BA 447 – day 6, 7, 8

1. BA 447 – day 6, 7, 8

2. Overview: Governance, corruption, terrorism • Review ch 11 • Discussion • Review ch 12 • Discussion • Raise questions raised

3. Ch 11: Other side of “flat world” • Technological optimist or historical determinist: the brave new world and its dark side • The reality of poverty and efforts reduce it • Too sick – disease and underdevelopment • Too disempowered - marginalized • Too frustrated – ideological, religious • Too many Toyotas – what if we did succeed in making people well-off?

4. Poverty statistics • Poverty rates in selected countries • http://www.worldbank.org/data/countrydata/countrydata.html • Poor are most vulnerable to natural disasters: tsunamis; typhoons; hurricanes; earth quakes • Poor most vulnerable to disease outbreaks • Sanitation • Access to health centers

5. Poverty • Poverty alleviation: decades-long goal • http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTPOVERTY/0,,contentMDK:20153855~menuPK:373757~pagePK:148956~piPK:216618~theSitePK:336992,00.html • http://www.makepovertyhistory.org/ • http://www.globalissues.org/TradeRelated/Debt/USAid.asp

6. Poverty and prosperity • Mansions, high rises, and slums • Benefits to elite (Philippine rates) • Caddies: $10 a game • Household helps: $55 a month • Driver (stay-in): $130 a month • Secretaries starting pay: $300 a month • Call center pay: $300 a month • Living wage and minimum wage

7. Too disempowered • The rural vote: in developing countries, to the extent that elections are honest, elections are dictated by the masses. • Economic growth often does not trickle down. • What are the arguments? • Global populists argue that the poor do not stand a chance

8. Anti-globalization • Western-driven movement composed of: • Upper-middle class with guilt complex • Rear-guard push by the old left • An amorphous group: neo ludites? • Anti-americanism (power is a magnet for criticism) • Serious groups focused on “how we globalize”

9. Response to anti-globalization • Reform retail - - • Local government focus, actually he means national government. • Village by village effort • Role of multinationals • HP’s efforts to help villagers articulate what they needed • Microsoft program providing computers • “Community relations” projects

10. Another view of poverty reduction • Targetted approaches, for example • http://www.usaid.gov/ • http://abcnews.go.com/International/wireStory?id=1205776 • The World Bank shifted to reducing corruption. • Corruption = lack of or poor governance • Poor governance perpetuates poverty

11. Day 7 • If not enough time, finish Ch 11 on day 7 • Too frustrated • Too many toyotas • Continue with Ch 12 • Issues • Terrorism • Islam • Traditional conflicts • Internal conflicts • Governance and corruption & relation to previous four

12. Islam and terrorism • Frustration due to authoritarian regimes and lack of economic opportunities • Islamist fringe and its supporters • Terrorist acts as directed against “trust” • The “West,” particularly the US, as a convenient target for dissatisfied Muslims • Establish an Islamist state • Feed on frustration due to humiliation - if Islam is that great, why are we poor

13. “Muslim Problem” • Centuries old issue of dealing with Muslim population in the Philippines - through Spanish, US, Japanese occupation • 10% of the population, mainly in South • Secessionist? Anti-Christian? • Factions within the population • MILF, MNLF, Abu Sayaf as splinter group • Families and clans also fought each other • Terrorist acts - kidnappings, bombings • Attract attention to their cause • Collect “taxes”

14. Bin-Laden’s Cause • Well before Sept 11 • http://news.bbc.co.uk/1/hi/world/south_asia/155236.stm • Western infidels on sacred ground - foreign troops in Saudi Arabia during Kuwait war • Corrupt Saudi Arabian government • US support for Saudi Arabian government • Depletion of natural resources - oil • Why conduct attacks on US soil? • Al- quaeda as a loose confederation

15. Terrorism in general • Objectives: • Attract attention/support for a cause • Destabilization of status quo • Methods • A small bomb, big bang in the press • Guerilla-style efforts, including suicide bombers, can tie up a whole army. Therefore, cost – benefit is in their favor • Harassment=leverage for whatever ends they may be working for, e.g. extortion, support, etc.

16. Islam • Shares common “tradition” with Judaism and Christianity. Qur’an as correcting Jewish and Christian scriptures • One God • Abrahamic roots • http://en.wikipedia.org/wiki/Islam

17. Religion and Government • Separation of church and state • People are free to worship • Government can not dictate/interfere • Some democracies have informal relationships between church and state • Other governments have closer ties

18. Growth and natural resources • What if China’s middle class actually grew? Or India’s? What type of lifestyle would they emulate? • Rise in crude oil prices in 2004 partly attributed to unexpected growth in Chinese demand for oil. • The growth of Chinese requirements for oil (and commodities) may subside a bit in next few years. • But who remains the biggest consumer?

19. Ch 12: The Dell Theory of Conflict Prevention • Supply chain management means that production in different countries are linked • For a particular country, this means foreign direct investments, jobs, etc. • War or any violent conflict that disrupts economic activity can disrupt supply chain • Such a conflict can also cause investments to move to more peaceful locations

20. Back to terrorism • Destabilization or terrorist acts may be targeted at “discouraging” investments • If the economics are right, a company may opt to deal with “terrorists” by paying “taxes” • In some areas, terrorists often does enough damage to increase uncertainty and extract rent. This is good “business.”

21. Historical Conflicts • China (People’s Republic of China) and Taiwan (Republic of China) • India and Pakistan • Japan and China, and Korea • UK and Ireland • Eastern European “hotspots” • South America??

22. Roots of Conflict • Religion as in the case of India and Pakistan • Was one country and broke up after independence • Ideology – China and Taiwan • Economic (capture resources) – Japan in World War II • Political with religious undertones (Ireland)

23. Internal conflicts • Tribal/ethnic conflict • Religion • “Frustration” • Control of the country

24. Governance & Corruption • This portion has been changed. For day 8 the basis for discussion will be in file labeled governance and corruption and reference will be made to assigned reading on ruling family in Saudi Arabia.