9.3.1 Economic Inclusivity

Economic inclusivity can involve all four dimensions of governance in providing opportunity and meeting the needs of everyone.

As communications and transport links have improved, it has been increasingly become possible for local employers to transfer work elsewhere: so-called ‘globalisation’ (3.4.2).  Globalisation has had several effects on people’s lives:

●  Free trade has reduced prices and increased economic growth in many wealthy countries (3.5.4), but that growth has required some immigration to fill skills shortages. Competition from the immigrants has depressed the wages of less-skilled people.

●  People in poorer countries, lacking economic opportunities, become economic migrants (3.4.3). They are drawn to rich countries, where they can help to fuel more economic growth – and increased job competition.

●  Technology (3.2.8) has also cut prices, increased economic growth and cut jobs (whilst creating some new highly-skilled jobs).

Some communities in wealthy countries have been left behind by these economic changes, despite greater total prosperity.  Power has shifted to the owners of wealthy corporations, as described in Robert Reich’s article What Really Happened to the American Dream?:

“FOR THREE DECADES after World War II, America created the largest middle class the world had ever seen. During those years, the earnings of the typical American worker doubled, just as the size of the American economy doubled.

Over the last 40 years, by contrast, the size of the economy has more than doubled again, but the earnings of the typical American have barely budged (adjusted for inflation).

… Today, confidence in the economic system has sharply declined. Its apparent arbitrariness and unfairness have undermined the public’s faith in it. Cynicism abounds. Equal opportunity is no longer high on the nation’s agenda.

To the contrary, our economic and political system now seems rigged.

That’s because it is.

… When most people stop believing they and their children have a fair chance to make it, the tacit social contract begins to unravel. And a nation becomes susceptible to demagogues such as Donald Trump.”

The above text described the situation in America, but a similar analysis applies to Britain and, to a lesser extent, Europe.  This accounts for the increase in the populist right wing in the West.

Economic inclusivity, at a minimum, means that no one should be deprived of their ‘socio-economic rights’ to food, shelter, health care and education as part of their agreed entitlements (4.2.4).  People expect more, though:

●  Resentment can be caused by an economic system that fails to take account of everyone’s needs (3.5.9).

●  Economic inequality can also be seen as a lack of inclusivity (3.5.6). It has become a political issue (6.7.2).

●  Some response is necessary to alleviate the problems of rapid economic change (6.7.8).

There is also an international aspect to this topic.  There are economic (3.5.8), moral (4.3.5) and political (6.7.6) reasons for helping poorer countries.



This page is intended to form part of Edition 4 of the Patterns of Power series of books.  An archived copy of it is held at https://www.patternsofpower.org/edition04/931.htm.