At this juncture in Arab history, there is an opportunity to be grasped. Unless there is a successful transition from the political to the social revolution in the Arab world, the sacrifice made by the Arab people will be betrayed. The following is a proposal to expose some of the previous aspects of development and economic performance in the Arab world with the aim to infuse the development debate with the idea of development as a human right. It need not be said, the present struggle is a struggle for rights. The idea of rights empowers people; it gives them a sense of self affirmation. The language of rights establishes a framework for the allocation of resources. Without the rights rhetoric we will end up with a totally uncaring market system that will not solve our problems.[1]
Introduction
Development is about unleashing human potentialities and broadening the choices of people. It is a fair and balanced outcome combining the rights to food, shelter, universal health care, work and the right to vote. It is freedom from hunger, from oppression and all that stands in the way of people participating fully and unhampered in shaping their future.[2] On a less qualitative note, development is also the infusion of knowledge in production, incremental growth in capital and progressive institutional change that responds to the demand of working people. Development, in the broad sense, combines the freedom paradigm and capital accumulation- but, not in a static combination. It is the mediation by which the agent, or the subject of history, interacts with the totality of the social condition for the purpose of development. Development therefore becomes the articulation of the social forces that shape capital accumulation. It is the outcome of peoples struggles, in particular, anti-imperialist struggle, to improve their lives through the political process.
Choosing the appropriate development strategy is not independent of the overall vision for the future of the economy and society and the context defining the parameters within which the strategy will be articulated. It is crucial to start with a correct appreciation of the social forces shaping the present and the full legacy of the past without losing sight of the fact that development is a long term process. The second we place development in the long term, the developing world overcomes the idea that developing countries are emerging markets that have to report financial gains on quarterly basis as if they had become the counterpart of Morgan-Stanley. Long term development is about placing the social agenda before the credit ratings of global and Breton-woods financial accounting. It is the deployment of real national resources in a developmental project. This perspective and a thorough assessment of the undercurrents of this particular revolutionary historical process form the connecting grounds that allow the pursuit of development objectives. It, more decisively, reorients policy in a way that redresses the costs of neoliberal experiments that toyed with people’s lives in the past, fosters an agenda that cuts across the divide of economic efficiency and social values, and promotes the idea of development as a human right.[3]
The intrinsic value of the right to development has been widely recognised. In essence, “[t]he right to development is an inalienable human right by virtue of which every human person and all peoples are entitled to participate in, contribute to, and enjoy economic, social, cultural and political development, in which all human rights and fundamental freedoms can be fully realized.”[4]
The right includes:
- full sovereignty over natural resources, including self-determination and popular participation in development;
- the right to work and equality of opportunity;
- the creation of favourable conditions for the enjoyment of other civil, political, economic, social and cultural rights;
- peace and security are essential elements for the realisation of the right to development.
The individual and the collective, which overrides the right to property at the individual level, are identified as the beneficiaries of the right to development, as of all human rights. The right to development can be invoked both by individuals and by peoples. It imposes obligations both on individual States – to ensure equal and adequate access to essential resources – and on the international community – to promote fair development policies and effective international cooperation.[5] The state, which recognises the right to development and the international covenant on economic, social and cultural rights, economic policies, should bridge the wealth divide, furbish the right to decent work and the right to a decent standard of living.
In the Arab world, economic policies are concentrated in the competence of the state. It is the efficiency and practicality of public policies that should be accountable and come under independent public scrutiny. The role of economic policy and, more specifically, fiscal and monetary policy is to find the appropriate regime that mediates disparate developments and puts interest back in the national and regional economies. Under the right to development rubric, economic growth should meet basic needs and not be a trickle down arrangement. Also, the Arab world is a world that is so interlocked with the global economy, such that, it would not be possible to lock in resources for development without international cooperation. “The international community, comprising countries and institutions at the international level, has the responsibility to create a global environment conducive for development. Indeed, by virtue of their acceptance and commitment to the legal instruments, the members of the international community have the obligation to support effectively the efforts of Arab States that set for themselves the goal of realizing human rights, including the right to development, through trade, investment, financial assistance and technology transfer.”[6] Without this rudimentary cornerstone of an economic strategy designed to reduce poverty and unemployment, it is unlikely that any economic program of action can meet the basics of human rights, compensate working people for their suffering under the neoliberal assault and, generally, to secure the right to development.
The economy of the Arab world in perspective
Oil prices are set to remain high in 2011 and, consequently, economic growth in the Arab world as a whole is expected to be higher than usual once more. High growth rates over the last nine years signify a departure from a poor growth trend that started in the mid-eighties. Growing demand for oil from developing countries continues and world demand for oil is set to grow into 2012. Higher quantities and prices imply that the share of oil in Arab GDP will remain high. In 2009, the share of oil constituted nearly 40 and 55 per cent of Arab world and GCC GDP respectively. But, despite a solid growth performance in 2003-2010, unemployment rates responded poorly to economic growth and remained critically high. There was roughly a two-three percentage point drop in unemployment over a seven-year period (2003-2009) that witnessed a cumulative growth rate of 35 percent- here I am only referring to the official rates, which are way underestimated. In an area that exhibits the highest rate of unemployment globally (15 percent), this weak response in job creation to growth makes anomalous the law of labour demand as derived demand and stands counter to the right to work as per the universal declaration of human rights. This otherwise chronically low income elasticity of labour demand vis-à-vis other regions springs from the fact that much of income is derived from oil rents. It is income earned without effort by the US backed ruling elite that controls the state via the security apparatus. It is also income that is channelled to support US debt and affluent consumption. Arab financial wealth does not get re-ploughed back on the productive side of national economies because development, which empowers the Arab people is prohibited by a US imperialist agenda in cahoots with Arab regimes. Mainstream economist cite fear of risk and an alleged lack of national absorptive capacity or, evidently, both as false alibis for diverting resources abroad. Just the idea of lack of absorptive capacity in underdeveloped economies calls for ridicule. Even the Gulf, with more than a five trillion dollars surplus in unrequited transfers, is still categorised as underdeveloped. In the Arab world there are deep seated reasons associated with the nature of the accumulation process that disrupt the intermediation between economic expansion and social development and, consequently, vitiate a plethora of U.N. covenants and declarations relating to development as a human right.[7] Foremost among these reasons, is the continued US assault on the Arab people, which intends to strip of their will and the right to own their resources, in collaboration with an Arab comprador bourgeoisie that has long ruled by outright tyranny and brutality.
The high rate of Arab unemployment is the accumulated product of about three of de-socialisation, class restructuring, declining investment rates, cyclical contraction and a production process that is labour unfriendly. Since the early 1980’s, the economies of the Arab world have been subjected to a neoliberal offensive and performing way below potential. While the real GDP per capita, for the region as a whole, was growing annually at a respectable rate during the 1970s (4.5 per cent), it declined at the annual rate of negative three per cent during the 1980s, and grew at the staggeringly low rate of 0.34 per cent during the 1990s. This prolonged contraction in economic activities was associated with a chronically high rate of unemployment, which despite a buoyant recent performance, which lasted for nearly a decade, remains at astonishingly high levels. As a case in point, it is pointless to speak of this unemployment rate when half the population resides below the poverty line.
When the cornerstone of development, namely the creation of decent jobs, fails to be met, the causes have to be explored not so much in the slow rate of build-up in machinery, physical plant and equipment, but in the way power, control and decision making are articulated between the Arab and extra-regional social formations. The failure to meet the target of jobs and poverty alleviation under the right to development to which all Arab countries are signatories points to shortcomings in the way various national institutions, which are dominated by comprador classes allied with US imperialism, relate to each other and to the outside world. It is at this fundamental level that disparities in development have to be explored and the causal mechanisms should be laid bare. When development is enshrined as a right, it becomes the responsibility of all participants. Furthermore, in a closely integrated world, the accountability cuts across national boundaries, and responsibility falls squarely on the shoulders of the United States and its despotic Arab allies. It is not a country, a nationality or a people that is responsible for the crime of poor development, it is a social class. Rebuilding the Arab world under the development as a human right edict should be a combined regional and international effort aligning the interest of working social classes across borders.
Arab oil rents have also dichotomised economies in a very unproductive way. A highly capitalised oil sector created few jobs relative to the capital invested in it and, in an adjunct manner, decent job expansion occurred through patronage in the public sector. The latter sector however, was not deployed to absorb the high rate of new young entrants into socially useful activity. Public sector employment was used to generate consent via clientalism and diverseness of the working class by favouring one social group over another. As to the private sector, the presence of weak financial intermediation between money assets that accrue from oil rent and physical capital, in addition to a healthy rise in income associated with rising productivity, the rest of economy leaned ever more heavily towards the service and informal sectors. All in the main, these poverty stricken informal sectors employ the majority of the labour force.
In the Arab world, the desired virtuous developmental circle, which is for people to generate a earn and support a decent living standard from national jobs, was obviated principally because profits are drawn from short term merchant and rent seeking activity tapping into oil rents as opposed to an industrially based development path. For now, if and when, the very volatile oil price tumbles, it will put in check a whole mode of development that is namely based on oil revenues. This mode of development is indeed precarious. It is not difficult to foresee that the oil rush is not sustainable and, it already happened once, starting in 1981 and lasting well into 2002. In this span of time real per capita GDP as reported by the world Bank for Saudi Arabia fell from around 18,000 US$ to about 6000 US$. The rate of those living below the national poverty line even in supposedly wealthy Saudi Arabia rose to around twenty percent of the population.
Uneven development and deepening labour force differentiation represent the mainstay of state policy in the Arab world. The process is aided and abetted by imperial and Zionist aggression, which puts in check the very idea that development is a long term process. So not only are internal national policies prohibiting development, but the risk of conflict spilling over at any time vitiates the future and annuls the long term. Developmental projects, which require long gestation periods, are no longer considered. Short term rents in all the economic sectors prevail making the present more valuable than the future. A FIRE economy flourishes (FIRE stands for finance, insurance, and real estate). But still, it may be relevant to recall that the overarching condition of imperialistically imposed geopolitical risk and its impact on inter-temporal preferences, institutional anti-working class bias, and the already inherent uneven developmental state of Arab countries come together to further thwart the path of development. Development therefore become the joint struggle against the local ruling despots and their imperialist patrons.
Uneven development and inequitable income distribution are remarkable in the Arab world. Risky small markets represent the context in which a development strategy has to be addressed. Small markets lead to little capital accumulation and vice versa. Security exposed countries also hinder the formation of development friendly capital. That is why regionalism and Arab integration are key operational solutions to the paradox of small markets and risk.
To illustrate the unevenness, on one end, densely populated Yemen is an LDC with a median monthly income of 100 US$ per family of seven, and sparsely populated Qatar’s comparable median income is near the 4000US$ mark. Within the existing rent and rentier class based and biased institutional context, presumptive redistribution allowing for lesser concentration of private wealth and greater interest in regional development is highly unlikely either within or across Arab countries. Oil rentiers do not reinvest in their countries for the purpose of capitalising productive capacity because their earnings are generated from the sale of natural assets found in their respective countries. To date much of the Gulf region excess savings, some five trillion dollars over 40 years, are divested abroad. The inter/intra wealth and income divide between lower and highest quintiles/deciles is highest globally in the Arab world (Texas income inequality data project). These lingering forms of social bonding, e.g. confessional ethnic and tribal, were purposefully reinforced by the rise of rent seeking comprador bourgeoisie and the constraints imposed on post independence state institutions from the imperialist centre with the sole purpose of dividing working people to strengthen pro-imperialist regimes. This has meant that the degree of disarticulation between the social and economic condition widened. People are forced by state policy to identify and belong socially to some repressive social hierarchical institution like a tribe or sect, whilst their incomes and livelihood are being decided on the commodities future market of the twenty first century. That is why the revolutionary process should situate sovereignty in the purview of the people and in the acknowledgment of the rights of citizenry. Power, under the right to development, belongs to the people, not to oppressive institutions that strip people of their rights. Little will happen in the way of putting a common denominator across national or neighbouring social classes unless the mechanisms and the payoffs, including the springing of NGOs sponsored by the World Bank, which have gone to breed divisiveness are halted.
Despite excess financial savings, the Arab world veered off course in meeting developmental goals. The alienation of the population, especially from partaking in political life, had weakened the security of Arab people and excluded stability over the long term, which is needed to redress frail investment in infrastructure, plant and equipment. The Arab world exhibits the lowest rate of investment, the highest rate of unemployment and the widest spread in income distribution. Political regime and elite insecurity shifted the accent away from development to stabilization efforts and squandered resources. So long as the working classes were insecure in their living conditions, so was the national arrangement and, conjunctionally, the balance of forces shifted gravely in favour of Zionism and imperialism. Institutions remoulded with security concerns in mind and developing under the onus of sluggish and highly erratic economic growth distort income distribution and wealth, in favour of political strongholds, hence, the euphemism ‘the privately owned public sector in the Arab world.’ A weak post independence starting point and successive defeats of Arab socialist regimes against Israel, especially the latest defeat and occupation of Iraq, exposed the security of the labouring classes across the region, weakened publicly accountable institutions and sapped resources to the point where the goal of development fulfilling basic needs under human rights became untenable.
Policy issues for the future
A turn around in development policy is needed to keep pace with the demands of development as a human right. The revolutionary vanguard in the Arab world has a commitment to the Arab people to part with the imperialist sponsored IMF and World Bank policies that have wrought havoc. There is at an essential level an irreconcilability of interest between imperialism and its regional allies with the interest of the Arab people. It is a process of accumulation pinned upon a class struggle. Before resorting to technical economic jargon on the matter, there need be an exposition of the ways in which different social classes and their representative institutions, regional and extra-regional relate to each other and are situated vis-à-vis the allocation of national or regional resources. In a context of continuing dependency, deepening national social rifts hollow out the role of the state as the realisation of common will and accentuate the negative impact of the international division of labour. When sovereignty as the embodiment of social and political rights weakens, sovereignty over national resources also weakens. In other words, the national ownership of domestic resources, a concept upon which there exists widespread consensus, should squarely mean that Arab nationals own their resources and that the institutional context be one that facilitates the process of turning financially earned resources into real wealth. The latter operational requirement implies that the often flaunted issue of ‘governance,’ which is a pseudonym of imperialist control, embeds national and international dimensions simultaneously, especially so, insofar as the international resource liberalisation regimes imposed by the Washington institutions, including free capital movement and imply anti-development flows. Locking in resources for the purpose of development in an otherwise capital rich developing Arab world requires an intertwining of the social with political order. A realignment of social and political interests did not occur so far. The present revolutionary process should bring these together.
This begs the question as to why globalisation, which is another buzzword for imperialist expansion, undermines the sovereignty of Arab developing states why the issue of good ‘governance’ is mainly a matter that applies to small developing states when the Security Council and the Breton Woods institutions themselves lack universally representative governance.[8] By analysing the structure of regional social formations and the lopsided mode of integration imposed upon the Arab world by the brute military power of US imperialism and its ally, Israel, a point of departure can be envisaged as to how it will be possible to connect different national social classes in a joint program of action for development.
For the Arab world to meet the right to development over the next decade, it will require, at least in part, the creation of 85 million decent jobs via a socially designed labour absorption plan in which the state has to firstly redistribute unequal assets and secondly, act as an employer of last resort. However, this will entail more than simple change in the growth optimization strategy of Arab states or minor adjustments to fiscal and monetary policies. It will involve a shift in the Arab class structure and institutional parameters that contribute to heightened regional insecurity, block greater efficiency in investment, and inhibit closer regional integration and coordination. The inevitable predisposition of major macroeconomic and demographic variables towards collision implied that there is little space for argument over the unavoidability of violent convulsions unless the idea of development as a human right takes hold of the imagination. The built up of discrepancies in an Arab economy that does not expand at a rate commensurate with the demands of working people means that change will not be gauged as a matter of degree even if the façade or semblance of parliamentary democracy are in place. Democracy is that which addresses the concerns and needs of working people. The US is seeking to impose an Arab democracy that would be better to its interests than the deposed dictatorships. Democracy is not protocol or etiquette of voting boxes, it is the reincarnation of the interests of working people. In light of this, the state, or the institution foremost responsible for development, may be hard pressed to reinvent itself as a mediator of various social interests, to further guarantee development friendly capital accumulation and to thoroughly implement checks and balances or conflict of interest policies/clauses. Harbouring a long term view of development would necessarily imply that the neighbourhood effect must figure prominently in the approach adopted and so does the issue of Arab integration as a corollary to the issue of development as a human right.
The fundamental premise of the right to development is that the freedom to participate in political life and organise represent an essential logical predicate to development. Social achievements accomplished by participatory democracy are safeguarded by the working people and hard to reverse later. It can occur that development may proceed under conditions of partial or selective democracy, but that will remain susceptible to dissolution since its achievement also represents a partial or selective realization of the public will and aspiration. Partial and selective democracies exclude huge sections of the population from representation. The absence of an unbiased flow of information, lack of provision of basic needs making working social classes vulnerable to manipulation en masse, poor institution of legal rights and, mostly, the perceived precariousness of the state as a viable institution undermine the essence of a democratic process. External imperial threats duly considered, the way in which Arab social structures are organised today leaves little room for input into the political and development decision making process from the broader working class base.
Meeting the concerns of development as a human right requires a process of capital accumulation guaranteeing the right to work. In the light of the inequitable and rent based growth performance of the Arab world and the eroding effects of neoliberal adjustment on welfare, absolute poverty levels rose across the board. In the immediate term, stabilizing or enhancing income distribution, including land reform, are needed for the Arab world. When savings outstrip investment in oil or geopolitical rent driven economies, there need not be concern for the widow’s cruise or the notion that the rich save and the poor do not. Savings flow abroad anyways. Current account surpluses are invariably implying capital exports from the region. The fact that so little has been done to redress inequitable national and regional income distribution may be related to the structure of rent based institutions that intensify social and cultural differences for the purpose of maintaining the acquisition of rents. Despite being capable of affording the so called luxury of equity and various social security valves and mechanisms, the hold of the ruling elite on oil rents and the bias for merchant or commercial as opposed to the industrial capital will not allow any of the Arab countries the stability needed to maintain sustainable social programs in the long run. Development therefore will require measures of autarky, including capital account controls, selective trade protection for national industry and the deployment of real national resources in an industrially based project of development.
The right to development should be realized through a programme of coordinated regional action. Development plans are to be implemented through a “Arab regional development compact” assisted the international community, which is also responsible for the disaster of Arab underdevelopment. In order to secure their supplies of oil under American tutelage, the world was for a long time silent about the slaughter to which the Arab people were subjected by their ruling regimes and imperialist allies. So, the emphasis has to be placed on regional and international cooperation. Under the regional development compact, Arab countries would undertake to fulfil their national human rights obligations, while the international community would provide the necessary safeguards in assisting an agenda of industrially based development and regional cooperation. The immediate points to consider are:
- Joint Arab regional investment facilitated by intraregional trade and access to markets.
- Arab intraregional transfer of resources and technology.
- Protection and guarantees of regional labour and capital, e.g. preferential legislation facilitating the flows inter-regional labour and capital.
- Restructuring of the regional financial system to give each less-capital endowed country a greater share in power and decision-making and to increase the flow of private capital to their economies.
Right based development under occupation is, as a matter of course, nearly impossible and at best highly tenuous. Occupation, especially in Iraq and Palestine, is first and foremost a categorical revocation of the International Bill of Human Rights. Requisitioning national security and personal safety are more policy imperatives than policy options for Arab countries under direct foreign occupation. However, the longer-term strategy for development and command over national resources, as per the purview of the international covenant on economic, social and cultural rights (entry into force 1976), should remain in the competence of the peoples of the Arab world residing under occupation, whose right to self determination still stands, especially in Iraq and Occupied Palestine.
Parting comments
For the Arab world, as a whole, already slightly more than fifty percent of the population subsists at below two dollars a day.[9] And if we were to look for the causes of this poor development, we will be hard pressed to find another more relevant reason than an imperialist driven historical process that shaped Arab institutions under the onus of joint imperial/Arab regime control stripping working people from the right to own and deploy their resources for their benefit. The result up until now is the highly inequitable growth, rising poverty levels and a fragmented market that is in dire need of retaining resources.
In the Arab world, the right to development is synonymous with the right to working class security, which is fundamentally security from want. Achieving this right could only come as a result of international collaboration to arrest US led imperialist aggression against the Arab people and to allow the present revolutionary process to turn political gains into social gains. For long, the degree to which present day forms of US led global accumulation, which are highly dependent on oil, and global economic imbalances, in particular, the dollar as an overstretched global currency, have shut out critique from governments/political groups around the world against the abuse to which Arab people were being subjected. There are so many countries that have even provided military support for the unlawful invasion and occupation of Iraq. Human rights violations in the Arab world, including the right to development, were shyly mentioned, if at all. Many countries are dependent on the US and its imperial stature and, hence, they aided and abetted the prolongation of the occupation of Iraq and the present interventions to circumvent the rise of Arab people. It was a sort of inter imperialist entente because the US controlled the oil waterways and the global economy rode on the back of US consumption. Their concern was what if the US lost the war to Arab resistance, would our dollar denominated wealth and economies come down with it.
There need be a smoothing of the transition from the present day US accumulation order. An alternative to the accumulation, which dispossesses and dislocates the Arab people exists. Social democratic systems have proven to be better performing in economic dynamism and in the provision of welfare. The people of the Arab world are readily and duly entitled to peace security and the speedy implementation of international resolutions relating jointly to the rights of development and to self-determination.
Ali Kadri is presently a visiting fellow at the London School of Economics (LSE). Formerly, he served as Head of the Economic Analysis Section of the United Nations regional office in Beirut. [email protected].
Notes
[1] These are the words of the late South African Justice, Albie Sachs.
[2] Sen, A.K. Development as Freedom, (1999) Oxford University Press.
[3] Development is regarded as a process of economic growth, with expanding output and employment, institutional transformation and technological progress of a country that steadily improves the well-being of all people. When that well-being is regarded as the fulfillment of human rights and fundamental freedoms that enhance the capabilities of the people to realize their full potential, the process of development that leads to the improvement of that well-being can be claimed as a human right. The realization of the right to development is seen as the fulfillment of a set of claims by people, principally on their State but also on the society at large, including the international community, to a process that enables them to realize the rights and freedoms set forth in the International Bill of Human Rights. Economic and Social Council, COMMISSION ON HUMAN RIGHTS, Working Group on the Right to Development, Geneva, 11-20 February 2004.
[4] http://www.unhchr.ch/development/
[5] Ibid.
[6] Review of progress and obstacles in the promotion, implementation, operationalisation, and enjoyment of the right to development. E/CN.4/2004/WG.18/2, 17 February 2004.
[7] A/RES/56/150 The right to development, A/RES/55/2 United Nations Millennium Declaration, A/RES/55/110 Human rights and unilateral coercive measures, A/RES/55/108 The right to development, A/RES/54/175 The right to development, A/RES/53/155 Right to development, /RES/52/136 Right to development, A/RES/52/120 Human rights and unilateral coercive measures, A/RES/51/99 Right to development, A/RES/50/184 Right to development.
[8] ‘[t]oday’s standard economists grope for explanations of continued poverty outside their own profession. They return to factors that have been studied and discarded before by the economics profession, like race and climate, and refuse to see that all historical experience tells us that the economic structure of wealthy countries all have certain characteristics that poor nations lack (increasing returns, innovations, diversity, synergies). The collapse of the first wave of globalisation led economists into eugenics or racial hygiene[9]. Africans were not seen as poor because of the colonial economic structure that had been imposed on the continent; Africans were poor because they were black. During a more enlightened era 400 years ago, Francis Bacon discarded race as a factor explaining wealth and poverty. Today the marginally more politically correct version of this type of theory is that Africa is poor because blacks are corrupt.’ A similar case can be made for the Arab world whose population are Africans or Afro- Asians (my italics). See Development and Social Goals: Balancing Aid and Development to Prevent ‘Welfare Colonialism’. Correspondence with Prof. Erik S. Reinert, The Other Canon Foundation, Norway & Tallinn University of Technology, Estonia, July 1, 2005.
[9] The case may be that unlike the rest of the world, for the Arab Region the 1$ benchmark does not represent a valid indicator of absolute poverty. With the exception of Syria and Morocco, the rest of Arab countries are Net Food Dependent Importing Countries (NFDIC) and, therefore, the subsistence bundle is priced at already high world prices while the income of the marginalized strata is determined at low domestic levels. And, hence, when one considers that the absolute poverty benchmark should be closer to 2$, it then turns out that nearly 50% of the population in the Arab countries reside in conditions closer to abject poverty.
