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U.S. Fiscal Crisis Impact on World’s Poor

Jim Kim World Bank President US Fiscal Uncertainty Affecting World Economy
It is constantly said of the profound impact of the United States’ domestic developments have abroad, that when the U.S. sneezes the rest of world catches cold. But what of the bottom 40% of the population of developing countries living in such squalor, unable to afford access to the most basic medical attention?

President of the World Bank Jim Yong Kim warns of the dire effects that a hard credit defaults would have on the world’s poorest. Kim issued these statements in Washington D.C. where this week meetings of the World Bank and International Monetary Fund took place in the wake of the recent government shutdown.

The inaction on Capitol Hill has led to international anxieties that a bill will not be passed on time to raise the U.S.’s debt ceiling, and would thereby create a U.S. default that would result in an international calamitous economic backlash. The U.S. Treasury debt has kept global economies perilously afloat for years, including those emerging economies of developing countries in Asia and Africa.

As the House and Senate continue their standoff, the Treasury Department’s Oct. 17 deadline looms mere days away. World leaders are deeply concerned with U.S.’s perilous waltz at the edge, but in the midst of dense official debate, it becomes easy to forget the repercussions on the world’s poorest people.

In an interview with USA Today, Kim urged legislators to “Please consider politics beyond the Beltway, politics beyond your own districts. Really think about the impact that inaction can have on poor mothers in Africa, trying to feed their children. It will really have an impact on those mothers. It will have an impact on young men and women trying to create businesses in the Middle East. This is real. This is not a theoretical impact. It’s very real.”

In the cold shadow of an uncertain future, President Kim’s words shed light on a cause that all parties and nations can and must agree on: the eradication of extreme poverty. Perhaps it is more fortuitous than darkly ironic that the meetings of the World Bank and International Monetary Fund followed up the United States government partial shutdown.

The talks have surely opened the dialogue to support heroic bipartisanship in Congress in the interest of the global good and sustainability—a responsibility that the United States has the privilege to hold alone.

– Malika Gumpangkum

Sources: CNN, New York Times, LA Times, BBC, USA Today
Photo: Yahoo News

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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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Top 10 Best Quotes on the Government Shutdown

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With the American public angered by a government shutdown that has sent up to 800,000 federal workers home without pay and has threatened to derail a fragile economic recovery, both Republicans and Democrats have attempted to frame the crisis from their own vantage point. The week’s best quotes on the government shutdown include everything from finger-pointing, name-calling, calls to reason, and hot mic revelations.

1) “Save us from the madness. Deliver us from the hypocrisy of attempting to sound reasonable while being unreasonable. Remove the burdens of those who are the collateral damage of this government shutdown, transforming negatives into positives.”

— Senate Chaplain Barry Black, opening prayer on the Senate floor, Oct. 3

2) “We’re not going to be disrespected, We have to get something out of this. And I don’t know what that even is.”

— Rep. Marlin Stutzman (R-Ind.), the Washington Examiner, Oct. 2

3) “I really think Boehner needs to get some courage. Maybe he needs to take an afternoon off and golf and contemplate it and come back.”

— Sen. Claire McCaskill (D-Mo.), on MSNBC’s “Morning Joe,” Oct. 3

4) “I think if you’re the White House, you just sit back and watch.”

— Former press secretary Robert Gibbs, on MSNBC’s “Now with Alex Wagner,” Oct. 2

5) “This is much more like what I deal with Henry in the morning when he says he wants to say, ‘I want candy for breakfast.’ It’s really a tantrum; it’s a tea party tantrum. ‘You either give me my way, or we’re going to shut down government.’”

— Sen. Kirsten Gillibrand (D-N.Y.), on MSNBC’s “Morning Joe,” Oct. 2, referring to her 5-year-old son, Henry.

6) “I think if we keep saying, ‘We wanted to defund it, we fought for that, but now we’re willing to compromise on this.’ … I know we don’t want to be here, but we’re going to win this, I think.”

— Sen. Rand Paul (R-Ky.), caught on a hot mic, Oct. 3

7) “I am not a criminal. I am not a scoundrel. So they better get a different definition of me.”

— Senate Majority Leader Harry Reid (D-Nev.), on the Senate floor, Oct. 2

8) “When you don’t have a president, every congressman, every senator, every governor, thinks they’re the spokesman for the party. And the one that lights their hair on fire is the one that gets on the evening news.”

— Former Massachusetts Gov. Mitt Romney, at the University of Utah convocation, Oct. 2

9) “It seems that there is nothing the media likes to cover more than disagreements among Republicans, and apparently some senators are content to fuel those stories with anonymous quotes. Regardless, my focus — and, I would hope, the focus of the rest of the conference — is on stopping Harry Reid’s shutdown, ensuring that vital government priorities are funded, and preventing the enormous harms that Obamacare is inflicting on millions of Americans.”

— Sen. Ted Cruz (R-Texas), Oct. 2

10) “Think about the precedent. What’s next? What if the Democratic extreme said, ‘Well we’re not going to sign a budget unless you do away with assault weapons?’ What if we’re not going to have a budget unless 20 people around here decide that everybody under the age of 40 should wear a tin hat around? This is not the way you govern a great country.”

— Rep. Jim Himes (D-Conn.), on MSNBC’s “Morning Joe,” Oct. 1

– Nayomi Chibana
Feature Writer 

Sources: Politico, Reuters
Photo: Vice

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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