Oral Statement by Mr. Philip Alston Special Rapporteur on extreme poverty and human rights

38th session of the Human Rights Council
Geneva, 22 June 2018

Mr. President,
distinguished delegates,
 representatives of civil society,

I am presenting three reports today, one on the USA, one on Ghana, and one on the International Monetary Fund (IMF) and social protection.

1. The USA

I note with regret that United States Ambassador Nikki Haley has characterized this Council as a cesspool and chosen to withdraw from it just days before my presentation.  Speaking of cesspools, my report draws attention to those that I witnessed in Alabama as raw sewage poured into the gardens of people who could never afford to pay $30,000 for their own septic systems in an area remarkably close to the State capital.  I concluded that cesspools need to be cleaned up and governments need to act.  Walking away from them in despair, as in Alabama, only compounds the problems.

The suggestion that this Council should only consist of rights-respecting States was made long ago by the US and others, but abandoned because there are no workable criteria to determine who should qualify under such a test, and because a body composed only of self-appointed good guys would not only be tiny but would be talking unproductively among themselves.  Human rights promotion requires robust engagement, not behaving like the kid who takes his football and goes home.

Ambassador Haley complained that the Council has done nothing about countries like Venezuela.  In fact I and several other special rapporteurs reported earlier this year that “vast numbers of Venezuelans are starving, deprived of essential medicines, and trying to survive in a situation that is spiralling downwards with no end in sight”.  We warned of “an unfolding tragedy of immense proportions.”

Mr President, I turn now to my report on the United States.  My starting point is that the combination of extreme inequality and extreme poverty generally create ideal conditions for small elites to trample on the human rights of minorities, and sometimes even of majorities. The United States has the highest income inequality in the Western world, and this can only be made worse by the massive new tax cuts overwhelmingly benefiting the wealthy. At the other end of the spectrum, 40 million Americans live in poverty and 18.5 million of those live in extreme poverty.  In addition, vast numbers of middle class Americans are perched on the edge, with 40% of the adult population saying they would be unable to cover an unexpected $400 expense.

In response, the Trump administration has pursued a welfare policy that consists primarily of (i) steadily diminishing the number of Americans with health insurance (‘Obamacare’); (ii) stigmatizing those receiving government benefits by arguing that most of them could and should work, despite evidence to the contrary; and (iii) adding ever more restrictive conditions to social safety net protections such as food stamps, Medicaid, housing subsidies, and cash transfers, each of which will push millions off existing benefits. For example, a Farm Bill approved yesterday by Republicans in the House of Representatives would impose stricter work requirements on up to 7 million food stamp recipients. Presumably this would also affect the tens of thousands of serving military personnel whose families need to depend on food stamps, and the 1.5 million low-income veterans who receive them.

The US health care system already spends eight times as much to achieve the same life expectancy as in Chile and Costa Rica, and African-American maternal mortality rates are almost double those in Thailand. The World Economic Forum recently ranked the US 26th out of 29 advanced economies for promoting intergenerational equity and sustainability, and 28th for promoting inclusion.  WHO data released recently shows that babies born in China today will live longer healthy lives than babies born in America.  In global healthy life expectancy rankings, the US came 40th.

In an exclusive Fox News story yesterday Ambassador Haley called my report “misleading and politically motivated.” She didn’t spell out what was misleading but other stories from the same media outlet emphasized two issues.  The first is that my report uses official data from 2016, before President Trump came to office.  That is true, for the simple reason that there will be no Census Bureau data on the Trump era until September this year.  But these data provide the best available official baseline, and my report then factors in the effects of the combination of massive tax cuts for the wealthy and systematic slashing of benefits for the less well-off.

The second criticism, as noted by Sean Hannity, is that the US “economy continues to roar to life under President Trump.” Indeed, the US economy is currently booming, but the question is who is benefiting. Last week’s official statistics show that hourly wages for workers in “production and nonsupervisory” positions, who make up 80% of the private workforce, actually fell in 2017.  Expanding employment has created many jobs with no security, no health care, and often with below-subsistence wages.  The benefits of economic growth are going overwhelmingly to the wealthy. Average pre-tax national income per adult in the US has stagnated at $16,000 since 1980 for the bottom 50% of the income distribution, while it has really boomed for the top 1%, a trajectory that has been quite different from that in most European countries. Even the IMF has warned that in the US “prospects for upward mobility are waning, and economic gains are increasingly accruing to those that are already wealthy”. In other words, the American dream of mobility, is turning into the American illusion, in which the rich get ever richer, and the middle classes don’t move.

My report demonstrates that growing inequality, and widespread poverty which afflicts almost one child out of every five, has deeply negative implications for the enjoyment of civil and political rights by many millions of Americans. I document the ways in which democracy is being undermined, the poor and homeless are being criminalized for being poor, and the criminal justice system is being privatized in ways that work well for the rich but that seriously disadvantage the poor.  Underlying all of these developments is persistent and chronic racial bias.  That bias also helps to explain the abysmal situation in which the people of Puerto Rico find themselves.  It is the poorest non-state in the Union, without a vote in Congress, at the mercy of an unelected and omnipotent oversight board, and suffering from record poverty levels in the aftermath of Hurricane Maria.

Perhaps the best illustration of the cause and effect of these trends is what might be termed the Ferguson syndrome, recalling the city in which an unarmed African-American was shot dead by a white Police Officer in 2014.  What happened in Ferguson, according to the US Justice Department, and what is happening in many other cities and counties can be summed up in the following composite picture.

In a nutshell: state and county taxes are capped; public budgets are slashed; governments are left without essential resources; they instruct their police departments to impose and collect more fines to fund the general budget; these fines fall overwhelmingly upon the poor; the victims cannot pay the fines and so additional penalties and fees accumulate; most scrimp and pay but some default and are imprisoned; when they are in prison their economic and family situations collapse; and when they emerge from prison they are even less unemployable because they have a conviction.

In her statement on my report, Ambassador Haley says that “it is patently ridiculous for the United Nations to examine poverty in America,” and claims that I should instead be looking at the human rights situations in two war-torn African countries (Burundi and the Democratic Republic of Congo).

“Rather than using his voice to shine a light on those vulnerable populations, and so many others, the Special Rapporteur wasted the UN's time and resources, deflecting attention from the world’ s worst human rights abusers and focusing instead on the wealthiest and freest country in the world.”

Leaving aside the fact that this Council has published many report detailing the situations in those two countries, my view is that when one of the world’s wealthiest countries does very little about the fact that 40 million of its citizens live in poverty, it is entirely appropriate for the reasons to be scrutinized.

If this Council stands for anything, it is the principle of accountability – the preparedness of States to respond in constructive and meaningful ways to allegations that they have not honoured their human rights commitments.

The United States position, expressed by Ambassador Haley seems to be that this Council should do far more to hold certain states to account, but that it should exempt the United States and its key allies from such accountability.

In terms of recommendations, I would single out three in particular. A first step would be to acknowledge that America’s proudest achievement –a vibrant democracy – is in peril unless steps are taken to restore the fabric from which it was crafted, including the adage that ‘all are created equal’. A second step would be to stop irrationally demonizing taxation and begin exploring how reasonable taxes can dramatically increase the social well-being of Americans and the country's economic competitiveness. And a third step would be to provide universal healthcare, as every other developed and many developing countries already do. This would rescue millions from misery, save money on emergency care, increase employment, and generate a healthier and more productive workforce.

2. Ghana

The Government of Ghana demonstrated exemplary cooperation with my visit in April. The relatively new Government has adopted a slew of new policies, some of which aim to improve the situation of those living in poverty.  But for Africa’s fastest growing economy to still have one in every eight of its people living in extreme poverty (and one in every five living in poverty), and for 28.3% of Ghanaian children to be living in poverty, is deeply problematic.

This is due in part to the fact that spending on social protection is very low by the standards of peer African countries, and remarkably little is spent on social assistance.  Ghana has a number of admirable social programs, but few convincing plans for funding many of them adequately.  As a result, a large number of Ghanaian do not enjoy their basic economic and social human rights and the prospects that Ghana will meet many of the Sustainable Development Goals are not encouraging.

Government officials are convinced that a range of major initiatives designed to implement election campaign promises will generate major economic growth, thereby also solving problems such as continuing high rates of poverty and problematic levels of urbanization.  But there is nothing in the design of the “one factory, one district”, “one village, one dam”, and “one constituency, one million dollars,” schemes to suggest they are capable of generating the sort of large-scale employment opportunities, or training for unskilled workers that would be needed to make a significant contribution either to eliminating extreme poverty or relieving urban crowding.

Ghana is at a crossroads.  It needs to tackle corruption seriously, to increase government revenues through an equitable and consistently implemented tax system, and to expand existing programs such as the Livelihood Empowerment Against Poverty (LEAP) program, and the National Health Insurance Scheme (NHIS) to address poverty more effectively and directly.

3. IMF

Later this month the Board of the IMF is expected to approve a credit line of up to $50 billion to Argentina.  The stakes for the Fund are high. First, it has to show that it has learned the lessons of its failed austerity policies of past decades.  Second it has to demonstrate that it can come up with prescriptions that promote fiscal consolidation while not inflicting misery upon the poorest members of society.  And third, it has to transcend its image of the unreflective purveyor of neoliberal economic policies that have generated widespread resentment of globalization and helped to provoke the rise of populism in many countries.

It is no coincidence that the Fund has shown a newfound interest in promoting social protection.  Last month it announced that it is moving to develop a new ‘strategic framework on social spending’, designed to ensure that its adjustment policies will protect rather than undermine social insurance and assistance, as well as basic education and health programs for the poor.

The main driving force is the need to avoid the social and political instability that have undermined its programs in the past and provoked widespread protests in the developing world.  This year has seen large-scale popular demonstrations in Argentina; the resignation of Jordan’s Prime Minister; and anti-IMF riots in various African countries. In the past the Fund has held firm against such street protests, claiming that it was merely playing the role of a doctor called to the emergency room.  It argued that it had no alternative but to prescribe drastic surgery, because the disease had been permitted to fester for so long that the patient would otherwise die.

But if the Fund is to show that it has really learned the lessons of its past failures, it must take this social spending floor seriously, in a way that has not done up until now.  For some years it has included ‘indicative targets’ for such floors in its loan agreements, but these have remained largely cosmetic and done very little in practice to ensure that the most vulnerable members of society are protected from the otherwise potentially devastating effects of the sudden fiscal consolidation prescribed by the Fund.  Strikingly, given its admirable predilection for evidence-based policies, the Fund does not evaluate either the impact of its own interventions on the welfare of vulnerable groups or whether social protection has increased or decreased as a result of its programs.  Admittedly such evaluations are complex, but so too are the calculations on which the Fund bases many of its policies.

To date, many Fund officials have viewed social protection as a temporary, stop-gap measure rather than a set of policies that can stimulate growth, provide a better workforce, avoid the drain on emergency services, and improve economic security.  They have fetishized the narrow targeting of benefits, despite compelling evidence that the proxy means tests used are deeply flawed, and result in major leakages to the well-off and widespread exclusion of the truly needy. And such unrealistically ambitious targeting has meant that very few people benefit, thus eliminating any broad-based political support for such programs.

The biggest challenge for the Fund is whether it can show that it is prepared to break with the neoliberal economic policies that it has been advocating for decades and which are clearly linked to the rise of populism in the world.  As the most influential global actor in terms of fiscal policies, the Fund bears an outsized responsibility for the dramatic rise in inequality, the rapid growth of economic insecurity for workers, and the absence of meaningful social protection that have become the hallmarks of globalization and have laid the groundwork for popular revolt. Following the Fund’s script, globalization has brought many good things, but it has also exacerbated inequality and marginalization, while facilitating the capture of immense wealth by a handful of elites.

This is not to suggest that the Fund is directly responsible for the growth of illiberalism, the reinvigoration of racist and anti-immigrant sentiment, or the assault by many governments on the rule of law.  But by prescribing ‘fiscal consolidation’ policies that have paid little heed to extreme inequality, extreme poverty, and economic insecurity, the Fund has created the conditions that have nurtured these very outcomes.  My report contains a series of recommendations designed to promote a better awareness of the centrality of social protection.

4. Future visits

I am very grateful to the United Kingdom for having officially confirmed the dates for my visit which will take place from 6-16 November.

I am also in contact with the Haitian authorities in connection with my request to visit and I am optimistic that this can take place in the near future.

5. The High Commissioner

Permit me finally to pay tribute to the outgoing High Commissioner Zeid Ra'ad Al Hussein for his superb contribution to the defence of human rights.  He will be remembered by all for his courage and determination, but equally important have been the depth of his engagement and his extraordinary identification with the victims of injustice.  The peoples of the United Nations have been well served.

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