Socio-Economic causes and effects of HIV/ AIDS

 

ASSESSMENT OF THE SOCIO-ECONOMIC CAUSES AND CONSEQUENCES OF HIV/ AIDS

Objectives, Outputs and Processes
 
Increasing numbers of countries have undertaken or are proposing to undertake studies of the socioeconomic issues relating to the HIV epidemic. In some cases these studies are planned as part of the preparations relating to Strategic Planning for HIV and AIDS, and in other cases are seen as one of the important outputs of the Plan. The main objectives of such Studies are as follows: -

Advocacy: to increase understanding of the multiple ways in which the HIV epidemic affects human development as an essential input in the mobilisation of government and civil society in the national response to HIV and AIDS.  Economic and Social Analysis of the HIV epidemic: to present data/ information and analysis relevant for the design and implementation of a broad based multisectoral response to the HIV epidemic. 

Given these as the two main objectives of such Studies the key outputs that can be expected are: -

· an increased understanding of the threat that the epidemic has for the sustained development of the country, both as a mechanism for raising awareness and as a means of increasing commitment to broad-based action, and,  · a clear specification of the practical activities that are feasible in the country, and which are needed if the socioeconomic aspects of the epidemic are to be addressed in a timely and effective manner.

The precise focus of such Studies needs to reflect the policy and programme needs of the country taking into consideration both the objectives and outputs identified above. Thus if the important issue that requires analysis is the impact of the epidemic on households then this should become the focus of the Study, and resources will not be misused in more general analysis and in less useful ways.  The processes followed in undertaking a Study must ensure that potential users of the data and information are involved throughout so as to ensure that it reflects policy and programme priorities. Furthermore, processes need to ensure national ownership, involve all important stakeholders in the design and implementation of the Study, and strengthen national research and other policy, programme and institutional capacity. 
 
Below, we set out precisely what this entails.

The Economics of Drug Policy

The Economics of Drug Policy: Why Systemic Reform is Urgent

Source: UNODC World Drug Report, 2010

The market for illicit drugs is unusual in that there exists a set of UN conventions and a parallel set of national laws in most countries that regulate their production, sale and use. This system has been operational more or less unchanged for some 50 years and although there are increasing demands for it to be loosened or reformed, maybe even abolished, it seems unlikely that much will be changed in the short term while the USA remains committed to the status quo. This is in spite of evidence that existing policies have severe negative outcomes, outcomes described as ‘unintended consequences’ by some commentators, although as we will see they are not so obviously ‘unintended’ but perhaps the main aims of the drug policies. 

What is odd about the present policy regime is that it has not been subjected to rigorous analysis by economists since what is at issue is the regulation of the market for a particular set of substances on the grounds that their production and use imposes social and economic costs. Costs that are so self evidently severe that using the full weight of the legal and judicial systems in the enforcement of market controls in respect of production, trafficking and use does not require justification through the application of standard economic analysis. Nor are the usual principles of empirical measurement applied to such policies – i.e. are the costs [financial and human] of the application of drug policies justified in terms of the social and economic benefits. To be able to answer this question one would need a full social and economic cost benefit analysis in which all of the costs and benefits were identified and measured including many that are not usually integral to such analysis, such as the costs of the drug wars in destabilising political systems in Central America at the present time.

It is feasible to apply standard economic analysis to the market for illicit drugs and the following is an attempt to trace some of the effects on users [households possibly], enterprises [both financial and non-financial] and the public sector. These are the usual distinctions between the private and public sectors and between the micro- and macro effects of the policy regime. Not much attempt is made to distinguish between the specific differences in the application of the regulatory regime in different countries since the broad principles are more or less the same everywhere. Except to note the policy shifts in those countries where the regime has been modified [such as Switzerland, the Netherlands and Portugal] and to argue that these are clearly preferable to what went before.

Key Propositions: Supply Side Issues

It can scarcely be a surprise to anyone that if you prohibit the production, trade and use of a product, the resulting disruption of markets will have effects on prices and on profits, will lead to shifts in the sources of supply, lead to product innovation and where demand is price inelastic and income elastic have little effect on levels of consumption of illicit drugs. Let’s look at each of these effects in turn.

If one prohibits the supply of products such as cocaine, heroin or marijuana and imposes severe penalties on those producing and supplying these products then one would expect prices to rise. This is more or less inevitable, as any economic analysis based on supply and demand would support. Thus a reduction in market supply not matched by an equivalent and offsetting reduction in market demand will cause a rise in market prices. Scarcity causes prices to rise. Furthermore since the risks involved in producing and supplying the product are raised by the enforcement of prohibition and the imposition of potentially severe legal penalties then those involved in the markets for drugs will demand higher monetary returns.

Africa Partenership for HIV/AIDS

Part II: Integrating HIV/AIDS in NEPAD
 
A. Cross Cutting Issues
 
There are five broad cross-cutting issues which have relevance for many
activities in NEPAD and it is worth identifying these separately precisely
because of their general importance in all sectors. These are: -
 
1. Human Capital
 
The importance of Human Capital for the achievement of sustainable
development is recognized by all developmentÝ practitioners. In part this
capital is the outcome of social processes undertaken privately, usually by
families, and in part it is the outcome of formal activities undertaken by
the state in the public education and training system, and private
institutions such as enterprises and churches. Whatever the source of the
investment in human capital it is essential for the processes of
development. Because the HIV epidemic is concentrated in the working age
population, both men and women, and may be affecting disproportionately
those with better education and skills, there is occurring in many African
countries an immense loss of human capital. Both the stock of human capital
is suffering attrition, but so isÝ the flow of those who are educated and
trained. These developments haveÝÝ consequences for all forms of social,
economic and political activity, and thus will have implications for the
totality of what is proposed by NEPAD.
 
2. Public Goods
 
The State in all countries plays a significant role in supporting the
processes of growth and development. It does this in part through regulatory
frameworks and systems of law and the judicial system, but also through the
direct provision of key services [such as the police, security, educational
and health provision, transport systems and telecommunications etc]. For
these services to function effectively there needs to be a system of public
administration which is appropriately staffed with relevant skills, and
managers and supervisors who are experienced and supported in their tasks.
But again the HIV epidemic is eroding public service capacity through the
losses of nurses, doctors, accountants, public administrators, teachers,
judges and so on. It follows that all of the NEPAD proposals that depend on
a functioning and effective public administration and on publicly provided
goods [such as those provided by utilities in the areas of energy, water
supply, telecommunications and transport] will only be feasible where
resources are devoted to sustaining public capacities.
 
3. Systems Approaches to Problem Solving
 
It needs to be noted that the economic and social system in all countries
consists of inter-dependent parts and that the efficiency of the whole
depends on the parts working more or less normally. In other words the
economic and social system has to a degree be conceptualised as "systemic"
if development plans are to be realized. It is clear from the foregoing that
because the impact of the HIV epidemic is generalized across different
productive sectors, social, political and economic, that policies and
programmes have to address the linkages ? or they will be less than
effective. For example, many children have been orphaned by the epidemic
[see above] and they and many other children are being increasingly
impoverished by the impact of the epidemic on families.

It follows that policies for educational expansion need to take into account
the changing needs of the school population, since many families will simply
not be able to send their children to schools [especially girl children].
Similarly, the educational system cannot carry on business as usual in that
employers are facing entirely new conditions because of HIV/AIDS in terms of
recruitment and retention of labour. NEPAD takes no account of the multiple
ways that HIV/AIDS has effects on system performance and what can be
achieved through new programmes for sustainable development.

It is also essential that the internal matrix of relationships be understood
if there is to be effective programming in any social and economic area. For
example within a productive sector there exist important economic and social
relations that need to be sustained for effective performance. Thus in
commercial agriculture because inputs are secured from external suppliers
[eg. the maintenance of equipment] then losses of skilled labour due to AIDS
in supplier organizations will adverse affect the productivity of commercial
farmers [who will face higher costs because of equipment failures]. Similar
consequences will affect performance in other sectors, such as education and
health, where the sectoral performance will be adversely affected because of
internal losses of capacity due to HIV/AIDS. Policies and programmes thus
need to address these intra-sectoral relationships if they are to mitigate
the impact of AIDS on economic and social performance.
 
4. Investment Strategies
 
There are issues relating to investment strategies. Raising levels of
investment in productive activities are seen as essential for the
achievement of the higher targeted rates of GDP growth and reaching the
various Millenium Goals [see above]. It is evident that raising rates of
investment in physical capital and importing embodied technology will in
themselves be less than successful unless human capital and organizational
capacity can be sustained in the face of HIV and AIDS.

There seems to be no realization in NEPAD of the fact that labour and capital inputs are both
essential for development in appropriate proportions, and therefore that
losses of human capital and erosion of public sector capacity will
significantly reduce the productivity of new investment. Nowhere in NEPAD is
there any analysis of the effects of the epidemic on new investment, whether
funded within the country or dependent on external flows of capital. There
are also related issues of the role of new investment in infrastructure in
positively increasing HIV transmission [and what might be done to mitigate
this], and of the role that technology can play in reducing some of the
adverse impacts of the epidemic on labour productivity [eg in agriculture].
 
5. Governance
 
NEPAD is premised on the statement and belief that Africa can and should
take responsibility for its current state and for the achievement of
sustainable development for all Africans. This is to be welcomed, although
it is recognized that its achievement will depend crucially on external
flows of resources, both ODA and private capital and technology. In the past
few years African leaders have begun to show leadership and commitment to
respond to HIV/AIDS, e.g. through involvement of political leaders in
National Coordination Bodies.

 Further evidence of the changes underway is
the fact that the African Development Forum in 2000 demonstrated
significantly increased levels of concern about the effects of the epidemic
on social and economic development. It is, therefore, rather inexplicable
that the only mention of AIDS in NEPAD is in the context [very brief] of
communicable diseases, as if AIDS were indistinguishable from other diseases
such as malaria.Ý To address the issues in this way totally fails to note
the complex ways in which the HIV/AIDS epidemic undermines sustainable
development.

The key challenge now facing African leaders is how to ensure that policies
and programmes are developed for the key strategic sectors identified by
NEPAD that integrate HIV/AIDS.Ý This is no simple task, and the evidence
from many countries that specific activities to mainstream AIDS across the
various sectors will take targeted resources and need to build on the
existing knowledge of what works and what does not.

Political Legitimacy

Political Legitimacy- In the Eye of the Beholder


That the Tories intended to legislate on Trade Unions was signalled in their election manifesto but the Bill that went through its second reading in the House of Commons in August has surprised all informed commentators and experts in industrial relations. Thus in a letter to The Guardian on 17th August more or less all of the leading experts on industrial relations in the UK denounced the Bill as ‘the most sustained attack on trade unions and workers’ rights since the Combination Acts of the early nineteenth century’ and argued that the Bill by setting minimum voting thresholds would seriously curtail the possibility of legitimate strike action. Their dismay was also supported amongst others by Liberty, Amnesty International, the British Institute of Human Rights and the Chartered Institute of Personnel and Development. The previous Business Secretary from the Coalition Government Sir Vince Cable is reported as describing the Bill as ‘ a vindictive, counter-productive and ideologically driven’ attack on Britain’s trade unions which has ‘no evidence base at all’.

What the Bill does amongst other attacks on Trade Union rights is to criminalise picketing, permit employers to hire strike breaking agency staff and check the flow of funds to the Labour Party. Tory ministers apparently made proposals within the previous Coalition Government to change the mechanisms for party funding by trade unions but were prevented by the Lib Dems from implementing these. The core of the Trade Union Bill is to make strikes unlawful unless 50% of those being asked to strike vote in the ballot. It also will require that for key public sector workers that at least 40% of those asked to vote support the strike – thus in teaching if 100 are asked to strike then it is only lawful if 50 teachers voted and 40 of those backed the strike. In effect the Bill sets a double threshold for key public services. These draconian changes are according to the present Business Secretary Mr. Sajid Javid  ‘ being introduced so that strikes only happen when a clear majority of those entitled to vote have done so....’.

The Ebola Epidemic

THE EBOLA EPIDEMIC:
UNINTENDED CONSEQUENCES OF GLOBAL AND NATIONAL HEALTH STRATEGIES

Public policy in the area of global health is a mess, and the desperate scramble by our leaders to limit the impact of Ebola and to reduce its transmission is evidence of long run failure to address a set of public policy issues. It is rather late in the day for President Obama to call for additional resources and finance ‘to bend the curve of the epidemic’ in West Africa although these are going to be essential to limit the global impact of Ebola and save potentially many thousands of lives.

But this state of affairs is scarcely accidental and the Ebola virus was identified many decades ago by Peter Piot and other scientists in the 1970s. Thereafter not a lot of resources were focused on finding a vaccine or the development of drugs since the problem seemed to be confined to Central Africa – a long way away from the centres of population in the rich developed countries. But with increasing population mobility – globally and in Africa- and growing urbanisation it was inevitable that Ebola would spread and that everyone would in time be threatened. Indeed this is precisely what has happened and as Professor Piot noted in a Guardian interview last week the real difference now is that Ebola is no longer confined to relatively sparsely rural populations in remote parts of Central Africa but has now spread to dense urban populations across West Africa – and beyond.

What is evident in Sierra Leone for example is not only the daily loss of life but that the epidemic  is undermining the economic and social framework of the country – schools are closed and the public health system scarcely functioning. Economic activity has been brought more or less to a standstill and what is now needed is a massive injection of resources – not just public health [doctors and nurses and other technical staff] but logistical assistance on a massive scale together with increased access to food as local production is destroyed. What is evident is that local health capacity in Sierra Leone, Liberia and Guinea was always totally inadequate not just because of the ravages of war and the post war failures of reconstruction but were always in desperate need of resources. At the present time the health response has been almost entirely dependent on NGOs such as MSF and the Red Cross given the lack of local health capacity with WHO at best providing a purely coordinating role.

How did we come to this state of affairs?

Reforming Financial Markets

REFORMING FINANCIAL MARKETS 

COMMENTS ON TREASURY PROPOSALS AND RECOMMENDATIONS FOR FUNDAMENTAL CHANGES IN ECONOMIC POLICY IN THE UK

The initial aim of this paper was to review the proposals made in July 2009 by the Treasury for the reform of the Financial Sector [FS]. It soon became clear that this limited objective would leave far too many issues relating to the conduct of financial and monetary policy as if these were unimportant. It is argued in the following that the conduct of economic policy has been lamentable in many respects and that the failings of the FS are only a sub-set of a general problem.

It follows that reform of the FS needs to be located within a framework for the effective conduct of economic policy overall – something that the Treasury White Paper fails to do. Subsequently the Coalition Government set up the Independent Commission on Banking  [ICB] to advise it on banking reform and the paper takes account both of some its proposals, and also of recent economic and fiscal policy. The fundamental thrust of the paper is that effective reform of the financial sector must take into account how the financial system interacts with the rest of the economic and social system.

The paper is essentially in 6 parts:

1.     Role, Function and Performance of the Financial Sector.

2.     Assessing the Costs of the Financial Crisis.

3.     Too Big to Fail and the Consequences for Economic Policy.

4.     Housing Bubbles and Housing Needs

5.     What is Needed for an Effective Monetary Policy.

6.     Policy Options for a Fractured Economic System