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University of Toronto Scarborough
Health Studies
Rhan- Ju Song

HLTC05: Social Determinants of Health Lecture 5 –The World System and Global Disparities in Health Tuesday, October 9, 2012 Social Determinants of Health  Neoliberal Ideology o (“an ideology of the dominant classes”, Navarro 2009) o All nations have a dominant class  Transnational Corporations Neoliberal Economic Policies (Navarro, 2009)  Initiated by Reagan in US, Thatcher in GB, late 1970s-80s o In order to pull out of the recession  1980-today, see global promotion of public policies that emphasize a neoliberal ideology: 1. The state (“the government”) must reduce its interventions in economic and social activities 2. Labor and financial markets must be deregulated to allow the (free) market to thrive 3. Commerce and investments must be “stimulated by eliminating borders and barriers to the full mobility of labor, capital, goods, and services” (p. 425) 1. MARKET LIBERALIZATION: o Less government/state interference (yet not when it involves government subsidies and tax breaks for big business) o Greater openness to international trade and investment; o De-unionizing workers (reducing wages) o Basically: total freedom of movement for capital, goods and services (“free trade”) 2. CUTTING PUBLIC EXPENDITURE FOR (less money-making) SOCIAL SERVICES o i.e., education, health services, public works, sanitation, which reduces the safety net for the poor 3. DEREGULATION: o Reduce government regulation of everything that could diminish profits, including environmental protection, job safety o Remove unions and workers’ rights 4. PRIVATIZATION: o Sell state-owned enterprises, goods and services to private investors – “for greater efficiency” (banks, key industries, railroads, toll highways, electricity, schools, hospitals, water, etc.), which puts greater wealth in hands of few o More competition = goods become less cheaper 5. ELIMINATING THE CONCEPT OF "THE PUBLIC GOOD" or "COMMUNITY" o and replacing it with "individual responsibility" – including pressure on the poor to “help themselves” (blame)  Image: o FREE TRADE ISNT FREE, IT COSTS JOBS o Trying to create more wealth within the country by using the neoliberal ideology Transnational Corporations (Millen and Holtz, 2000)  Evolution of multinationals (corporations operating in many nations, i.e., via overseas subsidiaries) o Evolved because the neoliberal ideology  Source, produce and market their goods in many countries simultaneously, claiming nationality in the countries that offer the most favourable tax structure or trade policies  Supranational corporations: larger than some nation-states, operating under no single jurisdiction and accountable to no governmental agency, i.e., Citicorp, Shell, BP, etc….greatly influence global agencies: IMF, WTO, World Bank TNC Expansion (esp. 1980s, 1990s) 1. Modern communications aided rapid movement of $$ 2. Many countries lessened or abandoned restrictions on movements of capital goods and services (neoliberal economics: deregulation, privatization, economic/trade liberalization)  Ever increasing wealth & consolidation of private power o 1970: 7000 TNCs worldwide o 1996: over 40,000 o Of world’s 60 largest economies, only 17 are actual countries; remaining 43 are TNCs o TNCs control over 70% products in international trade, 80% of world’s land cultivated for export crops and vast majority of world technological innovation o 3/5 of global TNCs officially based in US Economic Adjustment Programs  International loans  Structural Adjustment Programs (SAPs) (now: Poverty Reduction Strategy Papers PRSP) o Help countries with their debts during the 70s-80s o Put in place to help countries re-pay their debt o If these countries wanted to borrow money, they learned strategies to do so 1. Export-oriented development strategies 2. Liberalization of trade 3. Deregulation of the market 4. Privatization Economic Adjustment Programs (see Millen and Holtz 2000)  Economic “liberalization” to encourage foreign investments by TNCs would “counterbalance” the continued decline of development assistance by increasing host countries’ foreign exchange earnings and capital flows  In theory, would benefit poor countries with new technology, wage-earning employment and transfer of organizational and managerial skills and marketing networks o Benefits would help the country flourish and create wealth o Devalue currency to make goods/services more cheaper to buy Economic Adjustment Programs: The Reality  Currency devaluation, Cuts in basic social services, Cuts in subsidies for basic items (Oil, gas) The Reality  Rise in unemployment  Loss of wage and benefit protections  Shift to informal sector employment  Public sector cuts led to greater competition for private sector work (thus TNCs….)  Greater wealth disparity, global poverty and further marginalization of poorer nations (even in those with GDP increases) greater wealth in smaller hands, greater wealth in expense of other people (esp. dealing with poverty) o Greater debt, more poverty due to this new structure of re-paying back debt; SAP (occurred in South America, Africa, parts of Asia) o Map: heavily in debt countries during the 1990s, due to the structure of SAP For poor communities TNCs’ total social costs often far exceed their social benefits (Millen and Holtz 2000: 177)  Not offered benefits that it offered Quiz # 1: Neoliberal economic policies tend to a) Privatise previously public owned services b) Regulate environmental protections c) Restrict corporate expansion d) Discourage international investments Millen and Holtz 2000  TNCs and ... 1. Labour practices: re: wages, worker rights (unions), work conditions 2. Environment: pollution, land degradation, resource depletion (incl. wildlife), flooding 3. Advertising and promotional activities: impact on health and well-being, even in remote areas, through aggressive advertising, promotion of products (formula, cigarettes, pesticides, pharmaceuticals, weapons) TNCs: Labour Practices  Less worker protections (w
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