Income gap, access to education, health, land, or credit, equal treatment by the police and justice: all these are factors of social inequality that contribute to a climate of global insecurity affecting all regions, including Europe and Latin America and the Caribbean. But need for action is more pressing in Latin America because social inequality endangers the region's hardly earned democratic stability.
In order to enhance equity, governments need to actively enable a level playing field for all citizens and compensating the less fortunate, concluded participants in a recent international policy dialogue, Democracy and Social Cohesion in Latin America and Europe , convened in Berlin by the Development Policy Forum/InWent, in cooperation with the Federal Ministry for Economic Cooperation and Development and the IDB. Both German Minister for Economic Cooperation and Development, Heidemarie Wieczorek-Zeul, and IDB President, Enrique V. Iglesias, were among the participants.
Inequality is a deeply-rooted and pervasive feature of Latin American societies, participants pointed out. But there is growing awareness that high inequality has major costs and reduces the economic impact of poverty reduction efforts. Unequal access to credit and education are thought to hamper aggregate economic growth, as do social tensions.
In a region were inequality of opportunities is rampant, economic growth is condition deemed necessary but not sufficient. Participants called for pro-poor growth, implying enhanced redistribution.
On public finances, participants agreed on a promoting a fiscal reform aimed at increasing income tax rates and improving collection. And a move away from regressive spending patterns must be seen as a precondition to reduce social inequality. “The institutionalization of social cohesion through entitlements can only be successful if Latin American social policy is made more inclusive and ceases to reflect social stratification,” according to a statement.
The quest for social justice in many countries may be indicative of incipient policy change, implying that the Latin American poor are no longer perceived as mere recipients of charity, but as citizens enjoying basic social and political rights.
Social cohesion also requires public institutions that are accepted and supported by the population. Democratic integration of all population groups and the safeguarding of citizens' rights are all vital conditions for the social acceptance of a political system. In many Latin American countries, however, good governance and accountability will only be achieved after substantial political reform.
The conference discussed the role of sub-national governments in enhancing democracy and social cohesion. Decentralization may make democracy more inclusive and improve access to basic services, such as education and health care. Yet it cannot be taken for granted that decentralization will improve the situation of the poor and of indigenous groups.