Global economy must stop pandering to ‘frivolous desires of ultra-rich’, says UN expert | Environment

The global economy must be reorganized to ensure it serves ordinary people around the world rather than the “frivolous and destructive demands of the ultra-rich”, according to a leading UN figure.

Olivier De Schutter, the UN special rapporteur on extreme poverty and human rights, says politicians must stop prioritizing “socially and environmentally destructive growth” that only increases the profits – and meets the consumption demands – of the world’s richest individuals and corporations.

Instead, to confront the intertwined crises of rising inequality, ecological collapse and the resurgence of far-right politics, a new economic agenda is needed.

“The scarce resources we have should be used to prioritize the basic needs of people living in poverty and to create what has societal value rather than serving the frivolous desires of the ultra-rich. »

De Schutter said an economy that uses its limited resources to prioritize building large mansions over social housing, or powerful cars over public transport systems, was “grossly inefficient” and “will inevitably fail to meet the basic needs of people living on low incomes”.

The intervention follows the Guardian’s Beyond Growth series published last month, which highlighted calls for an end to the relentless focus on indiscriminate growth that critics say leads not only to ecological collapse but also to rising inequality.

De Schutter said he would publish in April his “roadmap to eradicate poverty beyond growth,” the result of an “informal beyond-growth coalition” he formed that includes U.N. agencies, academics, civil society and unions.

The objective of the roadmap is to expand the range of policy options available to governments, multilateral institutions and development agencies in the fight against poverty. Among the measures being considered are a universal basic income, job guarantees, debt cancellation and an extreme wealth tax.

De Schutter says the roadmap will coincide with two other initiatives: one launched by UN Secretary-General António Guterres, which plans to replace GDP as the key measure of economic success, and a second report from a group of independent G20 experts on global inequality led by renowned economist Joseph Stiglitz.

He said that although many UN members have been convinced for years of “the imperative to go beyond growth”, their “current mandate does not always allow them to say this politically at the highest level, and there is still a taboo on questioning growth”.

That could change next month, according to De Schutter, with its roadmap and other initiatives allowing high-profile figures to “come out of the closet” when it comes to growth.

“This moment offers us a realistic opportunity to shape the post-2030 agenda with a viable alternative that will reconcile planetary boundaries with social justice and the fight against poverty and inequality. This is the challenge and the opportunity.”

As part of this process, De Schutter calls for the creation of a permanent UN body to oversee the fight against inequality. It would aim to oversee a number of measures designed to ensure that “the economy is redistributive and sustainable by design rather than encouraging destructive growth and then trying to compensate for the resulting disorder”.

He said the new body could function like the Intergovernmental Panel on Climate Change (IPCC), established in 1988 and which has overseen international efforts to combat the climate crisis.

“Like the IPCC, we want the new body to collect not only evidence about what’s happening, but also evidence about what policy tools can be used to achieve well-being without growth or reducing dependencies on growth. That’s what we’re trying to do. And I have to say, I feel enormous enthusiasm from the different groups supporting the initiative, in part because it’s a very bottom-up collaboration.

Since being named UN special rapporteur in 2020, De Schutter has visited dozens of low-income and developing countries and said they are trapped in an economic model that prioritizes a destructive form of growth.

“Even if these countries still need to create resources to invest in hospitals, schools, infrastructure, etc., the growth that they are obliged to pursue, especially to repay their external debt… means that they must export, and to export they must produce not for their own people and not on the basis of ecological considerations, but solely on the basis of what the big buyers in global supply chains demand. »

He said the result was too often ecological destruction, low wages and minimal investment or prosperity. “We need growth in these countries driven by domestic demand rather than global markets, we need to encourage regional integration, south-south trade rather than north-south global supply chains, and we need to prioritize the needs of these people to lift them out of poverty rather than being locked into a system that prioritizes the demands of the ultra-rich. »

For richer developed countries, De Schutter said next month’s roadmap would identify how “public services and social protections” can be financed by taxing wealth and destructive economic activity rather than relying on indiscriminate growth across the economy.

“This is a complex issue, but the key idea is that instead of raising public revenue by taxing income from work or economic activity, we should ensure that public revenue is raised by taxing wealth, financial assets, real estate, financial transactions and all the ills of the economy, including those of the extractive industry and particularly fossil energy.”

And he added that there was a huge difference between what was being discussed and a recession or unplanned periods of low growth.

“We must avoid confusing the recession or stagnation we experienced after 2008 or 1929 with the carefully planned, democratically controlled transition to something else. »

De Schutter said the proposals to be presented in April were supported by leading economists and academics, UN agencies, trade unions and NGOs.

“There is a realistic opportunity to be able to present something that, for the post-2030 agenda, is a viable alternative, reconciling planetary boundaries with social justice and the fight against poverty and inequality. That is the challenge. If we don’t succeed, well, the far-right populists will win.”