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Periods of economic upheaval are always destabilizing and, as such, outcomes are uncertain. We are right now faced with a great danger and a great opportunity. The danger is that "recovery" efforts will favour those in positions of strength, reinforcing existing inequalities between and within countries. As this occurs, we will see existing disparities deepen, leading to social exclusion with grave social, economic and political repercussions. The opportunity is that leadership and bold policy action could reduce inequalities among countries and across gender lines.

Historically, financial crises have been distinctly harsh on the poor, especially on poor women. With little to cushion them, this upheaval comes on top of many other calamities: such as climate change, shortage of food and clean water, lack of basic public provisioning, joblessness, distress migration and over-representation in precarious informal jobs with meagre wages. According to estimates of the World Bank, the United Nations Development Programme (UNDP) and the International Labour Organization (ILO), the current economic crisis is already reversing gains in poverty reduction and gender equality made over the last decade, with over 300 million more in the past two years falling below the poverty threshold of living on $1 a day.

One of the critical issues this crisis has highlighted is that globalization, liberalization of the finance market and a "hands off" approach do not necessarily improve market efficiency or deliver desirable socio-economic outcomes. With the economic crisis still unfolding, the idea that markets are not self-correcting, at least not in the relevant time frame, is gaining traction. If unattended, recent history has demonstrated quite powerfully that inherently destabilizing forces lead to economic disasters. Therefore, stabilizing the unstable economy has become a de facto mandate for governments around the world.

SOCIAL CONSTRUCTION OF POLICY
What is not clear yet is what type of social contracts will emerge. During the post-Second World War period, most developed countries witnessed the emergence of a Keynesian consensus. With the experience of the Great Depression, the Keynesian tenet was that an activist State had a mandate to (a) use fiscal and monetary policy so as to steer the economy clear of danger and (b) put in place rights and obligations between the State and its citizens, as well as between labour and the private sector. Concerned with the welfare of its citizens, and aware of the differences and conflicts of interest among them, States assumed the responsibility to negotiate and reduce inequalities through redistribution policies. The pact that would bring peace and social cohesion included a social security system, which allowed for old-age pension, free universal education, and access to basic services.

Then came the Washington Consensus era, with its laissez-faire ideology which proposed that a smaller role and size of government would be better for a country's economy and its citizens. Cuts in spending for ¬public services, deregulation in production, trade and finance in the North went hand in hand with structural adjustment policies in the South that mandated the selling of public assets and a diminished role of government. As time progressed, with free market practices replacing the "managed capitalism" of previous decades, privileges for the financial sector in the form of national legislation and international institutional arrangements led to money-manager capitalism. In the past two decades, industrial policy and strategic development decisions -- with a few notable exceptions -- all but disappeared; and, all the while, it became clear that the numbers of vulnerable, socially excluded and marginalized people rose and income gaps widened. In most instances, social protection became the only viable antidote that could bridge the stubborn gap between those whose boats the tide lifted and those that it left behind, sinking.

TWO SYSTEMS:
NOT A SEMANTIC DIFFERENCE Social protection came to signify policy interventions that aimed to ensure a minimum standard of living for the most vulnerable people, with cash stipends as the most popular delivery mechanism. With cash in hand, the thinking goes, those incapable of fending for themselves can at least partially procure their basic needs from the markets. Subtle as the difference may be, we must highlight that government-guaranteed social security entitlements and services have been replaced by a social protection system of cash transfers.

This is not a semantic difference. There is a big debate whether social security and social development in developing countries is enhanced via social protection or by promoting livelihood diversification. The argument has been made that social security must address the circumstances of those who work in settings, like civil service, formal markets, etc., while social assistance is appropriate for people with acute special needs, like elderly grandparents caring for poor orphaned children. Then, there is a group of people that fall in-between who can only find unpredictable, informal, seasonal employment that pays very low wages. They have no land, or the productivity of their small land holding is extremely low. Condemned to chronic poverty, they cannot meet their basic needs. For this group, social protection policies via cash transfers are fitting.

The opposite view holds that cash transfers serve a good purpose as temporary unemployment benefits, old age and disability, etc., but should not be used for the "in-between" group. Instead, cash transfers should be allocated to diversify livelihoods. Examples include subsidies for seeds and fertilizers; the building of community storage facilities and agricultural extension services to increase productivity and secure the "right to food"; generating jobs when the market fails, or when seasonal unemployment in rural areas is daunting; guaranteed public job creation; and ensuring the "right to work". Cash transfers therefore are important and necessary as they allow weaker participants to enter the market as consumers.

In this Great Recession/post-Washington Consensus period, it is unclear what system(s) of social policy will emerge. National choices at this juncture depend on the degree of fiscal space within different countries and their ability to integrate policy with social protection. Based on their position in the world economy prior to the crisis, nations are now facing diverse pressures in terms of growth, employment, food security and ¬fiscal policy space. International lending organizations and donor countries have often dictated policy, and the fear is that they will continue to do so. But in addition to economic pressures, some countries are being dealt severe blows to their human development and socio-economic stability. While advanced and several emerging economies have some room to manoeuvre, many developing economies find themselves under the double bind of government and current-account deficits. Consequently, their policy and fiscal space has shrunk. At a time when targeted, counter and cyclical policies should be put in place for all affected less- and least-developed countries, and when government spending on the social sector should be expanding, they are forced to take the opposite path.

Indeed, something particularly unfair is taking place. Developed countries and some emerging economies coordinated and infused a large amount of liquidity with extraordinary speed, which saved companies considered "too big to fail". But all countries must have the ability to introduce countercyclical policies, with international help, in order to reverse the trends of insufficient demand and growing unemployment.

It is imperative that special lending facilities are made available under favourable conditions for this purpose. Recent International Monetary Fund and World Bank documents seem to recognize the lessons learned from previous crises and structural adjustment policies; yet, the claim is being heard again that "prudent" macroeconomic policies must remain in place. Therefore, the first question really centres on whether developing countries can "afford" the appropriate budgetary allocation to promote social security for men and women alike.

This is highly problematic, as it immediately suggests budget cuts on social spending and the selling of public assets, especially in view of increasing borrowing needs which vulnerable countries are facing from the shock the crisis delivered. Most counter cyclical measures, although in the right direction, have privileged primarily the financial sector (again) and companies that were "too big to fail."

In a somewhat parallel fashion, the policies and measures which were put into place to reduce the impact of unemployment benefited workers holding formal contracts. What became of those who were poor, working under informal conditions or those without job opportunities to begin with? This is the time for fresh ideas to enter the policy dialogue. Reverting to measures that exacerbate inequality and poverty in the hope of medium-term stability and growth should be eliminated. Adhering to the increased commitments of the 2005 Gleneagles Summit to meet the Millennium Development Goals (MGDs) in a timely fashion and a moratorium to suspend debt repayments acquire more urgency, as both would be providing a crisis-mitigating function for many countries.

POLICY RESPONSES TO THE CRISIS
Both women and men are affected by the current crisis, albeit in different ways, also depending on their geographic location, socio-economic position and primary source of securing a livelihood.
The importance of recognizing the differential policy impact between women and men, as well as among women, has been presented at length by several contributions in recent months, including in a recent paper by me written at the request of the Gender Team of UNDP. One of the most severe problems of the crisis is protracted unemployment. If past events could be of some guidance, the pace of economic recovery lags far behind Gross Domestic Product growth. Joblessness will stay with us for some years to come, and the 1997 Asian crisis is a dreadful reminder of this fact. If the main problem of this crisis is increased insecurity and vulnerability due to unemployment, there is a promosing intervention that can combine job creation, while enhancing livelihood options. If designed with women's needs in mind, such a social protection policy can be pro-poor, pro-development and pro-gender equality by reducing unpaid work burdens and promoting equal wages for men and women, while at the same time contributing towards reaching the MDGs.
FROM LENDER TO EMPLOYER OF LAST RESORT As mentioned earlier, one of the unintended but welcome outcomes of the current crisis is a renewed confirmation of the indispensable role of the State. Across the world, governments have now become the lender of last resort to the financial sector, the investor of last resort in recapitalizing private companies and banks, without moral hazard concerns or immediate deficit threats to deter such spending. Equally bold action is also needed in a different area: the State ought to act as the employer of last resort in providing jobs wherever markets fail to do so. In view of the severe job crisis, direct employment creation through ¬public works is indeed emerging as a key ¬policy instrument.

During times of economic crisis, the idea of government acting as the employer of last resort, guaranteeing employment, has a very long history. Over the years, many countries have undertaken what has variably been known as "employment guarantee schemes", "public service employment programmes", "food for work", "public works programmes" and "employment of last resort" programmes. Among them, India stands out as a special case. Besides having much experience in this area, in 2005, the country voted into law the Mahatma Gandhi National Rural Employment Guarantee Act (NREGA). In addition, many other countries -- Argentina, Bangladesh, Chile, Ethiopia and South Africa -- have been making use of this policy instrument, even prior to the onset of this crisis. It must also be kept in mind that the ILO has been providing support for 20 years in the field of employment-intensive infrastructure programme development, maximizing from an engineering point of view the use of labour in construction of public works.
BENEFITING WOMEN, TOO Many arguments have been made for guaranteed employment programmes from an economic standpoint, as unemployment leads to economic, social and psychological costs. It has also been convincingly argued that distress migration, ethnic antagonism, susceptibility to dangerous ideologies and anti-democratic political movements are linked to economic deprivation. The argument for full employment is indeed based on the idea that the right to work is important in and of itself, in times of crisis and prosperity alike. This right can be found in a number of United Nations documents, including the Universal Declaration of Human Rights. However, such employment has been documented to be primarily benefiting men. According to the ILO, around 80 to 90 per cent of construction jobs were held by men. Similarly, the "environmental programme" and the "green recovery" packages in the United States and the Republic of Korea are essentially male-dominant construction jobs. Two key issues from a gender perspective stand out.

The first is that any new jobs created are made available to women as well. Either appropriate training must be part and parcel of such initiatives, which although doubtful during severe crises is not impossible, or project design must include sectors of the economy that are primarily female-intensive to counterbalance male employment generation. In addition, to address supply constraints and redress unpaid work obligations which women suffer from, day-care facilities must be put in place. Otherwise it is a hard and unfair choice for women to make between caring for young children and being gainfully employed. This is indeed part of India's NREGA.

The second the creation of specific work projects in physical infrastructure, rural development and the social sector that can benefit women directly by reducing unpaid work burdens. A cadre of workers, men and women, can build physical assets and community structures that allow easier and faster access to fresh water and better sanitation, feeder roads, small bridges, upgraded traditional irrigation systems, ecological latrines, as well as delivery services for early-childhood development and home-based care for the sick, especially for households with members living with HIV/AIDS, that can literally transform the life experience of women and girls.

There are many more examples of best practices in gender-informed design of public works. NREGA mandates that jobs be within a certain distance of the women's dwellings. Argentina's Jefes y Jefas de Hogar, following the 2001 financial crisis, provided jobs mostly to women in community upgrading projects, many of which were designed and demanded by the programme beneficiaries themselves. South Africa's social sector projects, which are part and parcel of the Expanded Public Works Programme, provide another example. The case for gender-aware design of public works could also be made from an efficiency standpoint. An extensive research project on South Africa's direct job creation programme and India's NREGA has shown that the employment, income and pro-poor growth impacts in social infrastructure and social services have indeed been much stronger than those in physical infrastructure. These results have been verified in the case of other developing countries as well.

Social protection from joblessness ought to consider an employment benefit for men and women ready and willing but unable to find work. The evidence is compelling, and the search is on for appropriate responses to the crisis. The hope is that it will receive serious consideration.