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8 October: Second Committee opens: "Inclusive economic structure depends on effective, centralized state"An effective centralized State was needed to ensure the existence of an inclusive economic structure, delegates in the Second Committee (Economic and Financial) heard today as they opened the first general debate of the sixty-seventh General Assembly session.
Delivering a keynote address to the Committee, James Robinson, David Florence Professor of Government at Harvard University, told delegates how his book, Why Nations Fail: The Origins of Power, Prosperity and Poverty, emphasized the relationship between politics and economic institutions, and how his comparative history of economic development provided an historical perspective on the driving forces of inequality within and among nations. While long-run economic growth was driven by new ways of producing things, including innovation and technical growth, society also needed to be organized in such a way as to harness the talents, energy and skills of its people, he said. “Societies that fail, fail to use these attributes,” he added.
He said that argument formed the central thesis of his book, noting the impact of historical events in shaping the way in which polities in the Americas had developed. Citing the United States, he said it enjoyed inclusive economic institutions that harnessed the talents and skills of its citizens. While many parts of Africa had enjoyed very democratic institutions before colonization, he continued, they had not experienced economic growth because political power had been broadly distributed rather than centralized. In Colombia, where Mr. Robinson said he had lived for many years, the major development problem arose from the central State’s trouble in wielding effective political power.
Also militating against economic growth was discrimination against women, other races or ethnic groups and young people, he continued. Any discriminatory policy was detrimental to economic prospects because of the large scale unemployment that such policies caused, he said, pointing to Apartheid South Africa, where certain jobs had been strictly allocated and reserved for the white minority amid massive and growing inequality among the black majority.
Opening the Committee’s general debate, Wu Hongbo, Under-Secretary-General for Economic and Social Affairs, said the world economy was “teetering on the cliff” and the Committee would play a central role in tackling the world economy’s “glaring weaknesses”, including poor job growth, the fragile financial sector, unsustainable public debt, social inequality and ecosystems in peril. Beyond those crises, he stressed the importance of setting a sustainable development path, noting that three ongoing processes were reshaping United Nations development efforts.
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