This week the wealthy and the powerful meet for the annual meeting of the World Economic Forum in Davos, Switzerland. It is an important meeting which we should all look at with interest because it serves, very often, as a platform to put forward new ideas and approaches on how the economy should be managed.
The mission of the foundation that organises the Davos meeting is cited as “committed to improving the state of the world by engaging business, political, academic, and other leaders of society to shape global, regional, and industry agendas”. As such it serves as a forum for debate that will eventually shape future policies.
I now come to the title of this week’s contribution. The word ‘altar’ means a structure upon which offerings such as sacrifices are made for religious purposes. Therefore, the implication is all too often we have tended to sacrifice other things (not to use the word ‘everything’) for the sake of the economy. The tendency has been to subject everything to the rules of the economy, thereby giving the economy a supremacy over everything else.
Admittedly an economy that performs well has its benefits. It creates employment, it generates wealth, it enables people to enjoy a good standard of living, it enables governments to provide an adequate social welfare system, health services and an education system.
On other hand, it is often stated that a government cannot provide an adequate social welfare system or education system because it is not doing so well. It is also stated that the environment should never be given as much importance in policy considerations as the economy. And this is where issues start to crop up. This creates the link between the title of this week’s contribution and the Davos meeting.
If we remove the human person from being at the centre of policymaking, we cannot really aim for a shared future
The theme chosen for this year’s forum is ‘Creating a Shared Future in a Fractured World’. The title itself implies that we need to create a more inclusive and just society, where its members support each other. We cannot have a shared future unless we have a more inclusive society and we cannot have an inclusive society if income inequalities are allowed to grow.
As new technologies continue to develop, the globalised economy that we have developed over the years is being transformed. Whereas globalisation received a big push in order to enable countries that were lagging behind to develop their economy through international trade, there is now a tendency by governments, to roll back the process of free trade for the sake of their domestic economy.
We have a similar situation regarding climate change. After the great efforts put in to reach a global accord on climate change, there is now a willingness on the part of the world’s largest economy to renege on this agreement, mainly because of the perceived economic disadvantages that this agreement may bring about.
A third aspect is taxation. Some countries are pushing for reforms in their tax system and their aim is to ease the tax burden on the wealthier people. This would reduce resources for the provision of public services and increase income inequalities. The reason for such tax reforms is said to be a better functioning economy. As such we have three situations – limit free trade, ignore the effects of climate change and increase income inequalities – which are being promoted because they are seen to be better for the economy. However, in the process, we are certainly not creating a shared future and we are creating a more fractured world.
In a time of high unemployment, that most economies are experiencing, it is natural that the political debate is dominated by economic questions. So this is not the issue per se.
It is how we pose the economic questions and how we seek to resolve them that creates the problem. If we seek to resolve the economic problem by removing from the discussion table other considerations, then we would be excluding the human person from being at the centre. If we remove the human person from the centre of policymaking, we cannot really aim for a shared future.
Working for a shared future does mean taking an inclusive approach in economic policymaking. It also means that we should not sacrifice everything on the altar of the economy, because the economy is just one part of our existence.