Third World Development on Egypt Case - Essay Example

Third world development/ Egypt Introduction The speedy development taking place in the modern world and the growing integration between the countries has given birth to a number of development theories, which discuss the disproportion existing between the third world and the developed countries. There are many characteristics that are shared by the underdeveloped countries of Africa, Asia and America. Some of these characteristics are poverty, economic dependence on the developed countries and high birthrates. There was a term coined by a French demographer named Alfred Sauvy in the year 1952 that meant “third estate”, right after the French revolution. He further added that the third estate is nothing but it is in the way of becoming something. The term “third estate” is exploited by the countries in power and its destiny is usually a revolutionary one. Another idea that has been discussed by Saucy about the third estate is that their non-alignment neither belongs to the industrialized communist bloc nor to the industrialized capitalist world. The term third world was first used at the Afro-Asian conference in the year 1955, held at Bandung, Indonesia. There are a number of characteristics that defines the underdevelopment of the third world such as economies of the third world are usually devoted towards providing primary good to the developed countries, to fulfill the needs for their finished goods, high population growth rate, rural, traditional social structure and widespread poverty. The third world can be differentiated sharply, as it includes countries that are present on different level of economic development. Despite of the fact that there is high level of poverty existing on the urban shantytowns and countryside, the ruling elites present in the third world countries are still wealthy (Hadelman, 2013). Meaning of Development Inequality in income is considered to be one of the central issues with concern to the development agenda and for establishing the goal of sustainable development. It is a fact that economic and social inequalities tear up the social fabric, prevent the nations, affect the social cohesion and impose negative impact on the nourishment of an individual. In the developed countries, income inequality is considered to be one of the indicators of social wellbeing and health, whereas the levels of average income are not considered to be one. However on the other side in the developing countries where the economies are still emerging improvements in the living standards and greater equality is needed for the population to flourish. Reduction of inequality for the development of a Nation Evidence suggests that large difference in the income inequality can be damaging. Analysis of these studies suggest that great income inequalities can be worse for the health of population, as the rate of mortality and life expectancy is lower in the societies where these is high income equality. The rate of infant mortality, obesity and mental illness is also two to four times higher in such societies. The individual share better relationships in the society, higher level of social cohesion including the social capital and trust are also higher in equal countries. The status of women in such societies is better, as they have equal opportunities as men when it comes to education and employment. The rate of violence and crime especially homicide also increases as the income gap widens. Inequality is a waste to the human potential and human capital. It is clear from the provided evidence that greater income quality can be linked to the economic stability and progress. The development of the nation is comprised due to economic inequality. If the nation needs to progress, greater equality plays a greater role in transitioning the sustainable economies. Inequality is also a mean of driving status competition which eventually becomes a driver for consumerism and debt, which are considered to be a major threat to sustainability. When there is more income equality then societies become stronger meaning that people are willing to work for the greater good, as they start spending more on the foreign aid, they act for spreading common good and they recycle more. In order to achieve development in the third world country it is important that income equality should be achieved on all levels. Creating more egalitarian society Greater equality of world of poverty, wealth and prestige can be achieved in certain gathering hunting societies than in the human ones. The societies where the economies are based on immediate rather than returns, such economies are considered to be egalitarian. Equality can be achieved by providing direct access to the individual towards resources, means of mobility and coercion and limiting their imposition of control, by implementing certain procedures that prevent saving and impose sharing. This can be achieved by implementing the mechanism that allows goods to circulate, while decreasing the dependency of people on one another. People tends to be systematically disengaged from the property and hence also from the potentiality in the property for creating dependence. A comparison is made between such societies and other egalitarian societies, where profound intergenerational inequality exists and where the equality between senior citizens is only the initial point for the strenuous competition that leads to inequality. The value system of the egalitarian society fosters the development of the agricultural sector because the rules related to saving and investments speed up the attention that is provided to the incapacitated due to their control on dependency. Providing Social Welfare to everyone The welfare state is the concept related to the government, where the state plays a significant role in protecting and promoting the social and economic well-being of its citizens. Providing welfare is based on the principles of equitable distribution of wealth, equity of opportunity and the responsibility of providing provisions to those who do not have access to the benefits of life. This general term also take into account different forms of social and economic organization. A modern welfare state has been recognized by sociologist T.H. Marshall as the state with the combination of welfare, democracy and capitalism. The examples of some welfare state that the developing countries may look towards include Nordic countries like Iceland, Norway, Denmark, Finland and Sweden, which employ the Nordic Model to achieve the concept of a welfare state. The concept of welfare state involves transferring funds from the state for providing services like health and education to the people. A welfare state is funded by the help of redistributionist taxation and is also referred to as the mixed economy. However such taxation may require large portion of income tax from the people with higher income, which is called progressive tax. This help in reducing the income gap that exists between the rich population and the poor ones (Weatherby, Arceneaux, & Evans, 2010). Dependency Theory The word development means economic growth which first began in the United State of America in the year 1940.There is a relationship between development and governance. It is said that governance is formed by the aims of development. Most theorists of the dependency theory compare development with the economic growth of a nation and declared that state is the primary agent of development. One of the important aspects of this theory is to describe the importance of state in development. This shows that there is a close relation between dependency theory and practice. Dependency theory was one of the notorious theory of 1960 it became popular because of the research done by Raul Prebisch. Raul Prebisch stated that the prosperity of the wealthier nations is increased at the cost of the unfortunate ones. The dependency theory of economics is established on the basis of Marxist theory of the world. Marxist theory of the world says that globalization is the extent of the market entrepreneurship. The theorists of the dependency theory found that the world industrial system is the separation of industry into poor and rich countries. They also said that during the passage of time the rich countries will dominate themselves over the poor ones. Dependency theory is an approach which plays an important role in the development, endorsing nationalization of businesses, making hidden investment difficult and commanding hurdles to trade. Despite the importance of dependency theory in the field of history and sociology it has become extinct in economics after the failure of communism in 1990. The disorganizations in the field of economy lead to the progress of corruption which can be seen in countries like Zimbabwe. The role of capitalism can be seen in the third world and is present in the writings of Marx and Engels. According to the writings of Marx and Engels, Ireland is a country which is oppressed by capitalism. Engels wrote about the war of 1847 which took place between the USA and Mexico and said that it is step forward for a country like Mexico to be heaved into a historic activity by power. He also mentioned that it is supportive in the development of Mexico that it should be placed under the guidance of the United States. Marx stayed on the same positions during the preceding years of his being when he was conforming to the Russian populists. He explained his idea that laborer communities could provide the foundation for a new revolutionary civilization apart from capitalism in the letters he wrote to Zasulich. Unluckily he died before elaborating his ideas on this theory. The dependency theory and the world system theories share a mutual prominence on the concepts of global analysis, nature of global system and its influence on the national development and political dynamics. This theory also states that the concepts of colonialism and neocolonialism have created inequality in terms of economy among the rich and poor countries of the world. Neocolonialism means when the developed of wealthy countries dominates or control the poor countries through the use of power and supremacy. This is one of the causes of global poverty. The wealthy countries are manipulating the weaker ones through foreign trade and foreign debt. Raul Prebisch mentioned some ways in order to eradicate inequality from the countries. He said that the third world countries should take steps to recover their conditions. One of the ways to recover from their condition is to make a market and to start trade, as it will help in eliminating their problems related to trade and economic. In this way they will gain power and this will also help them in establishing relationship with other core countries of the world. By creating groups along with other nations they will have more supremacy than single third world country. Another way to overcome their situation is to alter the country’s situation of dependency. This can be done by convincing the elite class of your country to capitalize their wealth in building projects and literacy program rather than spending their money on luxurious vacations overseas. The aim of this program is to convince the elite class to spend their wealth for the development of their nation rather than on their self-centered habits but these efforts to change the behavior of the elite class were not effective. The theorist of the theory claims that our national, political, economic and international systems are facing unfair circumstances. Their perceptions are different from that of the order or diffusion approach theorist. Egypt- Case study applying the dependency theory The economic condition of Egypt from the year 1920-1950 explains underdevelopment effectively. However the way the country has worked its way through these economic disparities say a lot. It was during these years that Egypt got fully integrated into the capitalist system of the world. The country achieved the medium of political independence after the settlement of 1992 with the British. The Egyptians leaders effectively tried to implement the capitalist formula to seek out the development of their economy. They started relying on the business concerns and western capitalist states, in order to provide technical and capital assistance for the projects that they considered were beyond the capabilities of the Egyptian government and business firms. It was at the same time that the ruling elite in Egypt started to cultivate an indigenous bourgeoisie, which later led to the economic transformation of the country. The theorists have tried to discuss that what brought such great transition in the Egyptian economy. Many theorists have talked about implementing the single world system that evolves in the cyclical form. Such a cyclical system is known for ignoring various aspects of political economic and social structure. It is a fact that colonialism and neo-colonialism is considered to be the various stages of imperialism, which is considered to be a critical part of capitalist system. This world capitalist system results in the development of various areas, whereas it also causes underdevelopment in other areas because of the asymmetric relationship existing between periphery and core. This development of an undeveloped and primarily Eurocentric state towards a developed one occurred as the result of dualistic system of the unequal interdependence existing between metropolis satellite structures. The accumulative dependent relationship results in the reproduction of the periphery economy, which is the same assembly of dualism persisting in the global system. This decrease in the growth rate of periphery economy is the result of trickle down of technology and the growth in exports. The periphery economy also results in the reproduction of labor reserves, which is not justifiable on the ethical grounds as it raises inequality. If homogenous products are produced then the fixed wage rate existing between the periphery and core will cause the equalization of profits. This will also result in high wage rate and high production because of the process of unequal exchange, as the two countries produces heterogeneous products. The­­­­ unequal exchange takes place in the low wage countries, as they pay more for the imports than they would have otherwise if the wages were same in periphery and core. It is different from structural paradigm, where the share of peripheral behave as stabilizers and the share of the core real wage remains same and is passed on to the non-militant workers, working in the underdeveloped economies. The theory put forward requires some barriers, whereas the hysteresis of capital in the periphery (low wage economy) does not take place. From the perspective of the historians, the foreign direct investment flown towards Asian, Latin American, African and Arab world basically belonged to the knock-down industries. The capital flight taking off from the underdeveloped economy is considered to be a much larger threat than any other. In Egypt, the Arab Spring has been taken over by the educated youth of the nation. The unionization of the working class against the neo-liberalist and their negative implications has preceded the social popular revolution, a fact that cannot be ignored. The labor union thus formed gain prominence as they suppressed and not propagate the militancy of the labor. In Egypt, the number of worker strikes that took place from December 2006 to September 2007 was 650. Out of these strikes one of the major and most controversial strikes was called upon by the Misr Spinning’s workers in the Mahalla al-Kubra in December 2006. This strike began a new wave of labor protest in Egypt, which crossed various sectors of economy and industries present in Egypt. Although these protestors were not considered to be the first ones to protest at the Martyr Square, however the mass audience to this movement was provided by the labor unions. This revolutionary movement was the result of the western imperialist. It was in July 2013, that the democratically selected candidate Morsi was ousted by the military and the dissolution of the Muslim brotherhood took place. At this time, the Gulf States that gave preference to the hegemonic ideals over the Middle East desired that Egypt should stay constant in spite of all the turmoil and the possibility of civil war taking place in the country. It was under the rule of the Nasser that Egypt found the opportunity of leading the Pan-Arabism movement. The ironic part in this situation was that U.S. as well as the government of Egypt was di not care much about the current situation and the events that we retaking place, as none of the government showed any interest to derail the economic structure which is named by Duncan K. Foley as Adam’s Fallacy. Operation Bright Star was suspended by the Barack Obama by delaying the delivery of F-16 Jets to the current ruling military. This gesture at that time was of utmost importance as there was the requirement of regular repair of the parts. An annual aid of $1.3 billion was provided by the American government to the Egyptian army. Once the revolution ended in the mid of the year 2013, three huge contracts were sanctioned to the multinational companies by the Egyptian armies. It was also announced by the Kingdom of Saudi Arabia to provide a rescue package of $12 billion to Egyptian army (Economy Overview: Egypt, 2015). Conclusion In the case of Egypt, the western countries were not really concerned about the form of governance until the arrival of the very popular socialistic government, which explains the point emphasized upon by the dependency theory that the rich countries only take interest in the matters of developing countries when it is for their own interest. They maintained their internal stability through continuing their metropolis-satellite that they got running in the whole world. The most popular movement that initiated against the police regime collapsed once the Egyptians were taken over by the military and the whole political scenario was stabilized. There are many theorists who believe that the support that was provided to the regime of Elsisi was not a very good choice, as the military was considered to be more brutal, when it came to the suppression of labor union movement working in Egypt. The government of Egypt should try to make relations with the countries that are going to be beneficial for it in the long run. The country must not be dependent of any other countries that in any way exploit its resources. Although in the world a country cannot survive on its own without depending on others for the fulfillment of certain needs. However knowing that which relationship is beneficial and which is not is the core concept explained in the dependency story. References Economy Overview: Egypt. (2015). Retrieved July 5, 2015, from The World Factbook: https://www.cia.gov/library/publications/the-world-factbook/geos/eg.html Hadelman, H. (2013). Challenge of Third World Development . Pearson. Weatherby, J. N., Arceneaux, C. L., & Evans, E. B. (2010). The Other World. Read More