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Responses to 21 things

February 27, 2014

My last post, 21 things they never tell you about poverty, was by far my most-read yet, receiving about 10,000 views in two days. Clearly it struck a chord. I wonder whether there’s a widespread feeling that we sort-of think we’re doing things about poverty but that something is missing? Charities constantly harangue us, but poverty persists. The international media focus relentlessly on events in the rich world, encouraging us to think that is the world, but occasionally shows pictures of deprivation — which are portrayed as the exception, and the fault of poor countries themselves, separate from our actions. Certain less well-off parts of the world are synonymous with chaos and underperformance. Nothing happy ever happens there. Could it be that the causes of poverty are deeper than we think, and that, God forbid, the economic system might even be the problem — even for us in the rich world? Periodic hand-outs might not cut it.

What was interesting was to see how the post spread: at first someone in Croatia must have posted it on Facebook, because it became big in the Balkans, then during the American daytime someone put it on Reddit, which sent the most links. Twitter, surprisingly, provided a small proportion of hits. As always most views came from the United States, followed by the UK. Feedback was via Reddit, Facebook, Twitter and email, which is a bit of a shame because it meant that the discussion wasn’t in the same place. Of course for the reasons stated in point 1 most feedback wasn’t from the countries that the post itself discussed (and because it was in English!)

Anyway, enough navel-gazing. What were people’s main responses? Mostly they were very positive, which is encouraging.

One person criticised points 1 and 2 on the grounds that he or she “already knew it all”. Fair enough. Someone else thought i’d made a statement of the obvious, saying that it’s self-evident that more poor people live in Asia than in Africa because Asia is much bigger. But that’s not the narrative we’re taught. I don’t think people have woken up to the progress that’s been made in Africa or the growing differences within and between countries. Everything on telly about Asia is about the rise of China and the Oriental miracle, and how these high-tech superstates are going to run the world. Maybe, but first they have to sort out their glaring and growing problems of inequality.

Surprisingly no-one criticised point 6: “Our main tool for understanding poor countries – mainstream economics – is woefully inadequate and all about the rich world.” That’s a controversial statement, and one which i’d have thought some economist out there would have issues with. But perhaps most people nowadays just regard economists as close to a nasty thing you might step on in the gutter.

A more cogent criticism was that it’s naive of me to write that “the governments of poor countries should be more adventurous, leapfrogging ideologies. Environmental sustainability and a focus on happiness could enable some countries to prioritise the important things in life.” The objection was that in reality the marginalised countries don’t really have the autonomy to be able to pursue their own policy objectives.

But I think that’s an excessively cynical view, put about by those who imagine the world economy is a machine rather than a collection of human interactions. Governments and people all have the potential to influence the direction of the societies within which they live. Other narratives are possible — I cited the example of Gross National Happiness in Bhutan, which really works. I know because i’ve seen the policy in action. One of the incredible achievements of Cuba is to pursue a somewhat different economic system despite the United States embargo. It’d be like the UK being prevented from trade with Europe (something which politicians honestly seem to be considering, but that’s another story).

There was some criticism of the point that the world isn’t overpopulated. Again I suspect that overpopulation has become a standard trope, one which is easy to understand. But the world isn’t full up, and nor do we remotely use resources efficiently. Saying the world is overpopulated is a good way of excusing the rich world its voracious over-consumption and of absolving those 85 billionaires of their inexcusable affluence. Effective distribution is the challenge, not the birth rate. In any case high birth rates are partly a product of poverty. In all rich countries people stop having so many babies after a certain level of income. Lowering infant mortality actually reduces population growth, as this very clear video by Hans Rosling shows.

Someone expressed scepticism about point 16, which is that most countries which successfully reduced poverty didn’t directly try to reduce poverty. Others thought it was one of the better points. It’s based on the experience of the East Asian tigers, where there were no Millennium Development Goals on poverty, environmental sustainability or global partnerships for development. One of the most-ignored aspects of East Asian economic development was the sheer ability of governments to accumulate and mobilise capital and to direct it into productive areas. Health and education were certainly prioritised in some countries, but largely as a means of facilitating improvement of the stock of human capital rather than as ends in themselves. If people were sick or didn’t have good enough skills they wouldn’t be as useful. Poverty reduction in many cases came as a result of the economic boom, without direct policies aiming at reducing deprivation. After all, most Asian countries don’t even have social security. The point wasn’t to suggest that in future all countries that want to reduce poverty should initially ignore the poor, or even that they should be as brutal or utilitarian as the Asian tigers or China. They shouldn’t. But for the international development community to exclusively promote social goals at the expense of economic ends means that countries may not develop the government revenues to be able to spend enough money on education, health and social security themselves, and that development isn’t self-sustaining.

I think number 17, how rich countries behave is often more important than how much they spend on aid, is really important. I could have added the well-known point about US and European agricultural subsidies. Cotton subsidies for US farmers, in the order of billions of dollars, directly put West African producers out of business (and others, such as in Brazil).  The European Union spends around 40 billion euros a year on direct subsidies. Agricultural and fisheries subsidies form over 40% of the EU budget. Many years ago Oxfam famously calculated that in effect each European cow receives a handout worth $2.20 a day, over twice the income of the bottom billion of the world’s people.

In the comments underneath the blog Jonathan Said questioned point 18. “Just give them the f-ing money”. He rightly said that cash transfers aren’t the solution to poverty reduction. I should have been clearer. They play a small role but they’re particularly helpful because they mean that money is channelled straight to the poor without the intermediary of the charity manager or the aid bureaucrat. Aid is, or should be, a form of redistribution. The less it is just a tool of politics or patronage, the better.

There is a misperception that all aid breeds dependency and that countries should be left to develop under their own steam. This is wrong. Some aid can be problematic if it replaces funds that would have come from elsewhere, but lots of aid is the only game in town. It doesn’t ‘crowd-out’ private investment. European governments and charities are getting better at designing aid programmes, and ‘leaving countries to develop under their own steam’ really means abandoning them.

One of the worst books about development i’ve read is Dambisa Moyo’s Dead Aid. Bill Gates recently called it “evil”. Moyo presents a picture where vast oceans of aid are being squandered and stolen. In reality global aid is much smaller than she states (ridiculously, she counts only gross aid to Africa, not net — lenders receive large sums in interest payments on development loans) and aid has had a tremendous effect. Gates points out that it’s immoral to deny children live-saving medicines and vaccines, and that aid has saved hundreds of millions of lives over past decades, not to mention supported economic growth.

10 Comments leave one →
  1. March 27, 2014 2:51 pm

    Good, thanks

  2. April 3, 2014 8:08 pm

    Thanks for the informatión, here in México where in a fine line within poverty and rich people, so is critical to know better this stuff.

  3. April 4, 2014 7:32 am

    Reblogged this on flylow -paper plane builder and commented:

  4. June 1, 2014 10:06 pm

    good very good post

  5. July 7, 2015 4:04 am

    Thanks for the informatión, here in México where in a fine line within poverty and rich people

  6. September 20, 2015 8:40 am

    A well researched post that could form part of a lesson for students as they will be the next generation of shapers of the economy either as business owners or professionals.


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