World Council of Churches

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Yashpal Tandon presentation

16 de febrero de 2006

Plenary on economic justice

Mr Yashpal Tandon, an economist from Uganda, is the executive director of the South Centre in Geneva

Wealth and poverty: challenge to churches

Brothers and Sisters,

The greatest challenge of our time is the increasing disparity between wealth and poverty both between and within nations. The chasm between the poor and the rich is widening. From the monetary measure over 3 billion people are classified as poor living on less than 2 dollars a day. This is 50 % of the global population. The neoliberal approach in economics, particularly how trade and finance is handled globally, is responsible for this human tragedy.

Global inequality has grown exponentially. The ratio between the richest and the poorest 20% of the world's population was 30:1 in 1960, and 114:1 in 2002. If this is not addressed, humanity risks gross social and political chaos unprecedented in world history. Ecologically, we are destroying our mother earth to a degree never experienced before. Churches and social movements have alerted the world over and over again, but actors of corporate globalization have decided not to heed this warning. Instead, the driving forces of economic globalization continue to promote more growth without limits. One country which has 5% of the world's population consumes a quarter of the world's oil. Global trade is dominated by corporations. They pay lip service to poverty eradication and the protection of public goods and the environment. Profits, not public welfare, are their raison d'etre.

If we all go down this road, we shall need seven more planets like ours. This Assembly comes at the right time. We are at the crossroads between continuing to live or die with our earth. I therefore challenge the churches who are a custodian of ethics and morals, I believe, to show the way of promoting a just and participatory world, where resources can be shared and the earth cared. We need a world without poverty and this should be possible if we rethink the way we consume, produce and distribute resources.


The AGAPE document which I have read defines Neoliberalism. You need to say loud and clear that the free market system is a myth - it never existed, nor will it ever. It is in truth an ideology of the corporations paraded as "science of economics" by the neoliberals. They are a kind of sect in the academic community that are employed in large numbers by global trade and financial institutions, major universities in North and South, and most finance ministries in third world countries. They use a one-size-fit formula as their development paradigm. In the Greek legend, the bandit robber, Procusteus, used to waylay travellers and chop their legs if these did not fit into a "one-size-fit" bed. It may be said with justification that the neoliberal economists are the "Procustian Economists" of our time; they chop the legs of poor nations when they do not conform to their economic programmes. The poor in the South are these chopped legs that do not fit the one-size-fit formula of the neoliberal economists.

Malaysia, to give one example, has been able to develop better than larger countries like Indonesia and the Philippines. Why? Because Malaysia made its own policies, often in defiance of the IMF and the World Bank and the neoliberal economists. Most of Africa, on the other hand, has adopted neoliberal strategies as part of the Structural Adjustment Programmes and Africa is the worst suffering continent. In Latin America, on the other hand, things are changing. Argentina followed the neoliberal strategy with dedication in the 1980s and 90s. Then came the financial crash in November 2001, and the country imploded like a powder keg. The present government negotiated with the IMF and got away with writing off 75% of the debt. The IMF could do nothing about it. In Venezuela the people, in popular elections, overthrew the ruling oligarchy, and declared a Bolivarian revolution, and took control of the nation's resources. In Bolivia, they are doing the same - taking control of the nation's oil and gas resources.


The challenge to the Churches is to offer to the people alternatives to Neoliberalism. They do not have to go far. People everywhere are engaged in working out their own partial solutions out of their experiments in survival strategies. These have to be acknowledged, made more systematic, and given support, but in a different environment. For example, credit institutions for people's self-help projects have been tried by the thousands all over the third world. But they have failed to lift people out of poverty. Why? Because the environment was not conducive. Within the reigning capitalist framework, these self-help projects simply got absorbed in the dominant patterns of production and finance.

So the foremost challenge of our epoch is to change the whole edifice of global production and exchange. In order to do this, the Churches have to work at various levels:

A. At the global political and ideological level;

B. At the national and regional levels;

C. At the level of the people on the ground.

Starting at ground zero, people are learning from the past, and taking matters in their own hands. Against Thatcher's famous dictum that There is No Alternative (TINA), people are saying There Are Hundreds of Alternatives (TAHA). People are experimenting with creating their own currencies, or exchanging goods and services using the barter system. They are pooling their labour together to build boreholes and damming rivers to generate electricity. They are growing food in abandoned lands to fight against hunger and poverty, collecting waste and turning them into assets for survival. They are now even taking to politics, and putting in power their own leaders who will respond to their demand for a total overhaul of the national and global system of production and ownership as well as distribution and welfare systems.

At the national and regional level, some Latin American and Asian countries are defying the IMF and the Neoliberal orthodoxy. The churches have to support such acts of unilateral defiance by the nations and regions of the South. Argentina paid only 25% of its external debt and got away with it. In Bolivia the people are taking control of their natural resources. For Africa, the Bolivarian type revolution could be a start. But it may not be enough. Africa may have to seriously contemplate active disengagement from globalization in a sequenced selected manner, and then, once they build African unity within sub-regions and continentally, negotiate its re-entry into the global system from a position of strength. The churches in Africa may have to look at this possibility seriously. Already, an innovative section of the trade unions in the SADC region has launched a movement called ANSA - Alternatives to Neoliberalism in Southern Africa. They have a ten-point programme on an alternative strategy that the churches may want to study and support.

At the global level, there is now a paradigmatic confrontation between the World Economic Forum (WEF) and the World Social Forum (WSF), or what may be described as the "development camp", and the "free trade" camp. The latter believe that the objective of development is best served through giving free rein to the forces of the market, and creating conditions in which each country engages in international trade on the basis of its comparative advantage. This position has been challenged for the last twenty years, and now there is enough evidence on the ground that contrary to the self-perception of the free market theorists, they are actually anti development. The practical effects of their policies lead to the negation of development, and the creation of extreme wealth on one side and extreme poverty on the other. In 2001, here in Porto Alegre, began a process that challenged the rich people's club at Davos in Switzerland. As opposed to looking at the world from the perspective of those in citadels of power and privilege (which is what Davos does), the Porto Alegre process does so from the perspective of the marginalized and disempowered people of the world.

Where governments and intergovernmental organisations - even including the United Nations - are still bogged down in discredited theories of the past, some church organisations such as Christian Aid, and secular organisations such as Oxfam are taking the lead to draw attention to the inequities of the system, and challenging neoliberal theories that are servicing the greed of corporations. But these efforts are still in the margins of society. They have to become mainstream. The Churches are positioned well in society to make this happen.

Some people and institutions in the North are realising that the problem of poverty is not confined to the South. Globalization, and with it the erosion of social welfare in Europe and America, is creating a new wave of the unemployed, a new generation of the poor in the North as well. Furthermore, the South's poor are jumping walled fences across the Rio Grande in Mexico, and crossing from Africa to Europe over land and sea, half of them perishing on the way or exploited by unscrupulous agents who all want to get rich. The minorities from the South in the North are becoming the racial and religious underclass that is threatening the peace and prosperity of Western nations. At the same time, the wanton exploitation of the soil, minerals, forests, seas, oceans, mountains, wild-life, all this for the greed of corporations, is creating a doomsday scenario for the world.

The warning that the time bomb is ticking has been sounded a thousand times before. These have been either largely ignored, or palliatives thrown at some problems, such as making corporations responsible to the poor and to the environment. These have not worked; these will not work. The world needs a more thorougoing transformation of the way it is organising life on this planet—the only planet we have.

I hope that from here the churches will go with two messages: how to deliver the world from the curse of Neoliberalism, and how to strengthen the hundreds of alternatives (TAHA) of the people for a different world. In the words of the World Social Forum: Another World is Possible ! We can make it !

Yash Tandon

16 January 2006