Globalisation in 2017: Who is reaping the benefits of growth?

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A panel discussion between Irene Guijt and Mark Littlewood, chaired by Tatiana Coutto.

The panel was formed of two successful economists that despite many differences share the common goal of poverty eradication. Dr. Irene Guijt leads Oxfam GB’s Research Team, which uses evidence to influence economic, environmental, and social justice. Mark Littlewood is Director General of the Institute of Economic Affairs (IEA), and has formerly been chief press spokesman for the Liberal Democrats and the Pro Euro Conservative Party. This contentious debate attacked the fundamental benchmarks used to measure prosperity.

Over the past 30 or 40 years we have one hell of a news story to tell

The first to tackle the question at hand was Littlewood, with a short and sweet answer by any measure – “Virtually everyone”. Littlewood argued that over the past 30 or 40 years we have “one hell of a news story to tell”, explaining that the benefits of free trade have been incredibly far reaching. Over this time period the percentage of the world in absolute poverty has dramatically decreased from around 40% in the 1990’s to 10% in current times. Littlewood emphasized that he was not at all complacent and rather argued that we must learn from this progress in order to pull the last 10% above the line.

She questioned the rate of growth in the poorest percentiles

Dr. Guijt was unaccepting of this argument and bolstered the courage to give an emphatic but economically shaky response. Guijt threw around ideas concerning the wealth of western billionaires and their combined influence over consumer behavior and politics. Although not disputing the positive effects of globalization, she questioned the rate of growth in the poorest percentiles. Dr. Guijt stated that if the poorest in the world had experienced above average growth, then 75% would have made it across the poverty line. “It’s all about benchmarks”, she explains.

 

Central to this debate was one question: are we primarily concerned with inequality or absolute poverty?

 

Littlewood reasoned for the later and likened growth of free trade to a question of whether a rising tide raises all boats. He argued that although benefits do not accrue equally, a system focused on the marginal prosperity at the poverty line is far more socially just than one focused on a difference. Dr. Guijt was belligerent in defense and questioned whether there were people left outside of these boats, and why. One is left to decide whether a society with less inequality, but more absolute poverty, is more desirable than one concerned with the magnitude of the prosperity of the poorest.

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