The Financial Express

Middle-income blues: Slums, growth & everything in between

| Updated: August 08, 2019 22:16:04

Middle-income blues: Slums, growth & everything in between

Like the well-known "east-west" parable, the rich is rich, the poor is poor, and the twain shall never meet. Tanzil Shafique illustrates that pointedly through a discussion of Dhaka's 200,000-strong Korail slum being converted into a software technological park housing project for only one-fifth than many people. Since the land belongs to the Ministry of Science and Technology Information and Communications Technology, the contested plan is more than likely to tilt in the latter's favour, raising the very question Shafique is asking: can slums be replaced by planned, upscale communities in some blindfolded manner, or must some socio-cultural balancing, or at least blending, offer a more practical solution? Don't forget the larger question is more likely to be: where do the rest of the slum-dwellers go? Into new slums?

Questions like these plague the developing/emerging world - the faster the growth rate, the greater the chasm. Singapore could launch such a conversion fairly successfully from the 1950s, but its paltry-size sheds too little light on cases far, far larger today. South Korea, the country at about the same level of socio-economic development in the early 1970s as new-born Bangladesh, could make a somewhat similar transformation as Singapore that goes beyond visible Bangladeshi expectations even today. Its more authoritarian transformation explains one part why the difference, but only a small part. At stake are not just socio-cultural differences between economic classes, but also the widening gap between both ends, the faster technological breakthroughs today than then, and, critically, the shorter absorption time transient people have to even wait to consummate the changes.  Typical Koreans simply showed a more digestive acumen than have typical Bangladesh, Singaporeans even more so.

Of course, contraptions pile upon each other when the transiting society has a longer upward climb to complete to feel the desired change. In Bangladesh's case, that movement has been from a basket-case to a middle-income bracket, with hopes to reach the developed-country rank by 2040. South Korea's sojourn was equally protracted, from not quite so low a starting point but finishing far higher than Bangladesh today (or will be in 2040). One effect of both the size of the gap between starting and present points and the rate of transformation has to be that digestive capacity: whereas Bangladesh has prioritised a digitalised end-point when one-third of its population still remain at the margin, South Korea savoured merely a  manufacturing and industrialised target from its traditional, agricultural starting-point. The result, South Korea could savour a fuller transformation before targeting its own digitalised future than Bangladesh. In case of Bangladesh, the shift to just a low-waged ready-made garment (RMG) was so lucrative, and thereby too toxic, that entrepreneurs by and large abandoned any further technological explorations or climb: if manual labour raked in so much cash, who cared about moving up the technological value-chain? South Korea's Daewoo shifting its own RMG plants offshore from 1979 resulted from that greater digestion which has been consummated in a way that 40 years down the road, Bangladesh's constipated, or even undesired, digestion has not.

This is precisely where socio-cultural propensities get locked: the inherent desire to change remains, but with newer thresholds every other day, perhaps the ancient traits appear as the most stable to latch on to than the new. Against the force that change exerts upon individuals these days, helpless citizens end up mixing all sorts of traits, the old, inherited, and predictable ones with the newer, floating, and puzzling counterparts. It is at such junctures that the modernisation process becomes inefficient: unknown counterparts ultimately leaving no anchor to rest upon, or the target to reach given available contraptions and evermore heated competition.

Just as Korail is symptomatic of the Bangladesh case, so too is Bangladesh's case representative of a larger part of the world constantly and consistently. Technological changes in the rapidly-moving software age have been encroaching one stable country after another, from the undeveloped to transient to even developed countries today. We wee that in the populist reactions against such change, and its consequences, in developed countries, the transient countries rotating from hope to fear, or growth to relapses, and underdeveloped countries sliding more into instability as even established property right end up contested.

All of the above were unfolding differently even before the full thrust of artificial intelligence (AI) began uncoiling and destabilising societies, but along with artificial intelligence, uncertainty can easily slide into chaos. The advent of machine replacements of labour, for instance, in the RMG industry, would typically be ignored if, and only if, low-waged labour brings in the profits. Yet, if those profits only whet the appetite of owners, as opposed to innovating new frontiers, our human-machine conversion will be postponed until the costs get higher, or labour pressure through strikes, force owners into a machinery conversion. A similar conversion catalyst could be comparative advantage slipping: one country's low-wage output becoming inexpensive enough to drive a counterpart country towards mechanisation. The US RMG industry in South Carolina is on the footholds of such a change, while Bangladesh's strike-threatened RMG sector may be making a machine conversion more likely with each strike.

Income-gaps only widen under such circumstances, thus leaving society instinctively and inevitably less well-off: after all, long-term welfare demands such gaps not growing. The bottom-line is simply this: ceiling-breaking growth-rates cannot automatically deliver a developed country alone. Much more must be done commensurately at the social and cultural levels, not to mention the economic and political for that game-changing positively-inclined change: socially, for example, families have to adjust extended units towards nuclear outfits, and if that family change is too fast, that is, shifting directly into single-parent or individualised units, the interim social costs also spiral as safety networks evaporate; culturally what trait to keep, change, or modify demands as much through voluntarily before secular other forces get behind the steering-wheel, and often exposed by how religion, a dominant past behaviour and mindset, is married to such secular modern forces as cash, wealth, and privilege; economically, in lifestyles, such as consumer choices being compatible or odd, sedate or extravagant, we distinguish the plebian from the patriarchs, and the aristocrats from the bourgeois; and political in how smoothly changes get treated by legislations.

If we look around us at this 21st century juncture, Shafique is spot-on: the slum-versus-development trade-off is entering more societies each and every day, creating fabulous wealth in some pockets but depressing poverty descents in others. Yet, that salient feature at whatever level is our simple capacity to manage change as we once did. Either technology has finally trumped us, or we have gotten too greedy to pay attention to process. Whichever, as more Korails stare us in the face, how we prevent our Gulshans from becoming Gulistans may become our insolubly permanent question demanding increasingly practical answers.

Dr. Imtiaz A. Hussain is Professor & Head of the Department of Global Studies & Governance at Independent University, Bangladesh.

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