Dr Survé to serve on WEF board

That the fo­rum host fin­gers the eco­nomic model is re­mark­able, writes Ayabonga Cawe

The Star Early Edition - - NEWS - Ayabonga Cawe is the eco­nomic jus­tice pro­gramme man­ager at Ox­famSA.

DR IQBAL Survé, founder and ex­ec­u­tive chair­man of the Sekun­jalo Group, has been ap­pointed to the Ste­ward­ship Board of the World Eco­nomic Fo­rum’s (WEF) Shap­ing the Fu­ture of In­for­ma­tion and Entertainment Sys­tem Ini­tia­tive.

Ste­ward­ship, one of nu­mer­ous strate­gic WEF boards, is made up of 20 chief ex­ec­u­tives, min­is­ters and heads of agency from across the world. Survé, as ex­ec­u­tive chair­man of In­de­pen­dent Me­dia, is ex­pected to share with the board his lead­er­ship on me­dia tech­nol­ogy and me­dia as a tool for so­cial change.

“The dig­i­tal era is trans­form­ing us as in­di­vid­u­als and so­ci­eties.

“As an or­gan­i­sa­tion we need to en­sure that our poli­cies stim­u­late busi­ness growth and keep in mind the needs of our cit­i­zens,” said Survé.

Survé is a reg­u­lar par­tic­i­pant at Davos and serves as the first chair­man of the Global Growth Com­pa­nies Ad­vi­sory Board and vice-chair­man of the Global Agenda Coun­cil (GAC) for emerg­ing multi­na­tion­als, in­clud­ing con­tribut­ing to the Fo­rum Ad­vi­sory Board.

Dur­ing his time in Davos, Survé was a guest speaker at the Sys­tem Ste­ward­ship ses­sions which look at strate­gic rec­om­men­da­tions for the fu­ture of me­dia and in­for­ma­tion in cre­at­ing an in­formed so­ci­ety.

Survé serves on sev­eral mul­ti­lat­eral in­sti­tu­tions and global or­gan­i­sa­tions; he is a found­ing mem­ber of the Clin­ton Global Ini­tia­tive (CGI) and was ap­pointed by Pres­i­dent Jcob Zuma as one of five mem­bers of the Brics Busi­ness Coun­cil.

He is a mem­ber of the G20 B20 Task Teams and the UN Pri­vate Sec­tor Fo­rum.

He has par­tic­i­pated on many ad­vi­sory groups and been part of busi­ness ad­vi­sory del­e­ga­tions on South African state vis­its. – Staff Re­porter

PRE­SENT­ING a united front, the South African gov­ern­ment del­e­ga­tion looked im­pres­sive as they landed in cold Switzer­land for the World Eco­nomic Fo­rum (WEF) an­nual meet­ing in Davos-Kloster.

The theme of this year’s gath­er­ing be­ing “re­spon­sive and re­spon­si­ble lead­er­ship”. An in­ter­est­ing choice, in the face of nu­mer­ous chal­lenges, and in a world that many sug­gest, is shift­ing away from “glob­al­i­sa­tion”, to­wards a more in­su­lar and na­tion­al­ist sen­ti­ment.

The cause of this, ac­cord­ing to WEF founder, Klaus Sch­wab is the “gen­uine frus­tra­tion of peo­ple left be­hind by glob­alised mar­ket cap­i­tal­ism”.

Th­ese were the words of Sch­wab – not Jeremy Corbyn, Irvin Jim nor Floyd Shivambu, but Klaus Sch­wab!

That the “host” of the world’s busi­ness and po­lit­i­cal elite for a week in the Swiss Alps can ac­knowl­edge the role of an eco­nomic model that has pro­duced frus­tra­tion and in­equity is sur­pris­ing.

Who are those “left be­hind” that Sch­wab is re­fer­ring to?

A re­port re­leased by Ox­fam In­ter­na­tional this week sug­gests that eight men own wealth equal to the bot­tom half of the world’s in­come dis­tri­bu­tion.

This list in­cludes the who’s who of the wealth­i­est – Bill Gates, War­ren Buf­fet, Jeff Be­zos and Michael Bloomberg. In South Africa, three white men own wealth equal to the bot­tom half of the dis­tri­bu­tion.

This shouldn’t be sur­pris­ing, as a World Panel In­come Dis­tri­bu­tion study con­ducted by Christoph Lakner and Branko Mi­lanovic in 2013 in­di­cated that the rich­est 10 per­cent in South Africa’s in­come dis­tri­bu­tion cap­tured 64per­cent of the to­tal in­come growth be­tween 1993 and 2011.

So the frus­tra­tion that Sch­wab refers to, in South Africa for those in the bot­tom 50 per­cent is a re­al­ity they have al­ways known, of life in a so­ci­ety that has nor­malised the con­cen­tra­tion of wealth and mar­ket power in the hands of a few.

A wide ar­ray of fac­tors and de­vel­op­ments have got us to this point.

The Ox­fam re­port sug­gests that cor­po­rate strategy (in par­tic­u­lar those of multi­na­tional cor­po­ra­tions) and a ne­olib­eral pub­lic pol­icy agenda have re­pro­duced in­equal­ity.

More­over, the re­port sug­gests a hu­man econ­omy, one that pri­ori­tises the in­ter­ests of the 99 per­cent. In­equal­ity is an out­come of a cer­tain kind of struc­tur­ing of mar­ket re­la­tions, with a cause and an as­so­ci­ated set of as­sump­tions and “be­liefs” that en­sure its re­pro­duc­tion.

In a book about the events that led to the Great De­pres­sion in the late 1920s, Li­uaqhat Ahamed ar­gues that it was the de­ci­sions of four cen­tral bankers that were the primary cause of the eco­nomic melt­down. In­ter­est­ingly, it was this eco­nomic melt­down and un­cer­tainty that set the stage for World War II and the sub­se­quent Cold War. This is a re­minder that the econ­omy and its as­so­ci­ated polity, is not gov­erned ex­oge­nously by some univer­sal rules that gov­ern the in­ter­ac­tions of “na­ture”, but by sub­jec­tive hu­man choices and de­ci­sions.

Ahamed re­calls the ar­dent be­lief in the per­fect func­tion­ing of the “gold stan­dard” as one of the key eco­nomic as­sump­tions of the time.

Among bankers, whether in London or New York, Paris or Berlin, it was revered with an al­most re­li­gious fer­vour, as a gift of prov­i­dence, a code of be­hav­iour tran­scend­ing time and place.

The same kind of fa­natic and cult-like be­lief in the work­ings of the mar­ket and “price” as the best and most ef­fi­cient al­lo­ca­tor of re­sources is a ma­jor con­trib­u­tor to in­come and as­set in­equal­ity. The about­turn of the likes of the IMF and WEF is a recog­ni­tion of the role of the “re­cur­rent crises” of un­fet­tered mar­ket cap­i­tal­ism in get­ting us here.

But also an ac­knowl­edge­ment of the “po­lit­i­cal and so­cial price” of ne­olib­er­al­ism as an un­nerv­ing re­al­ity, as Bri­tish writer Ge­orge Mon­biot ob­serves, “…an eco­nomic model based on per­pet­ual growth con­tin­ues on its own terms to suc­ceed, though it may leave a trail of un­payable debts, men­tal ill­ness and smashed relationships. So­cial atom­i­sa­tion may be the best sales strategy ever de­vised …it is a gen­eral so­cial af­flic­tion, vis­ited upon us by gov­ern­ment pol­icy, cor­po­rate strategy, the col­lapse of com­mu­ni­ties and civic life, and our ac­qui­es­cence in a sys­tem that is eat­ing us from the in­side out”.

How do such mod­els and their dis­as­trous so­cial and eco­nomic con­se­quences come to pass? Much of it has to do with the in­tel­lec­tual “cover” that cer­tain ideas have en­joyed. Take for in­stance the of­ten im­plied idea that the mar­ket is the most im­por­tant in­sti­tu­tion in any given so­ci­ety. The mar­ket is viewed by in­vestors and pol­icy-mak­ers alike, as a yard­stick of a na­tion’s so­cial health and progress.

Our politi­cians in the wake of ad­verse events or de­vel­op­ments, are of­ten quick to re­as­sure the mar­ket­place that ev­ery­thing is un­der con­trol. How­ever, as Mah­mood Mam­dani re­minds us, the mar­ket is one of the old­est in­sti­tu­tions in so­ci­ety, but sel­dom in his­tory have we wit­nessed a sit­u­a­tion where we of­ten think (and the schol­ar­ship and teach­ing of eco­nomics has a hand here) that the “mar­ket” and the “econ­omy” are the same thing. Mar­kets have co­ex­isted with var­i­ous kinds of economies and so­ci­eties: cap­i­tal­ist, feu­dal, slave-own­ing, com­mu­nal, all of them. The dis­tin­guish­ing fea­ture of all pre­vi­ous eras has been that so­ci­eties have al­ways reg­u­lated mar­kets, set lim­its on their op­er­a­tion, and thus set lim­its on both pri­vate ac­cu­mu­la­tion and wide­spread im­pov­er­ish­ment. Only with cap­i­tal­ism has the mar­ket wrenched it­self free of so­ci­ety.

The Ox­fam re­port iden­ti­fies this promi­nence of the mar­ket along­side another re­lated de­vel­op­ment, that of a state that plays a min­i­mal role in the econ­omy. What Malaw­ian econ­o­mist Thandika Mkan­dawire calls, “watch­dog states”. This is at odds with what the Ox­fam re­port pro­poses is a solution to the mar­ket and pol­icy-in­duced in­equal­ity that we see. The re­port ar­gues for a “hu­man econ­omy” on two fronts. First, in its rec­om­men­da­tions it sug­gests a com­bi­na­tion of pub­lic ser­vice pro­vi­sion of es­sen­tial ser­vices, in­ter-state co-op­er­a­tion on tax and labour is­sues, a fo­cus on en­abling al­ter­na­tive gover­nance and own­er­ship struc­tures of pro­duc­tion (worker-owned en­ter­prises and co-op­er­a­tives for ex­am­ple) and end­ing ex­treme wealth dif­fer­en­tials through reg­u­la­tion (wealth tax or tar­get pay ra­tios) and sig­nif­i­cant as­set trans­fer (most no­tably in South Africa, the trans­fer of the land). Sec­ond, the hu­man econ­omy also must con­front our mark­ers of eco­nomic well-be­ing and how we cal­i­brate so­cial progress and health. Two ex­am­ples are worth men­tion­ing here. First the pol­icy fo­cus on im­prov­ing out­put or GDP growth in economies char­ac­terised by se­vere in­equal­ity presents sig­nif­i­cant lim­i­ta­tions. It stands to rea­son that the ben­e­fits of GDP growth would, rather than “trickle down” as the the­ory sug­gests, ac­tu­ally ac­crue to top earn­ers and those with own­er­ship of as­sets in a coun­try as un­equal as ours.

Even if we did achieve the 5per­cent growth tar­gets of the NDP, it wouldn’t rad­i­cally al­ter the em­ploy­ment and dis­tribu­tive pro­file of our growth; much like the growth spurt South Africa wit­nessed in the 2000s be­fore the fi­nan­cial crash in 2007/8.

The other ex­am­ple re­lates to the “un­com­pen­sated” role of women in the work of so­cial re­pro­duc­tion (house­hold work, rais­ing chil­dren and care work for the young, dis­abled and el­derly) that pre­pares the labour force. Much of this work is not fac­tored into the to­tal cost of pro­duc­tion, nor con­sid­ered as a factor in pro­duc­tion. A hu­man econ­omy is one in which such work and its value is quan­ti­fied in a man­ner that val­ues the work of women in our so­ci­ety and their true con­tri­bu­tion to the econ­omy.

With­out such an ac­knowl­edge­ment, even in mea­sure­ment, we will con­tinue to re­pro­duce a so­ci­ety wherein ru­ral and town­ship women, with their bod­ies, con­tinue to “sub­sidise” the pro­duc­tion of busi­nesses and or­gan­i­sa­tions, large and small.

The ac­knowl­edge­ment by many mul­ti­lat­eral in­sti­tu­tions such as the In­ter­na­tional Mon­e­tary Fund (IMF) that the “so­cial and po­lit­i­cal price” of in­equal­ity out­weighs the short­term ben­e­fits that are con­cen­trated among a few, is wel­come. How­ever, it is a moot point whether or not this ac­knowl­edge­ment will trans­late to key pol­icy shifts.

Na­tions like Brazil, China and many oth­ers which have seen an im­prove­ment in their ab­so­lute poverty and in­equal­ity in re­cent decades have done so as a re­sult of a strong state in­ter­ven­ing in the mar­ket and in so­cial life for op­ti­mal out­comes. China has been able to take more than 300mil­lion peo­ple out of poverty through a state-driven pro­gramme of land re­form (with small-scale farm­ers at the cen­tre), in­dus­tri­al­i­sa­tion and reg­u­la­tion.

Brazil on the other hand, has man­aged to im­prove its in­equal­ity mea­sures over the past decade or so, largely as a re­sult of pro­gres­sive so­cial in­vest­ment and wel­fare trans­fer poli­cies un­der Lula. The lat­ter ex­am­ple stands threat­ened af­ter the con­ser­va­tive palace coup that re­moved Dilma Rouss­eff last year.

So if the world’s elite are to spare some time to re­flect, amid their “hob­nob­bing”, on what re­spon­si­ble lead­er­ship is about in our con­tem­po­rary re­al­ity, such a re­flec­tion is in­com­plete with­out an as­sess­ment of pol­icy mea­sures that con­front the “po­lit­i­cal and cost” of in­equal­ity and the (patently er­ro­neous) as­sump­tions about how economies op­er­ate.

More im­por­tant, the Ox­fam re­port co­in­ci­den­tally re­minds us that it is not only our ma­te­rial pros­per­ity and so­cial pur­pose that is un­der at­tack, but our own demo­cratic im­pulses, as states un­der the ex­ist­ing sys­tem of­ten mir­ror the ac­tiv­i­ties of crony elites, as Mam­dani notes.

Not only has the mar­ket wrenched it­self free from so­ci­ety, the state is try­ing to do the same. Not only do mar­ket forces threaten to colonise so­ci­ety, the state, too, threat­ens to de­vour so­ci­ety.

A cru­cial task then emerges for or­di­nary peo­ple and the or­gan­i­sa­tions that they cre­ate and those that rep­re­sent them, to not only hold the mar­ket and big busi­ness to ac­count, but also to ex­tend the same vig­i­lance to the state.

In SA three white men own wealth equal to the bot­tom half Ox­fam sug­gests cor­po­rates pro­duce in­equal­ity

NETWORKING: A gen­eral view of the crowd on the first day of the 47th an­nual meet­ing of the World Eco­nomic Fo­rum in Davos, Switzer­land, on Tues­day. The meet­ing brings to­gether busi­ness lead­ers, po­lit­i­cal lead­ers and se­lect in­tel­lec­tu­als to dis­cuss the press­ing is­sues fac­ing the world. The theme is ‘Re­spon­sive and Re­spon­si­ble Lead­er­ship’.

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