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An Easy Fix to the U.S. Debt Problem

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If you were to actually take the time to sit down, do the research, gather all the data and crunch the numbers, you could easily come to the conclusion that the United States of America owes an insane amount of money. The national debt is over $17 trillion USD: that’s enough money to buy every citizen of Los Angeles a brand new 2013 Lamborghini Veneno, which was voted the World’s Most Expensive Car by thesupercars.org.

So here’s where we are: the country is in a terrible debt situation (maybe even comparable to that of a law student), unemployment at a national level is at approximately 7%, and for many people, the more pressing issue is finding the means to pay their own bills let alone the nation’s.

With a population of approximately 319 million, there appears to be an easy fix to the debt solution. The country could be debt free tomorrow if every United States citizen paid just over $53,000 USD all at once. It’s so simple!

It’s highly unlikely that there are many people willing to make such a contribution for the sake of the nation’s credit score. However, for those of us who are feeling exceptionally patriotic, the government is ready, willing and able to accept our donations.

In 1843, the United States Government established an account to accepts gifts from individuals “wishing to express their patriotism to the United States.” Pursuant to United States Code Title 31 Section 3113, the account exists “[t]o provide the people of the United States with an opportunity to make gifts to the United States government to be used to reduce the public debt…” (31 U.S.C. § 3113(a)).

There’s something romantic about the notion of citizens feeling so compelled by their patriotism that they would make such a selfless contribution to the country they love. But in times like these, who’s really donating their hard-earned money to what could arguably be described as a bucket with a hole in the bottom? According to the U.S. Department of the Treasury Bureau of the Fiscal Service, gift contributions to reduce debt held by the public since 2007 total approximately over $23.5 million USD. In 2012 alone, such gifts were made at over $7.7 million USD; nearly twice as much as any other year between 1996 and today.

So, if you find yourself overwhelmed with the desire to express your patriotism through a generous donation to the United States government, you are in good company. Just remember to make your checks payable to:

Gifts to the United States
U.S. Department of the Treasury
Credit Accounting Branch
3700 East-West Highway, Room 622D
Hyattsville, MD 20782

And thank you very much for your generous donation.

– Daren Gottlieb

Sources: US Census Bureau, Cornell University, Treasury Direct, FMS, The Supercars

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More than Moved

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In the midst of international mourning for Nelson Mandela and in an attempt to drive home the message of International Human Rights Day, a Brazilian NGO posed a provocative question on Tuesday, December 10.

A billboard designed by Conectas Human Rights, featured an image of Nelson Mandela and the question, “Do you feel moved by his legacy?” The text then urged the Brazilian population to act upon their emotions and “Do more than be moved.”

This campaign is driven by recent public opinion polls that reveal a negative feeling toward human rights issues in Brazil and support for more stringent laws and regulations.

Respondents to surveys administered across 134 municipalities in June 2013, support the reduction of maximum crime penalties from 18 years of age to 16, based on a belief held by 60% of the sample population that criminality is the result of ‘bad character.’

Moreover, the Datafolha Research Institute released data that reveal 26% of self-identified conservative-leaning respondents believe that homosexuality must be discouraged by society as a whole, whilst 33% believe that poverty is the result of laziness.

These emerging public opinions are linked to a reduction in funding for human rights groups, namely through foreign aid.

Brazil is widely considered to be an emerging market, the country’s role as 2014 World Cup host is evidence of this image but it disguises the fact that a growing economy does not automatically address human rights issues as seen through the need of foreign aid in assisting structural development.

It is estimated that 60% of the country’s NGOs relied on foreign aid for 80% of their budgets in 2003. Between 2008 and 2009 this aid decreased by 30% and again by another 49% in 2010 alone.

Executive Director of the Brazil Human Rights Fund, Ana Araújo, reminds us that Brazil was marked by dictatorship as recently as 30 years ago, a type of legacy that differs greatly from the one being celebrated across the globe on International Human Rights Day 2013.

Araújo argues that domestic support for human rights groups is the next, though not imminent, step, suggesting that emerging powers require more support, not less, to ensure that their emergence is ‘just.’

– Zoë Dean

Sources: Global Voices Online, Universo Online: CNT, Universo Online: Rightist Leanings, Open Democracy

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Poverty in Nepal

Poverty in Nepal
Poverty in Nepal? Sadly, yes. Nepal is one of the poorest countries in the world. The UN estimates that 40% of Nepalis live in poverty. Food insecurity, poor housing, low soil quality, low literacy, natural disasters, and ethnic discrimination plague the Nepalese people.  Though subsistence farming is the main way of life in Nepal, most of the population lives in the rural, mountainous region where the rocky terrain and arid soil make agriculture difficult.

Ownership of the fertile land is based on the feudal system.  Most families have land holdings of less than 1 hectare, too small to meet their family’s needs.  Most villages are made up of large families, and migrants come from the mountains to the lowlands. Refugees from Bhutan fled to Nepal during the violence in the 1990s. The growing population is putting pressure on the little cultivable land.

As a country straddling two tectonic plates, earthquakes, floods, landslides, and glacial melting inhibit economic growth.  Socially, Nepal unofficially recognizes the caste system, especially in rural areas.  This means poverty of lower castes is justified and expected.  Women also face discrimination in terms of healthcare, nutrition, education, and the domestic realm.  Women are unable to make major decisions or take responsibility for their own economic advancement.  Many women go hungry, and female babies are sometimes victims of infanticide.

The Maoists that rose up against the monarchs of Nepal from 1990s to the early 2000s dominate the government.  There is a president and a prime minister; however, there has not been a parliament since May 2012 after they failed to draft a new constitution.  Political instability is a major obstacle to socioeconomic reform and international cooperation.

Tourism, especially for climbing, is a key industry for the rural regions with urban areas surviving off of trade with India.  Major exports include carpet, clothing, leather goods, and grain.  Nepal is highly dependent on foreign aid and assistance from NGOs.  Ongoing NGO projects include energy access, skills development, environmental protection, infrastructure, clean water, and education.

– Stephanie Lamm

Sources: ADB, Rural Poverty Portal, BBC
Photo: Wikipedia

 

Learn about education in Nepal.

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In-Depth Democracy

Democracy is an idea that envisions a method of decision making characterized by the equal participation of members of the collective group. As a form of government, democracy is often thought of as a political system where citizens have the power to create and amend laws, elect and impeach leaders and retain ultimate control of important policy matters. But the idea of democracy rarely corresponds with the practical elements of modern nation-states, even those that claim to be democratic.

The word democracy is derived from the Greek words demos which means “the people” and kratos which means “to rule.” A good literal translation may be, “the rule of the people.” But in terms of governance, different forms of democracy tend to dilute the rule of the people. For example, in a representative democracy, citizens elect representatives to act on their behalf when it comes to making decisions that affect the collective group. The United States is governed by a representative democracy whereby the people elect congressional representatives and an executive to carry out the respective powers granted to them by the Constitution.

The United States has often touted itself as the most advanced expression of democracy. While this may be true to some degree, the U.S. experiment with democracy has also illustrated the complexity of a representative democracy. The health of a functioning democracy is dependent upon the participation of the people—if the people are to rule, then they must participate. In the U.S., voter turnout is on average a little more than 50 percent for Presidential elections and substantially less for non-Presidential elections. When people do not vote, they are not participating fully in the democratic process.

Another issue that affects a democracy is the information and education available to the participating citizenry. As Thomas Jefferson explained, “An enlightened citizenry is indispensable for the proper functioning of a republic. Self-government is not possible unless the citizens are educated sufficiently to enable them to exercise oversight.” It is not hard to see that without the proper information, citizens cannot effectively oversee their elected representatives. Thus, a free and independent press is indispensable to a properly functioning democracy. But no matter how much information may be available, it is ultimately the will of the people to be adequately informed that determines the effectiveness of democracy.

Like any idea, democracy is one that continually evolves. Each experiment with democracy is dependent upon the participation of the people in the decision making process. A well-informed and active citizenry makes for a healthy and dynamic democracy. But an unenlightened and indifferent citizenry cannot hope to participate in a functioning democracy. If democracy is—at its core—the rule of the people, then it is the people who must define the characteristics of their democracy.

– Daniel Bonasso

Sources: Stanford Encyclopedia of Philosophy, United Nations, The Guardian
Photo: Pixar Planet

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Poverty’s Effect on Captain Phillips

In April 2009, Captain Richard Phillips was kidnapped from his cargo boat by Somali pirates who demanded $2 million for his release. The pirates held Captain Phillips for five days in a small lifeboat, before Navy SEALs stepped in to save the captain, killing three pirates in the process. Tom Hanks immortalized the hardship of the event in a movie entitled Captain Phillips, released October 11.

The film’s director, Paul Greengrass, attempted to depict the pirate captain, Muse, as a dynamic character and to show the viewers the reasons for his actions. Greengrass expands Muse as a character by including the events that lead him to kidnap Captain Phillips in the first place. Not surprisingly, they involve real threats to both Muse and his family. The kidnapping could also lead to something Muse’s poverty-stricken family desperately needed: money.

For about 15 years, Somalia has lacked a stable government. The country has been fighting a civil war, and their resources continue to dwindle. The Somalian economy depends heavily on agriculture and livestock, both ways of living which require significant amounts of land. But without a stable government to provide trusted contracts of land ownership, making an honest living in Somalia is difficult. Furthermore, crops are sensitive to changes in weather and livestock to unchecked disease. Due to these and other factors, at least 43 percent of the Somalian population lives below the poverty line.

The kidnapping of Captain Phillips shows that poverty can push people to crime in order to support themselves and their family. While not all criminals are influenced by poverty, if the U.S. works hard to help those countries most in need then the incidences of crime threatening national security will decrease. As Captain Phillips shows, the U.S. can help increase its national security by investing in international poverty alleviating programs.

– Alessandra Wike

Sources: Foreign Policy, Hollywood Reporter, New York Times

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The Daily Cost of the Government Shutdown Compared to Combating Poverty

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The U.S. government shutdown 2013 is costing taxpayers an estimated $300 million dollars a day, according to HIS Global Insight. This cost just covers the economic loss from government worker furloughs. However, if the United States spent this $300 million on resources and technology for the developing world instead, this is what could be done:

  • 150,000,000 life straws could be distributed, which would provide direct clean drinking water to developing countries.
  • 6,000,000 starving children could receive Plumpy’nut, a malnutrition supplement, for two months.
  • 4,000,000 Hippo Rollers, a wheelbarrow like water carrying system could be delivered to developing countries, allowing for water to be carried more efficiently and preventing injury from carrying water.
  • 545,454,545 Unijet vaccines, disposable vaccines that avoid reuse of unsterile needles, could be provided – they are so simple to use that they require no training to administer.
  • 15,000,000,000 Peepooples disposable waste bags that quickly turn waste into biodegradable material could be distributed. Peepooples prevent waste spreading and contaminating environments.

Keep in mind, this is estimated with just one day of losses from the government shutdown.

– Nicole Yancy

Sources: NBC News, Tree Hugger: Clean Water, Tree Hugger: Hippo Water Roller, PeePoople, WHO, Independent
Photo: International Business Times

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Government Shutdown Threatens Foreign Aid

Government Shutdown Brinksmanship Foreign Aid Cuts
Even to those who display the most passive attention to the news, it is clear that politics in Washington D.C. has reached a fever pitch. Without any doubt, the implications of what is being discussed are, in fact, no hyperbole. Beholden to special interests, factions within the Republican Party have resolved to agree on a continuing resolution to fund the government – absent defunding of the Affordable Care Act (ACA). Short of passing the continued resolution, a government shutdown has taken effect. Yet, while the detractors of the ACA site economic concerns over the law, it is in our interests to consider the victims of even a short-term government shutdown.

While The Borgen Project is a non-partisan group, the implications of a government shutdown are serious and will have great effect on foreign aid and all government programs moving forward.

To put this argument into perspective, we should take an objective stance. By turning our attention towards the Congressional Budget Office (CBO), we can keep our feet rooted in the ground rather than in the clouds of ideological waffling. In their estimation, the CBO found the ACA would grant health coverage to 32 million people and raise government spending by almost one trillion dollars. While the specter of raising spending tickles the ire of republican ideologues, the CBO also found that revenues and savings would exceed this amount, effectively reducing the deficit over time.

With the non-partisan CBO stating the ACA would, in fact, benefit our economy, we must direct our attention to the victims of a government shutdown.

First and foremost, hundreds and thousands of government employees will effectively lose their jobs for the period of the shutdown. From many Pentagon employees, to park rangers, pockets will be squeezed tightly as they will not be receiving income for the period of the shutdown. Despite this, members of Congress will continue to be paid. The only bright side seems to have been President Obama’s decision to sign a bill in the midnight hour that would allow members of the military or any civilians working for the Pentagon who provide “direct support to the military” to be paid during the shutdown.

Secondly, the health of our economy is on the line. Looking back to August, 2011, our economy was dealt a blow when, for the first time in history, a credit rating agency, Standard and Poor, downgraded our rating from AAA to AA+. Dealing with confidence in markets, the mere fact that we were having the discussion we are having now was enough to reduce confidence in our economy. An actual government shutdown will have far wider and much deeper consequences.

While this is strictly political at the moment, the economic consequences will be difficult to assess until we are in the muck of it. Yet, as Obama addressed a crowd in Maryland early on Thursday, he sited the fact that even a short government shutdown will affect worse economic consequences than the proclaimed economic consequences of the ACA.

This form of brinkmanship will carry with it ramifications in all areas. If we cannot afford a cost-effective health care law in our own land, the fate of allotments for foreign aid will be the next bit of meat on the chopping block. While we call our representatives to advocate for the poor, let them know that political brinkmanship will only hurt humanity.

– Thomas van der List

Sources: MIT, NPR, ABC News, Politico
Photo: CNN Money

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What is Swadhaar?

Swadhaar MFI Microfinance India Development
Swadhaar is an organization that provides economic support to urban poor communities. Swadhaar works primarily in India where urban poverty is a major problem. India has an 8.5% unemployment rate and almost 30% of its population lives under the poverty line.

Swadhaar gives financial assistance to people living under the international poverty line of $2 a day. The organization also has a heavy emphasis on women living below the poverty line. Beyond crediting loans to impoverished people, it aims to create economic self-reliance for people they are assisting. The organization provides financial education and opportunities for its clients so that they may eventually be self-reliant.

This is extremely important in India where many people do not feel that the government is adequately providing for them. Most of the people that Swadhaar gives assistance to are people that do not qualify for government assistance. The organization provides loans to its clients that have declining interest rates. The company does still make a profit from the interest rates, but they are not so extreme that they bury clients in debt.

The major issue that many people living in poor communities have is lack of documentation. Swadhaar offers assistance to those who do not have access to government benefits due to lack of documentation. It may not be a non-profit human rights organization, but nevertheless it provides the tools for success to people in India, which can be just as important.

– Zachary Patterson

Sources: Swadhaar, CIA
Photo: Swadhaar

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Poorest Country in the World: Democratic Republic of Congo

Poorest Country in the World Democratic Republic of Congo
You might be surprised to find that the United States isn’t the richest country in the world. Actually, that crown goes to Qatar who has recently jumped ranks to take first place. But what about the other side of the spectrum, the parts of the world struggling with devastating poverty? Well, on that end the Democratic Republic of Congo comes in first – or last, to be more accurate – as the poorest country in the world, with the lowest GDP per capita than any other country.

 

The Poorest Country in the World: The Democratic Republic of Congo

 

Determining a country’s rank in wealth isn’t the easiest of tasks when you sit down and think about the data and economics involved. However, a good indicator of a nation’s standard of living is the assessment of its GDP (gross domestic product) per capita, which is defined as the total value of all domestic goods and services that country produces annually, times its PPP or purchasing power parity. GDP per capita (PPP) isn’t a perfect shot because its purpose isn’t to calculate that kind of economic rank but it’s measured frequently, widely and consistently, allowing trends to become visible.

In 2010, GNI (gross national income) per capita replaced GDP in the calculation, but the list is the same between the two. Qatar was still first with about $100,000 GDP per capita (PPP) in 2012 just as it was on the GNI list and the Democratic Republic of Congo came in last at around $370 GDP per capita (PPP). The gap is massive.

Of the 40 poorest countries in the world, a solid 33 are in Sub-Saharan Africa. They include Zimbabwe, Burundi, Liberia, and Niger. Other parts of the world notoriously infamous for high poverty rates include Afghanistan, Haiti, and Nepal. But none of these places takes it quite as harshly as the Democratic Republic of Congo (not to be confused with the Republic of Congo) whose turbulent past and bloody wars have eclipsed the nation’s potential to thrive.

Since its independence in 1960 and once the most industrialized country in Africa, Congo has bled onto the ground because of its lack of infrastructure and the brutal impact of civil war. Disputes between Congo’s prominent rival groups, the Hutu and Tutsi, erupted after the Rwandan Genocide in which 500,000 people, mostly Tutsi, were victims of mass slaughter by the Hulus in the East African state of Rwanda.

The result was an exodus of over 2 million Rwandans fleeing to neighboring countries like the Democratic Republic of Congo, known in that time as Zaire. Most of the refugees were Hulus attempting to escape the Tutsi who had climbed to dominance at the end of the genocide. The Hulu refugee camps in Zaire, however, became politicized and militarized and when Tutsi rebels invaded Zaire to repatriate the refugees, the conflict escalated into the First Congo War in 1996.

The situation only grew worse and by 1998, the Second Congo War, which was sometimes called the “African world war” because it involved a total of nine African countries and twenty armed groups, devastated Zaire and laid waste to her population and economy. The political turmoil continues today despite intervention and peace attempts and is one of the world’s deadliest conflicts with a death toll of 5.4 million people.

More than almost 90 percent of the conflict’s victims, however, died due a lack of access to shelter, water, food and medicine – all severely aggravated by displaced and overcrowded populations living in unsanitary conditions. Not to mention, 47 percent of deaths were children under 5 and some 45,000 children continue to die each month.

The nation also faces the problem of human rights and the countless crimes against humanity because while many have returned home, an estimated 1.5 million are still displaced. DR Congo is also infamous and heavily criticized for its treatment of women. The east of the country has been described as the “rape capital of the world” and rates of sexual violence has been described as the worst in the world.

It doesn’t help that DR Congo is consistently poisoned by corruption and greed. While mining growth has somewhat boosted the country’s economy, the elite are said to syphon off revenue for their own personal gain due to the nation’s lack of strong central government. Conflicts over basic resources, access and control over rich minerals and oil, and political agendas are some of the many complex causes behind the Democratic Republic of Congo’s inability to rise among the ranks and take the title of the poorest country in the world.

–  Janki Kaswala

Sources: World Bank, Maps of World
Photo: The Telegraph

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Budget Reform in Turkey Desirable

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Many have called for the Turkish government to spend more of the national budget on social aid as poverty rates in Turkey are over the average for countries in the European Union. Current spending on social aid policies is a paltry 1 percent of Turkey’s budget. But in addition to establishing policies that help the impoverished, some are also questioning whether Turkey is doing enough to diminish the extreme income inequality.

Even though it has maintained a 5 percent annual growth and is experiencing rising employment, Turkey has one of the highest income inequality rates among the Organization of Economic Co-operation and Development (OECD) countries. This income inequality is largely due to educational problems. The poverty rate for the illiterate in Turkey was 30 percent in 2009, compared to the only .7 percent for those who graduated from a university. As a result, the many agricultural laborers are stricken with poverty. The reason for this is that the agricultural industry in Turkey accounts for 9 percent of its GDP, but is around 25 percent of overall employment.

The overall education levels need to improve in Turkey with the help of more social aid spending, but, most urgently, educational rates for girls also need to rise. The literacy rate of men is much higher than that of women, causing more women to face the risk of living in poverty.

Even though the country has gone through many phases of immigration, urbanization, population rises, and changes in family structure, the social services and aid policies have not been properly reformed to address changes adequately. The institution in charge of social spending, the Family and Social Policies Ministry, has not allocated more than 1.2 percent of the GDP on policies that combat income inequality and poverty. Many are calling for a change, the Turkish government needs to make more of an effort to engage in social intervention.

But social aid policies are of no use if not managed properly. Turkey should to transfer policy implementation to local authorities instead of the current system of having social aid policy centrally controlled. If funds are managed by individual provinces, funding and resources can be more efficiently utilized, and efficaciously target poverty and income inequality within the region.

Over the last few years, Turkey has experienced significant growth, however more than a quarter children in the country still live in poverty. Even though the total percentage rate of poverty has dropped around 8 points, the fact is that still a fifth of the population is impoverished. Turkey has been investing in sustainable technology and building urban centers, but, to fully prosper, it will have to do more than flash signs of wealth and development. A budget reform in Turkey to reallocate more resources to boosting education and employment will decrease poverty and bridge the income inequality gap in the country.

– Rahul Shah

Sources: Today’s Zaman, The Guardian, Hurriyet Daily News