THE WELL-BEING BUDGET: NEW ZEALAND’S UNCONVENTIONAL APPROACH TO POLICY-MAKING

by Pankhuri Prasad
Staff Writer

Which country is the world’s most prosperous? Even if there were an unbiased and objective answer to this unanswerable question, chances are that the answer would be based on measuring prosperity as a function of economic growth, mainly through Gross Domestic Product (GDP). GDP is the total value of all goods and services produced by an economy within a given time interval. Economists and the public alike are attracted to the measure’s intuitive interpretation, which gives GDP the unfortunate illusion that it encompasses all that relates to the development and growth of a nation. This is true to a large extent, as GDP is a good monetary measurement of growth and one that lends itself to easy comparisons across years and locales. However, it has many drawbacks; GDP fails to measure important development aspects such as income inequality, sustainability impact, and perhaps most importantly, quality of life.

Recently, there has been a growing consensus among economists and politicians that the evaluation of growth and development must go beyond GDP. These concerns are being transformed into action by some countries, who are coming up with alternative systems of collecting data and new metrics to base public policy decisions upon. One such country is New Zealand, now under the leadership of the world’s youngest female head of state, Jacinda Ardern. She created ripples when she discussed New Zealand’s “Well-Being Budget” at the World Economic Forum (WEF), held in January 2019. The WEF is an annual summit that brings together many leaders of global society such as heads of states, owners of large companies, economic analysts, and environmental advocates. New Zealand looks to tackle a major challenge, namely citizen well-being, which is difficult to quantify but is mainly the result of a high quality of life. This includes but is not limited to: life satisfaction, physical health, family welfare, education, employment, wealth, safety, security, and the environment. To do so, New Zealand has adopted a “well-being approach” to evaluating policy. It focuses on social and environmental factors that increase well-being, rather than simply prioritizing increasing economic prosperity as measured by GDP and supporters believe it will translate to prosperity across all aspects of life.

What is New Zealand’s “Well-Being Budget”?

The New Zealand government’s 2019 budget differs from that of proceeding years mainly because of its well-being approach. It departs from the traditional, solely-economic approach to policymaking as it broadens the scope of evaluation when creating public policies and allocating resources. Their new calculations include not only fiscal and economic measurements but also the Living Standards Framework (LSF) developed by the Treasury of New Zealand. This framework was designed to support government agencies in directing public policy under the well-being approach and to ensure government spending and government initiatives aim to increase intergenerational welfare. As a member of the Organisation for Economic Cooperation and Development (OECD), New Zealand’s decision to create the LSF aligns with the OECD’s own shift towards a well-being orientation. The OECD conducts research developing its own well-being measures, which can be used as a robust foundation for understanding intergenerational welfare. Their framework uses four “capitals” as a way of defining the parameters of well-being: human capital, social capital, natural capital, and financial and physical capital.

The New Zealand government’s official definition of a well-being approach is indicative of its reason for adopting the new outlook. In its 2019 Budget Policy summary, well-being is defined as “enabling people to have the capabilities they need to live lives of purpose, balance, and meaning for them. It is an intergenerational approach that seeks to maintain and improve New Zealanders’ living standards over the long-term.” This definition seeks to enshrine the aspects of life that matter to citizens in the central government’s policy goals. New Zealand faces many complicated issues such as child poverty, inequality, and climate change. Therefore, the government deems it essential to go beyond simply considering economic growth in its hopes to make the best choices for current and future generations. The budget policy summary admits the importance of economic growth for creating opportunities but warns how New Zealand’s recent history is evidence that “focussing on it alone can be counterproductive and associated with poor outcomes such as greater inequality and pollution.” In a panel discussion at the WEF, Prime Minister Ardern argued that Brexit and trade wars can be considered as a proxy for the frustration people feel over a political and economic system that has left them behind. She also urged that this approach is not simply ideological but is designed to reinstate trust in political institutions and reduce the frustration felt by many political stakeholders.

New Zealand’s Prime Minister Jacinda Ardern

Why is New Zealand’s case important?

The concerns that New Zealand’s approach aims to tackle are not restricted in-country, rather, they echo across the world. Recently, the United States has witnessed a heated political debate over the Green New Deal—legislation that tries to address a large spectrum of issues ranging from climate change, renewable energy, and transportation to labor laws, higher education, and wage stagnation. The legislation itself may be controversial but the issues it addresses are real. These issues are the culmination of backlash against globalization and products of technological changes. Citizens have started demanding that all nations look beyond economic growth and include the distributional and environmental impact of growth in its priorities. For some governments, this has meant a retreat from globalization and openness, but for others it has meant integrating citizen welfare into current policies. This task is especially difficult because many of the factors related to well-being are hard to measure. Quantification of the human experience will most likely receive heavy criticism, just as the New Zealand Treasury was criticized for implying a life is worth $4.7 million. Despite these challenges, the new well-being approach in New Zealand’s public policy reminds us that modern governments need to refresh their priorities and could serve as a case study to model new governance approaches across the world.

Images by
OwenXu
Nevada Halbert

AMIDST KERALA FLOODS, INDIAN GOVERNMENT REFUSES FOREIGN AID

!!delete

by Tenzin Chomphel
Director of Marketing

August 24th, 2018: The monsoon season of India typically runs from June to September, bringing sporadic rainfall throughout the summer. This year, however, the southern state of Kerala received a 40 percent increase in rainfall, resulting in the worst torrential flooding the state has seen in a century. Entire towns have been engulfed by the waters and people have been evacuated by the thousands. Over 1.2 million individuals are currently homeless, taking refuge in camp shelters spread across affected areas. The death toll has risen to 373, mostly from landslides, and dozens are still missing.

In the long term, many locals will have to deal with the destruction of their homes and those with homes still intact may have to wait up to a year to return. “My house is full of mud and almost everything I own now is damaged,”one citizen said to a BBC reporter.  

Prime Minister Narendra Modi made a  visit to Kerala to assess the damages and agreed to a grant of roughly 70 million USD for aid purposes. While this grant will provide some relief, it is only a fraction of the estimated three billion in damages caused by the flooding. The United Arab Emirates offered 100 million USD to aid the recovery, but surprisingly the Indian central government has refused to accept this foreign aid.

The National Disaster Management plan developed by the central government in 2016 states that India, will not “issue any appeal for foreign assistance in the wake of a disaster.” If offered voluntarily, however, the Indian government may accept this offer, but so far all offers of foreign monetary aid have been rejected. The government has also stated that representatives of international foundations that wish to contribute can do so through existing relief funds belonging to the Indian prime minister or the Kerala government.

Many within India are furious at these actions, or lack thereof, citing the fact that the central government has accepted multiple offers in the past for external assistance. Recent examples include the Swachh Bharat, India’s nationwide street clean-up campaign, which has gathered external assistance since its conception in 2014. One reason for the government’s resistance to foreign aid may be the underlying desire to avoid being seen as weak. Government spokespersons have confirmed the agenda of “Changing India’s image for the world” to being an “aid giver, not an aid taker,” suggesting that the government believes accepting foreign aid in the context of a national disaster would tarnish its current reputation as a rising world power. This, coupled with Modi’s existing distaste for international NGOs, will continue to make it difficult for external aid to get through to the people of Kerala.

Kerala’s finance minister Thomas Isaac points towards political discrimination as another possible explanation for the state’s insufficient aid package. “We are a leftist government in Kerala,” he says in opposition to the right-wing governing Bharatiya Janata Party (BJP). Some of the most vocal members of the BJP consist of Hindu nationalist groups, which have argued the floods as deserved due to Kerala’s lack of observant Hindus. The Malayali peoples of Kerala have had a long culture of eating beef, which is considered taboo within the Hindu religion. Intolerance towards those who partake in this diet has existed for centuries, but attention is focused on recent acts of cow slaughter in Kerala, commonly done in protest against the central government. Far-right cow protectionist groups have cited the floods as divine punishment for this accused crime. These groups, as well as the politicians that defend their actions, have exacerbated this divide to contentious levels.

Whether the motivations behind these actions pertain to pride, prejudice or a mix of both, the people of Kerala are hoping to see more effort by the central government as soon as possible to fill this relief gap.

 

Photo by Tom Oliver

PORTUGAL, U.S. AND MEXICO: LESSONS FROM DRUG DECRIMINALIZATION (PART TWO)

by Mekalyn Rose
Editor in Chief

This is the second article of a two part series discussing drug decriminalization and its implications for Portugal, the United States and Mexico. Part One can be found here: https://prospectjournal.org/2018/06/15/portugal-u-s-and-mexico-lessons-from-drug-decriminalization/

Portugal’s [decriminalization] methods are drastically different from the increasingly strengthened War on Drugs in the United States, where over half a million people die from prescribed, legal and illicit drugs combined every year. The question is, if Portugal has been so successful in combating their own drug epidemic with these methods, why has the United States been so slow––even resistant––to follow suit?

It’s a simple question with a complex answer. Understanding current U.S. motivations behind domestic drug policy warrants taking a look at why it all started.

On the surface, draconian style laws in the United States in regards to the War on Drugs seem to boast a noble mission of promoting widespread health and eliminating crime. However, the historical underbelly of drug policy reveals highly political and racial motivations for the enactment of laws. Today, the United States faces a raging opioid epidemic with an unsustainable influx of incarceration, which points to one key point: something isn’t working. In order to move forward in molding policies that do work, it’s important to recognize how we got here and what went wrong.

The Road to Radicalization: Origins of Drug Policies

The first push against drugs in the United States came in 1875. Shortly after the arrival of male Chinese workers during the mid-nineteenth century, San Francisco passed a law against smoking opium. In 1909, the Anti-Opium Act made it a federal offense. These laws did not apply to the alternative method of injecting opiates, more commonly practiced by Whites; rather, they targeted a particularly Chinese practice. This was fueled by both the perceived threat to white male workers” during a work shortage, as well as stories published as part of a fear campaign emphasizing the “Yellow Peril” led by William Randolph Hearst which “[claimed] white women were being seduced by Chinese men in the opium dens.”

Laws pertaining to cocaine use took a similar route of reasoning. In the late 1800s, cocaine was introduced to Black communities as dockworkers first used it to withstand up to seventy hour stretches of work before this method of coping was also adopted on the plantations. Many of the crimes committed by Black people in the South were subsequently blamed on cocaine addiction. In 1914, The New York Times published an article titled “Negro Cocaine ‘Fiends’ Are a New Southern Menace.” This article included the idea that heavier artillery was needed to take down a “cocaine-crazed negro,” further inciting racialized fear.

Twenty years later, new drug policies were directed towards Mexicans. Similarly to perceptions of cocaine effects, marijuana was claimed to give Mexicans “enormous strength” and that it would “take several men to handle one man,” statements left unsupported by any noteworthy evidence. Nevertheless, The Marijuana Tax Act of 1937 prohibited its use or sale as a method of controlling the surge of immigrants following the Mexican Revolution, who were accustomed to using it as a medicinal plant.

Fast forward to the 1970s and marijuana is classified as a Schedule I drug, but for an entirely different reason. In 1994, John Ehrlichman––the former domestic policy advisor under President Nixon––admitted in an interview that the War on Drugs, which was speed-rolled during Nixon’s presidency in the ‘70s, was politically motivated against Nixon’s antiwar and Black opponents.

We knew we couldn’t make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin, and then criminalizing both heavily, we could disrupt those communities.

It would seem that the debate of whether or not to reexamine our drug laws would end there, as history has reflected “how deeply embedded drugs are in our cultural frame of reference, the background ‘unconscious’ of our society where reactions are formed prior to conscious reflection.” However, both the cultural stigma against illicit drugs and political motivations continue to release a message of drug demonization and prohibition that constitutes an ideology the United States attempts to force onto its citizens and allies.

The Costs of Suppression and Regulation

Mexican President Vicente Fox has discussed the failed War on Drugs and U.S. denial of its own mistakes within a prohibitionist past, calling for a new paradigm. Ironically enough, the effort to curb illegal drug use turned out to be the very catalyst to create a breeding ground for drug trafficking. It wasn’t until after opiates, cocaine and marijuana were criminalized within the United States that the lucrative drug trade “materialized south of the U.S.-Mexico border.” Today, the United States faces a daunting realization. Almost half a century since Richard Nixon declared a War on Drugs and nearly one trillion government dollars have been spent, efforts have adversely culminated into the antithesis of the “Land of the Free” with an estimated 450,000 people incarcerated for drug related offenses in 2016, compared to around 40,900 prisoners in 1980.

Notably, when it comes to marijuana, public opinion has begun to shift. Nine states and Washington D.C. have legalized both recreational and medical cannabis use and research on health benefits have produced many positive results. Despite this progress, the conversation of legalization, let alone decriminalization, usually doesn’t apply to other drugs and the legalization of cannabis––especially in California––has had an unintended consequence for the drug trade coming out of Mexico. Illegal substances create a market and cannabis is no longer profitable, at least not for the cartels. Now, heroin is the new market and U.S. pharmaceutical companies are partly to blame.

The current opioid epidemic can be traced back to a public health system saturated with the very substance that incited the original drug laws: opioids. The United States has a “pain” problem. In 2015, it was reported that around 92 million people, or 38% of the U.S. population, took a prescribed opioid painkiller. Despite a lack of pain reported in the last couple of decades, “sales of prescription opioids in the United States nearly quadrupled from 1999 to 2014.” While painkillers like OxyContin and Vicodin have proven highly effective in treating pain, their abuse potential is significant. Around 4-6% of people who misuse their prescriptions turn to heroin, which happens to be a “cheaper and more powerful” alternative.

Questioning Current Approaches to Drug Policy

So, what do these changes reveal about current approaches? Will there always be another drug exploited to profit off the masses? History will indicate yes, unless society forgoes the fear and taboo of illicit drugs long enough to discuss honestly the realities of human culture and address the issue of drugs as a whole. Drugs have always been incorporated into human society and it is unrealistic to push a goal of complete eradication, nor is it always straightforward to define the line between safe drugs and dangerous ones. Anything used beyond the scope of necessity increases risk, as the abuse of opioid prescriptions indicates.

There is also no proof that the decriminalization policies used in Portugal will provide the United States with the same positive results. Some counter arguments cite the massive size difference in population and the cyclical nature of drug epidemics that cannot be helped by policy. However, it is maintained that “much of the American approach to drug policy is based on speculation, fear-mongering, and outdated methodologies and ideologies, instead of the empirical evidence that allowed the Portuguese task force to focus on specifics of poverty.” Today, there is growing support for decriminalization, backed by both the United Nations and World Health Organization.

Finally, the question remains why the United States has appeared resistant to change. Among several possible reasons, propagandist belief systems have shaped our perspective and knowledge of drugs, private prisons profit off drug crime, pharmaceutical companies benefit from addiction and language such as “druggie” and “junkie” continue to promote the dehumanization of people seeking help. A culture of shame replaced by a society of well-being would alter the label of “criminal” to “ill,” provide greater avenues for seeking help, allow for valuable medical testing and free up law enforcement to focus on bigger issues and improve their relationship with communities. Like Portugal in the 1980s, the United States is reaching a point of desperation. The rate of change is dependent upon our willingness to question the foundation of our current viewpoints and how to implement laws or strategies founded on principles of health and public good instead of racial or political underpinnings. Perhaps then the focus will be less on the thickness of physical chains and more on the alleviation of psychological ones on the road to healing.

 

Image by Anne Worner