BA 447 – day 6, 7, 8
Overview: Governance, corruption, terrorism
• Review ch 11– Discussion
• Review ch 12– Discussion
• Raise questions raised
Ch 11: Other side of “flat world”
• Technological optimist or historical determinist: the brave new world and its dark side
• The reality of poverty and efforts reduce it– Too sick – disease and underdevelopment– Too disempowered - marginalized– Too frustrated – ideological, religious– Too many Toyotas – what if we did succeed in
making people well-off?
Poverty statistics
• Poverty rates in selected countries– http://www.worldbank.org/data/countrydata/countrydat
a.html
• Poor are most vulnerable to natural disasters: tsunamis; typhoons; hurricanes; earth quakes
• Poor most vulnerable to disease outbreaks– Sanitation– Access to health centers
Poverty
• Poverty alleviation: decades-long goal– http://web.worldbank.org/WBSITE/EXTERNA
L/TOPICS/EXTPOVERTY/0,,contentMDK:20153855~menuPK:373757~pagePK:148956~piPK:216618~theSitePK:336992,00.html
– http://www.makepovertyhistory.org/– http://
www.globalissues.org/TradeRelated/Debt/USAid.asp
Poverty and prosperity
• Mansions, high rises, and slums
• Benefits to elite (Philippine rates)– Caddies: $10 a game– Household helps: $55 a month– Driver (stay-in): $130 a month– Secretaries starting pay: $300 a month– Call center pay: $300 a month
• Living wage and minimum wage
Too disempowered
• The rural vote: in developing countries, to the extent that elections are honest, elections are dictated by the masses.
• Economic growth often does not trickle down.
• What are the arguments?– Global populists argue that the poor do not
stand a chance
Anti-globalization
• Western-driven movement composed of:– Upper-middle class with guilt complex– Rear-guard push by the old left– An amorphous group: neo ludites?– Anti-americanism (power is a magnet for
criticism)– Serious groups focused on “how we globalize”
Response to anti-globalization
• Reform retail - - • Local government focus, actually he
means national government.• Village by village effort• Role of multinationals
– HP’s efforts to help villagers articulate what they needed
– Microsoft program providing computers– “Community relations” projects
Another view of poverty reduction
• Targetted approaches, for example– http://www.usaid.gov/– http://abcnews.go.com/International/wireStory?id
=1205776
• The World Bank shifted to reducing corruption. – Corruption = lack of or poor governance– Poor governance perpetuates poverty
Day 7
• If not enough time, finish Ch 11 on day 7– Too frustrated– Too many toyotas
• Continue with Ch 12• Issues
– Terrorism– Islam– Traditional conflicts– Internal conflicts– Governance and corruption & relation to previous four
Islam and terrorism
• Frustration due to authoritarian regimes and lack of economic opportunities
• Islamist fringe and its supporters– Terrorist acts as directed against “trust”– The “West,” particularly the US, as a
convenient target for dissatisfied Muslims– Establish an Islamist state– Feed on frustration due to humiliation - if
Islam is that great, why are we poor
“Muslim Problem”
• Centuries old issue of dealing with Muslim population in the Philippines - through Spanish, US, Japanese occupation
• 10% of the population, mainly in South• Secessionist? Anti-Christian?• Factions within the population
– MILF, MNLF, Abu Sayaf as splinter group– Families and clans also fought each other
• Terrorist acts - kidnappings, bombings– Attract attention to their cause– Collect “taxes”
Bin-Laden’s Cause
• Well before Sept 11– http://news.bbc.co.uk/1/hi/world/south_asia/15
5236.stm• Western infidels on sacred ground - foreign troops
in Saudi Arabia during Kuwait war• Corrupt Saudi Arabian government• US support for Saudi Arabian government• Depletion of natural resources - oil
• Why conduct attacks on US soil?• Al- quaeda as a loose confederation
Terrorism in general
• Objectives:– Attract attention/support for a cause– Destabilization of status quo
• Methods – A small bomb, big bang in the press– Guerilla-style efforts, including suicide bombers, can
tie up a whole army. Therefore, cost – benefit is in their favor
– Harassment=leverage for whatever ends they may be working for, e.g. extortion, support, etc.
Islam
• Shares common “tradition” with Judaism and Christianity. Qur’an as correcting Jewish and Christian scriptures – One God– Abrahamic roots
• http://en.wikipedia.org/wiki/Islam
Religion and Government
• Separation of church and state– People are free to worship– Government can not dictate/interfere
• Some democracies have informal relationships between church and state
• Other governments have closer ties
Growth and natural resources
• What if China’s middle class actually grew? Or India’s? What type of lifestyle would they emulate?
• Rise in crude oil prices in 2004 partly attributed to unexpected growth in Chinese demand for oil.
• The growth of Chinese requirements for oil (and commodities) may subside a bit in next few years.
• But who remains the biggest consumer?
Ch 12: The Dell Theory of Conflict Prevention
• Supply chain management means that production in different countries are linked
• For a particular country, this means foreign direct investments, jobs, etc.
• War or any violent conflict that disrupts economic activity can disrupt supply chain
• Such a conflict can also cause investments to move to more peaceful locations
Back to terrorism
• Destabilization or terrorist acts may be targeted at “discouraging” investments
• If the economics are right, a company may opt to deal with “terrorists” by paying “taxes”
• In some areas, terrorists often does enough damage to increase uncertainty and extract rent. This is good “business.”
Historical Conflicts
• China (People’s Republic of China) and Taiwan (Republic of China)
• India and Pakistan
• Japan and China, and Korea
• UK and Ireland
• Eastern European “hotspots”
• South America??
Roots of Conflict
• Religion as in the case of India and Pakistan– Was one country and broke up after
independence
• Ideology – China and Taiwan
• Economic (capture resources) – Japan in World War II
• Political with religious undertones (Ireland)
Internal conflicts
• Tribal/ethnic conflict
• Religion– “Frustration”– Control of the country
Governance & Corruption
• This portion has been changed. For day 8 the basis for discussion will be in file labeled governance and corruption and reference will be made to assigned reading on ruling family in Saudi Arabia.