The Gender Implications of Current Global Financial Crisis - Essay Example

Topic: Lecturer: Presentation: Introduction Global financial crisis emanated from United s and spread to developed countries but its effects which resulted to economic crisis are felt all over the world. It started in the middle of 2007 and 2008 as a result of sub-prime mortgage crisis due to securitization of assets (Shah, 2009). The US had relaxed its regulatory systems to enable banks to expand sources of profitability hence allowed securitization of lending in 2004 (Antonopoulos, 2009). Banks thus engaged in enormous borrowing to lend out and create securitization and investment banks bought mortgages to securitize but mortgage prices declined crumbling the financial sector. Mortgage collapse was accelerated by credit default swaps. This led to credit freeze thus limiting investments and consumption leading to insufficient aggregate demand and economic crisis (Seguino, 2009). Governments resorted to bail outs thus cutting expenditure on social services such as; education, health and child care. There were massive job cuts leading to human rights crisis due to mass unrests as a result of economic hardships. This paper is a critique of the gender implications of the crisis and influence of gender perspective on responses to current recession. The Gender Implications of Current Global Financial Crisis The current global financial crisis which has transformed into global economic crisis due to credit crunch has affected all people all over the world but the women are the most affected. This is because women are the caregivers at home and to the community and engage in unpaid, informal and volunteer work and mostly work in the services sector. The millennium development goals focus on women’s access to work opportunities, income and resources and hence improve the welfare of children, families, community and promote economic growth (Antonopoulos, 2009). Jobs were thus created in textile sector through export processing zones, tourism and agriculture and also work in public service as social workers. Men on the other hand are involved in masculine jobs such as construction work in public works and are highly paid while females engage in lowly paid jobs. Globalization enhances masculine dominance (Acker, 2004). Due to traditions, women are considered dependent on men thus benefits such as; social insurance, pensions and welfare benefits are paid through the husband (Elson & Cagatay, 2000). Privatization makes women more dependent on men as women lose public service jobs. The cut in government expenditure on social services has great effect on women. It translates to loss of jobs for women who are concentrated on this sector of provision of social or health care. They work in public sector hence due to expenditure cuts, they risk losing jobs (Elson, 2009).Cuts on education and health provision also lead to job loss for them. Their burden for caring for family and community is increased as they have to spend more on health, education, water and sanitation with reduced income. Agriculture is also affected due to reduction in subsidies on inputs leading to food insecurity, hunger and malnutrition. Women do not have land rights or access to extension services hence no meaningful production. Global financial crisis has led to decline in demand for exports. Most developing countries rely on primary exports for economic growth such as textiles, tourism, and agriculture. As Seguino (2009) notes, these sectors offer job opportunities to a large number of women. Closure or reduction of these industries leads to massive job losses. This results to poverty increase and widening of gender gap as not many men are affected. It also leads women to engage in unpaid labour mainly subsistence farming which is limited by credit freeze. Globalization lead women to migrate and look for jobs to sustain their families and end up as domestic workers abroad and at home they are expected to care for their families hence double burden (Marchand & Runyan, 2000). Financial crisis reduces remittances by these migrants. Volatility in official development assistance (ODA) has negatively impacted on peoples livelihoods. At such time of economic crisis, developing countries need development assistance. Without this assistance, there are no investments hence no job creation instead jobs are lost. This assistance is sometimes passed through NGOs which is a major employer of women hence reduction of aid leads to job loss for women. Assistance in managing HIV/AIDS is reduced causing more burdens on women who find it hard even to engage in unpaid work. The burden of excessive financial risk taking is thus shifted to women who are care givers (Staveren, 2000). Gendered Perspective on Responding to Current Recession Recession is a situation where there is low aggregate demand and hence the government comes in to boost the demand. This is done through the use of fiscal stimulus programs such as tax cuts, increased government borrowing, reduction in government spending, and monetary policy of inflation targeting (Antonopoulos, 2009). A reduction in taxes would encourage more investments hence job creation but governments also create jobs through public works. Fiscal and monetary policies help to reduce the recession but they are gender biased as they favour men than women. Gender perspective responses aim at creating gender equity and at the same time curb recession. The governments can begin by involving women in economic and financial issues since they are the most affected. Government budgets should be gender sensitive to avoid disadvantaging women such as on policy of reducing expenditure on social services as it leads to job loss for women and increased burden hence poor health, low productivity and slow economic growth (Antonopoulos, 2009). Women’s health determines state of the economy. Government direct creation of jobs through public works which involves construction is gender biased. Gender perspective is that jobs should be made available to women through provision of physical infrastructure and rural development. Women’s job would be made easier and burden reduced. Women jobs can also be created in public works but not far away from their residential areas and according to Antopoulos (2009); social services can be incorporated into public works program such as health services, education and extension services. Chow (2003) recognizes the role of globalization in shaping gendered institutions. It determines access to and control of resources and gender power relations. Globalization enables women to migrate and look for alternative employment although according to Marchand & Runyan (2000), women in rich and poor countries face burden of greater workload as both countries face constraints such as structural adjustment programs and welfare reforms. For Dejardin (2008), globalization has created new job opportunities and transformed traditionally unpaid domestic care work into paid work. Gender perspective advocates product diversification, factor intensity of production, skill mix of employment and upgrading women technical skills for long-term position in the labour market. This would protect women from job losses hence sustained incomes for women would boost consumption and demand needed to curb recession. Elson & Cagatay (2000) emphasize the need to incorporate women’s work which is often ignored in national economic statistics. This would reduce privatization bias and involve women in economic development and have increased productivity. Conclusion The global financial crisis has shifted burden of excessive financial risk taking to people especially women. It has led to global economic crisis due to credit freeze as a result of lack of confidence in lending thus creating insufficient aggregate demand and consequently job crisis and human rights crisis. It has led to closure of financial institutions, reduction in export demand thus collapse of export sectors which are dominated by women. Developing economies are forced to pay debts leading to cuts in provision of essential services such as education and health. The response measures of fiscal stimulus and monetary restrictions don’t auger well for women hence the gender perspective response which is favourable to all such as formulating macroeconomic policies for promoting growth and not to destroy production processes of securing livelihoods and integration in global markets and institutional arrangements. References Acker, J. (2004) “Gender, Capitalism and Globalization”. Critical Sociology, 30(1): 17-41. Antonopoulos, R. (2009). “The Current Economic and Financial Crisis: A Gender Perspective”. Levy Institute, Working Paper no. 562. Retrieved 18 May, 2010 from http://www.levy.org/pubs/wp-562.pdf. Chow E.N. (2003) “Gender Matters: Studying Globalization and Social Change in the 21st Century”. International Sociology, 18(3): 443-460. Dejardin, King, A. (2008) “Gender Dimensions of Globalization”. 4 Sept, 2008. ILO Discussion Paper, Retrieved on 18 May, 2010 from http://www.ilo.org/wcmsp5/groups/public/---dgreports/--integration/documents/meetingdocument/wcms_100856.pdf. Elson, D. (2009) “Gender Equality and Economic Growth in the World Bank World Development Report 2006”. Feminist Economics, 13 (3): 35-59 Elson, D. and Cagatay, N. (2000) ‘The Social Content of Macroeconomic Policies”. World Development, 28 (7):1347-1365. Marchand, M. and Runyan, A. (2000) “Introduction: Feminist Sightings of Global Restructuring: Conceptualizations and Re-Conceptualizations”. In M. Marchand and A. Runyan (Eds) Gender and Global Restructuring: Sightings, Sites and Resistances, London: Routledge. Seguino, S. (2009) “The Global Economic Crisis, Its Gender Implications and Policy Responses”. Paper prepared for Gender Perspectives on the Financial Crisis Panel at the Fifty-Third Session of the Commission on the Status of Women, United Nations, March 5, 2009 http://www.uvm.edu/~sseguino/pdf/global_crisis.pdf Shah, A. (2009) “Global Financial Crisis”. Global Issues. Retrieved 17 May, 2010 from http://www.globalissues.org/article/768/global-financial-crisis.htm Staveren, I. (2000) “Global Finance and Gender”. Paper Presented at IAFFE Conference, Istanbul. August 2000. Read More