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gidynm
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Paradox Of Our Times
February 25, 2009 - 12:30 PM
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We live during interesting times, the era of globalization, era of information , era of accontabilty, transparnccy. This are all the buzz words we hear everyday.
True the world has become intertwined like a complex web whereby i can get realtime news of what is hapenning thousands of miles away from me.
But has this flow of information made us better as human beings has it eliminated prejudice, stereotypes and has it made us more caring.
How can we sleep every night after enjoying a nice meal knowing that 800 million people will go to sleep hungry.
Are human being creature of paradox,why can't we use tomorrows ideas to solve today's problem.
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matuda
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Re: Paradox Of Our Times
February 25, 2009 - 03:42 PM
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I call it world imbalance.I believe it is possible to alleviate poverty ( if every single rich person contributed, if we all worked together etc..if...) We are living in times when people no longer share and we are selfish we want to get ahead and luxuries have become necessities.
There needs to be those that lead and make the rules and those who follow. Hence there will be the poor and the rich and with that brings those who starve and those who waste.
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Emad
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Re: Paradox Of Our Times
February 26, 2009 - 10:38 AM
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Globalization has given us the chance to understand different cultures and their societies. Understanding the dynamics of other societies would give us more to learn about ourselves by spotting the differences among us. It all depends on the peoples perceptions to globalization. It can be argued both ways as being good and bad. However, i believe it has to be controlled to make much use out of it.
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Kabo Harold
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Re: Paradox Of Our Times
March 3, 2009 - 01:45 PM
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I cant believe you chaps. What do you mean by if every rich person contributed?? It sounds like you're advocating increasing taxes for the most talented and productive individuals in a society. Many of the wealthy chaps you seem to abhor worked very hard for the fruits they enjoy today. Why should they be punished with taxes??
Every man makes his destiny. Whether we like it or not, we cant follow a system that relies on handouts. Like JFK once said, "Ask not what your country can do for you, but rather what you can do for your country"... Globalization didn't bring about poverty, it only made us more knowledgeable to the growing needs of humanity. With the internet I can now see the slums in Mumbai or Somalia. Even in the days of Christ, beggars roamed the streets of Jerusalem. It's no different today.
If you cant sleep because of your constant worry for the needy, my advice to you is to drink a double shot of tequila and lime. That way, you're creating employment(for the poor) and stimulating the economy through VAT.
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redmamba
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Re: Paradox Of Our Times
June 14, 2009 - 06:01 AM
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Globalization was necessary and as long as technologies that led to our current state are applied well, it is awesome to live in a global village.Globalization has made acute our awareness of social inequality.
It is true that we have capacity and we can achieve whatsoever possible, however, only if all factors are held constant.
I do not advocate for the handout culture; that is demeaning and dehumanizing. However, I stand on the principle of fairness, being realistic, truthful and good.
One boy is born in a slum In Kibera (one of the largest slums in Kenya). Another boy is born of the president of the republic; between the two, who has more odds against him? Taxes are good, if used well, they help ensure that all in society get the bare minimum. Aid is important, those who have more should necessarily help others, as long as the aid does not remain at the level of a handout. Aid should be more in line with helping in capacity building.
This is true of the world at large. due to certain historical factors some countries are privileged, some regions are privileged or advantaged; they have more muscles than others.
Talk of trade; unless you peg on moral arguments and ask for trade concessions that are fair, they that have muscles can easily have their way at the expense of the poor. One would say "why not?" Of course, class struggles become the order of the day with the majority against the few.
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Kabo Harold
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Re: Paradox Of Our Times
June 18, 2009 - 06:09 AM
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Good Morning Redmamba
First let me take this time to apologize for the late response. You've mentioned some interesting points that I feel deserve more clarity. For instance you say "you do not advocate for the handout culture; that is demeaning and dehumanizing. However, I stand on the principle of fairness, being realistic, truthful and good." In other words, you advocate for the payment of taxes because they're fair and truthful... You then go on to give an example of the two boys (one a pauper and the other a son of a President).
My African brother, I vehemently believe that the fundamental flaw in your argument lies in linking the payment of taxes as a means of alleviating poverty. The primary cause of poverty in Africa and around the world is insufficient capitalism. Only if leaders embrace free market capitalism and policies that support capitalism; free trade, low taxes and functioning markets will the bare minimum of society be met. To answer your question about the two boys, I believe that in the long term neither of them have positive odds in their favour. You might be surprised on my outlook, however let me remind you that a man should be rewarded through merit and not privilege. There are plenty of examples of men and women who have risen from adversity to become business titans eg George Soros, Oprah Winfrey etc
The crux of my argument is that if society does not have any systems in place to empower the creative and innovative that society is ultimately doomed. Many countries in Eastern Europe and Africa have embraced socialism and communism, hence these closed societies have led to an under investment in human capital, research and development and infrastructure. International aid has been used to purchase tools to enable these despotic regimes to further their cause and rule for a longer period. In retrospect, aid is the very poison that slows down progress through social, political and economic reform.
This post was edited on: 2009-06-18 at 06:14 AM by: kaboharold
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Kabo Harold
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Re: Paradox Of Our Times
June 18, 2009 - 06:25 AM
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Trade and investment are interlinked facets of any viable economy. I wont dwell much on trade concessions because that is not my area of competence. In conclusion, I advocate for the Sub- Saharan region to be declared a free trade area. History and empirical evidence shows that African countries DO NOT trade with each other. Therefore if regional trade were to increase maybe poor countries would not receive unfair restrictions from the West.
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prieten47
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Re: Paradox Of Our Times
June 20, 2009 - 08:30 AM
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kaboharold wrote:
My African brother, I vehemently believe that the fundamental flaw in your argument lies in linking the payment of taxes as a means of alleviating poverty. The primary cause of poverty in Africa and around the world is insufficient capitalism. Only if leaders embrace free market capitalism and policies that support capitalism; free trade, low taxes and functioning markets will the bare minimum of society be met.
Hello Harold,
You sound a lot like me when I was younger! I think recent events has shown that unbridled capitalism is also not a guarantee of prosperity. I worked hard for twenty years in the USA, saved and invested my money (conservatively, I thought!) and BAM! 40% of my retirement assets disappeared in the month of September 2008. The result of this wheeling and dealing on Wall Street has been an internaltional financial meltdown. Even Alan Greenspan, once the champion of laissez faire capitalism, has apologized for his careless supervision of the financial markets.
The best thing about capitalism, its rewarding of hard work, is also its greatest weakness. People don't seem to know when enough is enough. They will work themselves to the bone to be able to buy a house much bigger than they need, a car much bigger than they need, food far in excess of what they need, they are destroying this planet! Americans in particular consume 25% of the world's resources although they represent only 4% of the world's population. This consumption level is unsustainable in the long run. But capitalism always requires growth, growth, and more growth...
The ugly truth of capitalism is that it always results in a large poor population along with a small wealthy population. This has always been true for countries like Brazil, China and India, but income disparities between rich and poor are becoming very pronounced in the USA and Japan. I am not saying past communist or socialist economies were better achieving prosperity, they collapsed because they didn't.
But these are new times: we are facing limits to economic growth, oil is getting expensive again, soon food prices will resume their march upwards. Food riots will begin again. I agree food handouts are not the answer.
A new kind of economic model must be found. One that encourages hard work and innovation (the best features of capitalism), yet also allows us to live within the limits of the Earth's resources (some kind of economic planning, okay socialism).
Some call this merging of capitalism and socialism a "social welfare state". To a greater or lesser degree, most European countries like the Scandinavian countries, also Germany and France, aspire to this model. They have their own problems like high unemployment, but they try to maintain a certain minimal standard of living for everyone.
I am full of praise for Botswana which is one of the few economic and democratic success stories in Africa. What is Botswana's secret?
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Wangchuk Chungyalpa
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Re: Paradox Of Our Times
June 20, 2009 - 01:08 PM
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Poverty alleviation remains a challenge all across the globe, including in developed countries. Taxing the rich is but one small step. What is required is redistribution of wealth which is easier said than done. In a capitalist society, it would fall upon the government to create and implement policies and rules to ensure equal distribution of wealth. For example, ensuring employment quotas for marginalized communities, providing the capacity for marginalized communities to partake in economic growth via investment in soft areas of capacity building such as education, healthcare, establishing employment guarantee schemes, by pursuing and promoting those industries that can generate the highest employment as was done in China by the manufacturing sector. In India, The National Rural Employment Guarantee Act is a flagship program of the current administration that guarantees 150 days of labor to all workers. In this way, the government can play a central role in equitable wealth distribution.
Does globalization cause poverty? I believe so. We are referring to global trade and generally, countries give first priority to their economy. As a result, unfair subsidies to local producers, high tariffs and trade restrictions such as import quotas can hamper the growth of a nation. Generally rich countries are in a better position to dictate terms and conditions upon trading partners, thus fair trade is very important.
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prieten47
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Re: Paradox Of Our Times
June 21, 2009 - 09:35 AM
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Wangchuk wrote:
Does globalization cause poverty? I believe so. We are referring to global trade and generally, countries give first priority to their economy. As a result, unfair subsidies to local producers, high tariffs and trade restrictions such as import quotas can hamper the growth of a nation. Generally rich countries are in a better position to dictate terms and conditions upon trading partners, thus fair trade is very important.
I think we have to be careful when we say globalization causes poverty. Without a doubt high paying jobs in the USA and Europe are disappearing as these jobs are moved to China and India, where the jobs are performed at much less cost, but for Indians and Chinese, these are very good jobs. So in a way, we can say globalization impoverishes the developed world and benefits the developing world. It is also true that farm products which are heavily subsidized in the USA and Europe are flooding the developing world's markets, causing poverty in the rural population. So which is it? Does globalization offer a net benefit or a net cost to a developing country? I am sure the new middle class of 200 million or so Indians are enthusiastic about globalization, but the other 800 million are screaming for protection from cheap food imports.
In America we grow food very efficiently, but only 2% of Americans are farmers. The rest of us have watched our good paying jobs disappear to China and India. For a while we maintained "prosperity" by borrowing back the money we paid China to make the things we used to make, and then using the money to drive up our house prices. We all know what finally happened: the housing bubble burst!
I still have some hope that rising oil prices will force a rethinking of globalization. When transportation costs rise enough, imports of manufactured goods and food will become too expensive and regional production will again reassert itself. Then globalization will be replaced by relocalization.
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Kabo Harold
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Re: Paradox Of Our Times
June 23, 2009 - 08:34 AM
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Hello Priesten47
Thank you for the kind remarks regarding my country, Botswana. Whats our secret? In six words; good'ol free market capitalism and democracy. We're quite lucky to have a government that respects the rule of law, enforces property rights and keeps taxes low to enable entrepreneurs to take on more risk and grow their businesses without government intervention and manipulation. I am sad to hear that you also lost money during the September crash. My portfolio also took a beating but I was able to recoup some of my losses recently during the three month bear market rally in the US and Asian equity markets.
Alan Greenspan contributed immensely to the crisis by keeping interest rates low whilst encouraging a "borrow and spend" attitude throughout his tenure as Fed Chairman. I have come to the assertion that five or ten years from now, the world will realize that this crisis was caused by central planners in Washington and NY. If they hadn't peddled social objectives in private firms ie Fannie and Freddie, Americans who did not have suitable credit wouldn't have been allowed to take loans on mortgages they couldn't afford. In turn Wall Street would not have gambled with homeowners equity. The system was flawed due to the constant meddling of central planners. It is for this very reason why I feel that capitalism with a dollop of socialism will lead to fascism. Recent events where BOA Chairman Ken Lewis was bullied by Ben Bernanke and Paulson over the Merrill Lynch acquisition starkly proves that you cannot trust the government to make sound business decision that would benefit shareholders. Socialism/fascism breeds more central planning and massive regulation which then stifles creativity and innovation from corporations and entrepreneurs.
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Kabo Harold
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Re: Paradox Of Our Times
June 23, 2009 - 08:52 AM
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Moreover you mentioned that "The ugly truth of capitalism is that it always results in a large poor population along with a small wealthy population. This has always been true for countries like Brazil, China and India, but income disparities between rich and poor are becoming very pronounced in the USA and Japan. " The glaring difference between these emerging markets and the US is Americas respect for freedom , democracy and civil liberties. There is a high correlation between high income and democracy.
India has startling protectionist laws that hinder foreign investment. China's government abhors democracy and freedom, whilst Brazil's government can easily change laws overnight and expropriate the assets of a foreign firm. Though these countries have huge latent potential, the economic system they choose to follow is going to determine whether they will reach the apex of sustainable economic growth.
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prieten47
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Re: Paradox Of Our Times
June 24, 2009 - 06:05 AM
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kaboharold wrote:
The system was flawed due to the constant meddling of central planners. It is for this very reason why I feel that capitalism with a dollop of socialism will lead to fascism... Socialism/fascism breeds more central planning and massive regulation which then stifles creativity and innovation from corporations and entrepreneurs.
I agree with your analysis of the causes of the financial crisis in the USA. However, I think the statements I have quoted are a bit too extreme.
We can argue whether income disparity within a country is a bad or a good thing, but I think a lower income disparity between the richest and the poorest people in a country is generally a better indicator of a government that is trying to create general prosperity amongst its population, as opposed to a country that is intentionally or unintentionally allowing a small group of people to become very wealthy, leaving the rest of the population behind.
There is a "Gini Index" which measures the relative shares of national income earned by the richest and poorest segments of a nation. A lower Gini index indicates there is less income disparity and a higher Gini Index indicates greater disparity. This Gini index has been calculated for many countries (unfortunately, not all) and can be viewed at Wikipedia here:
http://en.wikipedia.org/wiki/List_of_countries_by_income_equality
There is both a UN Gini Index and a CIA Gini Index given but the CIA list has indexes for more countries.
If you sort the table by Gini Index in ascending order (by clicking on the little box at the top of the column), and ignore all the N/A countries, we see some startling groupings of countries.
The lowest Gini Index (least income disparity) is in the Scandinavian countries of Sweden(Gini Index:23) and Denmark(Gini Index:24). Other European social democracies like Germany and France (both 28) are not far behind. There are some anomalies like Slovenia and the Czech Republic that also rank "highly" but I am guessing they are still very homogeneous because they only recently adopted capitalist economies or are emulating their social democracy neighbors. Albania and Bosnia Herzegowina also rank "highly" but this must be due to the general poverty in those countries.
What is the Gini Index for the USA and Botswana?
The USA, way down the list with a Gini Index of 45.
Botswana, third from last with a Gini Index of 63.
What does this tell us? Maybe, just that socialist/capitalist mixture economies like those in the Europe do a better job of creating general prosperity for their population than countries adhering to more capitalist economies.
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redmamba
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Re: Paradox Of Our Times
June 24, 2009 - 05:03 PM
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Hi Harold
I will insist and refer you to this statement in my first submission "It is true that we have capacity and we can achieve whatsoever possible, however, only if all factors are held constant." That was the gist of my argument.
What you advocate for, the capitalist way, is the way of the jungle. In the jungle, Survival is for the fittest; and according to you, Human beings should not consider the prudence of walking the world that way.
It is true that if people applied their potential, worked hard with consistency and purpose, they can achieve much in their dream of dreams. However, that can only be assuming we are all born under the same circumstances, socialized in the same way and given equal opportunities.
But again, even if the ideal model; capitalist way, where one is rewarded for effort were the case, world resources are scarce.
It is from this understanding that I wish to agree with my friend Prieten47. Free market economies encourage creativity and initiative: however it advances greed; man eat man kind of mentality. Out of greed then Man or woman does not care about anything but to get rich; some even aspire to be lords of the universe. What is wrong with that?
Of course, with scarce resources, competition is the word. Those who already have muscles grandiosely decide to use their privilege against others. Class struggles become the norm; if class struggles are not the norm then arms race, increase in crimes, anarchy, sabotage of economies is likely to be the state as everybody (the unprivileged majority) selfishly seek to make it big in life. Then life on earth in general becomes a big mistake.
It is on those grounds that the privileged out of humane considerations or prudential considerations are expected to support fellow mankind; maybe simply by paying taxes. However, I agree with you, reducing as many of the taxes as possible and embracing capitalism (fused with love and care for all that is; that the human concern is not just about amassing wealth)is the way to go especially for underdeveloped Africa.
This post was edited on: 2009-06-24 at 05:06 PM by: gideonwafula
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Kabo Harold
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Re: Paradox Of Our Times
June 29, 2009 - 06:23 AM
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Hello prieten47
First let me apologize for the late reply. For the past couple of days I've been feeling a bit under the weather.In response to your income disparity argument, I can only lament on how unfair Botswana's Gini index has been recorded. CIA data clearly states that Botswana's Gini index was recorded in 1993 and not 2007 like that of the USA. Many government programs aimed at building a spirit of entrepreneurship have been embraced by the vast population. In retrospect a Gini index of 63 which was recorded in 1993 cannot be used as an economic barometer since it is outdated. Moreover, it does not shed light on the economic improvements for the last 16 years.
However I do acknowledge the credence behind the argument. In the face of financial devastation in the USA and throughout the world, government intervention has been a welcome intrusion meant to lessen the pain of lost savings,foreclosed homes, violated security, broken dreams and the horrendous fear that many of us will never rise out of the hole created by the implosion of trusted systems we relied upon for our way of life.
The danger now is that welcoming the suave of government intervention may embolden some misguided politicians(Barney Frank, Barrack Obama) and the vested-interest big government to permanently corrupt the ounce prosperous free markets. Government intervention has the potential of destroying the creative processes by undermining entrepreneurship and small businesses to protect an emerging and growing portfolio of government controlled assets.
I would also like to appeal to you prieten47 to embrace the teachings of Adam Smith and legendary investor Benjamin Graham who clearly believed that every bull markets must end with a correction. Wall Street and Mainstreet helped to inflate the biggest asset bubble in modern day history. From 2002 to 2007 the US economy been growing in leaps but disposable income and savings did not follow suit We are now witnessing a correction through a massive deleveraging of assets; consumer spending, financial credit...
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