Why equity matters more than you might think

Around the world, millions are trapped in situations of protracted crisis and violence where they are denied opportunities and can no longer enjoy gainful employment, provide safe environments for their families, or hold the prospect of a better life for themselves and their loved ones.

While such violence and instability clearly leads to dreadful socioeconomic outcomes, we often forget that the causality runs both ways: social and economic inequalities and a sense of injustice lead to the unrest and security breakdown in the first place. And the interplay of socioeconomic inequality and insecurity creates a downward spiral over time that is hard for countries to escape and people to recover from.

To better illustrate this point, let’s look at Latin America: a region battling grave socioeconomic differences, which is also home to 43 of 50 of the world’s homicide capitals. Whereas causality is hard to prove few question the correlation. Whatever way we look at it, this implies that socioeconomic and security issues must be addressed holistically.

Our predicament is not particularly new. Throughout the ages, history has repeatedly seen the lack of socioeconomic opportunities challenging the political and business establishment. And not just within the classic development and economist circles. Just as economists often refer to the evils of physical insecurity for a properly functioning economy, the security and industrial military systems have for some time funded civilian research and initiatives aimed at understanding the mechanics of large-scale social unrest across the world. Insights gleaned are sometimes used to inform military doctrine and security policy.

Yet we do not see a clear taxonomy, narrative or collaboration between security experts, economists and the governmental and non-governmental institutions working on these issues on the ground. This must change.

A vicious cycle

We don’t need a crystal ball to predict that today’s social unrest and growing social inequalities, in spite of the promises brought on by the Fourth Industrial Revolution, won’t let up without a drastic improvement in opportunities. Without intervention today, we are likely to see a period of diminished expectations and increased uncertainties potentially leading to greater social unrest and conflict, and in turn truncated opportunities and growing socioeconomic inequalities. A vicious cycle.

Socioeconomic opportunities and security must be seen as going hand in hand. Making this link may be controversial – but not doing so is irresponsible. The downward spiral could drive the world to the brink of economic and societal disaster with dire security implications.

Growing social unrest often provides governments with a pretext for increasing militarization: popular uprisings have contributed to increased defence spending in some countries. Cynical opportunism by politicians stoking patriotic fervour also often leads to greater defence spending – North Korea is the extreme example, but by no means the only one.

Polarization of the issues and growing populist forces prod some leaders to take ill-advised, short-term measures that may give the appearance of “doing something” without really tackling protracted crises at their roots.

Such forces can amplify the vicious circle, leading to the closing of borders to immigration and trade, with potentially devastating consequences for integration and growth: witness the dangers presented by the current refugee crisis, which has grown into an existential threat to some receiving countries and regions. For the most part, the discussion and therefore the responses are "gated", policy responses short sighted and dominated by the problem itself rather than the desired outcome. This is a very dangerous gamble.

No quick fixes

So how do we break the cycle? There are no quick fixes. But clearly nothing will be achieved without fostering collaboration and breaking down numerous silos. First there are the silos separating political leaders from citizens. The sensation of inequality is amplified by exclusion from political spaces. Therefore, a constructive way forward is to ensure that citizens are both informed and strongly integrated into the political process.

We must also break down the silos that separate the security establishment from the economic development field so that they work together hand in hand to address these concerns.

Finally, business, government and civil society must leave their own silos and work together to address challenges of economic exclusion and security: all have a strong interest in addressing these challenges, and all bring complementary perspectives and strengths to bear. In sum, only inclusiveness and cooperation at all levels will make the world both more prosperous and more secure.

Authors: Jennifer Blanke, Chief Economist, World Economic Forum; Anja Kaspersen, Head of Geopolitics and International Security, World Economic Forum.