Financial Crisis in the UK Banking Sector Essay

Financial Crisis in the UK Banking Sector - Essay Example Likewise, those that did not have access to important natural resources have been able to access the resource base and exploit the same to their advantage. The characteristic advancement of information and technological systems has made it possible for populations, firms and corporations to exploit emergent opportunities with ease. Notably, a significant percentage of the populations are taking practical steps to align their ways of life to the societal expectations with respect to improved standards of living. Apart from benefiting the society positively, inherent globalization has also had adverse impacts on the wellbeing of the society. Perhaps the sector that has been the most affected by the relative changes pertains to the economic segment. At this point, it cannot be disputed that the world economy directly affects the quality of life of the populations. This has further been occasioned by the characteristic integration that has tied local and regional economy to the wider glo bal economy. Thus operations at the global level have direct implications on the performance and general wellbeing of local, national and regional economy. This integration has made the financial sector susceptible to the negative impacts that stem from economic shocks. Coupled with the fragile nature of financial systems, the current economic instability has undermined the ability of the respective systems to cushion themselves against relative negative impacts. One of the economic problems that has posed great challenges to the UK government as well as the global financial system pertains to the 2008-2009 financial crisis. Seemingly, relevant authorities are taking practical steps to reinstate financial stability and enhance optimal performance. This is elemental in enabling them to attain a desirable state with respect to sustainable growth and development. Fundamentally, relative strategies are in line with their economic goals and objectives. Besides the challenges that are rel ated to economic integration, the UK financial sector has been compounded by governance problems. At this point, it cannot be disputed that governance problems contributed a great deal to the financial crisis that the country experienced at this particular time. In a society that is characterized by uncertainty, effective governance is important in enhancing optimal performance. Governance in this regard is all encompassing and ranges from the expertise and policies to the rules and regulations that are established to guide behavior and decision making. These need to be based on informed thought and to bear desirable outcomes; they need to be consistent with the economic changes being experienced in the market. Indeed, the fact that good governance is essential and contributes significantly to the integrity as well as stability of financial systems cannot be overstated. With this asset, corporations and organization can be able to maneuver their way through the volatile economic env ironment. It is against this background that this paper provides an in depth analysis of how poor governance in the UK financial sector contributed to the financial crisis that it experienced. To enhance coherence, the paper begins by explaining the notion and importance of good governance in the current financial corporate sector. Understanding Good Governance In his research, Hart (1995, p. 54) contends

Critique of Research Articles Paper Example | Topics and Well Written Essays - 750 words

Critique of Articles - Research Paper Example Chavers, B.M., Solid, C.A., Daniels, F.X., Chen, S., Collins, A.J., Frankenfield, D.L., & Herzog, C. A. (2009). Hypertension in Pediatric Long term Hemodialysis Patients in the United States. American Society of Nephrology, 1363-1369. Sample Characteristics: For the USRDS CMS ESRD CPM special study, BP measurements were attained for the complete population of the US of pediatric long-term hemodialysis patients getting therapy during the fourth quarter of 2001. In other words, the researchers have been capable of adequately defining the samples. The theoretical framework that has been considered for the purpose of this study is that most of the clinical issues faced by the patients having haemodialysis are mainly related to their incapability to eat proper foods and restrict their fluid intake. Experimental research design has been used in this study. It can be stated that the research design that has been used is appropriate for such kind of studies. The study was randomized trial in which two teaching programs had been implemented such as video education and oral education. The sample size for this study has been sixty-three patients who have haemodialysis. Therefore, it can be stated that the sample population has been adequately described. The sample size is adequate for this kind of study and can adequately help to achieve the research objective. Sampling Method: The sampling method that has been used for this study is random sampling method. It has been found that the analyses have been successful at addressing each research question. The study makes use of linear mixed model. The study has tried to avoid Type I and Type II error. The slope related to intradialytic BP over dialysis was deliberated by the log of BP degenerated over time. By utilizing a linear mixed model, the slopes between control as well as ultrafiltration groups present at baseline and over a period of times were compared. The effect of dry weight

Managing Multicultural Team Diversity

Managing Multicultural Team Diversity The purpose of this work is to illustrate literature that suggests that member of multicultural team brings all new fresh ideas and approaches to problem solving. Those members however come up with a challenge by also introducing different understandings and expectations regarding team dynamics and integration (Ochieng and price 2009). Dealing with the question of how being attentive to the diversity and creating the structure required for success, a manager can effectively work and same time influence multicultural team diversity. This paper uses a case study of heavy construction engineering projects and its Findings identifies key multi-dimensional factors that either facilitated or limited the effectiveness of multicultural teamwork. The result has implications for managers who work with multicultural teams and are committed to improving team performance and productivity (Ochieng and price 2009). However, it revealed key dimensions to consider but it would not instantly transform multicultural teams into high-performing ones. Originality/value Though the benefits of multicultural teams have been acknowledged, the study helped to develop an understanding that conflict, misunderstanding and poor project performance can occur because of the cultural differences among teams (Ochieng and price 2009). Introduction: While diversity efforts have the potential to strengthen organizational effectiveness and efficiency, and to advance social justice, study has shown that realizing the full benefits of diversity is neither a simple nor a straightforward process. It is quite another to develop a supportive work environment that enables people of diverse backgrounds to perform at their highest levels, contribute fully to the organization and feel professionally satisfied. It is an even greater challenge to integrate fully the varied knowledge, experiences, skills, creativity, perspectives and values that people of diverse backgrounds bring into an organizations strategy, goals, work, products, systems and structures. (Adle and Gundersen 2008) Managing diversity is an on-going process that organises various talents and capabilities which a diverse population bring to an organization, community or society, so as to create a wholesome, inclusive environment, that is safe for differences, enables people to reject rejection, celebrates diversity, and maximizes the full potential of all, in a cultural context where everyone benefits (Rosado 2006). Results have shown advantages and disadvantages (Williams and OReilly 1998, Chevrier 2003). In fact, workforce diversity isnt a competitive organisational strength unless its effectively managed. Allard (2002) founded that diversity itself does not guarantee greater success in business nor does it guarantee qualitative social and creativity improvements. Ancona and Caldwell (1992) explain that difficulty of merging different cognitive styles, attitudes and values, such as those found in teams with diverse members. Diversity if not well managed can create internal processes that slow decision making and keep members distracted from the task. Teams made up of individuals from different thought-worlds may find it difficult to develop a shared purpose and an effective group process. (Worman 2005) The general motivation in growing use of teams is the degree of diversity in the workforce of multicultural organization; multicultural team provides an efficient and flexible way to coordinate production requiring a diversity of skills, talents, and information (Eckel and Grossman 2005) Team diversity may permit greater productivity than could be achieved by individual effort as no individual possess all task-related characteristics necessary to achieve the desired goals. The cross-fertilization possible in a diverse work team leads to more creativity; diverse teams are more effective (Northcraft et al., 1996). Literature review: The emergence of globalization means organizations no longer rely upon the traditional teams. There is a need of people from different cultural background to work together to make global enterprises succeed in the global marketplace (Steers Nordon, 2006) they also founded that Multicultural teams provide an open opportunity to integrate widely differing social, cultural, and organizations perspectives into key decisions that affects the success of all international operations(liaqat et al 2008) The management and development of teams within a global context unavoidably leads to a consideration of diversity and related challenges. For appreciation of international context and development of abilities to understand everyday issues from different cultural perspectives it is essential that managers receives help form organisations. Bartlett and Goshal (1989) identified the main challenge facing organisations intending to work overseas as the introduction of practices, which balance global competitiveness, multinational flexibility and the building of global learning capability. The authors further argued that if organizations have to achieve this balance, they must develop cultural sensitivity and the ability to manage and build future capabilities. The worlds most innovative firms, such as Microsoft, took advantage of diversity by introducing multicultural teamwork as (Ely and Thomas, 2001) diversity increases the number of different perspectives, styles, knowledge and insight s that the team contributes to organizations complex problems. However, team integration requires organisations to value explicitly multicultural teamwork, to adapt to it and use it to generate improvements in work performance and team effectiveness. There are literatures on cultural diversity which examines team members, demographical backgrounds and other such relevant factors to their diverse cultural characteristics, values and discernments ([Ansari and Jackson, 1996].As confirmed by McLeod and Lobel (1992) multicultural team generates more high quality ideas in brainstorming tasks, and when it comes to identifying and solving problems culturally diverse teams perform better than homogenous teams Jackson et al. (1992). And a better utilization of multicultural team by organization yields significant gains in productivity Townsend et al. (1998). For example, Ng and Tung (1998) a multi-branch financial services firm with culturally diverse team gained more financial profits than t o their culturally homogenous counterparts. More recently, Marquardt and Hovarth (2001) established that if the energy and synergy of individuals from diverse culture are managed, organisations could generate creative approaches to problems and challenges that are faced by corporate teams in tasks, they provide their significance for organizations in international marketing activities, expertise to decision making and managerial actions, a greater possibility to implement the decision in a timely manner, there is limited empirical evidence that decision consensus actually leads to decision implementation speed or success (Preim et al 1995). Multicultural Teams in few cases reach to a consensus on a decision by overcoming conflicts but at time of implementation they still face problems, Alternatively when groups smooth over task related disagreements decision consensus suffers because of the remaining latent conflicts among the group members (Preim et al., 1995). Findings of certain studies reveal that communication in multicultural teams fosters the formation of an emergent team culture. Team culture has a straightforward rules, performance expectations and individual perceptions upon which multicultural team develops and depends. Earley and Mosakowski (2000) further confirmed shared individual prospects facilitate communication and team performance resulted from strong emergent culture of effective multicultural team. This also suggests that the performance and team effectiveness can be improved and boosted through the positive effect and trust generated by the perceived shared understanding. Most importantly, the formation of strong emergent team culture can be facilitated by effective interaction among team members Pearson and Nelson (2003). Nonetheless, as multicultural teams are particularly susceptible to communications problems this can affect team cohesion. Individuals in multicultural teams can have different perceptions of the envi ronment, motives and behaviour intentions. Shaw (1981) argued that due to impeded social cohesion the effects of such differences could result in lower team performance. Further research by Evans and Dion (1991), on these two variables showed a positive correlation. Even Elron (1997) asserted that cohesive teams are more efficient and respond faster to changes and challenges. Generally the most common challenge to multicultural teams is Managing cultural differences and cross-cultural conflicts (Elron, 1997). The main cause of conflict is the cultural issues among team individuals because working style of each culture is significantly different from other culture and other reasons are misunderstanding and poor performance (Shenkar and Zeira, 1992). As (Pearson and Nelson, 2003 found there is five important distinctive challenges that managers face are: developing team cohesiveness; maintaining communication richness; dealing with coordination and control issues; handling geographic distances and dispersion of teams; and managing cultural diversity, differences and conflicts). Because of the distinct perception managers from different countries have on environmental opportunity they are likely to translate and respond differently to the same strategic issues or team tasks. To address rapidly changing and complex nature of working environment multicultural teams must improve their ability to combat such external challenges. The sense of belonging to a group gives a growing feeling of safety and comfort to team member in return can enhance the response to task challenges (Schein, 1985). Case study: E.G. Ochieng and A.D.F. Price caries out interviews to the eight organisations that were selected, operated in the energy, pharmaceutical and petrochemical sector. The selected organisations were well balanced in terms of size, status and projects managed, where 20 of the participants interviewed were picked on the basis of project management experience with each having long-standing familiarity in managing large and complex projects over a period of many years, Being familiar with cultural issues empowers project leaders with the requisite knowledge for improving the efficiency of managing multicultural project teams. Addressing the poor performance of multicultural project teams remains an aspiration within the construction industry (Baiden, 2006 Baiden, B.K., 2006. Framework of the Integration of the Project Delivery Team. Unpublished Ph.D. Thesis, Loughborough University.Baiden, 2006). There is mounting evidence and opinion indicating that integrated teamwork is a pri mary key in efforts towards improving product delivery within the construction industry (Egan, 2002). There is a growing trend towards discussing cross-cultural complexity more openly within the construction industry as the demand for international construction projects with multicultural project teams have been exceeding, same time to examine if cross-cultural complexity and cross-cultural communication can be effectively managed, before exploring the effective management of multicultural project teams. The finding shown, that all team member need to trust and understand each other in order to achieve a fully integrated multicultural project team. It is also evident that when it comes to carrying out project tasks all participants favoured collectivism over individualism. The research established that communication in the multicultural teams is a significant factor in the successful completion of heavy construction engineering projects. It is essential for project leaders to ensure that the nature of the interactions do not affect the strength of the relationships between project teams and their ability to transfer knowledge and information required to complete project tasks successfully. As substantiated from the findings, project leaders need to implement a clear and robust procedure of resolving conflicts that might arise. Participants further acknowledged that in a multicultural project team, individual achievement is not valued in a collectivist culture; whereas in an individualistic project team it is one of the most important values. Thus, in a collectivist project team, even though the project leader might play the most important role in successful realisation of a project task, reward is often given to all team members. The consensus that emerges in this study is that a collectivist culture in heavy engineering projects emphasizes the importance of team effort to success, and is not likely to attach failure to an individual person even though this pe rson is the project leader. From the above, four key factors has been identified by the authors that influence multicultural project teams at team levels. These were cross cultural communication, cross cultural collectivism, cross cultural empathy in project leadership and cross cultural trust. What needed to be well understood is that the effective structure of a multicultural project team depends on a well structured integration system, between the client, project manager and the project team. As illustrated by the two groups in this study, the culture of a project manager plays a major role in how the project team will perceive cross-cultural communication on projects. Evaluation: Katzenbach and Smiths have outlined three team goals in his model of team basics: performance results, personal growth and collective work products. Management sets the Measurable performance in order to give the team a rationale to exist. The individual as they have the responsibility for personal growth, they must align with and contribute to the teams goals. The last is collective work products instead of individual products. To achieve all three goals team needs skills, commitment and accountability. To master the assigned tasks Problem solving, technical, functional, and interpersonal skills are necessary. The teams sense of responsibility culminates in accountability for the assigned tasks. Furthermore, only the collective unit not the individual will be responsible for the teams collective product succeeds or fails in fulfilling expectations. Finally, the individuals commitment is important when conflicts, difficult tasks or other critical situations arise. Study by several authors found that Power Distance moderates the relationship between participation and organizational commitment whereas; resistance moderates the impact of culture on satisfaction and commitment (Kirkman and Shapiro 1997). Katzenbach and Smiths model has two more dimensions; the collective and individual dimensions. According to agency theory (eraz and Earley, 1993), individual tends to maximize his self-interest, and accordingly faces a dilemma when working in organizations. Triandis (1995a), and later Eraz and Earley (1993), found that individualists performed better alone than working in an ingroup or outgroup. Conversely, collectivists work better in an ingroup than in an outgroup or alone. This shows how the degree of heterogeneity is not the only determinant of performance. The involved cultures and their characteristics must be considered to assess whether the team is likely to perform well. Conclusion: multicultural team encounter specific problems that can be summarized in three categories: attitudinal problems (mistrust, stress), perceptual problems (stereotyping, tension) and communication problems (Adler, 1991:) however, cross-cultural teams are more effective at generating ideas (enhanced creativity, more alternatives, better solutions) and display limited groupthink (critical evaluation of diverse ideas, self censorship). With the findings of the case study it has been concluded that if the maximum benefits are to be obtained from multicultural team, it is imperative that these negatives should be overcome by proper managerial initiatives. Team managers need to know how to ensure successful behaviour integration among diverse group members (Wright and Snell 1999; kreitz 2008)HR managers must ensure that team managers have adequate training to help them develop needed skills in the emotional aspects of group management, intervention techniques, communication, and team building so that they can manage diverse work teams effectively. Effective teamwork requires members to recognize the team as a unit with common goals, values, and norms (Lembke and Wilson, 1998). The more that team members identify with one another, the more likely they are to believe they hold similar goals, values, and norms, and the more willing they will be to cooperate and work together as a team.( Cummings 2004; Kreitz 2008) Managers must remember that not all sources of diversity in work groups enhance the value of knowledge.87. Jonathon N. Cummings, Work Groups, Structural Diversity, and Knowledge Sharing in a Global Organization, Management Science 50 (2004), p. 360Different diversity characteristics should be chosen to enhance team performance and should be aligned to the teams purpose and goals. An individual who perceives herself as a member of a team is more likely to perceive the fate of the team as her own (Ashforth and Mael, 1989). This commonality is more likely to be recognized if team members are, or perceive themselves to be, of the same social category.

Civilization: Savagery, Power, Fear :: Free Essay Writer

Civilization: Savagery, Power, Fear Civilization is when man meets his basic needs. Civilization begins to form when man is searching for something more; something better than just meeting his basic needs, for he has already achieved this. Civilization forms slowly and carefully, and once it is formed, it can change and be destroyed at any moment. Civilization is as fragile as an eggshell, and it has three basic forces that can destroy it: savagery, power, and fear. Savagery is when a people revert back to their lost human instincts. Savagery is most often found in situations where the people are under extreme circumstances. One example of this is being stranded on a deserted tropical island. In William Golding's book, Lord of the Flies, he has done just that. Golding had his characters revert back to their lost human instincts. When the boys on the island finally catch a pig and get meat, the one hunter, and main character, Jack, cannot bear to let someone else tell his savage story. He begins, "We spread round. I crept, on hands and knees. The spears fell out because they hadn't barbs on. The pig ran away and made an awful noise-It turned back and ran into the circle, bleeding-We closed in-I cut the pig's throat-" (p. 74-75). Jack has reverted back to savage, uncivilized ways; his civilization has been shattered because of being stranded. Jack even gets the rest of the boys to join in, "As they danced, they sang. `Kill the pig. Cut her throat. Bash her in.'" Savagery can destroy civilization. It only takes a small number, even a single person, to revert back, and everyone will soon follow. Another example of people being savage is in the book, The Pearl, by John Steinbeck. In this book, when a family finds an unbelievably large pearl and tries to better their own lives with it, their friends and neighbors become their enemies, they even begin to fight in their own family. Greed has caused the family and the townsfolk to revert back to being savages. One example of this is when Juana, the wife, tries to rid them of the pearl because she knows of its bad nature. Kino, her husband, catches her, "Her arm was up to throw when he leaped at her arm and wrenched the pearl from her. He struck her in the face with his clenched fist and she fell among the boulders, and

Roger Chillingworth’s Journal

Doctor Roger Chillingworth July 21st 1646 The minister's health is fading. I fear that if I do not find a solution to his ailment soon that he may die, leaving me without a meaningful patient. Maybe it is Hester Prynne that is the problem. She is the evil influence that is taking the last little bit of life he has left. I am ashamed to think that I was even minutely involved with her many years ago. I used to be a good man but our terrible marriage corrupted me. All I have left is Mr. Dimmesdale. I have made him a concoction using plants I found on tombstones.I hope that these plants, which have grown from buried human hearts will have an effect on him. If he dies then I will no longer have a patient to perform experiments on so I will have to slow my medical research until I find another ailing individual. It will be hard to find another individual with such a strong heart and a similar aura to the pastor. Also, a victim with enough assets to pay for my expenses. He knows that I hav e profited from his ailments and his weak frame. I do not see the Pastor's recovery as a likely scenario.I see that he is heading to his grave so I need to take as much energy from him before he passes on. Maybe it is the demon child Pearl that is causing his imminent death. She has her own sickness which I tried to cure previously, but was unable. The deep rooted evil in the child is something even the most skilled physician cannot remove with any medicine. You can see the malevolent spirit in her eyes. I wonder if the father of this child is the devil himself. Hester is too ashamed to name her father even years after the incident. One day I will find out how this child came to be.Perhaps I will go out again to the forest tonight and perform a ritual to try to find out the true father. I must find out soon, I am getting to be an old man and I fear my time in this town is limited if I cannot find another host. I shall take the pastor for a walk on the beach tomorrow while I secretly gather ingredients for a spell. He has not been walking as well but I will still insist that he come. I must search into this matter further. If he questions me as he usually does, I will give him some medicine to calm him down.I have a draught I have made that will slow him down for a few days giving me the opportunity to control the situation. My intelligence is far superior to that of Arthur's and I can use that to my advantage. It is true that he is a man of purity; but he is also naive. He is the perfect patient in every way. I hope that my medicines can extend his life for at least another year. He is a very rare case, I must find out more before he leaves my care. I will continue practising on him until he expires. ,Roger Chillingworth~

Death of An Economy

My topic deals with Pakistan, its relationship with the IMF and World Bank, and its internal problems that are causing unemployment, poverty, economic crisis and hunger. I shall be analyzing the situation using the neo-classical theory, as it is what the economists of the Pakistan government and the IMF are using to alleviate the economic instability of the country. Situated in the sub-continent, Pakistan is a low-income country, with great promise for growth. Unfortunately, it is held back from reaching middle-income status by chronic problems like a rapidly growing population, sizable government deficits, a heavy dependence on foreign aid, recurrent governmental instability and large military expenditures. It is to address these fundamental faults in Pakistan†s economy that the IMF has initiated the Structural Adjustment Programs (SAPs) in the country. This is discussed in further detail later in the paper. Like all developing countries, Pakistan†s population is largely employed in the agricultural sector, which accounts for about 48 percent of the labor force. In today†s world the Industrial and Service sectors are the largest growing areas of a developed county†s economy. Yet Pakistan only employs 39 percent of its population in Service, and a minute 13 percent in Industry. This is a paltry figure, compared to the employment statistics of a developed country. Pakistan is also heavily dependent on a single export crop, cotton. Hence the country†s fortunes rise and fall with the cotton market. It is no wonder that there are so many poverty stricken people in Pakistan. When almost half the population is involved in a very volatile market, a lot of the time, a lot of people will be burnt by price fluctuations. The country is also subject to the mercy of the weather. Focussing on a major cash crop means very little diversification. This translates to mass hunger and hard times for the agricultural sector whenever the agrarian lands are ravaged by floods, or conversely, by droughts. Even more importantly, Pakistan†s agricultural sector is marked by large landowners, controlling most of the production. Hence, only a minimal amount of the profit from exports goes to the poor people working for the large farmers. It is these people who constitute a large portion of Pakistan†s population. It is also these people who are living in abject poverty in the rural regions of the country, devoid of the right to feed their families. This is a great illustration of a theme discussed in â€Å"World Hunger, Twelve Myths.† Lappe, Collins, Rosset and Esparza discuss the commonly believed myths about why hunger and poverty exist. In it they clarify this very important point: hunger does not exist due to a shortage of available food, but because of ‘fear† and ‘powerlessness,† resulting in the ‘anguish, grief and humiliation† felt by the hungry and poverty stricken. Pakistan is a classic example of this theory. Based on a feudal system, especially in agriculture, Pakistani society is primarily controlled by feudal overlords, (a.k.a. the politicians or relatives of politicians), who own or oversee most of the agrarian land and industrial base. Being above the law, due to their political influence, these corrupt people can literally get away with murder. Thus, keeping their laborers subdued and underpaid is no hard task. Anyone who dares to complain is used as an ‘example† for potential future unrest. As a result, the people in their ‘elakhas†, (controlled lands), remain destitute in the throes of poverty, unable to help themselves due to their lack of power and the fear of the ‘thekedars†, (large landowners). By a lack of power, I refer not to a dearth of physical prowess but to a scarcity of basic human rights. These are the same rights that people in developed countries take for granted. The right to vote for whomever one feels like is missing. Instead a lot of villagers are forced to vote for the local land owner due to a combination of fear and ignorance; a fear of the repercussions of a potential loss by the feudal lord and the ignorance of any means to escape this same overlord†s wrath. Very often there is also no choice of candidates. There are very few people willing to risk their own and their families† safety by running against their subjugators. All this goes against the very nature of the free market economy that Pakistan is supposed to be running. While the IMF and World Bank are using Neo Classical theory to address the nation†s problems in the capital, half the country is still being run under the feudal system. Till this system is broken, and the immense lower classes are empowered there is not a dent that can be made in the country†s poverty and hunger issues. Rather the problem will continue to grow right under the economists† noses. Pakistan is also set back by ethnic problems, having numerous groups including Punjabis, Pakhtoons, Sindhis, Balochis and Mujahirs. Speaking different languages, the different ethnic groups do not get along very well as is witnessed by the numerous clashes between Sindhis and Mujahirs in the violence torn city of Karachi. The language barrier also translates to a lack of mobility of labor, which is a key to economic success under neo-classical theory. Hence the large sparsely populated province of Balochistan is presently under utilized. Due to a lack of available labor, industries are tough to set up. If the language/ethnic barrier could be overcome, the rich lands of Balochistan could potentially become the saviors of Pakistan†s economy. Pakistan also has a very week industrial base. Being an ex British colony it suffers from a similar problem to the one ailing a number of the African and South American countries. This issue is that the colonists never bothered building up the necessary base for industrialization. While the rest of the world was busy building this base, greedy colonists who did not care about the country and thus paid no attention to its development were exploiting countries like Pakistan. Hence Pakistan is permanently playing catch up to the rest of the developed world leaving very little money for social services to help the situation of the poor. The literacy rate in Pakistan is also very low. In 1992, the official literacy rate for the adult population was said to be a low 36 percent. Even more dismal was the statistic that listed 45 women being educated for every man. With this dearth of qualified personnel, there is no room for economic growth as there are no new minds to head the growth. Women are also the primary food producers in Pakistan. If they are not being educated, it means that they are not up to date on the latest production techniques, which in turn translates to inefficiency and the aforementioned ignorance. Once again it all ties into the powerlessness that marks the hunger and poverty-stricken. Women represent 54 percent of Pakistan†s population. If they are not allowed to exercise their rights to an education and to vote, how can the country be expected to progress? It is like asking a man with one leg to run. Like other third world countries, in Pakistan, substandard housing, inadequate sanitation and water supply, and widespread malnutrition contribute to spread of disease and to high infant, childhood, and maternal mortality. The leading causes of death are gastroenteritis, respiratory infections, congenital abnormalities, tuberculosis, malaria, and typhoid fever, all preventable diseases. Unfortunately the poor, uneducated lower classes are not given enough attention by the corrupt officials running the country, which is resulting in their situation deteriorating year by year. These, along with other economic and social issues are causing immense hunger and poverty in Pakistan. Presently Pakistan is passing through an unprecedented economic crisis, made worse by the global recession. The turmoil in domestic markets and the imbalance between resources and liabilities threatens to roll back the modest levels of economic development and industrialization that Pakistan has achieved so far. Had it not been for a reasonably strong agricultural base, the situation would be much worse. This ‘situation† has been caused by a mixture of issues, including the near sightedness of politicians and their persistence in following politically popular, but economically disastrous policies. An example of this is the detonation of a nuclear bomb a year ago. Simply to show off to India and the rest of the world, as well as to raise their local popularity, the Pakistani government decided to go ahead with an unnecessary test that brought economic sanctions against them and also cost them a lot of their aid from western countries. However, much more important have been the structural reasons underlying this deterioration, all of which have been contributing to the growing feeling of desperation the hungry and poverty stricken have been experiencing. Before this paper begins finding solutions to the problems at hand, we need to remind ourselves of the key issues. 1) One major problem that Pakistan needs to deal with is the fact that its expenses are far more than its revenues. Partly due to decades of lax fiscal management, but more because of myopic policies in its external relations, the militaristic structure of the state and the narrow vision of its rapist elite, Pakistan is Rs 100 billion short of the money to simply keep its existing machinery operational. How is a third world country supposed to develop an infrastructure when it is spending more than its net revenues on only two items, debt servicing and defense? In fact, Rs 18 billion of its defense has to be financed to borrowing. The Pakistani government has not been governing; it has simply been acting as a debt-securing agency. 2) Lately the government has been touting the fact that it has achieved the IMF imposed budget defect target. What it neglects to mention that it achieved the target through questionable means. Firstly, it drastically reduced its developmental expenditure from 7.5 per cent of GDP in the early '90s to a paltry 3 per cent, which translates to a cutback of 140 billion in present prices. A cutback of expenditure of such extent in the governments purchases of private sector goods like cement, pipes and cables and services like engineering explains why a number of private sub-sectors are at the point of closing down, operating at a vastly reduced capacity. This is adding to the issues of hunger, poverty and unemployment being faced in Pakistan. The government has also reduced the amount it givers to the provinces by Rs 30 billion, transferring some of its debt to the provincial governments. In other words the government has done nothing to resolve the issue of structural defect. 3) What†s worse is that not only has developmental expenditure been sharply curtailed, but that the scarce resources set aside for infrastructure works have been diverted to less productive investments_like the new motorway and the new Lahore airport. This massive reduction of the public sector†s developmental activities is causing a contraction in employment opportunities for Pakistan†s growing number of middle class educated youth. This is particularly serious in the areas where the private sector is unlikely to locate due to the lack of infrastructure. Thus the really poor areas continue to live in poverty due to the government†s inability to provide adequate physical and social infrastructure or create an environment for private sector investment. It has also not been able to maintain law and order and is guilty of not living up to its contractual obligations which is further discouraging foreign and domestic investment in the country. The treatment of its foreign currency account holders and IPPs last year illustrates this point. 4) Pakistan suffers from the typical problems that all third world countries suffer. One of these is massive corruption at all levels, estimated at Rs 100 billion a year. This means that a large portion of national wealth has been stolen from the poor. No wonder, the country is unable to lift itself out of the quagmire of poverty and hunger. 5) Tax evasion is another issue that the government needs to address. Successive governments have failed to establish a tax culture due to an inequitable structure, which taxes different sources differently. An example of this is provided by the large farmers who, despite now getting higher international prices for their crop, are unwilling to pay the modest levels of provincial taxes. The political leadership itself does not pay its taxes diligently. Thus, unless companies owned by sitting ministers install invoice based systems for tax accounting, it will continue to be difficult to enforce retail taxes. Also, the repeated bowing down of the government to shutter-down threats of traders and the repeated refusal of large land-owners to meet their tax obligations is increasing the burden of taxes on the helpless poor, the organized sectors, and the honest people foolish enough to pay their taxes. If the rich are not willing to meet their responsibilities, how are the poor supposed to survive? 6) There is the additional problem of a gap of between 5 an 6 per cent of GDP per year between domestic national savings and investments which translates to approximately Rs 150 billion being financed from external borrowing. This further adds to the crippling debt that is allowing the IMF and World Bank to interfere in the formulation of domestic economic policies. 7) The external debt of around US$ 34 billion is more than 50 per cent of GDP, and four times the annual foreign exchange earnings. Pakistan can neither repay nor service this debt. So far I has only postponed the inevitable, default by piling up further debts at abominably high rates. 8) Pakistan†s exports compromise 0.2 per cent of world exports and diversification from a single crop economy has remained an elusive dream. Therefore to hope for exports to be the driving force of economic recovery, as the government is doing, would require an astronomical rise in exports, and the price of cotton. In other words it is impossible. 9) The country†s ability to export is also affected by sluggish world trade, which coupled with an over valued currency, is rendering Pakistan†s exports uncompetitive. With the rise in the price of oil, the gap between import bills and export receipts is widening. 10) Until now this gap has been met with remittances and short-term borrowing. But due to a decline in remittances for a number of reasons and Pakistan†s declining credit, this is no longer an option. It therefore seems that it is impossible to maintain the present levels of growth rates and imports as well as meet debt servicing. 11) Public sector industries are also deeply in the red due to over-manning, corruption, and the protection given to large defaulters of utilities. The combined debts of just WAPDA and KESC, (which deal with electricity and gas respectively,) are Rs 91 billion while the loans of 18 public sector enterprises is close to Rs 250 billion. 12) The government is offering 15 to 18 per cent interest rates on its saving schemes which is far to high for it to be able to generate high enough returns to service the debt and still have enough left over to finance developmental activities. 13) Most of Pakistan†s industry faces the issue of negative or nominal growth, while value-added industry is operating at 30% below capacity. The limited growth is due to a lack of comparative advantage, the lack of credit availability and a high interest rate. Despite inflation being well below double digits, interest rates are as high as 15 to 18 per cent on loans! This is too high to keep the present economy afloat, let alone raise it to a maintainable level of growth. 14) There is also a lack of confidence in the government by the private sector. How can a government that cannot even handle domestic peace issues be expected to turn around an economy that is in the throes of a downward spiral? Therefore the private sector has been occupied in short-term trading and currency speculations which do nothing for growth or the welfare of the state. 15) An obvious result of this situation is that the disparity between the rich and the poor has grown. The share of the poorest 20 per cent of households has fallen to 7 per cent while the richest 20 per cent are receiving over 45 per cent. The low rate of economic growth and the high rate of inflation over the last few years have left the poor with no buying power resulting in almost a third of the population living below the poverty line. There is also anger amongst the poor about the fact that the incidence of increased taxation has been heaviest for them; expenditures on services for them have declined. Social tensions are rising with the growth of the absolute number of poor, illiterate and jobless, as employment opportunities and wages decline due to the stagnating economy. Such conditions are hardly conducive to political and social stability, without which growth will remain a distant dream. On top of all of this, Pakistan is plagued by the curse of the IMF and World Bank. Constant defects in the current account of the balance of payments and depleting foreign exchange reserves is causing the extension of credit to become an exercise in haggling and bargaining. Each time there are negotiations along with a string of conditions attached to the loan. The release of credit is then delayed until each and every condition of the IMF has been met. The only way that Pakistan can now secure loans and vital extensions on its debt is to institute the Structural Adjustment Programs that have been drawn up by IMF economists. The problem is that the benefit of these programs is questionable. Most countries have suffered immensely from them. Instead of improving the economy, these programs have been destroying them. Unfortunately, like other countries that have yielded to the them, Pakistan is virtually being taken over by the IMF, along with the World Bank.