Troubled Galaxy Destroyed Dreams: Chapter 190
COUNTERVIEW | Policies perpetuated poverty
'National movement needed to get rid of poverty, casteism'
India Poverty
www.Outreach-International.org Helping Poor People Help Themselves Community Development. Learn More!Poverty Around The World
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Poverty threshold - Wikipedia, the free encyclopedia
The poverty threshold, or poverty line, is the minimum level of income deemed necessary to achieve an adequate standard of living in a given country. ...
en.wikipedia.org/wiki/Poverty_line - 62k - Cached - Similar pages -Ministry of Urban Development & Poverty Alleviation
Oversees and formulates policy for urban development. Includes detail of legislation, policy, and citizen's charter.
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The poverty in India takes many a forms and degenerates to the utmost kind ... Some of the following pictures depict utter poverty and can be disturbing. ...
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5 min - 26 Apr 2006 -
No Subject, speaks for itself ... Make Poverty History ...
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Contents of the Site are owned, maintained and updated by Ministry of Housing and Urban Poverty Alleviation. Sites belonging to attached office, ...
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For decades, policy makers in governments and multilateral institutions have been attempting to find a workable model that would end poverty. ...
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26 Aug 2008 ... Official statistics on poverty in the United States.
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Details of its activities, mission, history (with news clippings), awards obtained, and reports.
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It is the same with poverty. When all the number-crunching is done, the lines of poverty defined and redefined, poverty is about the adivasi starving in ...
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2 Jan 2009 ... The poverty section of the Global Issues web site looks into causes of poverty around the world. Why are poor nations poor?
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Washington, December 11, 2008— The World Bank announced today it is boosting aid to India, for much-needed infrastructure and also to help the nation’s poorest states. Funding is being considered for the next four years under the Bank’s country assistance strategy, with more assistance planned for the future.
http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:22009107~pagePK:64257043~piPK:437376~theSitePK:4607,00.html
My people, worldwide Black untouchables and the Indigenous Aboriginal and Minority Communities are BORN ENSLAVED in POVERTY struck by famine and Food Insecurity and DEBT to die in POVERTY! Since they are the NATURE associated ENVIRONMENT Friendly Peace loving species in this Galaxy! I live with the Peasnt Community destined for SUIcide, Tribals suffering from Starvation, Joblost industrial workers and Displaced Peasants and tribals fighting to survive and bretahe in the GHETTOS created for east bengal refugees!
The number of chronically hungry people has surpassed the 1 billion mark for the first time as the economic crisis compounds the impact of high food prices, the United Nations’ top agriculture official has warned. In an interview with the Financial Times, Jacques Diouf, director-general of the Food and Agriculture Organisation, warned that the increasing numbers of undernourished people could trigger political instability in developing countries.
“The issue of world food security is an issue of peace and national security,” he said, urging world leaders who are discussing ways to resolve the economic crisis not to forget that last year more than 30 countries suffered food riots.
The Rome-based organisation estimated last year that about 960 million people were chronically hungry in 2008. Diouf said that had since risen and “unfortunately, we are already quoting a number of 1bn people on average for this year”. Before the food crisis started in 2007, there were less than 850 million chronically hungry people in the world, a level that has been roughly constant since the early 1990s owing to the global fight against poverty and countries such as China lifting their economic growth.
Diouf’s assessment signals that the food and economic crisis have reversed the past quarter-century’s slow but constant decline in the proportion of undernourished people as a percentage of the developing world’s population. The percentage fell from 20 percent in 1990-92 to a low of just below 16 percent in the 2003-05 period. But with 1 billion people chronically hungry now, the percentage has risen to almost 18 percent.
As a consequence, the FAO’s director-general proposed ditching the UN’s Millennium Development Goal of halving the number of the world’s undernourished by 2015 and replacing it with a target of “eradicating hunger by 2025”. He said to meet that aim, the world should learn from the mistakes of the 1990s, when investment in agriculture fell sharply, paving the way for the surge in food prices of the past two and a half years.
Diouf is pressing world leaders for a summit in Rome in November to tackle the roots of food insecurity, rather than to continue reacting to every crisis with ad hoc measures. “The food crisis is not over,” he said, warning that although international benchmark prices for major agricultural commodities such as wheat, corn, rice and soyabean had fallen from last year’s peak, they remained almost 30 per cent above the 2005 level. He added that domestic prices in developing countries had not tracked the drop in international prices as their crops had been disappointing.
Now, he said, “the financial crisis is worsening the situation by increasing unemployment, limiting the credit for trading [agricultural commodities] and lowering remittances, which in poor countries were used to purchase food”. “Combining all the elements we are in a very unstable situation,” he added.
At the proposed summit, Diouf said that world leaders should commit to investing in agriculture, particularly in the developing world, as the rise in the world’s population from today’s 6.5 billion people to 9 billion by 2050 will mean the world needs to double its current food output.
He added that leaders also should agree to revive the FAO’s Committee on World Food Security, elevating it to ministerial level to “allow policy decisions [to] be made”. Diouf said that several heads of state and governments already back its idea of a summit in November to tackle the food problem. Previous summits, however, have yielded few policy results.
High growth, low votes
South Asia has the highest rates of malnutrition and the largest numbers of undernourished children in the world! Poverty is often the underlying cause of child malnutrition, and while South Asia has recently experienced impressive economic growth and reduced poverty, this has not translated into improved nutrition. The region fares worse than any other developing region including Sub-Saharan Africa (45% vs. 28%, respectively). There is an urgent need to tackle the severe malnutrition situation in South Asia.
http://endpovertyinsouthasia.worldbank.org/
A section of the DALIT intellectuals including ADITYA ROY, Dr Jagadish Haldar, Adhikar Editor Gauranga Biswas, and others have issued an appeal to all Political parties to HIGHLIGHT the demands of the DALITS.
Kolkata (IANS): Describing religious conversion as "God's work", new Superior General of the Missionaries of Charity (MoC) Sister Mary Prema on Friday said she would go to Orissa's Kandhamal - scene of communal violence - if she received divine inspiration.
The German born Prema, who was elected as MoC head Tuesday, hoped the order's founder Nobel laureate Mother Teresa will be canonised one day. She also expressed her desire to meet Pope Benedict XVI.
Replying to a query on the Kandhamal riots during her maiden media meet after taking over the top position, she said: "We forgive those who caused us suffering".
"If God inspires me, I'll definitely intervene," said Sister Prema, when asked whether she would go to Kandhamal.
Asked to spell out her views on religious conversion, she said: "Every human being has the right to believe. Each person is born with dignity. Religious conversion is God's work".
Sister Prema, who turns 56 in May, responded to a host of posers during the half-hour media interaction at the Missionaries of Charity global headquarters, the Mother House.
Expressing surprise at her election, the nun said she needed to know the community across India.
Sister Nirmala, who had led the congregation for 12 years since Mother Teresa stepped down in 1997, was re-elected for a third term March 13. But the MoC held a second election on Tuesday after she expressed a desire to be relieved of the post owing to ill-health.
"My election was a bit of a surprise to me. I had no plans, Mother led the society quite amazingly. Sister Nirmala followed her. Now, I have to follow Sister Nirmala."
"I'll work for the poor, the downtrodden. I will work to eradicate poverty," said sister Prema, who was born Mechtilde Pierick in Reken, Westfalia, Germany. Her parents are now dead, but she has an elder brother and a twin sister. "Both of them are married and have children." In her early life, Sister Prema taught in a school for the handicapped.
She first came to know about Mother Teresa by reading the book "Something Beautiful for God" by Malcolm Muggeridge.
"Inspired by the book, I met Mother in 1980 in a youth meeting in Berlin, and joined the MoC the same year in Essen, Germany."
Missionaries of Charity sources said she served the poorest of the poor in Italy and other European countries, and was a member of the general chapter in which Nirmala succeeded the Mother as Superior General.
Since 2001, sister Prema is living in Kolkata.
"Sister Nirmala will continue to guide us," she said to a question on her predecessor.
Sister Prema hoped that the Mother will be canonised one day. "The investigation of the Miracle is still on."
The MOC, founded by the Mother in 1950, now has 766 Mother Houses all over the world, of which 246 are in India. "We have 4,950 novices working all over the world, though their numbers have gone down in the last one year," said Prema.
She traced the reason to break-up of families and fewer children.
Sister Prema said the young generation has to be inspired to join the MoC. "Through our humble service and plain lifestyle we have to draw the young generation," she added.
She did not think the charisma of the Mother was missing. "It is still there."
TO GRAB POWER AT ALL COSTS |
| Malvika Singh |
With Rajnath Singh supporting Feroze Varun Gandhi and, therefore, all his rather scary utterances, and stating that he will go and campaign for the young aspirant, the Bharatiya Janata Party has established its position vis-à-vis Indian Muslims, Sikhs and other non-Hindus. For a national party to silently endorse a possibly sinful oath is taking humanity back to the days of uncivilized politics when an eye for an eye and an ear for an ear was the war cry of revenge. To see a supposed national party stand by a bagful of false beliefs in the present age of information technology and globalization makes one shudder with fear and sadness. What a waste of energy in a country haunted by poverty and lawlessness, corruption and unjust politics that defy and fight against the essence of pluralism. Will the majority of the Hindus tolerate and condone this rhetoric and the accompanying acts that contravene the laws of this land? Will they, the majority, join a political dispensation that holds such preposterous positions and unbending beliefs that will, most certainly, kill the soul of India? Often it is an unthinking, wild desperation that manifests itself in such acts and speeches, a personal desperation to grab power at all costs. An ascent to power propelled by rabid speeches of this kind is usually fraught with superficialities and results in an equally sudden downfall. The BJP appears to be ‘using’ Varun Gandhi, maybe because he is a Gandhi. Perhaps his party needs a representative of the ‘first family’ of Indian politics within its fragmented fold to assert its national appeal and to enable it to compete with the Congress. Otherwise, why should the party leadership go out of its way to endorse Varun Gandhi, thus alienating some of its critical allies?
Central pie India remains a conservative, semi-feudal culture and it will take some more decades and a clear generational shift in politics and society for the democratization of her multi-faceted cultural traditions, her resilient, ancient philosophies and therefore, of the majority mindset, to take place. Respect for diversity, differences and debate will have to override the scheming, wheeling, dealing and more that we have been witness to over the last few decades. All through the last week we have had to hear non-stop repeats of the diatribe of Feroze Varun Gandhi, whom the press insists on calling by his middle name. Then, a few days days ago, that frightening image was juxtaposed with one of Rahul Gandhi, who was calm and collected, engaging with the press on issues that need correction and action. A different tenor, a different endeavour, a different goal. Forcing a polarization, the BJP and Varun Gandhi may well compel the country to make some hard choices. Some will win on the Hindu plank, others will fall by the wayside and Bharat will go through some severe contractions before the birth of a modern civil society. This may well be our trial by fire! The government is virtually a ‘caretaker’ till the results are declared. If the Congress reaches the 150 mark, chances are that the opportunist bees will race to the hive with their numbers and there could be a radical change of partners in the course of the jig. If the Congress drops its count, the single largest vote-getter, Mayavati or Jayalalithaa or anyone else, will cobble together an ‘united’ collective with all others carrying their ‘numbers’ and jockeying to grab a bit of the Central pie. Real, constructive alliances have not been intrinsic to Indian coalitions. The selfish, divisive ‘alliances’ that have been plaguing India are over for now. The gross horse-trading will resume on the evening of May 16, when votes will be counted. The alliances that will survive till then are those that are mutually beneficial to the partners in the political play. |
NEW DELHI (AFP) — A Muslim-baiting speech ahead of India's elections next month has opened the door to a divisive campaign exploiting the country's religious fault lines.
The black sheep of India's Nehru-Gandhi dynasty, would-be Hindu nationalist MP Varun Gandhi, has prompted a major scandal after TV footage showed him whipping up anti-Muslim hatred while hunting votes in a northern Hindu heartland.
His Bharatiya Janata Party (BJP) would, he was taped telling a rally, "cut the head of Muslims" if it beats the incumbent Congress party in the polls that start next month.
Varun Gandhi is now in legal trouble and facing arrest -- as inciting violence is not taken lightly in a country susceptible to the occasional pogrom.
But the BJP is unrepentant, shrugging off calls from the Election Commission to drop him as a candidate.
Observers say debate on issues such as grinding poverty and other pressing social and economic matters is once again being sidelined as the campaign goes sectarian.
But the fact remains that communal issues are still seen as vote winners.
"The effect of religion on Indian politics is staggering, and denying its influence would be a blunder by any political party," said political analyst Pran Chopra.
"Sectarian politics has a great degree of appeal. It can never vanish from Indian politics."
The scandal surrounding Varun Gandhi, analysts say, underscores some unsavoury facts about modern India -- a country that takes pride in its "world's largest democracy" badge and that wants to make the 21st century its own.
They say that more than sixty years after the subcontinent was drowning in the blood of partition, sectarian rabble-rousers can still score points.
"Hate has been employed as an effective tool to polarise in almost every election," noted Suhel Seth, a well-known television commentator and newspaper columnist.
"The tragedy is that the Indian politician has not learnt how to inspire. He has only been taught how to foment hatred, which is no longer a virtue in these frail times fraught as they are with economic and social stress," he wrote in the Hindustan Times newspaper.
Indeed, according to the Midday tabloid, the BJP has a "new lucky mascot" and a "star campaigner" in the London-educated Varun Gandhi, the grandson of former premier Indira Gandhi.
This has left the rival parties arguing about the communal issues that India's founding fathers tried to put behind them in the wake of partition, with Congress labelling the BJP as a major threat to social cohesion.
"The BJP is out to divide people on the basis of communal lines," Prime Minister Manmohan Singh said this week when launching Congress's manifesto.
"This is the record of Mr. Advani," Singh said of BJP leader L.K. Advani. "We currently must reflect whether this is a person who is fit to hold office."
The BJP quickly retaliated, accusing Congress of cynically courting the important Muslim vote -- Islam is followed by 135 million to 140 million of India's 1.1 billion population -- and of being weak on terror.
Caught in the middle are India's Muslims, many of whom hold little faith in either of the two main parties.
"Political parties are linking recent terrorist attacks to communalism to feed prejudice," said Seema Mustafa, an Indian Muslim columnist.
"Muslims across India are arrested at random and have no one to protect them from injustice."
The BJP's own campaign manifesto is expected to reiterate the party's commitment to building a Hindu temple on the ruins of a mosque demolished in 1992 by Hindu zealots.
The demolition sparked Hindu-Muslim violence that claimed around 2,000 lives.
Declining poverty ups UPA's re-election chances: Study
NEW DELHI: India may have begun to experience a new era in electoral politics, where a large number of incumbents stand a good chance of getting
While poverty has declined in 380 of the 543 Lok Sabha constituencies in the past five years, an analysis by the Economic & Political Weekly (EPW) shows that anti-incumbency, the trend for the electorate to vote out the incumbent representative, has declined significantly between 2004 and 2008.
Some of this may have been reflected in the recent assembly polls in five states, where three incumbent governments retained power. Over two-thirds of sitting MPs lost their seats in the 2004 polls. But they could be more hopeful this time around. If reduction of poverty in 380 constituencies is taken as a proxy for a possible pro-incumbency, then Congress and its present allies seem positioned well.
Of the 380 seats where poverty levels have fallen, Congress has 84, RJD 17, NCP 6, SP 16, BJP 65 and the Left Front 31 while BSP has 10. This is what emerges from the ET-Indicus Analytics Election Special analysis of constituency-level data on over two dozen demographic, social and economic development indicators.
A recent study published in the Economic and Political Weekly found a declining trend in anti-incumbency . The study shows that while 77% of all incumbent state governments were voted out of power in the decade ended 1998, this proportion dropped sharply to just 46% last year.
It is also seen that state election results mirror that of the Lok Sabha in a large number of cases, especially when the two are held within a year of each other. Although a direct correlation between one single measure of development and electoral performance runs the risk of being too simplistic, it’s a safe conclusion that a decline in poverty is a factor that favours re-election.
However, anti-incumbency could work in constituencies where poverty levels have remained static or increased between 2004 and 2008. In the last five years, poverty has remained static in 51 constituencies, and increased in 112 constituencies. Poverty is defined by the government in terms of food intake: people who cannot consume 2,400 calories of energy a day in rural areas or 2,100 calories in urban areas are deemed poor, or below the poverty line (BPL).
The proportion of BPL population fell to 26% from 28% at the national level between 2004 and 2008. During the same period, poverty decreased across all states barring Uttarakhand, which last year took on the dubious mantle of a state with the highest proportion of BPL population at 47% compared with 43% in 2004.
Until 2004, Orissa used to be the state with highest BPL ratio (46%), which has come down to 45% in 2008. Mizoram continues to have least proportion of BPL population at just 1%. Assam saw a 4% drop—the biggest—in BPL population, with all 14 constituencies in the state reporting decreased BPL numbers. This should be good news for Congress, which runs the government in that state.
Primary data from the National Sample Survey Organisation’s 50th, 55th and 61st rounds was taken to arrive at the constituency-wise BPL population projections in 2004 and 2008.
The top 10 constituencies with the largest drop in proportion of BPL population are in the north and eastern states, with as many as six from Uttar Pradesh. Orissa’s Aska constituency saw the biggest 10% drop in BPL population, although the number remains at a high 43%, but below the 46% average number for the state. The Biju Janata Dal sacked and disqualified the MP from Aska, Harihar Swain, for violating the party whip and voting for the Manmohan Singh government in the vote of confidence.
Other constituencies in the top 10 include Pratapgarh, Sultanpur, Sitapur, Jalaun, Akbarpur and Kanpur, all in UP, Orissa’s Berhampur and West Bengal’s Darjeeling. Bihar’s Arrah constituency with a population of 2.5-million gets the dubious distinction of the largest increase in proportion of BPL population, up 8% between 2004 and 2008. This should be bad news for the sitting MP, RJD’s Kanti Singh.
But that needn’t be so. Congress president Sonia Gandhi’s constituency Rae Bareli also saw poverty levels rise, and was one of three constituencies in UP to figure in the list of the worst 10 performers on the BPL score. Want to bet against her re-election?
http://economictimes.indiatimes.com/News/PoliticsNation/Declining-poverty-ups-UPAs-re-election-chances-Study/articleshow/4324309.cms
CJ: Citizen Shiba, 1 day ago Views:640 Comments:1
5 per kg for the poor. And the list goes on with Andhra Pradesh, Karnataka and Orissa.
http://www.merinews.com/catFull.jsp?articleID=15762983
Poverty in India - Wikipedia, the free encyclopedia
Eradication of poverty in India is generally only considered to be a long-term goal. Poverty alleviation is expected to make better progress in the next 50 ...
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www.youtube.comPoverty in India
An analysis of poverty in India. This page is part of IndiaOneStop.Com, a content-rich website dedicated to positioning India in the global marketplace.
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29 Jun 2007 ... A modern smart card system that delivers cash and/or subsidies to the poor could do the trick.
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The rise of 'poortainment'Business Standard - 21 hours ago But it is not a realistic portrayal of the poor in India today. This is the real poverty in India: 80 per cent of Indians live below the commonly used ... COUNTERVIEW | Policies perpetuated povertyTimes of India - Mar 27, 2009 The UPA and the Congress talked about inclusive growth. But did they strive for it? We call growth inclusive when benefits of economic growth reach vast ... Brand Advani: Perils Of Rebranding! CounterCurrents.org News makers of the week MSN India The triviality of the T20 tournamentExpress Buzz - Mar 27, 2009 ... whether playing the cricketing equivalent of a masala movie outside of India is a blow to Indian pride and hospitality. There is poverty in this nation. ... Is IPL more important than Elections? Mangalorean.com New light on Lala Lajpat RaiHindu - 18 hours ago NEW DELHI: “The country needs a new renaissance and a new leadership that can re-awaken the Indian soul and rid the people of misery, ignorance, poverty and ... 'National movement needed to get rid of poverty, casteism' Central Chronicle Time to cut down on disease specific programmes, feels expertsHindu - Mar 28, 2009 ... the poverty line each year, the lecture indicated. In such a scenario, primary health care (PHC) in India particularly has a wide scope, experts said. ... India slips in WEF’s global IT indexEconomic Times - Mar 26, 2009 Mobile telephony has been particularly instrumental in raising prosperity, poverty deduction in developing countries. According to co-author Soumitra Dutta, ... Nepal is bottom 8th in ICT Republica Nordic, North American countries 'most networked' - report Earthtimes (press release) RBI may trim repo rate to 4% by midyear: Moody’sEconomic Times - Mar 27, 2009 With much of the population in poverty, excessive price growth is a huge burden on households and could therefore trigger social unrest. ... India’s growth to be around 6 percent this fiscal: Moody’s Newspost Online High growth, low votesBBC News - Mar 26, 2009 His book India: The Emerging Giant was recently published by the Oxford University Press, New York. This report claims decline in poverty since 2003. ... CPI-M manifesto for 15th Lok Sabha elections IBNLive.com Declining poverty ups UPA's re-election chances: StudyEconomic Times - Mar 27, 2009 NEW DELHI: India may have begun to experience a new era in electoral politics, where a large number of incumbents stand a good chance of getting re-elected ... If God wishes, I'll intervene in Kandhamal: Sister PremaHindu - Mar 27, 2009 I will work to eradicate poverty," said sister Prema, who was born Mechtilde Pierick in Reken, Westfalia, Germany. Her parents are now dead, but she has an ... New boss for Mother Teresa's Straits Times |
High growth, low votes
Poverty — Born: August 20, 1978(1978-08-20)
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Global Crisis and Its Impact on the Region: The Need for a New Growth Model | ||
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Also available in: Montenegrin
Jan-Peter Olters World Bank Representative Country Office Montenegro
IV COSAP Conference and 8th Cetinje Parliamentary Forum Cetinje, Montenegro, March 27, 2009
Twenty years ago, it had appeared that the fall of the Berlin Wall marked the final nail in the coffin of (what Germans call) Staatsgläubigkeit, the confidence that the state could have a beneficial—and should have an active—role in economic matters. These were the days of the so-called Washington Consensus, with a political emphasis on stabilization, privatization, liberalization, and, not least, deregulation. The collapse of Lehman Brothers and the resultant financial turmoil nineteen years later seem to mark the end of Marktgläubigkeit, the belief in the wealth-creating power of, and the socio-economic benefits from, liberalization and deregulation. Who would have thought—just a few months ago—that international debates on the financial sector would center on supra-national financial-sector regulation and supervision, after rounds of nationalizations in countries as economically liberal as the US and the UK? More clearly than ever before do we see today that our principal challenges consist of having to redefine the interrelation of these two valuable, yet highly imperfect systems of coordinating human conduct, economic ambition, and social development—the market for private goods and the state for public ones, both systems with the potential to advance the lives of people and destroy the wealth of households, firms, and countries.
More than half a century ago, when dissecting The Great Crash of 1929, John Kenneth Galbraith—one of the great, for decades disregarded, economists who is celebrating an unexpected renaissance these days—identified five principal weaknesses explaining the severity of the fallout from the financial crisis on the real sector, culminating in the Great Depression, which weighed so heavily over the 1930s. These were (i) a high degree of income inequality; (ii) corporate greed in the context of weak financial reporting standards; (iii) excessive credit growth and insufficient banking supervision; (iv) excessive external imbalances; and (v) weak data and insufficient economic analysis.
This warrants a reflection deeper than can be provided in a short speech—including in Central and Eastern Europe, a region that appears harder hit by this crisis than many other parts of the world. From today’s perspective, there are indeed increasing indications that history might repeat itself. The IMF and World Bank have forecast negative growth rates for the world as a whole—for the first time in 60 years—, with economies of the euro zone and Russia (Montenegro’s main trading partners) expected to contract between 3 and 5 percent in 2009. In recent weeks, governments in Iceland, Latvia, Hungary, and the Czech Republic were forced to step down. In Europe alone, a considerable number of countries—Armenia, Belarus, Georgia, Hungary, Iceland, Latvia, Serbia, and the Ukraine—have already requested IMF support, and others are following suit. Trade is collapsing, large and prestigious companies everywhere are under threat of closure. Rising unemployment and increasing social unrest, as already seen in France, is feared throughout the continent.
With 1929 in mind, the US and most industrialized countries have adopted very large, deficit-financed fiscal stimulus packages, thereby paying tribute to another great, but equally disregarded economist: John Maynard Keynes. Assuming things go well and as intended, with confidence in economic prospects returning also to the banking sector, we should be able to see some life in at least some of the major economies by mid-year, entailing the potential that the mood changes and confidence improves more quickly than thought possible right now. In that case, the current crisis would be U-shaped, unfreezing liquidity and lifting economies, including those in the region, out of their current difficulties—by 2010 the latest.
However, if major economies remain lifeless by summer, the current policies will have largely proven blunt, without fiscal or monetary ammunition left to give it a second shot. If indeed the case, the crisis will be L-shaped—that is, severe and long drawn out. The immense difficulty in forecasting the crisis’ shape reflects the detachment of economic fundamentals from business sentiment, the almost complete collapse of confidence in and among financial institutions, resulting in the almost complete drying up of liquidity, in Montenegro as much as elsewhere. Once lost, confidence is, of course, the trickiest ingredient to restore.What does this all mean, including for Montenegro?
The short-hand answer is as sobering as the economic environment. Transition and post-transition countries in Central and Eastern Europe will need a new growth model—one that does not depend on foreign direct investments and external credits as the engine for growth. Growth will have to come from within, grounded on innovation and increased productivity. For those of us trained in the dismal science of economics, we will have to have a closer look at the endogenous growth theory. Beyond the mathematics and the equations, these models highlight the crucial importance given to the production of new technologies, to training and education—highlighting those areas, in which carefully designed policy measures can have the largest impact on the long-run growth rate of an economy. There is no one headline-grabbing policy that can achieve this, but a set of reforms improving the overall environment within which private-sector activities take place. These models, of course, did not exist when Galbraith derived the five aforementioned bottlenecks, which have led to the rapid deterioration in the overall economic situation and, ultimately, the Great Depression, but they circumvent a plethora of generally microeconomic policy measures that are required to define this new growth model.
These five fundamental conditions of “shock resistant” economies are as relevant today as they were 80 years ago. By now, of course, there is a robust body of academic literature that has placed a considerable emphasis on questions of social inclusion. Apart for reasons valid in themselves, this focus stems from experiences that social tension and large income inequalities result in lower rates of potential growth, weaken political cohesion, contribute to environmental degradation, and add considerable costs to societies in terms of foregone opportunities. To summarize related challenges into one sentence, this requires an educational system that offers opportunities to everyone, irrespective of his or her background, giving people the tools, once having graduated, to be able to contribute effectively to the greater good, within the public or private sectors. The government’s task of providing for an environment that permits the increase of overall productivity, both in terms of invested capital and employed labor, the focus will have to be on the instruments available to government—public institutions, laws, regulations, and mechanisms ensuring their rules-based application. Today, even more so than in the years before, it is paramount that attention is being paid to the quality aspects of public expenditure, to the careful definition of objectives and priorities, the strict adherence to highest standards during implementation, and the ex post assessment of whether, or to which degree, pre-specified goals could have been realized with the policies implemented. And that is where good data—the road map to policy-makers—enters this equation.
I know none of this sounds particularly exciting or novel. It is hard work in areas where benefits can be had only indirectly and often with a considerable delay. However, this region, in particular, will benefit from the fact that the obligations inherent in the European integration process, so eloquently discussed earlier in this morning, are fully consistent with—in fact, largely define—the development of this new growth model. Thus irrespective of the developments within the EU, or the time required to sort out the current institutional impasse, the continued focus on reforms strengthening public institutions, increasing the quality of the public goods provided, and ensuring the transparent and uniform application and judicial verification of rules and regulations promises considerable benefits—certainly economic ones.
With that I wish you the strength and determination to take the opportunity that is inherent in any crisis and build a Montenegro even more successful and better equipped to tackle the challenges ahead, whether the seas are calm or the waters are troubled. | ||
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