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They contend that the spread of markets throughout the world generates a race to the bottom in terms of labor policy
and environmental control, and reinforces an unequal distribution of resources between rich and poor nations.
The logic of economic reasoning and the evidence point in the opposite direction. Markets are the most effective
means available to improve the lot of mankind by spreading the international division of labor and increasing the
productive capacity of mankind. Increases in real income can result only from increases in real productivity, and
increases in real productivity result from improvements in labor skill, advancements in the stock of technological
knowledge, and more effective management and organization of economic production within enterprises.
Globalization brings all three of these sources of real productivity gains from the more developed economies to the
less developed ones. Moreover, the expansion of the market area erodes the power of local monopolies and exposes
political leaders to world standards of acceptable public policy toward the least advantaged in a society.
Its main advantage is that it is considered the best mechanism to achieve the efficient distribution of resources in an
economy, always under the framework of perfect competition. In addition, it avoids government intervention, avoiding
errors and misinformation.
FREE MARKET
Income inequality also increases when a country is more open to free trade.
In OECD countries free trade encourages exports of high-quality goods and services, thereby promoting employment
among highly skilled people.
Free trade causes upward pressure on wages of highly educated people and downward pressure on those of low-
skilled people, which also increases income inequality.
A third factor that promotes income inequality is the degree of regulation of markets for goods and services and of the
labor market. In countries with a very low minimum wage the wages of low-skilled workers are often lower than in
countries with a higher minimum wage.
A factor of influence with regard to the regulation of product markets is governmental anti-trust policies. To the
degree that the government is more effective in combating the economic power of large companies and is preventing
them from pushing small businesses out of the market, competition will be livelier and the profit margins will therefore
be smaller. This prevents businesses like Google and Facebook from controlling a large part of the market. Because
it is often the rich who possess such large companies, helping to combat the economic power of large companies is
also a way to counteract inequality.
El marxismo y el liberalismo son teorías políticas y económicas opuestas, que plantean dos tipos de desarrollo para una
nación.
El marxismo sostiene que los medios de producción deben ser propiedad del Estado, de modo que no existan las
diferentes clases sociales.
El liberalismo sostiene que los medios de producción deben ser propiedad de capitales privados y que todos tengan
posibilidad de intervenir en las decisiones del mercado.
En la realidad de las sociedades modernas, ambas teorías han demostrado que no pueden ser aplicadas de manera integral,
sino que presentan fallas de mercado, es decir, situaciones en las que el balance del mercado no es alcanzado y se generan
consecuencias negativas en su funcionamiento. Por ejemplo: la competencia imperfecta, la distribución desigual de la
riqueza, la existencia de bienes públicos y la inestabilidad de los ciclos de la economía.
Seguimos cayendo en la falsedad de defender ideologías y etiquetas, cuando de lo que tenemos que hablar es de cómo
crear buenas ideas y mejores resultados.
El gobierno protege a sus empleados y grupos especiales de trabajadores a expensas de otros trabajadores.
Friedman assumes that a free market capitalist system fosters freedom and therefore will enhance equality. However the
concept of freedom that he uses is fundamentally flawed, because it is largely negative and procedural in form. Emphasis is
placed on the right of the individual to be free of external constraints so that he can be free to choose and pursue his
individual self interest. Autonomy and self determination lies at the heart of his concept of freedom. Yet for autonomy and self
determination to be realised certain attributes and capacities are needed. In other words, some positive content must be
given to freedom. The free market cannot foster the attributes and capacities necessary for the individual to make
autonomous decisions. Smart66 rightly notes that for autonomy to have value non-market institutional spheres, such as the
educational, cultural, familial and associative spheres needs to be protected from market forces. Friedman, however, does
not restrict free-market logic to the economic system but applies such principles to nearly all spheres of life such as
education, health and welfare, thereby transforming these non-market spheres into commodities that are subject to sale in the
market, or indirectly by being subject to the norms and meanings of the market. In doing so, he neglects the significance of
non-market relations for the development of the capacities required to exercise self-determination.
Friedman's concept of equality of opportunity, is as flawed as his concept of freedom, because it does not address the crucial
question whether the conditions in and through which autonomous agency is to be constituted is fair and favourable. What
about those people that do not have equal access to education and jobs because of a lack of resources due to the systemic
legacy of political discrimination on the grounds of race or gender? The definition of equality as equality of opportunity will
necessarily be detrimental to the social development of such groups of people and will lead to their further marginalisation.
Friedman, furthermore, accentuates the voluntary cooperative nature of the free market system, but underemphasizes the
effects that continuous competition has on society. Competition does not always create opportunities, but might also inhibit
opportunities, because there are always losers in a competitive environment. Where individuals compete against each other
for scarce economic resources, they often attempt to outwit their competitors through methods which are neither fair nor
healthy. In fact, the policy of unrestricted market logic advocated by Friedman has led in many cases to rising inequality,
poverty and social exclusion, because not all people are able to compete on an equal footing. Interests of people are at times
in conflict and not all individuals are equally equipped to protect and promote their interests. The expected benefits from
transactions often do not agree with the actual benefits because factors such as a lack of information or incompetence are
often present in exchanges. The only way to address the shortcomings in the exchange system is through regulation,
something that Friedman oppose fervently.
The global economic system of free trade is currently anything but beneficial for greater equality, because there is no state
intervention and the number of losers therefore far exceeds the number of winners. International corporations have become
powerful political forces. In some cases their budgets exceeds the gross domestic production of nation states. Third world
countries are often exploited by multi-national companies that use cheap labour, dump waste in poor countries and degrade
the environment through unsustainable economic activities. Farmers, entrepreneurs and traders in third world countries find it
very difficult to compete with first world countries, because they don't have the same resources as their counterparts in first
world countries, and therefore struggle to find markets for their products. In short, the market system alone cannot be relied
upon to provide basic needs in respect to food, shelter health and education. Some kind of distributive justice will always be
needed.
Free market economics isn't perfect, but neither are completely regulated economies. The key is to strike a balance
between free markets and the amount of government regulation needed to protect people and the environment.
When this balance is reached, the public interest is protected, and private business flourishes.
However, in a free market economy there are greater possibilities for economic growth and a more efficient
distribution of resources. In a free market economy there is no government intervention in economic activities. But
its fair intervention is required to protect consumers from market forces and to manage the social impact on the free
market. Therefore, a mixed economy can be identified as the most effective type of economy for personal and social
welfare.
Importance of a free market economy, which promotes business initiatives, together with the regulation of basic aspects of
activities by public administrations. Excessive regulation harms free competition, but excessive deregulation in the regulation
of an essential good such as gas or electricity can harm legitimate social interests that are also a guarantee of progress and
well-being for citizens. Regulatory stability and predictability that also guarantees free competition among economic agents in
strategic sectors.
HAPPINESS
Fighting inequality is of great social significance.
It to be one of the factors that affect human happiness in society: the more inequality, the less happy people are on
average.
Trust in government institutions is also being affected. It is very important that citizens feel that they count in society.
As income equality grows, a larger proportion of them will feel more incluted. Affects their happiness and provides
fertile ground for behavior that rejects society.
INEQUALITIES
The gap between poor and rich has grown in the last thirty years. Inequality is not a natural phenomenon.
Governments can take various measures to reduce inequality.
The estimates show that, as the government reduces tax, income inequality in a country is higher.
When higher income groups pay relatively more tax than low income groups, inequality decreases. The tax system
will in that case provide a redistribution of income from rich to poor.
Income inequality is a source of all kinds of other forms of inequality, such as inequality in health and access to
health care, inequality in education and inequality in the quality of the direct living environment of people.
Wealth inequality
The inequality picture is even bleaker when looking beyond what people earn – their income – to what they own –
their assets, investments and other wealth.
In 2021, the richest 1% of Americans owned 34.9% of the country’s wealth
By comparison, the richest 1% in the United Kingdom and Germany owned only 22.6% and 18.6% of their country’s
wealth, respectively.
Drivers of extreme income and wealth
Large increases in executive pay are contributing to higher levels of income inequality.
Back in 1965, he – all CEOs were white men then, and most still are today – earned about 20 times the amount of an
average worker at the company he led.
In 2018, the typical CEO earned 278 times as much as their typical employees.
Gender Inequility
At the global level, in 2020, women will receive barely 35% of the income from work (compared to over 65% for men).
This share was 31% in 1990 and 33% in 2000: we can therefore see that progress exists but is extremely slow.
In Europe, the share of women will reach 38% in 2020, which is still far from parity.
CLIMATE CHANGE
Without action to limit and adapt to climate change, its environmental impact will continue to amplify inequalities and
could undermine development and poverty eradication.
Environmental Inequalities
Too often, the climate debate is reduced to a comparison of average carbon emissions per country and their
evolution over time.
We can see that the poorest 50% of the world's population have relatively reasonable levels of emissions, for
example 5 tons per capita in Europe.
Meanwhile, the average emission reaches 29 tons for the top 10% and 89 tons for the richest 1%.
The conclusion is obvious: we will not meet the climate challenge by cutting everyone at the same rate.
More than ever, the planet will have to take into account the multiple inequalities that cut across it in order to
overcome the social and environmental challenges that undermine it.
While inequality refers to differences in income or wealth across the whole range distribution, poverty concerns
individuals below a given income threshold, or lacking access to basic needs.
By hitting the poorest hardest, climate change risks both increasing existing economic inequalities and causing
people to fall into poverty.
Limiting the global temperature increase to 1.5°C requires reaching net zero CO2 emissions by 2050 and reducing
global emissions by approximately 50 percent in 2030, compared with 2010 levels.
Limiting the increase in temperature to 2°C means net zero CO2 emissions should be reached by 2070, and global
emissions should be reduced by 25 percent by 2030. Every fraction of a degree counts because the impacts of
climate change increase with rising temperature in a nonlinear way.
The need is urgent for policies to transform rapidly and profoundly the way we use energy and transportation,
produce and consume food as well as other goods, and shelter ourselves. The question is how to design these
policies.
Climate change is a justice issue for three reasons. First, its causes are driven by social inequalities: most politically,
culturally, and economically marginalized communities and nations use vastly less fossil fuel-based energy.
Second, the rich and poor feel its impacts unequally; this is true locally, nationally, and globally.
Third, policies designed to manage climate change—including renewable energy sources, adaptation measures, and
geoengineering schemes—will have starkly unequal impacts within and across societies.
This is in part because decision-making processes for emissions reductions and adaptation policies tend to exclude the
politically marginalized.
In the coming decades, climate change and natural disasters could destroy much of the progress made in lifting
households out of poverty in previous decades.
According to one estimate, climate change could push 100 million people worldwide into poverty in the next 10 years.
Moreover, by the end of the century, as a result of climate change and climate-induced natural disasters, the ratio of
per capita GDP between the richest and poorest countries in Latin America and the Caribbean is expected to
increase dramatically.
The region needs to make a concerted effort to design policies that promote sustainability and inclusive growth.
There are three reasons why climate shocks and natural disasters exacerbate inequality.
First, poorer countries, regions and people tend to be more exposed to the impacts of climate change and natural
disasters than their richer counterparts.
Second, they are the ones who lose more of their wealth when climate shocks strike.
And third, these populations have fewer resources to cope with the negative impacts of climate shocks.
For example, Brazilian states with higher temperatures have lower GDP per capita, suggesting that poor states are more
exposed to the impacts of rising temperatures.
When climate shocks occur, the poor tend to lose a greater share of their wealth.
These disparate wealth losses translate into unequal reductions in consumption.
The poor are less able to cope with the negative impacts of climate shocks and to recover from their effects.
They have fewer financial resources, not only because their social networks - or support systems - are also often
poor, but also because they have less access to formal savings, credit and insurance.
While wealthier families are able to adjust their budgets, poor families are already devoting a significant portion of
their budgets to meeting their basic needs.
These three factors form a feedback loop in which the poor are more likely to suffer from climate shocks and to lose
more of their wealth as a result.
Fortunately, countries are in a position to break this cycle by implementing inclusive development policies that are consistent
with climate stabilization and disaster risk management objectives and, at the same time, by reducing inequality.
The first step in this regard is to improve social safety nets and enact policies that enhance the ability of the poor to cope with
the negative impacts of climate shocks. For example:
Achieving improvements in insurance and formal financial products.
Providing access to health care
Improving infrastructure services.
When natural disasters occur, governments must also provide assistance to those most in need. Without rapid assistance
following a disaster, poor households may be forced to sell productive assets, withdraw their children from school or delay
seeking medical care in order to meet their immediate needs, jeopardizing their long-term prospects.
Governments can quickly target resources to the most vulnerable by using preauthorized funds for this purpose through
existing cash transfer mechanisms.
This is because the poor often live in slums that are more costly to protect against climate change, while possessing
less wealth that would benefit from such protection. Such discrepancies can only be resolved fairly if inequality is
explicitly taken into account and the poor are involved in decision-making.
Unmitigated climate change threatens to have disastrous effects on both economic growth and inequality, but if
action is taken as soon as possible and poverty and inequality are taken into account in the design of public policies,
the region can preserve the social achievements of the recent past and make further progress towards its
development goals.
Strategies against global warming must take into consideration the imperatives of equality, equity and justice, as they
could have negative impacts on the environment, people and their rights, further deepening inequalities and injustices.
The devastating effects that the climate crisis will have on those who live in poverty and who directly experience the
impacts of environmental degradation, are more exposed to extreme climate phenomena and have fewer possibilities to carry
out adaptation actions.
>Vulnerabilities to climate change, and increased inequality and poverty, are critical issues to consider from a climate
justice perspective.
In order to overcome poverty, inequalities and the environmental and climate crisis, it is necessary to change the
production and consumption model.
Climate change is one of the most important global threats to the guarantee of human rights. The movement also demands
recognition of the unequal distribution of climate burdens, and calls for its consideration in the design and implementation of
all related policies.
In short, the climate crisis exacerbates the relations of inequality already present in our societies and especially affects
historically vulnerable groups.
In addition, climate change particularly affects the residents of the most climate fragile territories, who, as a general rule,
have contributed the least to historical greenhouse gas emissions and have benefited the least from the economic
development and well-being that the burning of fossil fuels has brought to humanity.
Current generations do not take into account the long- term costs of the affluence
Less consumption is unattractive because it equates leading grim, unhappy existence
Eco-friendly reforms presented as sacrifices appear expensive and uncertain
Keynes's Prediction:
1930: Keynes predicted that the average Briton's work week would drop to 15 hours within a century.
Defensive growth models argue that growth-related negative externalities fuel the growth process itself
Defensive growth models argue that growth-related negative externalities fuel the growth process itself
Defensive growth models argue that growth-related negative externalities fuel the growth process itsel
Defensive growth is based on the idea that social capital provides individuals with free goods and services that can be
replaced with private goods available on the market.
When growth is defensive, the declining quality of environment and relationships, as well as the high workload, offset the
positive effects of growing income for well-being.
Private affluence
Common poverty
At the core of defensive growth in the distant future
2 critical hypotheses and 1 additional condition of defensive growth drive this conclusion
1. pessimistic expectations about the distant future
2. extensive distrust in politics
plausibly mimic the current features of industrial societies
Unsustainability appears as a tragedy of collective impotence that results from the hunt for a private exit strategy from
collective problems
The rush to private protection is the problem and not the solution.
Environmental destruction is just one of the dark faces of a society that pursues money as compensation for the distress it
creates.
What should be done? Rebuilding trust in the political system is crucial for sustainability.
Post-democracy
post-democracies : contemporary political systems
The growing influence of economic elites in political decision-making has caused a regression to a pre- democratic situation,
where exercise of political power was restricted to closed elites (Crouch, 2004)
democracy
can and should be innovated to reduce the disproportionate influence of corporations on policies
the condition to escape the tragedy of collective impotence that leads to unsustainability
Policies for social capital
“Epidemiological studies showed that greater levels of social capital and well-being, and weaker social comparisons predict
substantial reductions in morbidity, and thus in healthcare spending
Conclusion
— It is possible to obtain both happiness and sustainability in current situation
Main Points
1. Ecologist Messages
Threat of ecologist disasters 4. Derived Preference
Uncertainty perceptions of catastrophe Future expectations
Sustainability sentences sacrifices Political systems
Innovated democracy
2. Defensive Growth
Negative externalities 5. Consumption agenda
Substitutes Decoupling life quality
Offset in the long-run Expanding well-being rather than economic activity