Abstract
Everyone should read this book. You may not agree with everything in it (I do not) and you may conclude it does not fully carry out the project on which it sets out (I do), but it raises issues that every student of economic policy should think about. Readers of this journal may even find in it a call to valuable research.
The book argues that economic policies have impacts on the ability of people to enjoy their human rights and that policy analysts should take these effects into account in their work. In fact, economists rarely engage with the universe of human rights advocates and human rights advocates are often innocent of studies in political economy, “radical” or otherwise. As the book is the outcome of a project headed by two economists, the focus of the book is the impact on economic and social rights, as set out in the Universal Declaration of Human Rights (1948) and as further elaborated in the International Covenant on Economic, Social, and Cultural Rights (1966) and other international agreements (the book does not attempt to address cultural rights). While the Universal Declaration has come to be considered “customary international law” and thus one can argue it binds all states, the International Covenant, like most of the other human rights agreements, is a treaty that only binds its signatories (which in this case does not include the United States). 1
Human rights law is potentially powerful because governments can be held accountable for its violation, although cases in which courts have decided against a government for a violation of economic and social rights have been few and far between. However, human rights principles also have power as a moral imperative and implicitly this is sufficient ground for the editors of this book to argue their relevance to policy. Here I totally agree. An argument that a government is not honoring what are or should be its human rights obligations can be powerful politically, far more so than legally. Indeed, in the case of the United States, one of the two countries on which the book focuses, there would probably be very limited advocacy mileage from pointing to a critical assessment of U.S. policy by a United Nations human rights body, given the generally low appreciation of the United Nations among U.S. households. Nevertheless, the substance of the arguments in such an assessment could be politically useful in building consciousness of where the United States stands in relation to other comparable countries and its own potential in realizing what most of the world regards as so important a moral imperative that it is called a “right.”
The book thus asks what have been the human rights consequences of experiences in several policy areas. In a manner accessible to the lay reader, it focuses on two countries, Mexico and the United States, which allows a deeper assessment of each one, albeit at the expense of a broader comparative analysis. In particular, after an introductory overview, the editors present a series of chapters taking up: fiscal and monetary policies (chapters 1 and 2), public expenditure (3 and 4), taxation (5 and 6), international trade policy (7 and 8), and pension regulation reform (9 and 10). Mostly, these policy issues are not the usual ones addressed by writers with a human rights focus (right to food, right to health, etc.).
The analysis in each chapter aims to compare the performance of the Mexican or U.S. governments against their human rights obligations as specified in normative texts of international human rights bodies. That is, governments are expected to “respect, protect, and fulfill” economic and social rights. In this context, “respect” means not violating a right that a citizen already enjoys (e.g., forced eviction from housing without adequate compensation for resettlement), “protect” means preventing third parties from violating one’s rights (e.g., monitoring to ensure employers provide safe working conditions in factories), and “fulfill” means taking actions to provide services deemed a human right, such as primary education. However, whereas in the area of civil and political rights, the starting point is that every citizen should fully enjoy the rights, such as freedom of speech and religion; it is universally acknowledged that governments cannot ipso facto guarantee fulfillment of the economic and social rights of their citizens, such as the right to employment. Instead, governments are expected to work for the “progressive realization” of those rights, applying “maximum available resources” to their realization and with no “retrogression” during hard times. In addition, governments are expected to ensure “minimum essential levels” of economic and social services as a “core obligation,” not discriminate and treat all peoples equally. Also, governments should be accountable and transparent, and provide their people with the opportunity to participate in their governance.
The analytical project is a compelling one. The chapters describe the policies put in place in terms of “obligations of conduct” (policy intentions and the factors that do or do not enter into their consideration, such as the degree of concern about the unemployment impact of a strong monetary policy focus on price stability) and “obligations of result” (showing comparative data on employment, wages, and so on). In the process, considerable information is presented about the policies and how they are made in Mexico and the United States and about trends in relevant social and economic indicators. While acknowledging that correlation is not causation (and no formal statistical exercises are undertaken), the weight of the argument is that neoliberal policies adopted in both countries have violated the economic and social rights of citizens of Mexico and the United States in the sense of an unnecessarily slow or unsuccessful “progressive realization” of those rights.
This may well be the case, but a fair assessment also depends on presentation of a counterfactual. The argument made famous by Margaret Thatcher—TINA, “there is no alternative”—has to be addressed. In a general way, it is implicitly addressed as the authors identify what they call the “progressive” alternative. But quantitative analysis of the differences in impact between a more progressive alternative and the actual policies as they work their way through the economy are missing. The editors acknowledge that some sort of modeling exercise is necessary for such an analysis and that heterodox economists would do the modeling exercise differently than “mainstream” economists, but no such exercises are undertaken. Also, the analysis is weakened by not allowing the mainstream economists responsible for the policies described to answer the charges against them. We have only the accusations and an appreciation that people suffered during the times the policies were in effect (or did not sufficiently benefit). To the extent the editors wished the analyses in the book to identify rights-consistent policies, the book disappoints. 2
I think the challenges raised in the case studies are basically correct, and the call to governments to produce more and better data to facilitate a human rights assessment (e.g., more impact data by gender, more information on the informal economy) is well taken. However, I am not sure the so-called progressive alternatives advanced by the authors (which are not always even made explicit) 3 would have sufficiently advanced the enjoyment of economic and social rights if they had been implemented.
The authors do not help their argument when they divide economists and their policy advice into two groups: “neoliberal” (sometimes called neoclassical) and “progressive” (sometimes called heterodox). Progressive economists, according to the editors of the book, are not afraid to advocate direct government involvement in the economy, which the authors deem necessary for realizing economic and social rights. The unstated assumption is that the government is legitimate, effective, not riddled with corruption, and represents the general good. One may conceive of cases in which assigning further activities to a government would worsen the enjoyment of the economic and social rights of citizens and that outcomes would have been superior by instead empowering informal community organizations, civil society organizations, or labor unions to fight business interests for their rights. An otherwise intriguing analysis seems weakened by a seemingly technocratic appreciation of government.
Moreover, the classification of “progressive” economists is quite broad and includes much of the mainstream, perhaps definable by the content of textbooks written by prominent authors among them, including Joseph Stiglitz and Paul Krugman. These authors are wonderful antidotes to the nonsense that the loony-bin right wing argues, although I think they would both define themselves as mainstream albeit critical economists rather than as heterodox. 4 However, in the broad scheme of things, this is a quibble. The essential challenge of the book is to insist we ask the question of the human rights impact. Whether or not these authors answer it well, the question is central. This book embodies a call to a research agenda for a generation of economists.
Footnotes
1
The covenant was signed by President Jimmy Carter in 1977, but was never ratified by the U.S. Senate.
2
For example, the Oportunidades program in Mexico, which gives a financial incentive to poor families to send their children to school and to undergo regular health checkups, is criticized for not reaching all the poor since it targets areas with high concentrations of poor people and it withdraws support from families that fail to comply with the requirements. Presumably, the authors would prefer universal unconditional cash transfers but they do not address the main innovation in the program, which is to acknowledge that the poor pay an “opportunity cost” when they take up offers to help realize the rights of their children to health and education.
3
For example, we read that Mexico incurred a large fiscal burden that negatively impacted various government expenditure categories when it nationalized its failing banks in 1994. We read that meeting contractual obligations to high-income creditors was deemed a higher priority than human rights obligations to workers. Yes, good point; but we are not told what should have been done instead, a question of continuing interest today in Spain, Ireland, and elsewhere.
4
A posting by Dani Rodrick nicely makes the point: “Neoliberalism is to neoclassical economics as astrology is to astronomy” (“After Neoliberalism, What?” Project Syndicate, September 27, 2002).