3 Economic Development and Sustainability: Poverty and Wealth

Introduction

When people think of development, they first think of economic development, which is one of the three dimensions of sustainable development. Yet, while the world has become wealthier, the extremes of wealth and poverty have also increased, a trend that is itself unsustainable. It is difficult in the West to imagine the reality of extreme poverty without firsthand experience. For the one third of humanity who suffer its consequences and are increasingly aware of how unjust their situation is, acceptance of the present system is intolerable.

Development is usually equated with economic growth, as measured by an increase in GDP (gross domestic product), and the term "sustainable development" is often considered a contradiction in terms, since endless material growth is contrary to sustainability. In fact, some in wealthy countries advocate "degrowth", since their over-consumption is leading to the rape of the planet and leaves no resources for those who are materially poor to have some legitimate growth to meet their basic needs. "Sustainability" is now often preferred to "sustainable development" for this reason.

The economic impact of the pandemic and broader imbalances in the world economy highlight how fragile and unsustainable the economy has become, with excessive levels of debt, multinational corporations escaping from government regulation and taxation, banks too big to fail, delocalization, rampant speculation, corruption, exploitation of workers, tax avoidance by the financially wealthy, and many other ethically-questionable practices. Future economic crises seem inevitable.

Watch: Income and Wealth Inequality: Crash Course Economics 10:15 An excellent introduction into the many aspects of economic inequality.

Discussion

As you read below, consider these discussion topics:
1. What are some of the characteristics of the globalized economic system that make it unsustainable?
2. What role does work play in development?
3. What attitudes towards poverty and wealth will help us to achieve sustainable development?

Readings

Reading 1: Dahl (1996), The Eco Principle: ch. 2, pp. 7-28. This chapter provides a critique of the Western economic system and its development failures. It covers issues such as specialization; the limitation of economic perspectives to what is traded in the market; the fact that people are secondary; the economic benefits of negative activities; trade and the global economy; employment; waste and pollution; the economists' short-term perspective; and the preoccupation with growth.

While it is easy to criticize the present economic system, an alternative has yet to be devised, although small-scale experiments have begun, and there is increasing discussion of a "green and circular economy", although still within the present growth paradigm. This was a major theme at the Rio+20 United Nations Conference on Sustainable Development in 2012.

Reading 2: Dahl (2023) Climate Change & World Economy: When an Irresistible Force Meets an Immovable Object. This article published by the Global Governance Forum addresses the impact of the Climate Crisis on the economy and the consequences for the future. 

Reading 3: UNEP (2011) Towards a Green Economy, Summary of the Conclusions (2 p.) 

This brief reading provides an overview of the essential components of a Green Economy. It doesn't matter that the numbers cited are outdated.

If you have the time, you may enjoy the excellent webinar Recovering better: Global opportunities for jumpstarting the real economy #GO4SDGs, a side event at the 2020 High-level Political Forum on Sustainable Development 2020. You will find the video in the Resources for this unit linked at the end of this page.

Part of the challenge of sustainable development is to redefine the goals of development and the concept of prosperity in a way more broadly acceptable to all of humanity. The Bahá'í­ International Community has done just that in "The Prosperity of Humankind", which discusses both economic and social principles.

Reading 4: Bahá'í International Community, The Prosperity of Humankind (34 pp.). This reading is also relevant to Unit 5, so you can continue reading it for the following week.

This statement is so rich in creative thinking about development that it is worth reading several times. It reexamines the attitudes and assumptions in current approaches to social and economic development and provides a new wider vision of human prosperity. Part I emphasizes that a strategy for global development must be based on the oneness of humankind, requiring a transformation of both human consciousness and the structure of social institutions. Part II reviews the essential principles of justice, human rights, and cultural diversity. Part III calls for a fundamental redefinition of human relationships and institutions, in which the principle of consultation becomes the operating expression of justice in human affairs. Part IV shows that development requires access to knowledge, combining the two basic knowledge systems of science and religion. Knowledge empowers universal participation in development, founded in spiritual commitment and moral principle, with service to humankind as the purpose of both individual life and social organization. Part V describes the economic issues that face humanity, including poverty, unemployment, work, the environment, and participation of women. It shows the necessity for new economic models to achieve the real purpose of development: laying foundations for a new social order that can cultivate the limitless potentialities latent in human consciousness. Part VI addresses issues of power and authority in the political realm and the way in which they are expressed in institutions of governance. Part VII concludes with an appeal to all humanity to look beyond the present turmoil in society and recognize that we are at a turning point in social evolution that will make this vision of human prosperity a reality. 

Watch: May Akale, Commission for Social Development - Bahá'í International Community Oral Statement 5:02

On the occasion of the 49th session of the United Nations Commission for Social Development, the Baha'i International Community delivered an oral statement.

Reading 5: Bahá'í Quotations on Economic Sustainability (the last section on Transformation - a New World Order will be read in Unit 6)
1. Unsustainability of the old world economic order
2. Principles for a new economic order
3. Justice
4. Poverty
5. Poverty and wealth
6. Distribution of wealth
7. Capital and labor
8. Employment

Resources

This file of voluntary resources can help you gather some background information on specific themes related to this unit. It contains two other Bahá'í International Community statements that are also especially relevant, recommends several books, and features several video talks.  Robin Wall Kimerer expands on the concept of Reciprocity in a talk and in a podcast on the Economy of Abundance.  Mohammed Yunus shares his ideas and experience about poverty. You can also explore ideas for community projects such as regenerative farming,  and finally listen to a talk on wealth inequality given at an Association for Bahá'í Studies conference.

Resources for Unit 3

Go to Unit 4