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Racial Discrimination Continues at the Development Banks Hobbling Efforts to Meet the MDGs in 2015

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Recently, the Rev. Jesse Jackson wrote an article in the Chicago Sun-Times about the problem of racial discrimination at the World Bank. Jackson wrote that the Bank's legal immunities from civil lawsuits in the countries where it operates have allowed it to perpetuate racially discriminatory hiring practices without sanction from the courts. This problem casts a long shadow.

At the Government Accountability Project in Washington, D.C., we have heard from a number of whistleblowers who disclosed racial discrimination at the international financial institutions, including the World Bank. We reported on the problem in two studies, but we're still learning about the ways in which it disables the work of these organizations.

In the year 2000, at the Millennium Summit, the United Nations adopted the eight Millennium Development Goals (MDGs). Twenty-three international organizations signed on to the commitment to eradicate extreme poverty and hunger, reduce child mortality, and achieve universal primary school enrollment by 2015, among other aspirations.

The World Bank, the regional development banks, the International Monetary Fund (IMF) and the U.N. system all underwrote the effort, and the aid industry swung into full-cry fundraising mode. Estimates of what it would take to reach the MDGs varied widely, but by 2005, they had increased from the original figure of $61 billion to between $82 and $152 billion. Seven years later, the Organization for Economic Cooperation and Development further revised the figure to include an additional $360 billion by 2015.

Beginning around 2010, both observers and participants in the aid industry predicted mixed results on reaching the MDGs by the target date. Although hundreds of billions of dollars were allocated, little was used to fund the programs in places where people were poorest and most excluded from social development projects (more than half of the allocated funds went to debt relief and much of the rest went to cover disaster recovery and military expenses).

Given that they're "goals," the MDGs have always been advertised as pursuing measurable results. Benchmark figures were established for the goals and the progress was to be quantitatively recorded. Despite the use of funds for debt relief and military aid, the World Bank and the Inter-American Development Bank (IDB) are reporting substantial progress in the campaign to achieve some of the goals by next year. The World Bank reports dramatic reductions in maternal mortality, for example, and the IDB claims that gender equity in primary school enrollments for Latin America has already been achieved.

While no one is claiming that the goals have actually been reached, indications are that the reported progress is significantly overstated. This sleight of hand is accomplished statistically by making the truly vulnerable and poor populations disappear into a larger pool of data collected on a macro scale from the better-off.

In Latin America, for example, Afro-descendant groups are among the poorest people, and many of them live in places far removed from the reach of the census-takers and the government. Afro-descendants, in fact, represent about 30 percent of the population in the region, but approximately 50 percent of the poor, according to the U.N.

The World Bank recognized the link between race and poverty in Latin America in 2005:

Opportunities for Afro-Latins to improve their economic and social welfare are undermined by their lack of access to health and social services, general discrimination in public services, including the justice system, and lower levels of educational achievement. Removing the institutional and social barriers confronting Afro-Latins is a critical step if LAC [Latin America and the Caribbean] countries are to achieve the Millennium Development Goals, especially halving the region's poverty rate by 2015...

While national censuses and household data can help identify social inequities, if improperly designed or executed, they can also hinder attempts to address these problems. As only a handful of countries in the region currently include a category to account for Latin Americans of African descent, there is concern that data used for public policy planning may be unreliable or questionable criteria for establishing race and ethnic identity, and ill-trained census surveyors will continue to marginalize the existence of Afro-Latins (emphasis added).

When it focuses on the issue, the U.N. concurs:

[M]ost of the region's nations still confront deeply seated racial inequality and discrimination that impacts all aspects of economic and social life. These problems of inequality must be addressed and resolved in order to deepen and sustain opportunities for large segments of the population.

Still, in 2014, there are no long-term, reliable data about this population specifically, and therefore no way to tell whether they, who should be beneficiaries of a 15-year development campaign costing hundreds of billions of dollars and designed to improve social welfare, actually benefitted. Despite the MDGs' self-description as results-oriented, for some reason, no agency involved in the implementation of the goals regionally established a data collection method that would show whether MDG-projects were successful in relation to the largest identifiable poor group in Latin America.

The data deficit is, unfortunately, understandable, if we take Jackson's article into account. Quite simply, the racial discrimination that underlies the poverty and exclusion of Afro-descendants in Latin America is reflected in the personnel of the development banks mandated to pursue the MDGs. Our 2009 study of the personnel practices at the IDB found that, like the World Bank, the institution fails to promote racial equality adequately in its hiring, retention and promotion practices. In addition, the report showed that IDB lending failed, over the years, to reduce poverty and inequality, especially among Afro-descendant populations, when assessed using proxy measures for race.

And as Jackson showed, the World Bank does not fairly recruit and promote Afro-descendants either. The fact that so few representatives of Afro-Descendent groups occupy senior policy-making positions at the institutions charged with implementing the MDG program goes a long way toward explaining why many of the goals will not be achieved next year. Programs designed to reach the poorest groups lack knowledgeable and committed advocates at the institutions designing projects to help them.

Most unsettling, as the international organizations line up at the development aid spigot for additional billions to promote the next set of 15-year social goals, there will be little evidence of their current failure. Although they collect data on age, gender, place of residence, level of schooling, access to water, etc. in Latin America, they somehow forgot to get the numbers for race.

The General Assembly of the United Nations has declared the period between 2014 and 2023 the International Decade for People of African Descent, and Mutuma Ruteere, Special Rapporteur at the United Nations on contemporary forms of racism and racial discrimination, has spoken forcefully about the relationship between racism and poverty. In his speech on Nov. 4 last year, he said that poverty disproportionately affects racial or ethnic minorities and concluded that a lack of education, adequate housing and health care transmit poverty from generation to generation.

To date, we're only guessing at the severity of the problem. As the 2020 census takers begin preparations for the next round of data collection and the Decade for Afro-Descendants kicks off, it's time for the deficit of racial data to be addressed.