The debt crisis of the 1980s led to a severe recession in almost all African and Latin American countries. IMF and World Bank adjustment programmes required countries to cut back on their expenditures, introduce user charges for health and education, and reduce or abolish minimum wages. Per capita income became stagnant and sometimes fell. Reductions in protection led to the collapse of industrial sectors in many countries, and to high unemployment. Poverty rose and income distribution worsened. Most countries had no or very limited programmes of social protection. All this led to what became known as the
‘lost decade of development’.
UNICEF responded with calls for Adjustment with a Human Face, arguing that children and families need to be protected during economic crisis and explaining how this
could be done. The recipe – more expansionary macro-programmes, redirection of meso-policies to protect crucial social and economic sectors serving the poor, and the introduction of social protection programmes. By the time of the Millennium Summit in 2000, the world generally acknowledged the priority importance of reducing poverty.
In 2008, a new global recession developed, with irresponsible lending by Western banks again as a main cause. The poor all over the world, in developed as well
as many developing countries, are again suffering – this time from a crisis that is entirely due to actions taken in the developed world. The crisis has already lasted five years. It is critically important that this does not extend to a new
lost decade; and that people do not suffer for as long as they did in the 1980s.
But, déjà vu, many countries are continuing to cut public expenditures, wage bills, subsidies, pension and health expenditures, while unemployment remains high or
rising and the number of decent jobs is often falling due to reduced economic growth and labour reforms.
A rigid focus is kept on public debt and fiscal balances, even though people are suffering unnecessarily and there are alternatives.
Policy and action now need to turn to alternatives, not used to tighten further the screws of austerity. The lesson of earlier crises is that the state needs to be stronger not
weaker; the financial sector needs to be reformed, to make it the servant and not the master of the whole economy; young people need to be helped to get education, not left in unemployment; women need to have opportunities for using
all their skills, not just left to pick up the pieces or be employed in part time jobs; health services need to be strengthened for all section of the population; and regional and international action is needed to support countries
pursuing such policies, not being used to enforce further cut
If you share our outrage, please join us in exploring alternatives. Our earlier booklet, “Be outraged: There are
alternatives”, set out actions which could be taken. We now need to update this discussion, both to explore what now needs doing and to share references to work or findings
documenting the contradictions of austerity and the opportunities of alternatives.
Issues of economic inequality and social justice have come to dominate the global debate, together with rising levels of
social unrest and worldwide discontent. The world must address big questions, but we only hear small answers.
The social costs of the crisis are very high, as reported among others in our book “A Recovery for All” . We had to conclude the first e-discussion (2010-2012) with a question
mark – “A recovery with a human face?”
Today, the World Day of Social Justice, we are starting a second phase of the e-discussion.
We welcome your views/research on alternatives for a socially-responsive recovery. Just send an email to
We look forward to a vibrant discussion.
Richard Jolly and Isabel Ortiz