Saturday, January 17, 2015
By Bakampa Brian Baryaguma
On Wednesday, 3 December, 2014, the Parliament of the Republic of Uganda debated and passed a motion to investigate the complaint against underperformance of the Law Development Centre (LDC). The complaint is available here: http://www.bbbakampa.blogspot.com/2014/05/complaint-concerning-under-performance_10.html. The House directed that the complaint be investigated by the Legal and Parliamentary Affairs Committee, which should compile a report to be presented to the plenary, for the Honourable Members’ final consideration.
Briefly, the complaint analyzes the causes of the unacceptably high failure rates at the Law Development Centre (LDC); calls for an independent and serious parliamentary inquiry into the same; and proposes breaking the LDC monopoly over the Bar course, by devolving the training and teaching of the course to universities in Uganda that are offering the Bachelor of Laws (LLB) programmes. We expect that universities will do a much better job than LDC has done.
The Committee will begin its investigations in February 2015, soon after MPs return from recess. The date of starting the hearings will be communicated later. I am reliably informed that the Committee comprises about 25 members, although usually 15 are present, conducting its business.
On behalf of the coordination committee of this matter, and indeed on my own behalf as Chief Coordinator, I call upon Ugandans and other well wishers to take keen interest in this matter of great national importance. In particular, I call upon our people to step forward and give testimony before the Committee, pertaining to the excesses at LDC. I also invite them to attend the Committee hearings whenever they can. In a classic case of institutional failure and state capture, the Centre commands a reputation of horrible tales of corruption and extortion of money from students in exchange for marks by lecturers, sexual exploitation of students also by lecturers, and many other abuses. We need brave volunteers to give evidence to this effect, exposing the cruelty, oppression and tyranny of LDC. Your testimony will go a long way to salvage the situation and liberate future lives.
The issue of legendary high failure rates at LDC, bordering on massacre and the impunity that reigns there, largely due to the incurably defective system that superintends over them, are matters of national interest, affecting all Ugandans and non-Ugandans equally and without discrimination. These excesses do not bear any political, religious, ethnic, economic or social inclination.
The Law Development Centre is akin to a monster that is on rampage, devouring everything and anything within its sight and reach. Young lawyers in Uganda, who are yearning and preparing for a life of and living in legal practice, have been the monster’s source of food for a very long time. Unfortunately, as explained in the complaint, for so long, these lawyers have been too timid to confront this merciless and insatiable monster.
It is in light of these facts and revelations that our joint efforts as citizens are paramount. When a people are besieged by a common enemy, the logical thing to do is to come together, stand as one, and confront the enemy as one united force. We should work together to tame and cage the monster on loose. We should exterminate it like vermin since it is of no value, considering that there are more viable alternatives. Together, we shall end institutional failure and state capture at LDC.
Anyone interested in giving evidence before the Legal and Parliamentary Affairs Committee of Parliament may contact me via mobile number +256753124713 or e-mail email@example.com for purposes of working out the relevant modalities.
Monday, December 29, 2014
By Bakampa Brian Baryaguma
On 20 December 2014, I had the honour and indeed privilege to attend a couple’s wedding ceremony at one of the Catholic churches in Kampala. There was a wedding mass first and later, the wedding reception. Both functions were wonderful: the celebrant, a reverend father, preached very well; and the party thereafter was awesome.
The bride and bridegroom were very handsome and smart. The two lovebirds smiled endlessly to one another and the rest of us in the congregation. To my mind, this confirmed the eternal truth of the message in the biblical scriptures. Proverbs 18:22 says that when a man finds a wife, he finds a good thing, showing that the Lord is good to him. In the bride, the bridegroom found an excellent, befitting companion and received God’s favour. That is why he smiled all the way. Mathew 6:21 says that where one’s treasure is, so is one’s heart. Clearly, in the bridegroom, the bride found her treasure of love, joy and other blessings. I wish the two lovers well. May their marriage blossom with abundant peace and prosperity, with God being their strong pillar of support and comfort.
I now turn, however, to the not-so-nice bit of things in the proceedings of the wedding mass. I was shocked by the show of discrimination, coupled with what I really considered (and still consider) to be opportunism. For the record, while the bride was Catholic, the bridegroom was Anglican. This means that the mass was attended by people, relatives and friends, of both Christian faiths.
Time came for us to give offertories. The celebrant called upon us, without distinction, to give our gifts to the Lord. All of us (or at least most of us) complied, without exception, by giving generously and whatever we could (hopefully), after which the offertory was blessed by the celebrant, who thanked God for it and requested Him to give us more from His abundant wealth.
Then came time for Holy Communion: the symbolic eating of Jesus’ body and drinking of His blood. At this moment, the rules of the game (if I may just call it a game) were instantly and sharply changed. The celebrant did not call upon everyone to eat and drink. Rather, he only invited his fellow Catholics in attendance, saying that, ‘Those of the Catholic Church come forward.’ The Catholics moved forward, while the rest of us stayed behind. I thought this was tantamount to discrimination and opportunism, which, for the following reasons, are completely wrong and unfair.
First and foremost, I do not think either God or His son, Jesus Christ, in whose memory Holy Communion is celebrated, would endorse this malpractice, moreover committed by men of God, in the House of God! Jesus treated his followers equally without distinction. When he fed the 5000 and 4000, He did so for all those present, including the pagans who doubted Him. He did not discriminate against anyone.
I submit that our religious leaders, who are His successors on earth, should do the same to His people, more so, when it comes to renewing our faith in our Lord by partaking of His body and blood in memory of Him. We may have allowed a lot of confusion about the Lord’s ways to creep and settle among us – as shown by the many Christian denominations and their philosophies – but surely this regrettable confusion should not be extended to renewal of our faiths in Jesus, as exemplified by Holy Communion, which for me is a very simple and straightforward matter, because there is only one Christ for all of us, from whose body and blood we all eat and drink. Jesus’ grace and salvation are for all His followers.
I am sure that the almighty God who sits high up in heaven, with Jesus Christ seated on His right hand side, in abundant and eternal glory, shuns and condemns this practice like I am now doing. I therefore, call upon all church leaders, right from the highest seats of authority in the world, to revisit, with a view to reconsider, this malpractice.
Secondly, as a matter of principle, this conduct is opportunistic and certainly wrong, because it defeats all logic. I take it that by all of us giving our offertories without exception or distinction, we were building the kingdom of God together. It follows therefore, that we should all receive the fruits of the joint effort, again without exception or distinction. To do otherwise, is to be mean and selfish – vices strongly condemned by the God we all love and serve. Justice demands that when two or more people embark on a common enterprise, be it good or bad, they should participate in reaping the fruits of their common endeavours. If the seeds sown were good, they reap beneficially, but if the seeds were bad, then equally so, they reap poorly or by way of punishment, as the case may be.
On the contrary, in our churches today, we do the sowing together, but the reaping is for the select few. This is very unfortunate. It militates against good sense and fairness. It is undoubtedly unpleasing to the Lord. I therefore, suggest that thenceforth, religious leaders should allow every person to renew his or her faith in our Lord Jesus Christ. Here, the word person means and includes Christians and non-Christians alike. For we should remember that Jesus is the healer who came for the sick, not necessarily the well. This way, we shall be able to build a church that truly stands as one, in Christ Jesus.
I am aware that in order to achieve unity and harmony in the church, our religious leaders have devised joint working groups and mechanisms, serving as centres of mutual cooperation and strategic development, for example, the Uganda Joint Christian Council (I stand to be corrected). These are wonderful and welcome developmental achievements, but I tell you brethren, all efforts under these umbrella organizations will come to nothing, if we maintain the Chinese walls and fallacies that have been firmly built and entrenched in the philosophical foundations and practices of our splinter groups, even on basic doctrinal values like Holy Communion. After merging together administratively, we should go back and remerge philosophically and practically, as much as we possibly can, with Jesus Christ, the firm foundation of the church and whom we all love and serve, being our helper.
Thursday, December 18, 2014
By Bakampa Brian Baryaguma
Credit should always be given where it is due. I therefore, wish to thank the President of the Republic of Uganda, HE Yoweri Kaguta Museveni for instituting and presiding over a largely humane and law abiding regime in the country.
One and a half years ago, General David Sejusa a.k.a Tinyefuza found himself in exile in London, the United Kingdom. General Sejusa is a maverick four star army general in Uganda, who has held many senior posts in President Museveni’s government, including presidential adviser, Coordinator of Intelligence Agencies and Member of Parliament representing the army – positions that he held by the time he left the country. We may never know for sure under what circumstances the General ended up in exile – for government says that he imposed it upon himself, having left voluntarily; yet he insists that the decision was forced upon him, after heavy deployment of the army at Entebbe airport on the day of his scheduled return on official duties – but what we know for sure is that General Sejusa was in some sort of exile, which is not nice at all, in this modern day and age.
While in exile, General Sejusa made many stinging revelations and uttered several uncharitable remarks against the person of the President, his family and government, including advocating armed rebellion to overthrow them. Personally I found these remarks very shocking especially, considering that they were coming from a hitherto blue-eyed boy of the President. His remarks were so alarming and frightening that had this been say, nearby Rwanda under Mr Paul Kagame, General Sejusa would have been quickly eliminated in the most shameful, brutal and barbaric manner. Then Mr Kagame would have come out publicly chest-thumping and boasting like a petty village bully, hurling even more insults like he did on the murder and attempted murder of his former army officers, Generals Kalegeya and Kayumba Nyamwasa respectively, calling them dogs that deserved to die. You may recall that in around 2012, the British government formally wrote in protest to the Rwandan government asking it to stop the habit of following exiles with the view of killing them. Then this year, the South African government also officially complained against the Rwandan government for the same reasons, sparking off a diplomatic row between the two, involving mutual expulsion of diplomatic staff, with Mr Kagame’s government setting it off.
Fortunately, on Sunday, 14 December, 2014, at 3:00 AM in the norning, General Sejusa came back safely to his home in Uganda (maintaining that President Museveni must relinquish power). The government has warmly welcomed him and promised to ensure his safety. This is incredible, if you ask me. Thank you very much, President Museveni and your government, for this level of sanity, particularly in a country that had once stooped so low that human life was utterly meaningless and, it goes without saying, valueless. Now, I am aware that many people have downplayed the significance of this, calling it politics, a joke or favouritism; and that the whole exile thing was President Museveni’s intelligence gathering project with his spy chief General Sejusa. Well, be that as it may. My point today is that, it is important that we concede certain facts and truths: the Museveni regime in Uganda is not murderous like some before it or contemporary ones in other parts of the world. I am therefore, saying that we should be appreciative of that level of humanity and accommodation. Certainly this makes a lot of sense in light of our chequered political history.
While commenting on General Sejusa's return, Prime Minister Dr Ruhakana Rugunda, called upon all Ugandans in exile to use this example and come back home. I would like to join him in this endeavour and also urge all our citizens who are forcefully living in foreign lands, including my friend Colonel Mande Samson, to come back to their country and contribute to its development; of course, trusting and believing that President Museveni and his government will do everything in their power to ensure the returnees’ well-being, such as has been promised of General Sejusa.
Saturday, December 13, 2014
By Bakampa Brian Baryaguma
[Dip. Law (First Class)–LDC; PG Cert. Oil & Gas–Mak; LLB (Hons)–Mak; GC Candidate–GCA]
Globalization has been instrumental in improving people’s lives worldwide through boosting production and revenue earnings in form of profits, taxes and wages; increasing living standards and life expectancy; easy access to knowledge, thus reducing isolation; easier access to global networks for instance, in finance and marketing; enabling transfer of required technology among trading blocks; etc. The world is a much better place today, than ever before in human history.
However, in spite of this impressive trend, the world still faces a profound challenge: dire poverty – a symbol of shame, gravely haunting human conscience and pride – posing a global development paradox. In the so-called ‘age of plenty’; in a world said to be, ‘... for the most part too rich for it to be a big part of the story of the persistence of poverty,’ there are still far too many poor people.
Clearly, we cannot sit comfortably or sleep easily knowing that global poverty will soon be in the past; and development a given. Poverty imposes upon us huge responsibilities to address it as one human community.
2. The Current State of Poverty in the World
Poverty literally means a ‘state of being poor;’ and to be poor means ‘having little money; not having and not able to get the necessaries of life.’ Poverty largely denotes material deprivation, but it has human rights connotations too: it is characterized by a denial of human rights, including the right to food, such that poverty and hunger have come to be synonymous with each other. Thus, in some quarters, ‘A “poor” person was essentially defined as someone without enough to eat.’ In essence, prosperity without freedom is a form of poverty itself.
There are no hard and fast rules in measuring poverty, but the commonest standard is the global poverty line of one United States dollar a day. Going by this standard, it appears that poverty has reduced considerably in many parts of the world, in the last two to three decades; because while about half of the population in the developing world lived below USD 1$ a day in the early 1980s, this had folded to less than a quarter – 22% – in about 30 years by 2008. In China alone, about 400 million people were lifted out of absolute poverty.
Poverty today mainly afflicts societies that were outside the ambit of the 19th century industrial revolution, which was isolated and concentrated in Europe and North America, ushering in extensive technological development and unprecedented wealth in that part of the world. The isolated nature of this revolution has ultimately led to extreme global economic inequality, and regional imbalance.
3. Our Responsibilities in Addressing Poverty in the World
Addressing poverty is a collective responsibility: individuals, states and the international community, have obligations to perform. Some countries overcame poverty and are successful. Our responsibilities in this regard, should be determined by their successful strategies – and more.
A. Fixing the Fundamentals – Building Human Capital and Effective Public Institutions
Poor and undeveloped societies are largely composed of unskilled populations, served by highly ineffective public institutions. This may be reversed by undertaking broad-based complementary investments in human capital development and building effective public institutions.
Education systems should be adequate to produce highly knowledgeable and skilled people, who are relevant in meeting social needs – for education is the ability to meet life’s situations.
Establishing effective bureaucratic and political institutions should be given due attention to support the governance aspects of fundamentals like education. Institutions should be democratic, accountable and responsive to people’s needs, in cognizance of their development challenges.
B. Ensuring Structural Transformation – Emergence and Expansion of Modern Industries
Most – if not all – poor societies are characterized by the existence of a dual system of large rural populations and tiny urban populations: the dominant rural populations are dependent on subsistence agriculture, occupy largely unproductive land (if any), live in abject poverty; and for them, social service delivery is difficult. This dualistic formation hinders development.
Structural transformation eliminates this dualism by turning subsistence agriculture into commercial farming, complete with agro-industrial cottages that turn agricultural farmers into manufacturing workers. This ensures optimum land use, eventually turning rural areas into semi-urban centres, able to retain their inhabitants and thus easing social service delivery there, hence development.
Reforms to remove or compensate for costs faced by modern industries are necessary, including opening up world markets for nascent manufacturers to sell their products. New industries can be stimulated by economic policy incentives, to attract investments that will employ workers in traditional economic sectors.
The two development strategies – developing the fundamentals and social transformation – are mutually reinforcing: successful countries have done them together.
C. Encouraging Migration
Migration improves people’s global income position, and human capital. It is the single most important trend to alleviate poverty today, even exceeding international trade. International migration should be encouraged.
D. Promoting Charity
Our world is increasingly interdependent; and so are human communities. This interdependence should be harnessed through charity – kindness and compassion for one another – as an important tool in closing the gap between the rich and poor, especially now, when, ‘We live in an age of empathy.’ For poor people, ‘their poverty is a problem of distribution, not a problem of being unwilling or unable to work.’ Charity helps in solving this problem.
Poverty poses danger to global development. Its persistence is a mockery of today’s age of plenty and robust scientific achievements.
As the Dalai Lama said, ‘We, therefore, need effective international action to address [it] from the perspective of the oneness of humanity, and from a profound understanding of the deeply interconnected nature of today's world.’
Fortunately, poverty is decreasing. The factors responsible for this decrease should be consolidated and replicated to advance impoverished countries. We should also promote financial literacy among the poor, to avoid ‘poor economics.’
Notes and References
1. Joseph E. Stiglitz, Globalization and its Discontents (2002), at 4-5. The resulting international networks have ushered in a host of other benefits and opportunities to all manner of people globally. For instance, promoting democratic governance among states, as well as improving accountability, respect for the rule of law and access to justice in the states, all of which serve to guarantee a life of dignity for all people. The international community works as a global watchdog, ensuring the observance of and respect for these global values among states. In particular, the tremendous growth of international trade has, for instance, facilitated enormous wealth creation; and although this wealth is still unevenly distributed today – meaning high international inequality – this uneven world resource distribution is nevertheless, decreasing gradually and international cooperation has a lot to do with the ongoing reduction. Therefore, that globalization has positively changed the prospects of millions of people around the globe, is self-evident.
2. But this is not to say that globalization is not without its excesses or failures. Indeed, Joseph E. Stiglitz, ibid., propounds that in spite of its benefits globalization has not brought its promised economic benefits to many people in developing countries that are economically and technologically weak: ‘Despite repeated promises of poverty reduction made over the last decade of the twentieth century, the actual number of people living in poverty has actually increased by almost 100 million. ... globalization has not succeeded in reducing poverty....,’ he says, at pages 5-6 of his book.
Professor Stiglitz is not alone in complaining against globalization. Professor Jan Breman reportedly said that globalisation is irrational, for example, it has turned Europe into a rich fortress, keeping out the poor, for which reason he called for good governance at the transnational level. See, Grant Bartley, ‘World Poverty and the Duty of Assistance’ (2014). (Available at https://philosophynow.org/issues/57/World_Poverty_and_the_Duty_of_Assistance, accessed on 22 November 2014, at 00:26 hrs.)
3. Roger Thurow and Scott Kilman, Enough: Why the World's Poorest Starve in an Age of Plenty (2010).
4. Abhijit V. Banerjee and Esther Duflo, Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty (2011) – Chapter 2 – A Billion Hungry People?
5. A.S. Hornby, A.P. Cowie & A.C. Gimson, Oxford Advanced Learner’s Dictionary of Current English (1983), at 664.
6. Ibid., at 658.
7. Commission for Social Development, Thirty-sixth Session, E/CN 5/1998/4. The Commission adopted Texts on Promoting Social Integration, stressing that poverty is a root cause of social exclusion and called on the international community to support developing countries' efforts to address social and economic problems. See, Press Release at http://www.un.org/press/en/1998/19980223.SOC4444.html (accessed on 21 November 2014, at 23:03 hrs).
Further, Grant Bartley, ‘World Poverty and the Duty of Assistance’ (2006), notes that the problem with famine is not the lack of food in the world, but the lack of rights of access to food. So generally, to be poor means not having access to food, clean water, medical care and education, all of which are fundamental human rights. (Emphasis in the original – available at https://philosophynow.org/issues/57/World_Poverty_and_the_Duty_of_Assistance, accessed on 22 November 2014, at 00:26 hrs.)
8. Article 25(1) of the Universal Declaration of Human Rights, 1948 (This declaration affirms that all human beings have the right to freedom from want and freedom from fear. The human rights it espouses are inclusive, interdependent and universal.) See also, Article 11(1) of the International Covenant on Economic, Social and Cultural Rights, 1966.
9. This association of poverty and hunger is institutionalized in the United Nation’s first Millennium Development Goal (MDG), which is to ‘Eradicate extreme poverty and hunger.’ The Millennium Development Goals are a series of time-bound targets, cutting across development areas of interest to the United Nations. They were agreed upon at the Millennium Summit in the year 2000, with a 2015 deadline.
10. Abhijit V. Banerjee and Esther Duflo, supra note 4. According to Banerjee and Duflo, ‘Indeed, poverty lines in many countries were originally set to capture the notion of poverty based on hunger—the budget needed to buy a certain number of calories, plus some other indispensable purchases (such as housing);’ noting also that, ‘... hunger and poverty are assumed to go hand in hand: The inability of the poor to feed themselves properly is also one of the most frequently cited root causes of a poverty trap.’ See, ibid.
11. Dani Rodrik, in his Week 11 lecture on ‘Poverty and Development,’ in the Global Civics lecture series, of the Global Civics Academy. Those living above this standard daily are classified as the rich people; those who live on it per day are the poor; while those who live below it are the absolute poor, living in absolute deprivation.
12. Dani Rodrik, ibid. He states that in 1981, 1.9 billion people in the world lived below the absolute poverty line, but by 2008, this had reduced to 1.3 billion people, which to him is the world’s greatest ever achievement as nothing like this had ever been achieved before. He also says that China and other East Asia countries have registered the highest success in reducing poverty, having experienced a very rapid rate of growth since the 1970s, although inequality there also skyrocketed during this time; and that reductions in absolute poverty were also registered in Sub-Saharan Africa, South Asia and Latin America, in 2000.
13. Grant Bartley, ‘World Poverty and the Duty of Assistance’ (2006). (Available at https://philosophynow.org/issues/57/World_Poverty_and_the_Duty_of_Assistance, accessed on 22 November 2014, at 00:26 hrs.) Bartley defines absolute poverty as poverty that is life-threatening.
14. Thus, Joseph E. Stiglitz, supra note 1, at 5, states that, ‘A growing divide between the haves and the have-nots has left increasing numbers in the Third World in dire poverty, living on less than a dollar a day.’
Moreover, while in many parts of the world poverty is a daily phenomenon and a permanent feature of people’s lives, Abhijit V. Banerjee and Esther Duflo, supra note 4, state that, ‘For many ... in the West, poverty is almost synonymous with hunger;’ meaning that it is transient and easily curable. It is no wonder therefore, that Grant Bartley, supra note 13, characterizes poverty as one of the ‘preventable causes.’
15. It follows therefore, that one’s prospects of being either rich or poor today are largely dependent on which part of the world one lives in: for instance, if the person is born in a relatively rich country, then his or her prospects of living decently are much higher than the one born in a poor country.
16. Yet, particularly in the case of developing countries, as Rodrik, supra note 11, says, ‘... they often start with the same conditions – like being colonised, similar resource comparative advantage and weak institutions.’
17. The findings of the study by Abhijit V. Banerjee and Esther Duflo, supra note 4, on the relationship between poverty and hunger, highlights the significance of institutional effectiveness in tackling poverty. Their study found that, ‘... most recent famines have been caused not by lack of food availability but by institutional failures that led to poor distribution of the available food, or even hoarding and storage in the face of starvation elsewhere.’
18. Dani Rodrik, ‘Economic Development and Governance’ (2013), at 9. According to Wikipedia, ‘Human capital’ (2014), available at http://en.wikipedia.org/wiki/Human_capital (accessed on 19 November 2014, at 16:00 hrs), ‘Human capital is the stock of knowledge, habits, social and personality attributes, including creativity, embodied in the ability to perform labor so as to produce economic value.
Alternatively, Human capital is a collection of resources—all the knowledge, talents, skills, abilities, experience, intelligence, training, judgment, and wisdom possessed individually and collectively by individuals in a population. These resources are the total capacity of the people that represents a form of wealth which can be directed to accomplish the goals of the nation or state or a portion thereof.
It is an aggregate economic view of the human being acting within economies, which is an attempt to capture the social, biological, cultural and psychological complexity as they interact in explicit and/or economic transactions. Many theories explicitly connect investment in human capital development to education, and the role of human capital in economic development, productivity growth, and innovation has frequently been cited as a justification for government subsidies for education and job skills training.’ (Emphasis in the original).
19. For all its benefits, Dani Rodrik, Lecture on Poverty and Development, supra note 11, notes that global governance can support national governance, but cannot substitute for it. This means that poor countries must pay serious attention to their governance issues if they are to eliminate poverty and develop to the level of their advanced counterparts.
20. These are the poor agricultural workers, whom Professor Jan Breman described as ‘the biggest working class in the world.’ See, Grant Bartley, supra note 13.
21. Indeed, the World Development Report 2008 of the World Bank, Agriculture for Development (2008), at 26, found as much: that, ‘Three out of four poor people in developing countries—883 million people—lived in rural areas in 2002. Most depend on agriculture for their livelihoods, directly or indirectly.’
22. The World Development Report 2008, ibid., at 72, captured the effects of this transformational process stating that, ‘Many rural households move out of poverty through agricultural entrepreneurship; others through the rural labor market and the rural nonfarm economy....’
23. Dani Rodrik, Economic Development, supra note 18.
24. Dani Rodrik, Lecture on Poverty and Development, supra note 11. Rodrik observes that a permissive global environment has facilitated growth in the successful countries. On this note, the United States’ non-reciprocal trade programme with select African countries under the framework of the African Growth and Opportunity Act (AGOA), a legislation that offers tangible incentives for select African countries to continue their efforts to open their economies and build free markets, by providing trade preferences for quota and duty-free entry into the United States for certain goods, deserves commendation. As noted by Rodrik, ibid., we need to have enough cooperation among the nations of the world to ensure that we have a moderately open world economy.
The Report of the Secretary-General, In Larger Freedom: Towards Development, Security and Human Rights for All (2005), at 18, pointed out that, ‘At present, developing countries are often denied a level playing field to compete in global trade because rich countries use a variety of tariffs, quotas and subsidies to restrict access to their own markets and shelter their own producers.’ It is hoped that the AGOA will go a long way to open and reduce inequity in the international trading system, at least in so far as the US market is concerned.
But inequities in international trade are still promoted by several in-built mechanisms like transfer pricing that undermine the growth of international trade and investment, to the detriment of poor and developing countries. Gideon Benari, ‘Tricky Tax: Two Tax Avoidance Schemes Explained’ (2009), at 2, defines transfer pricing as, ‘The setting of prices for intra-group or company transfers of goods and services. In other words it is establishing the price for a transaction taking place between two entities (a company or subsidiary) that are owned by the same person or company. The transfer price is the price at which the goods or services are transferred or 'sold'.’ It is a scheme, devised by especially multinational corporations (MNCs), calculated to unconscionably increase profits through unfair commodity pricing across national borders through circumventing or setting aside market forces of demand and supply and other political conditions, while avoiding tax payment. MNCs exploit the difference in tax rates across states and increase their overall profits, by manipulating the transfer price to shift profits to the subsidiary which is subject to the lowest tax rate. Like Benari explains, ‘For this to occur, the subsidiary paying the higher tax rate needs to purchase from the one subject to the lower tax rate. Raising the transfer price raises the cost to the buyer, which means its profits are reduced and it pays less tax. The losses to the buyer are gains to the seller. These gains are now taxed at a lower tax rate where the selling subsidiary is registered. Although the overall profits before tax (pre-tax profits) for the group do not change, the overall net profits will increase. This is because it is now paying a lower tax rate on a greater portion of its profits.’
This scheme is injurious to trade interests of developing countries that lose tax revenue because they neither have MNCs of their own nor do they have sufficient control over those operating within their borders. It is reported that, ‘In 2006 ... developing countries lost an estimated $858.6 billion – $1.06 trillion in illicit financial outflows.’ See, Benari, at 4. This is in spite of the existence and application of the arm’s length rule, whose aim is to promote the growth of international trade and investment. According to Benari, the rule states that, ‘... when pricing the transfer of goods or services between companies with joint ownership, the companies should treat the transaction as if it was taking place between two unconnected parties. In other words, they should try to emulate the market conditions as closely as possible, thereby attaining what would be a fair market price. When setting the price, they should take into consideration all other factors which would affect the price if the transaction occurred between two unconnected entities.’ See, Benari, at 4.
Benari suggests unitary taxation with formulary apportionment as an alternative to the arm’s length rule in dealing with transfer pricing. The unitary taxation with formulary apportionment formula, he says, ‘... allocates the world wide tax liability of a multinational based on its economic links (i.e. sales, payroll etc.) with each tax jurisdiction in which it operates.’ See, Benari, at 4.
25. For example, land donations, tax holidays, credit subsidies and export promotion. Grant Bartley, supra note 13, states that Dr Linda Yueh, an economist, who while speaking on China’s phenomenal growth, attributed the country’s phenomenal growth to internal government policies, such as providing productivity incentives to farmers – not received wisdom about development: foreign aid, investment or trade. It seems that on the contrary, too much development wisdom and controls can be injurious to developing economies.
Thus, Dani Rodrik, Lecture on Poverty and Development, supra note 11, advises that, ‘... we should not have so many global rules and disciplines that will reduce the policy space that each national government needs in order to fashion the national policies that are going to set into motion these policies or this process of structural transformation, which is significant for economic growth.’
26. Dani Rodrik, Lecture on Poverty and Development, supra note 11. Rodrik stresses that, ‘If you rely only on structural transformation, you get growth starts, perhaps, but these eventually run out of steam. If you rely only on fundamentals, you get rapidly low rates of growth. The miracle economies that have done rapid growth, decade after decade, have been doing both; and that is what fundamentally accounts for the success of countries like Taiwan and South Korea that have moved to the category of relatively developed countries.’ Further, Rodrik states that success or the lack of it among the developing countries has been influenced by policy choices at national level; and not by the nature of global governance. He observes that the global economy is not a global commons because most bad economic policies are borne mostly at home and similarly the benefits of good economic policy accrue mostly at home.
27. Branko Milanovic, The Haves and the Have-Nots: A Brief and Idiosyncratic History of Global Inequality (2010), at 123. According to Milanovic, ‘... one’s own efforts, one’s country doing well, and migration are three ways in which people can improve their global income position,’ but he stresses that, ‘The role a person’s effort plays is small; he cannot influence his country’s growth rate, so the only alternative that remains is migration.’ See, ibid.
28. Michael A. Clemens, ‘Economics and Emigration: Trillion-Dollar Bills on the Sidewalk?’ 25 JEP (2011) 83, at 89; potential migrants (those yet to emigrate) particularly benefit through knowledge spillovers, research and development, physical health, political leadership, fertility and capital accumulation. See, ibid., at 90. For instance, it is believed that the vast emigration of Mexicans to the United States between 1970 and 2000 may have caused an 8% increase in Mexicans’ nominal wages in Mexico; comparable increases in home wages were caused in mass emigration from Sweden and Ireland. See, ibid., at 94.
29. The United Nations Development Programme’s Human Development Report 2009, Overcoming Barriers: Human Mobility and Development (2009), states that migration has positive impacts on migrant’s places of origin and destination (see, chapter 4 thereof). At places of origin, impacts can be seen on improved income through remittances that can be used to finance major investments and immediate consumption needs. Other areas are education, health and broader cultural and social effects – ideas, practices, identities and social capital; collectively known as social remittances; that alter social, class and ethnic hierarchies. At places of destination, immigration increases innovation and investments, leading to more employment.
Michael A. Clemens, supra note 28, at 99, also theorizes that this happens through remittances (saying that global flows of remittances are rising toward $400 billion per year) and intra-household welfare, whereby migrants gain more household income by moving to work in other countries. In his view, barriers to emigration place one of the fattest of all wedges between humankind’s current welfare and its potential welfare. See, ibid., at 101.
30. Michael A. Clemens, supra note 28, at 84, states that, ‘The gains from eliminating migration barriers dwarf–by an order of a magnitude of two–the gains from eliminating other types of barriers. For the elimination of trade policy barriers and capital flow barriers, the estimated gains amount to less than a few percent of world GDP. For labor mobility barriers, the estimated gains are often in the range of 50–150 percent of world GDP.
In fact, existing estimates suggest that even small reductions in the barriers to labor mobility bring enormous gains.’ He also emphasizes that, ‘... the gains from reducing emigration barriers are likely to be enormous, measured in tens of trillions of dollars.’ See, Clemens, ibid., at 87.
31. Unfortunately, however, Michael A. Clemens, ibid. at 83, says that tightly binding constraints on emigration from poor countries constitute the greatest single class of distortions in the global economy, in so far as policy barriers in high-income countries deter vast numbers of people in low-income countries from emigrating to settle in rich countries. The rich countries are placing large obstacles to migration, because the temptation for people to migrate from poor countries are very high.
Branko Milanovic, supra note 27, at 164, has warned of consequences that this will have on the crucial subject of globalization, saying that, ‘... if both large income gaps between countries persist and rich countries limit or prevent migration, globalization may have to be scaled back.’
Michael A. Clemens, supra note 28, at 97, rightly notes that, ‘The extent of feasible emigration depends on the willingness of politicians at potential destinations, acting as agents for their electorates, to allow immigration.’ But this may be a tall order for them, depending on prevailing political realities, because he hastens to observe that, ‘If the median voter at the destination holds relatively little capital or skill, this could limit the willingness of citizens and politicians in that country to reduce impediments to emigration from poor countries. Noneconomic attitudes such as nationalism can also play an important role. ... it is the wealthier, better educated, and less-nationalist individuals in rich destination countries who have more favourable attitudes toward immigration.’ See, ibid.
32. International Task Force on Global Public Goods, Meeting Global Challenges: International Cooperation in the National Interest (2006), at 3.
33. Tenzin Gyatso, ‘Human Rights, Democracy and Freedom’ (2008) (Available at http://www.dalailama.com/messages/world-peace/human-rights-democracy-and-freedom, accessed on 21 November 2014, at 01:43 hrs). Tenzin Gyatso is the 14th Dalai Lama.
34. Tenzin Gyatso, ibid., says that we should be, ‘... compassionate in our choice of goals, compassionate in our means of cooperation and our pursuit of these goals. The awesome power that economic institutions have acquired in our society, and the distressing effects that poverty continues to wreak, should make all of us look for means of transforming our economy into one based on compassion;’ in affirmation of the principles of dignity and social justice for all, embodied in the UDHR.
Indeed, the International Task Force on Global Public Goods, supra note 32, stated that international cooperation has many uses, including being an important tool for altruistic purposes. This means that charity should not just be something for and about the individual, but a matter of interest to the human community as a whole.
35. In strongly advocating kindness to strangers, Kwame Anthony Appiah, Cosmopolitanism: Ethics in a World of Strangers (2006), at 162-166, says that we have, ‘To recognize that everybody is entitled, where possible, to have their basic needs met ...’ which, for us translates into basic obligations; meaning that we should strive to meet those people’s basic needs, by giving a fair share of our basic obligations (in consistency with our being) to make the world a better place, for them to lead decent lives. Appiah however, warns that one need not sacrifice everything, for everybody, in a bid to do so; that, ‘... our obligation is not to carry the whole burden alone.’ See, ibid., at 164. This is precisely because, as reported by Grant Bartley, supra note 13, ‘you are also an ‘end’, not merely a ‘means’: you ought to look after yourself as well as others.’
Meeting our basic obligations to help others meet their basic needs is a duty; for as Tenzin Gyatso, supra note 33, says, ‘This constantly increasing gap between the ‘haves' and the ‘have-nots' creates suffering for everyone. Concerned not only for ourselves, our families, our community and country, we must also feel a responsibility for the individuals, communities and peoples who make up the human family as a whole. We require not only compassion for those who suffer, but also a commitment to ensuring social justice.
If we are serious in our commitment to the fundamental principles of equality that I believe lie at the heart of the concept of human rights, today's economic disparity can no longer be ignored. It is not enough merely to say that all human beings must enjoy equal dignity. This must be translated into action.’
This duty is incumbent upon the rich everywhere – more so in North America, Europe and East Asia – who, as stated by Grant Bartley, supra note 13, ‘... evidently have some sort of duty to those with much less than ourselves.’ (Emphasis in the original.) For as reportedly submitted by Professor Jonathan Glover, the poor have humanitarian claims on the rich – on the basis of a human recognition of other people’s suffering – and also claims of justice, such that the rich have a duty to try to ‘live life at the moral maximum.’ See, Grant Bartley, supra note 13. (Emphasis in the original.)
36. Steven Pinker, The Better Angels of Our Nature: Why Violence Has Declined (2011) – Chapter nine thereof – Better Angels. Pinker says empathy is a good thing in general, though not always. In this book, he calls for mutualism which he describes as a situation, ‘... where an organism benefits another one while also benefiting itself, as with an insect pollinating a plant, a bird eating ticks off the back of a mammal, and roommates with similar tastes enjoying each other’s music.’ See, ibid.
37. See, Grant Bartley, supra note 13.
38. Tenzin Gyatso, supra note 33, notes that, ‘Wherever it occurs, poverty is a significant contributor to social disharmony, ill health, suffering and armed conflict. If we continue along our present path, the situation could become irreparable.’
39. Tenzin Gyatso, ibid.
40. Dani Rodrik, Economic Development, supra note 18, at 3, 4 & 5. He also argues that national governments and their policies deserve that credit. See, ibid., at 11.
Rodrik’s belief is vindicated by Dr Linda Yueh’s assertion that China’s phenomenal growth is attributable to its internal government policies, such as providing productivity incentives to farmers – not received wisdom about development: foreign aid, investment or trade. See, Grant Bartley, supra note 13.
41. The term chosen by Abhijit V. Banerjee and Esther Duflo, supra note 4, to denounce poor spending habits among poor people, which they lament as follows:
‘The poor often resist the wonderful plans we think up for them because they do not share our faith that those plans work, or work as well as we claim.... Another explanation for their eating habits is that other things are more important in the lives of the poor than food.
It has been widely documented that poor people in the developing world spend large amounts on weddings, dowries, and christenings, probably in part as a result of the compulsion not to lose face. The cost of weddings in India is well-known, but there are also less cheerful occasions when the family is compelled to throw a lavish party....
Generally, it is clear that things that make life less boring are a priority for the poor. This may be a television, or a little bit of something special to eat—or just a cup of sugary tea.... Festivals may be seen in this light as well. Where televisions or radios are not available, it is easy to see why the poor often seek out the distraction of a special family celebration of some kind, a religious observance, or a daughter’s wedding. In our eighteen-country data set, it is clear that the poor spend more on festivals when they are less likely to have a radio or a television. In Udaipur, India, where almost no one has a television, the extremely poor spend 14 percent of their budget on festivals (which includes both lay and religious occasions). By contrast, in Nicaragua, where 56 percent of rural poor households have a radio and 21 percent own a television, very few households report spending anything on festivals.’
In this book, Banerjee and Duflo deny the existence of a poverty trap – at least from the perspective of its relationship to hunger – maintaining that the world is for the most part too rich for it to be a big part of the story of the persistence of poverty, only that the poor seem to have many choices, including expenditures on alcohol, tobacco and festivals. Not surprisingly therefore, some rich people think that there is still a residual feeling that the poor are responsible for their own poverty and so it is their responsibility. See, Grant Bartley, supra note 13.
Having had the benefit of living among poor people and therefore witnessing poverty first hand, I find this analysis highly persuasive, though not conclusive, because I know for sure that there are very many genuinely poor people. I submit that poor people should be assisted to watch their spending habits.