Diego Sánchez-Ancochea: Challenges for Social Policy and Cities in Latin America
Diego Sánchez Ancochea, Associate Professor of the Political Economy of Latin America at the University of Oxford, sat down with Luciano Mateo Rodriguez Carrington, the Latin America Coordinator for the Oxford Urbanists, to discuss challenges for social policy and cities in Latin America. He highlights Latin American countries’ unequal success in advancing social policy, a need to tailor ideas of universal social policy for the Latin American context, the relevance of social policy for urban integration, and the risks of overly broad international development goals. (This interview transcript has been edited for clarity.)
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LR: You’re an expert on the political economy of Latin America and the role of social policy in addressing issues of poverty and inequality. In your view, what are today’s main challenges for the provision of social policy in the region?
The end of the commodity boom in 2013-14 reversed the expansionary trend that we had seen in previous years. While social policy is now stable in most countries, it is being cut in others, such as Argentina, Brazil and Ecuador. Overall, however, no clear picture is emerging, and some trends will depend on the upcoming presidential elections in Colombia, Brazil and Mexico.
This break comes after an expansionary phase during the 2000s. High commodity prices and low interest rates contributed to a rapid upswing in government spending in general – social spending in particular. Social spending as a percentage of GDP in Latin America was seven percentage points higher in 2014 than in 2000. Many countries introduced new non-contributory programs in health care and pensions and/or reformed the existing programs. We also witnessed an increase of conditional cash transfer programs.
The reforms helped incorporate into to the social system people who have been excluded for a long time. Yet, there are still differences in program generosity for different groups, as well as more general inequalities between these groups. Further, in a recent paper, Juliana Martínez Franzoni and I show that social policy outputs differ significantly between countries. Some countries have improved a lot – like Colombia in health care and Bolivia in pensions – while other countries have fallen behind.
What are the challenges for the future? Governments need to find ways to avoid excessive talk about fiscal austerity and find ways to expand social programs while making them less fragmented and more equal.
LR: You recently came out with a new book, The Quest for Universal Social Policy in the South, with Juliana Martínez Franzoni. What does universal social policy entail for you, and what is its role in reducing inequality and alleviating poverty?
Let me start with the second part of the question. Juliana and I argue that universal social policy is really important if we want to reduce inequality and promote social cohesion. Programs that provide similar benefits for the whole population will create cross-class coalitions that support the programs’ expansion over the long run – something that several European countries have experienced historically.
In our book, we call for a significant rethinking of universal social policy in the South in general and Latin America in particular. At the moment, scholars tend to think about universalism in two ways. A minimalist definition assumes that universal social policy is just about coverage: the goal is to cover everyone even if different groups receive very different (and unequal) benefits. This will likely not reduce inequality to the extent that many claim. A maximalist definition of universalism aligns with the Scandinavian model of social policy: the goal is to provide everyone with quality services based on the principle of citizenship, funded by general taxes. This model won’t work for Latin America. While it strives for the results we want, it requires instruments unavailable to us: the region greatly struggles to tax the rich.
Instead, Juliana and I argue that we should think about universalism in terms of policy outputs. Universalism is secured when all of our interventions in a particular policy realm – like health care or pensions – result in similar, generous benefits for a majority of the population. We show that you can obtain these positive outputs with a combination of policy instruments, including social security and social assistance interventions.
When will we obtain universal policy outputs? In the book, we argue that this all depends on the characteristics of the policy architecture – that is, the set of instruments that define what is provided to whom and by whom. For example, Costa Rica was successful because it had a unified social security system where social assistance and social security provided the same benefits. So the challenge is to find ways to expand programs in a unified way, avoiding fragmentation of our pursuit of universalism into many different interventions.
LR: Issues of unplanned urbanization, rural to urban migration and urban poverty pose great challenges to Latin American countries. What could the role of universal social policy be in the creation of more just and socially inclusive cities in Latin America?
Cities include all kinds of groups: the poor, the middle class and the wealthy. A primary goal is mixing people from different classes. For example, we should try to create schools that are attractive for the middle class but close to areas where the poor live. Not easy… but not impossible! Social policies can help, but they have to be designed in the right way.
In the case of cities, we should adopt a broader understanding of social policy that includes services which promote mixing. Think about green areas and parks, where children from different origins can play together. Or think about the way cities like Lima are closing the avenidas on Sundays so everyone can enjoy them. We need to make sure that people mix in parks and avenues better than in malls!
LR: The New Urban Agenda is the outcome document agreed upon at the Habitat III Cities Conference in Quito, Ecuador, in October 2016. Elaborating on Goal 11 of the Sustainable Development Goals (“make cities inclusive, safe, resilient and sustainable”), it provides recommendations for a range of actors, including nation-states, cities, international development funders and civil society. Do you believe that the SDGs and initiatives such as the New Urban Agenda provide useful frameworks for the implementation of social policy and the creation of more inclusive cities?
Juliana and I have shown that international ideas are really important in shaping domestic debates, but they need domestic champions that “translate” them for specific contexts and secure the political support necessary to implement them.
I also believe that these types of international ideas shouldn’t be too broad; broadness may make it difficult to build the pressure needed to advance them. I worry about the SDGs, which, because they are about everything, could become nothing. But I am more optimistic about initiatives like the universal coverage promoted by the World Health Organization. The right ideas in the hands of the right policymakers can do a lot of good!
Diego Sánchez Ancochea is an Associate Professor at the University of Oxford, where he specialises in the political economy of Latin America, with a particular focus on Central America. His research interests centre on the determinants of income inequality and the role of social policy in reducing it. He has published extensively in international journals such as World Development, the Journal of Latin American Studies, Latin American Politics and Society and Latin American Research Review. He is also the co-editor of four books and the co-author of two books with Juliana Martínez Franzoni: Good Jobs and Social Services: How Costa Rica Achieved the Elusive Double Incorporation (Palgrave Macmillan) and The Quest for Universal Social Policy in the South: Actors, Ideas and Architectures (Cambridge University Press).