Economic Inequalities Constitute A Threat To Global Security Economics Essay

Economic inequality of any country are overconcentrations of wealth and power. Unbalanced distribution of power can lead to a lack of political representation in government for some groups, the creation of power elites, the loss of individual liberties and civil rights, and abuse of authority, of which genocide is an extreme example. Unbalanced distribution of wealth can lead to loss of economic opportunity and social mobility, to create a permanent class, and the circumstances of illiteracy, unemployment, homelessness, hunger and disease. Social issues caused by economic inequalities are a threat to world security. Relationship between the economy and global security is complex and does not necessarily make a direct connection. Relationship between the economy and global security is complex and does not necessarily make a direct connection. And it is essential to understand that it is important for the country’s economic situation and development, and effects, which are the size of the country. This can be done by examining the theories of structuralism. Exploring the relationship between economic inequality and global security is also important to define the categories into which countries are classified regarding their financial position. “Advance in industrialized countries (AIC) to enjoy the self-sustained economic growth in all industrial sectors, while the” least developed countries (LDCs) are characterized by low GDP, low GDP per capita, low levels of per capita , growth, and low life expectancy, combined with high population growth. The objectives of this essay is to explain the reasons that cause countries to fall into these groups and to outline the understanding of why this disparity has gradually received more severe and harder to control. This is necessary to outline the potential threats that are here today because of economic disparities worldwide.

The role of external factors, developing countries are dramatically increasing. Since the differences between the financial power and economic interdependence between countries is to obtain increasingly asymmetric in nature. Although a small group of most industrialized countries, plays the leading role in issues of globalization, most of the remaining states will turn its objects are “drifting” the waves of economic of economic development. Consequently, disparities in social and economic development in the world is growing. The world economy is, of course, still divided into “growth areas” and “areas of stagnation.” (Ferraro, page 1) Thus in 1998 ten leading countries, recipients of FDI accounted for 70 percent of their total, and countries with low development level accounted for less than 7 percent. In 1960 the income of the richest 20 per cent of the world population has exceeded 20 percent of 30 times was in 2002 that gap has tripled. Currently, half the population of Earth has an income of less than one dollar a day. Approximately one billion people have no work, and among those who work 89 per cent were deprived of social guarantees.

The “Global Poverty Report” issued by the G8 Summit in Okinawa in July 2000 noted that eliminating global poverty “is both an ethical imperative and a necessity for a stable world” (World Bank 2000 Page I) . The first concern is undeniable: Poverty is an ethical abomination of the highest order. In fact, this moral argument motivates the personal conduct precious and non-governmental organisations: thousands of private organisations are working tirelessly and with great effectiveness in reducing global poverty. But these private initiatives can not, by themselves, overcome the problem and can not act outside these efforts in the political and economic update by the method of the state. States stay the most organised & powerful agents in the world today, & their support is necessary to alleviate global poverty substantially. (Ferraro, page 1) Otherwise poverty will often contribute to global insecurity as people in need may turn to non-legitimate means to make more income.

Poverty in the world is not obviously a threat to the national interests of states defined in these terms. Generally, poor states are militarily weaker than richer states, and few poor societies can directly challenge the territory or autonomy of rich states. Absent a direct threat from poor states, rich states can and will assert that their resources should be directed toward other issues; generally issues of a more immediate and unambiguous character. The alleviation of world poverty is a priority for the richest countries. When Thomas Hobbes first dilemma articulated State Security of the 17th century, there was no general power to ensure the security of states and each state had no other choice but to produce their own electricity for his own protection. The development of this power, however, compounded each state a sense of uncertainty among its neighbours, which in turn will have no choice but to expand their power as well. This cycle of energy and increased anxiety generated a relationship between states that mimicked the classic Hobbesian description of these lives lived without the protection of a sovereign: “solitary, poor, nasty, brutal and short” (Hobbes, p . 186).

Powerful states have an interest in the stability of the international system, and we can not overstate the importance of world order to a powerful state. For their power, these states have formed the political, economic, and cultural norms and rules that contain the whole method and have taken steps to ensure that these rules and regulations are in correlation to their interests. (Ferraro, page 2) U.S. foreign policy since 1945 is a good example of the method: the United Nations more or less reflects the republican form of representative democracy in the United States and the Bretton Woods method (International Finance Facility, the World Bank and World Trade Organization) defends the rules of capitalism in the market. The threat from poor countries to rich countries comes because of the weakness in poor countries could be globalized, thereby destabilizing the international system. What is new and different about this threat is that, with few exceptions, this is a deliberate strategy. Poor countries are not “enemies” of the international system, although the consequences of their condition may affect both the whole system and quality of life in rich countries deeply which is potentially catastrophic.

Globalization has succeeded in economically integrating a large number of countries, rich and poor, into world markets. Proponents of globalization assert that the process benefits all who participate, and there is little question that globalization stimulates widespread economic activity (Maddison, 1995, page 19). Increased global economic activity has been accompanied by a dramatic worsening of the global income inequality. The OECD study of the world economy in 1820-1992 and information on GDP per capita has led to the conclusion that “the total revenue extends long-term model has been remarkably different. In 1820, the international status (the distance between the leading country and the worst score) was higher than in 1870, 3:1, 7:1, 1913, 11:1, 35:1 in 1950, 1973, 40:1, 1992 72: 1” (Maddison , 1995, page 22). Thus, economic inequality appears to increase again and the global uncertainty as well. But this model is increasingly unstable. High levels of economic activity is not sustainable in light of dramatically increasing inequality of income. As economic activity becomes more concentrated and larger population groups are excluded from this activity is both short and long term risks of the method of the global economy.

The frequent debt crises since 1982, for example, Mexico in 1982, Mexico again in 1995, several Asian countries in 1997, Russia in 1998 and Argentina in 2002, a paper on short-term risks This growing inequality between rich and poor countries. Total debt outside of developing countries in 2001 amounted to about 2.300 billion dollars (World Bank 2003, p. 221), approximately 40 percent was owed to private lenders. This debt will never be repaid in full, and rich countries has apparently accepted this risk. But debt can be forgiven without inflicting irreparable ruin the future integrity of the international financial method. Even a total failure of such loans could fatally undermine confidence in global capital markets and banks in particular, to critically undermine the substantial loan. Therefore, once economic inequality is, however, undermine the international modern method, and a threat to global security.

Rich and poor countries are thus locked together in a mutual hostage situation. The economic securities of rich countries require a degree of economic development in poor countries to ensure a sustained commitment to a certain level of debt repayment. Poor countries can not meet this commitment, without significant help from the rich. (Ferraro, p. 4) But, paradoxically, the issue of repayment of the debt became so great that rich countries are more vulnerable to default on paying more than poorer countries are threatened not to repay the debt. Rich States to lose more than the interest payments on their loans, if the growing poverty in the debtor countries the forces of default. O’Rourke and Williamson assess the long-term risk of growing inequality in the form of a backlash against globalization itself. In assessing the gloomy economic collapse in 1930, concluded that these students: “A political backlash developed in response to actual or perceived distributional effects of globalization. The failure has led to the reintroduction of tariffs and the adoption of restrictions on admission, before the Great War. Far from being destroyed by an unforeseen and exogenous policy, globalization, at least in part, is destroyed” (O’Rourke and Williamson, 1999, page 287).

NSS addresses a point in the political threat posed by the poor. His argument is well known: the poor will resort to violence (whether by terrorism or other criminal activities like drug trafficking) to adjust the method and economic policy, which they are responsible for their poverty. (Ferraro, page 5) of the World Bank, James Wolfensohn, the President also drew a clear link between poverty and violence in 2001, where they spoke of the war against terrorism: “It is difficult to say when war will be won. Put your hand on Osama bin Laden or install a new government in Afghanistan will only be the beginning of the method. The war will be won, before they get control over the problems of poverty and hence sources of dissatisfaction. Not in Afghanistan but also in neighboring regions in many other countries. This is compared to war against Bin Loaded, terrorism, Al Qaeda, the ruins of the World Trade Middle East and the Pentagon, but these are signs. The disease was the discontent seething in Islam and, more generally, in the world of the poor” (World Bank 2001).

While this political explanation of violence has a grain of truth, overall it is both misleading and dangerous. It is misleading because poor people do not really have the time nor the means to pose a serious threat to security. One of the greatest ironies of poverty is that dealing with the poor is like a full time job: poverty requires your full attention to the subsistence and no time for leisure or crawling. Poverty is undoubtedly a factor on the use of violence, poverty itself is a kind of generalized violence. (Ferraro, page 5) But the link between poverty and terrorism is, at best, precarious. terrorist leaders are not poor. Maybe that poverty can inspire infantry ready to terrorist leaders, but terrorist organizations often have their own agendas that have little to do but by the way, with the reduction of poverty.

Walt Rostow presents a valuable contribution to the analysis of why some countries have developed to far superior levels and at a much greater speed than other countries, in his ‘Stages of Economic Growth’ (1969). Originally all countries had an economy based on barter, agriculture and subsistence when they were at the first stage of economic growth described as the ‘Traditional’ society. Rostow identifies four following stages: the ‘Transitional’ stage in which economies produce surplus and shift toward specialization, the ‘Take-off’ stage seen in the process of industrialisation and growing investment, the ‘Drive to Maturity’ in which there is less reliance on imports and diversification of production takes place, this is followed by the final stage where a country enjoys high mass consumption. Using Rostow’s five stages of economic growth one is lead to identify the point in which inequality originates, as not all countries appeared to experience the ‘Take off’ stage.

The ‘Dependency Theory’, constructed by Andre Gunder Frank, presents underdevelopment not as a phase but as an inherent characteristic of the world capitalist system. This theory rests on the belief that in order for a country to develop, it requires disengagement from the global capitalist system. The link between capitalism and inequality is widely recognised, in 2001 the World Bank were quoted as saying “Poverty rates will continue to fall if growth continues” (J.Vandemoortele. 2002. p392). It is ironic and hugely unfortunate that the system of capitalism has resulted in overwhelming economic success within certain countries whilst coinciding with devastating poverty in others.

There are of course many other factors that can be considered reasons that further the division between rich and poor countries and that make it near impossible for certain economies to develop and strengthen. For example the population of country should be taken into account as mentioned whilst comparing the US and Latin America. There is wide agreement that the most rapid growth rates of world population will be in the South, with high birth rates, low death rates and an overall population momentum. Widespread illiteracy is also a source of deepening poverty as it constitutes to rising inequality and slowing growth, “countries cannot expect to integrate into the global economy without equipping their people with basic capabilities” (J.Vandemoortele. 2002. p379). AIDS is another contributor and an example of circumstances that have spiralled out of control and are now irreversible. Roughly seventy per cent of those infected with AIDS live in Africa and the “economic effects of the AIDS pandemic have been nothing less than calamitous” (P.Wilkinson. 2007. p132). Medical services are unable to cope and families are no longer able to support themselves.