Extracts - introduction and core agument

In recent memory, a combination of pressure from below and enlightened leadership from above has produced some remarkable exercises in redistribution. In several East Asian countries, for example, elites have embraced the long-term case for equality, to prevent social division and to stoke a thriving economy. Taiwan and Viet Nam have combined astonishing growth with high levels of equity. ndonesia and Malaysia have managed to reduce inequality over an extended period through government-led redistribution and generation of employment.

This book explores these and other efforts to grapple with inequality and poverty in three key areas: politics, markets, and vulnerability. In each case it finds that development, and in particular efforts to tackle inequality, is best achieved through a combination of active citizens and effective states.

By active citizenship, we mean that combination of rights and obligations that link individuals to the state, including paying taxes, obeying laws, and exercising the full range of political, civil, and social rights. Active citizens use these rights to improve the quality of political or civic life, through involvement in the formal economy or formal politics, or through the sort of collective action that historically has allowed poor and excluded groups to make their voices heard. For those who do not enjoy full rights of citizenship, such as migrants or (in some cultures) women, the first step is often to organise to assert those rights.

By effective states, we mean states that can guarantee security and the rule of law, and can design and implement an effective strategy to ensure inclusive economic growth. Effective states, often known as ‘developmental states’, must be accountable to citizens and able to guarantee their rights.

Why focus on effective states? Because history shows that no country has prospered without a state than can actively manage the development process. The extraordinary transformations of countries such as South Korea, Taiwan, Botswana, or Mauritius have been led by states that ensure health and education for all, and which actively promote and manage the process of economic growth… the road to development lies through the state.

Why active citizenship? Because people working together to determine the course of their own lives, fighting for rights and justice in their own societies, are critical in holding states, private companies, and others to account. Active citizenship has inherent merits: people living in poverty must have a voice in deciding their own destiny,rather than be treated as passive recipients of welfare or government action. What is more, the system – governments, judiciaries, parliaments, and companies – cannot tackle poverty and inequality by treating people as ‘objects’ of government action or other action. Rather, people must be recognised as ‘subjects’, conscious of and actively demanding their rights, for efforts to bear fruit.

This book argues that active citizenship and effective states are compatible, as well as desirable. The challenge is to combine them as early as possible in a country’s development. However, the relationship between the two is complex. They march to different rhythms, the steady grind of state machineries contrasting with the ebb and flow of civil society activism. In many cases, long-term development requires an element of deferred gratification, requiring businesses to reinvest rather than skim off profits, rich people to accept redistribution of wealth and income for the sake of national stability and growth, and poor people to limit demands for the improved wages and social spending that they so desperately need.