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The Post-2015 Process: Inequality Is Not the New Poverty

20/05/2013 11:53 BST | Updated 17/07/2013 10:12 BST

The international aid community was sent into conniptions this week as reports from the UN High Level Panel meeting in New York to decide on a framework to succeed the Millennium Development Goals indicated that no target for the eradication of absolute poverty (those living on less than $1.25 a day) was to be included, despite strong lobbying by the British and other European nations.

A focus on absolute minimums is not just about morality, it is highly political. The reduction in extreme poverty is the headline achievement of the MDGs, and so not emphasising this is tantamount to criticising the very idea of development frameworks in general, and the coalition that came together over the MDGs specifically. It was also indicative of the NGO-centred worldview that says the project of lifting people out of poverty is owned by Western aid agencies.

As outlined in a previous blog, and in the Schumacher Institute's submissionto Beyond 2015, the civil society group lobbying the UN High Level Panel, the post-2015 process is in danger of misapplying the lessons of the MDGs and letting hubris overtake analysis.

The NGO world-view unfortunately treats the MDG process as a finished project whose achievements no longer need defending. However, the general consensus that the new framework needs to incorporate more environmental goals - and even add Sustainable Development Goals to the mix - hasn't begun to address how this can be achieved while protecting the gains already won.

Research from the Stockholm Resilience Centre and the CONVERGE project, among others, demonstrate that a growing crisis of environmental decline and resource shocks expected over the next few decades is likely to increase poverty, not decrease it. Yet despite the implications of systemic environmental and resource shocks for current poverty levels, the current frameworks imagines it can go one step further and not just abolish poverty but end inequality too.

Despite a major theme of the post-2015 consultations being the need to better integrate environmental and development targets, the largest aid groups rarely mention the significant barriers to pursuing these quite different goals simultaneously.

The MDGs worked so well because they were politically astute, and because a limited window of opportunity existed to build a coalition and avoid the most contentious disagreements. Even the Americans eventually signed up. The new process is based on the assumption that poverty can be redefined as inequality, and somehow this is connected to protecting the environment, as if these problems occur in discrete boxes and that protecting the environment would never be interpreted as a constraint on the economy.

Save the Children claim that the two tests that need to be passed are 'eliminating poverty in all of its forms' and 'address[ing] the inequality and discrimination' that leads to poverty, without mentioning that a significant form of poverty is caused by stress within the economic-environmental systems within which people live. Describing these as 'inequality' is even less precise than describing them as poverty.

I don't criticise the aid agencies for their motives, but I do question the outcomes. Save the Children have produced good research showing that income inequality leads to, for example, worse nutrition for the very poorest children, widening literacy gaps, and rising prices putting basic commodities out of reach even as the overall economy booms.

Oxfam, who have long invested in research, have developed the useful concept of planetary boundaries, limits to environmental damage bounded on their lower flanks by 'social floors', minimum standards of income and social protection that may require short-term growth to achieve. This at least shows some movement towards the idea that economic development has to be reconciled with environmental protection in recognition that each is dependent on the other.

But success can lead to hubris, and this can obscure the lessons of the past. One of the main reasons that the MDGs were such a success was that they set concrete, achievable and measurable goals with realistic deadlines, and the information on progress was made freely available. The data published publicly on MDG targets can be found here, but even for the headline indicator of the Goals - people living on less than $1 a day - this data is patchy and incomplete.

The current publicly-available dataset on poverty reduction dates from 2010, but only a few countries report data up until 2010 with some countries' data dating back to 1995, only five years older than the 1990 base-line and a full five years before the MDGs even began. Again, absolute poverty reduction was the gold-standard measure for the Goals. Given that the data is poor on the fairly uni-dimensional measure of those living on less than $1 a day, how are we supposed to trust the data for a multi-dimensional measure such as inequality?

Further still, the vast numbers lifted out of absolute poverty are overwhelmingly located in the BRIC nations, as much as 80% by some estimates. This reduction in poverty wasn't based on some Oxfam inequality programme, these nations have averaged 6% growth each year since the MDGs began and inequality has shot up. Which of these nations would be first in line to switch their economic strategy from high growth to inequality reduction?

There has been a growing consensus on the way forward with the Goals: keep going on things that are working; address those that aren't (such as sanitation); differentiated responsibilities; and new SDGs such as on clean water, food systems and ecosystems.

Both the UN and the aid-agencies seem to be leaving things out, however. The High Level Panel is running into the political reality of trying to define poverty and inequality in such a way as to be agreed by 190 countries including huge, fast growing economies such as the BRICs, rich countries with flat-lining economies in Europe and America, and poor countries undergoing commodity and land booms desperately trying to promote new manufacturing bases.

This worldview is happy to trumpet the headline achievement of the MDGs, a reduction of those living in absolute poverty, without being honest about where those ex-poor people live. Poverty has been reduced for these people by state-directed export and commodity-led growth strategies that owe little to Oxfam or ActionAid and the rest.

Nor are they honest about what a switch from poverty-reduction to inequality-reduction would politically entail. Inequality has grown in each of the BRIC nations in the last 15 years, as it always does in countries experiencing rapid economic growth. So to approach Post-2015 negotiations calling for a reduction in inequality when these nations have secured development success precisely by rejecting the Western-NGO's new focus on inequality is to invite failure.

There is a real danger of over-reach because of a world-view that says that what is measured is what is important, that those with money have answers, and that donor's values are universal values. Imagining that poverty is on its way to extinction, this mind-set segues seamlessly into outlawing inequality, confusing once again process with outcome.

As we are debating whether we can transition from poverty-reduction to inequality-reduction (and let's outlaw bad luck and meanness while we are at it) an actual, existential, threat hangs over this whole process. Unless you can reconcile development goals with the significant environmental change and resource depletion expected over coming decades, then all of the progress to date will be reversed and inequality will suddenly seem at lot less important again than absolute poverty.

Two worldviews collide, disorder ensues, and eventually something better rises from the ashes: synthesis. But after synthesis can come hubris, and after hubris comes nemesis. The Post-2015 process is in danger of hubris, of assuming that technical fixes can be applied to problems such as poverty and even to making the world more equal. You have to get the politics right first, and these are not hubristic times.