Removing the Barriers to Global Health Equity

Theodore H. MacDonald, Rashmin Tamnhe

• Publisher: CRC Press
• Year: 2018
• eBook ISBN: 9781315357935
• Edition: 1
• Topic: Medicine
• Subtopic: Medical Theory, Practice & Reference

Medical research and global awareness of health inequalities continue to grow apace. Why then is global health inequality widening, with benefits disproportionally affecting the richest third? How can obstacles to more equitable healthcare be overcome? This passionately-argued book presents answers that will be essential reading for everyone interested in global health, public health, public policy and economics. Policy makers in global communities and government, political activists and all those with an interest in equality in healthcare will find stimulating, well-supported analyses of the interaction between neoliberal policies, geopolitical issues and health. Meanwhile professionals in international healthcare organisations, care agencies, and international charities will find challenging and refreshing socio-political solutions to those offered by the current neoliberal paradigm.

Chapter 1

Is neoliberalism compatible with global health equity?

What is Neoliberalism?

Neoliberalism features prominently in the discourse of this book and hence an introductory chapter on the issue is called for. The term ‘neoliberalism’ has become so widely used in recent years that many users of the word have a very hazy idea of its meaning. The situation is further complicated by ideological commitments of various types and a rather severe difference between what the general public, along with the ever corporate-compliant media, mean by it on the one hand and what bankers and other corporate-type people mean by it on the other.

In the mid-seventies ordinary people started to run across the term, but generally in a rather positive context. Along with wonderful expressions such as ‘wealth creation’ and ‘big government’, neoliberalism suggested a breaking away from totalitarian restraints, leaving people free to rub exciting arguments together without over-burdensome restraints, thereby creating jobs and money-making opportunities. All off this was euphemistically referred to as ‘wealth creation’. And for this magnificent flowering of talent and opportunity to take place, we had to remove obstructive legislation, including such things as health and safety rules, union rights and so on.

Back then, neoliberalism was widely promoted and presented as ‘the wave of the future’, the ‘only way forward’, virtually a guarantee of individual fulfilment and general happiness. Not only did comparatively few non-economists question the wisdom of this widespread approbation, but indeed, almost any criticism of it and/or the suggestion that government should monitor it in any way was called ‘unrealistic’. It was as though we had somehow evolved to a high point of social development with the development of neoliberalism and it became part of our moral responsibility to help the teeming masses of Asia and Africa understand that we had discovered the Holy Grail and to encourage them to acquiesce in the globalisation of neoliberalism.

In fact, this author recalls attending a meeting in Australia of the New South Wales History Teachers Association in Sydney in 1982, where the general consensus was that, although students should be told about such totalitarian vulgarities as communism, socialism, fascism, etc., the students must realise that ‘everyone accepts that neoliberalism is the only realistic solution’. Moreover, certain inalienable laws govern the give-and-take of market forces and to interfere with the self-regulation of the market is to court economic suicide. In a sense, it regards ‘market forces’ as being akin to the great force fields in physics, such as magnetism, thermodynamics, etc. In other words, like these other forces, humans must respond according to those ‘laws’ or face annihilation. But in reality humans – not some outside agencies – design their economies and markets to meet their needs. If the model they are using is not delivering the goods, they can change the market rules. That is, market forces do not control human societies. Instead human societies can adjust their market regulations to meet with their needs.

Although certain events, such as the increasing tendency to resort to war, the need to find sustainable sources of energy instead of relying on fossil fuels, global warming, international economic insecurity (especially with respect to our banking system), etc., have – since the 1970s – gradually caused some people to be suspicious of neoliberalism, not much has really changed. For instance, none of the major political parties in the First World nations have seriously threatened to actively try to develop alternatives to neoliberalism.

But, as tends to happen, if a political or social system has some flaw in its make-up – some unresolved logical contradiction, say – this flaw will become increasingly evident the harder and longer the model is pursued. For instance, in mid-April 2008, the Director of the World Food Programme warned the UN Security Council that the world, during 2008, would begin to feel the effects of a global food crisis.¹ This situation is now causing serious questioning about the merits and defects of neoliberalism.

Before proceeding further, though, with these details, we must briefly consider the economic theories behind neoliberalism and to do that, a brief résumé of its history cannot be avoided.

Neoliberalism, Monetarism and ‘The Washington Consensus’

This author has even heard economists state that neoliberalism had its origins in the monetarist arguments of Milton Friedman at the Chicago University Department of Economics in the 1960s and 70s and that it became a dominant plank of Prime Minister Margaret Thatcher’s government in Britain in the 1980s. But that leaves out some of the prior twists and turns and tends to confuse monetarism (Friedman) with neoliberalism (Hayek). And to confront the Austrian conservative economist Friedrich von Hayek, we have to go back before World War Two. Von Hayek was concerned primarily with business cycles in Europe and was virulently anti-socialist.

But, before returning to von Hayek’s influence on these matters, it is important – if only briefly – to indicate the differences between neoliberalism, monetarism and what later became known as ‘the Washington Consensus’. The latter term was first used in 1989, by the US economist John Williamson, of the Institute for International Economics, and at a conference at which he played a principal role. The conference in question took place in Barcelona and he had entitled it ‘From the Washington Consensus to Global Governance’. By ‘Washington Consensus’ he meant to refer to the increasing degree to which some Third World countries, especially in Latin America, had modernised their economies with respect to both trade and domestic policies and in line with US governmental and business views on what constituted ‘sound economics’. Basically, this involved the application of monetarism in banking practices and neoliberalism at the broader levels of fiscal policy.

The author draws the reader’s attention to the issue at this point because the three terms tend to be used loosely in much public commentary in the media and hence are readily confused with one another. It helps to think of the Washington Consensus as the USA’s response, at the time, to the ways adopted by a number of Third World national economies in adapting to the neoliberal context increasingly imposed upon them through international trade. Monetarism fitted into the equation by providing a theoretical foundation for this process.

As for monetarism, it has had a number of incarnations since the early days of the 20th century, largely originating at Chicago University’s School of Economics. The earlier versions of monetarism were found to be lacking for various reasons, but economists at the Chicago School kept working at the idea, until they felt that they could offer a workable model. Fundamentally, it involved the regulation of money supply as a means of controlling and stabilising the economy and thus avoiding sudden unanticipated swings.

But it is Milton Friedman, who became Professor of Economics at the Chicago School in the 1950s, who is widely acknowledged as the father of modern political monetarism. As a philosophical basis for national economic policy, it is largely congenial to a high degree of flexibility on the part of the banks and to an emphasis on the flow of money being determined by market forces, rather than by government diktat. In particular, the banks had to be free of ideological restrictions being placed on their lending policies.

It goes without saying that the above four paragraphs have grossly oversimplified much of the economic theory behind the phenomena described but, hopefully, they have provided an adequate basis for the reader to better understand the impact of von Hayek’s thinking.

His ideological orientation against socialism deeply influenced the rest of his life’s work and he saw in neoliberalism a method of removing constraints on business practice. His views gained some popularity among a few economists, but generally he was shunned. Keynes was regarded as the man to watch!

The author, in a previous book, described how John Maynard Keynes, the internationally respected British economist, had been somewhat involved in setting up the UN during the 1940s, but the UN had bigger political backers, leaving Keynes to play a more minor role.² Indeed, it was he who had suggested the creation of the International Monetary Fund (IMF) and also the International Bank for Reconstruction and Development (IBRD), known more commonly as the World Bank. But the IBRD did not develop in the way that Keynes hoped it would! He had the view that future international military conflict could be avoided if the IBRD would help the war-torn nations regain their strength through loans.

However, it was at this point that things began to go wrong and neoliberal ideas intruded. The US government, under President Roosevelt at the time, wanted to insist on three conditions for the loans:

1. They must be paid back in US dollars.
2. The loans had to be used to engage private providers for the services required.
   They could not come under government control.
3. The IMF would apply ‘conditionalities’ (Structural Adjustment Policies or SAPs) with each such loan, heavily controlling how the client country used the money, but such SAPs did not enter the scene fully until the 1970s.

What the formation of the IMF and the World Bank under these restrictions meant was that the latter – instead of representing that progressive thrust forward to world peace and international justice – became a method of imposing economic imperialism on some of the world’s poorest countries. Since 1970, indeed, the World Bank and those SAPs have had a disastrous impact on global health and, since 1988, this has been widening the global health equity gap rather than diminishing it.³ And the mechanism has been neoliberalism.

This is all described in the book cited above, but basically it worked like this:

1. Since the debtor countries were obliged to repay the debts (including compound interest) in US dollars, they were required to raise that money by selling their national resources to US markets at prices determined by them.
2. This, in turn, meant that they had to sacrifice all other internal needs of their country to creating a total infrastructure of roads, rail, etc., to the trading ports. Union rights were slashed and the workforce rendered tame. Large areas had to be deforested and rivers were poisoned by excess use of chemicals, etc. All of this had negative impacts on health.
3. In just about any government, the two main areas of government expenditures are in health and education, but the SAPs required that – instead of domestic governments administering these matters – private providers had to be used, opening the country to higher costs for these services. Of course, IMF and World Bank stockholders (living in opulence in the First World) greatly rejoiced in this as their stock values rose. This is neoliberalism in action.

Populist Views of Neoliberalism

Looked at dispassionately, why should anyone be surprised that neoliberalism has developed in this way? Only a very modest degree of logic would persuade the average thinking person ofsuch political ‘axioms’ as: People evolved government to protect the tribe, group or community. To mediate conflicts between interests in that group, the government must play a dominant rôle. That is why we invented it!

Therefore, such ideas as ‘markets’ being allowed to make major social and political decisions without the mediating influence of government is nonsense. The corollary is that the ‘government’ should acquiesce in this by ‘withdrawing’ and playing as small a part as possible in the economy, and that also flies in the face of logic (if not of social anthropology!).

It is these perversions that now make it seem reasonable that ‘corporation’ (in most national constitutions) be regarded legally as an ‘individual person’ and with the same constitutional rights to protection under the law, etc. This runs into sticky situations when an operative, say, a relatively lowly placed worker on a building site or whatever, employed by a corporation without due regard to that actual individual’s right to health and safety protection, becomes killed or injured as a result.

Suddenly, in that case, the situation changes in court. Although the ‘corporation’ (legally protected and defined as a ‘person’) has injured or killed another person (an actual person, this time), no one can be held criminally responsible for it. The owners, including the chief executive officer (CEO) of the corporation, are all ‘real’ people, but suddenly become not legally responsible for what they did to the injured or killed ‘real’ person! We are truly in ‘cloud-cuckoo land’ here, but it is par for the course if we accept that neoliberalism is a benign social idea.

It not only implies that ‘government’ (which we evolved over human history to protect us) should voluntarily curtail its own rôle in the economy, but that ‘corporations’ (those ‘persons’ that are not ‘real persons’) should be accorded unhindered scope for their exercise of power. Not only that, but the consequence of such an idea is that trade unions (which also evolved over time to protect the human rights of workers in different trades) should be restricted in exercising their power. The end result is that ‘ordinary’ citizens – many of whom regarded themselves as ‘apolitical’ and ‘not involved in the argument’ – suddenly find their human rights reduced.

But all of that has already happened and is still happening and is all part of the same neoliberalism that we have been urged for the past few decades to regard as the guarantor of our human rights and of our development as people and nations. It is the same neoliberalism that remains rampant as any lion and clawing as much of our once public/community life into privatisation as it possibly can. And it makes it possible for those of us committed to health equity to appreciate how neoliberalism has gained its almost religious (and essentially ‘irrational’) hold over global health.

Let us now return to the sudden change in the power of the IMF and the World Bank and their increasingly malign influence on the World Health Organization (WHO), a UN agency, while all three were supposedly working in harmony to defend and promote human rights under the UN’s defining Charter, the Universal Declaration of Human Rights (UDHR). It charts t...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Contents
• Foreword
• Foreword
• Preface
• Acknowledgements
• List of relevant acronyms
• Dedication
• 1 Is neoliberalism compatible with global health equity?
• 2 Setting an optimum context for global control
• 3 Inequity in access to water
• 4 Neoliberalist approaches to healthcare and the transnational pharmaceutical corporations
• 5 The obstacle of war
• 6 A world mortgaged to war
• 7 Imperialism and global health
• 8 Global mismanagement of food resources
• 9 The barrier of moral parochialism
• 10 What can we do now?
• Index