Friday, April 29, 2011

The State and Social responsibility: Moving away from traditional models

It is well known that the welfare State notion was imported from Europe, to allow massively to others, what it was granted for just a few. Did this notion fit properly with some sense of social responsibility ?.As long as Social Responsibility, deals with taking into account the interest of stakeholders (not just shareholders), probably it did so.
In this case ,shareholders were those who finance the State with their taxes, but stakeholders were those who share with the State the importance of social stability, and self esteem of being considered part of a community and their needs. Wherever these needs were not matched, it was not up to the dignity of the State, and the community which it belongs .-
Thus, the notion of welfare State is the first attempt to include social responsibility on State actions. However, further developments distorted the compromise to make the State Socially responsible, as long as the whole efficiency of the state intervention was below desirable standards.
But how do we understand a socially responsible State these days?. Latin America in the fifties, made the State the engine for economic development. Later in the eighties, it realizes how difficult is to fix what the state could not .There are limits to the actions based on the State resources.
Economic development, is a matter of private sector decisions about investment opportunities .Therefore, the State becomes rather socially irresponsible when it interferes in such a process through regulation above optimal level, inappropriate economic policies, or corruption practices which distort the price signal to allocate resources, making inequality an even more complex problem to solve. In such a situation, the State actions are far away from what is desirable in terms of its social responsible expected behaviour .-
These days of global trade and markets integration, most of the economies needs higher level of competitiveness which depends upon better public policies ,as much as efficient management private firms models.
Actually, a Social responsible State and its public policies, include a different approach which is based on helping citizens to take advantage of new opportunities no matter whether it deals with entrepreneurs, productive infrastructure needs, or regional economies and its potentialities . Besides, global citizens demand more space for freedom , self realization and wider options to fulfil each one expectations concerning their own future. The State deals in a more active way with its stakeholders and their demands, which imply that the State can not become an entry barrier for business opportunities, education facilities and better quality of services, and quality of life improvement .The Sate should move to a new condition to become a source of social responsibility, which requires deep and against the clock reforms .
In Latin America it take more time to begin a new business, than elsewhere (Asia and the USA). The justice system, work with fewer resources than what it needs, which make the law enforcement less effective than otherwise The quality of public health is far from appropriate .In Chile, even though it opened up the access to public health, there are 500.000 people on the waiting line for medical surgery in the public system . than otherwise. Public education in Latin America do not qualify among the best in the world, which affects future competitiveness gains due to lack of human capital. Besides, there are still more Psychology than enginery students. Poverty rate although decreasing in the latest years, is still a source of non traditional exports to the rest of the world. These facts do not fix with the purpose of a Social responsible State.