human rights perspective of the economic crisis, we are opening up the Insights article to our HuriTalk members through an accompanying ‘blog’. As we wish to hear a wide spectrum of voices on this issue and your response to the comments made by our interviewees, we warmly encourage you to provide your thoughts and insights to this topic, in the comments area below.

1- What can States do to protect and fulfil their obligations on Economic Social and Cultural Rights (ESCR) in response to the economic crisis- particularly in regards to vulnerable groups?

Daniel Seymour

Daniel Seymour, Chief, Gender and Rights Unit
Division of Policy and Practice UNICEF New York*
The starting point is to properly understand the current economic context from a human rights perspective.

Sometimes, it is argued that if more people are hungry or fewer children are going to school, then realisation of human rights must have fallen.  As a result, it is argued, the current economic crisis represents a crisis of human rights, because people will be poorer, hungrier, and less likely or able to send their children to school.  This essentially apolitical view of human rights is perhaps misleading and not necessarily helpful, since it plays down the role of States Parties’ duties and accountabilities in the equation.

Article 2 of the ICESCR makes clear that a State Party is obliged ‘to take steps… to the maximum of its available resources… to achieving progressively the full realization of the rights recognized in the present Covenant’.  So if a State Party has reduced resources available to it, it can be consistent with its human rights obligations that it provide less.  As countries are affected by the crisis, and governments see fiscal space reduced, they are neither necessarily in violation of treaty obligations if social sector expenditure reduces, nor to be criticized for the consequences of increased poverty to the extent that this arose from factors beyond their control.

Instead, we need to appreciate that the duties of States Parties lie primarily in the choices they make in response to the crisis, and the merits of these choices with regard to their impact on the enjoyment of human rights.  We need to realize that what we face at the moment is a potential human rights crisis arising from an inappropriate response to the economic crisis.  To address that potential human rights crisis we need to frame, evaluate and critique the response to the economic crisis in line with the duties of States Parties under human rights law and principles.  In short, we should be less concerned, as human rights proponents, with the difficult situation that governments find themselves in, than with the human rights qualifications of their attempts to extricate themselves from it.

For much of the world, the period from the end of the Second World War has seen patterns of inequality both between and within countries at best stay the same, or at worst deteriorate (depending on how inequality is defined and measured).  While the spread of democracy has empowered many of those formerly disenfranchised, the concentration of wealth and economic power in the hands of a relative few has arguably disempowered people to a greater extent.  This economic disempowerment has been the underlying challenge that has driven our efforts for the realisation of economic and social rights.  The current crisis is neither the result of mechanisms breaking down nor of economic mismanagement: rather, it was the result of mechanisms, which had over recent years generated impressive gains for some, working themselves to their logical and perhaps inevitable conclusion. Given this, it would be naïve to think that the response to economic crisis will not be at risk of being captured by the same interests that have driven and benefited from increasing disparities in economic power.

So, we should conclude, the human rights challenge is to ideally, through the policy response to the global economic crisis, reduce levels of economic disempowerment through the tools of a human rights approach. These would require that proposed policies:

• Do not detract from the circumstances of any group on grounds of discrimination.
• Treat all those within the government’s jurisdiction as equally deserving of assistance to achieve certain minimum standards as laid out in human rights law, without advantaging some groups over others.
• Are transparent and developed, monitored, evaluated and refined in an open and participatory manner that recognises people’s right to a say in decisions affecting them.
• Articulate their component parts as rights to which people are entitled and for which there is accountability and means of recourse should the response not be implemented properly, (where such recourse would normally be legal complaint).
• Explicitly frame responses in terms of the human rights obligations that they respond to and present them for review by mechanisms that monitor the standards of human rights law, such as UN treaty bodies.

Capitalising on the economic crisis as an opportunity to reduce levels of economic disempowerment may be beyond us.  At least if we cannot reduce, we should hope to make sure that such disempowerment is not exacerbated.  And we must appreciate that to do so we must challenge a set of power relations which have consistently short changed the poor, marginalized and vulnerable.

Radhika Balakrishnan

Professor Radhika Balakrishnan, Professor of Economics and International Studies at Marymount Manhattan College, US.

The one thing that we need to hold states accountable to is having a counter cyclical fiscal policy. For example, often in the US when there is a boom in the economy the State gives tax cuts to everyone and when there is a crisis they cut spending. However, we can use human rights to argue that States are obliged to have a counter cyclical policy, so that they can make sure that the flow of money is constant. Hence, in the time of crisis, they are able to provide services.
This relates to the question of how to protect the ESCRs of vulnerable groups. States claim they lack funding, yet cutting funding on ESCR to vulnerable groups is retrogressive behaviour.  They cannot just claim a crisis to justify these cuts, they should have planned for this crisis so that no cuts are needed.
Also, we need to talk about the fact that the crisis did not ‘just happen’. It was manufactured. A lot of it comes from changes in regulations, which allowed for speculative and unregulated financial actions. In this, the State failed in its obligation to ‘protect’. This point is not emphasised enough. Deliberate state actions, such as changes in laws allowed for these types of investments. It was a failure to protect by the State. This perspective has a significant impact on the way we approach the ongoing G20 discussions; the human rights community needs to be much more vocal in asking for regulations and framing it as an obligation of the State.

2- What redress mechanisms are available to vulnerable groups in the case that their ESCR are violated?

DS:

For many in the world the main potential redress mechanisms are through social organisation, voting decisions and even consumption.  Part of a human rights based approach for the United Nations consists of giving people the capacity to avail themselves of these sorts of levers of influence through building their knowledge, supporting the efforts of civil society, and promoting electoral processes within which voters are as well-informed as possible of the choices available to them.

At a different level, the reporting mechanisms for human rights instruments, both global and regional, that address economic and social rights can and should be used to examine and critique policy responses.  Thus the Committee on Economic, Social and Cultural Rights should consider States Parties’ responses with regard to the extent to which they promote the rights of all, rather than advantage the better off.  The Committee on the Elimination of Racial Discrimination should review policy responses to see how they have delivered for marginalized groups.  The Committee on the Rights of the Child and African Committee on the Rights and Welfare of the Child should review how well policy responses have served children, while the Committee on the Elimination of Discrimination against Women should do the same for women.  The same would apply to Universal Periodic Review.

The United Nations family for its part can, through support to States Parties with their reporting and to civil society for alternative or shadow reporting as well as assistance to the Committees themselves, assist with an overall effort to make sure that the response to the crisis is considered through a human rights lens.

RB:
It is hard to say. It very much depends country by country. In the US there are not many. One important step for all countries is to ensure that there is a national consciousness that these rights exist. In the US for example the fact that people have ESCR is not part of the popular imagination.

3- From a human rights perspective, how should States be responding now in terms of practical and concrete policy responses at the national and international level?

DS:

Policy options in response to the crisis have varying human rights credentials.  Monetary policy responses require careful analysis: the case for reduction of interest rates as a means of stimulating growth, or avoiding recession, should be considered in terms of its impacts upon the poor in particular, bearing in mind that inflationary impacts are often most damaging for the most vulnerable.  The choice of components of fiscal stimulus packages has significant human rights implications, including the balance between tax cuts and spending, or the extent to which a tax cut component might be progressive: so far it appears that many such stimulus packages are premised on a ‘trickle down’ principle, with relatively little stimulus provided directly for individual consumption.  Examples such as Brazil’s extension of its Bolsa Familia to an additional 1.3 million families are rare among the 20 or so fiscal stimulus packages that have so far been put in place.

The point is not that from a human rights point of view there are necessarily preferred monetary policy options or fiscal stimulus packages.  Instead, the imperative is that proposed monetary or fiscal responses need to be reviewed from the perspective of their effect on the enjoyment of human rights, not solely on their effect on growth regardless of the distributional and other qualities of that growth.  Our best approach will not be to argue that there is a single ‘one-size-fits-all’ human rights response, but rather that proposed responses must be judged in large part on their human rights credentials. We may reasonably assume that such judgments will reveal, for example, that significant investment in fiscal stimulus through the establishment of guaranteed, long-term social protection systems offers greater human rights benefits.  But these judgments should be the consequence of institutionalizing a human rights perspective and rationale in policy setting.  Investing our efforts first in altering the rules of the game, rather than trying to identify and sell a consistent winning strategy, is more likely to produce sustainable and politically solid results.

There is also an international element to this issue, relating to global agreements and regulatory systems that affects trade, debt and currency exchange in particular. Applying human rights law to interaction between states is always complicated.  The human rights obligations of one State Party to the government or citizens of another under a human rights treaty are not necessarily widely recognized or agreed.  This constrains the application of human rights law with regard to, for example, trade agreements.  At an ethical level this is intuitively difficult: if one country imposes terms of trade on another country that impoverishes one part of its population and result in a large number of children dropping out of school, it seems hard to conclude that the former is in no way responsible or accountable.  At the very least, it should be presumed that international responses, such as the funds being made available to the International Monetary Fund, should also be subject to critique from a human rights point of view, even if the impacts of measures by one country on those living in another are harder to engage.  That Non-Governmental Organisations will offer such a critique can probably be assumed.  However, it perhaps cannot be assumed that the Board of Governors and management of the IMF, for example, will recognize the validity of such a critique within their considerations.  The General Assembly (GA) may be an important forum within which Member States assert the importance of such considerations, and UN entities should make sure to give their support to consideration of the human rights perspective within the GA.

RB:
I would say that at national level it goes back to issues I brought up in question 1- we need a regulatory system on the financial sector that pays attention to the impact of the crisis on ECSR and that protects people from the crisis. ECSR need to be the front and centre of how regulations are being constructed-
At the international level, it is really important to rethink the policies and mantra of international monetary fund in light of the current crisis.. For example, how can poor countries be asked to liberalise their market sector and carry out structural adjustment programmes when governments in the North are arguing for the need for increase regulation of the financial sector in particular and asking for more protectionist trade policy? Also, many poor countries are now going to have to take IMF loans; are they going to be asked not to have deficits where rich countries are going into massive deficits to address the crisis? We need to rethink this dichotomy between these discourses.
At the national level, one thing we are struggling with in the US is the crazy amount of money being spent in the bail outs, with very little accountability, transparency or participation. Absolutely none of these elements have existed in these processes.

4- What reforms are needed for a more accountable economy that protects and serves all those under the State’s jurisdiction without discrimination?

DS:

The broader issue of making economies more accountable is essentially one of governance. From a human rights point of view the priority is to establish an economic order whereby structures of economic governance deliver to all a standard of living and access to services that represents the highest attainable given available resources.

This does not mean to say that the human rights advocate is compelled to seek massive redistribution of wealth, perhaps to fund vastly increased social service expenditure among other things.  Proponents of human rights are capable of appreciating the merits of greater benefits for all in the medium to long term in exchange for smaller disadvantage to some in the short-term, and this includes an appreciation of the potential returns that may arise from inequalities in that shorter-term.  However, from a human rights point of view the costs in assessment of different economic outcomes on violations of economic and social rights need to be factored in.  Thus, for example, from a human rights point of view, there is a premium on economic arrangements which lead to improved realisation of economic and social rights for all, and this premium will often merit accepting lower overall growth as a consequence, since growth does not always deliver perfect outcomes for economic and social rights’ realisation.  It should also be recognized that many of our concerns from a human rights point of view overlap with the concerns of those advocating pro-poor growth strategies.

In practical terms, there are, essentially, two main strategies for introducing human rights considerations into economic policy development.  The first is essentially technical, such as that which UNICEF employed in China, whereby those with expertise in economic management, and budgets in particular, seek to promote economic plans which advance the rights of children, women, and/ or the poor in general.  The second is essentially democratic, such as that which UNICEF supported in Ecuador, whereby the process of economic planning is opened ideally to citizens, but at least to civil society, through investments in spaces for participation and dialogue and efforts made to present and communicate economic proposals in language which is accessible to as wide a range of the population as possible.  In some ways, the latter appears to be more sustainable, and perhaps at the political level also more effective and less dependent on the acquiescence of government.  The two approaches are not mutually exclusive, and sometimes the practice is to combine both.

With regard to the United Nations, both of these approaches are ones we can and should support.  They are also both approaches which can be mainstreamed into our existing modalities of support, be it through our assistance to Ministries of Planning and Finance in the preparation of national development strategies or budgets, or through support to the activities of civil society in the countries where we have programmes.

RB
At a much more material level, we need some kind of ethical lens to hold the economy accountable. Growth as a mantra does not work. Making ESCR the purpose of macro-economic policy will help make the economy more accountable. You can hold States accountable to these standards and ask them, what are you doing in ensuring they are promoted and protected? This is what we try and do in our recent publication- Auditing Economic Policy in the Light of Obligations on Economic and Social Rights. The article looks at ways in which we can better hold the economy accountable, through the use of auditing.

Documented by Emilie Filmer-Wilson