Week 9: Ending Extreme Poverty

In Jeffery Sachs’ discussion of development assistance he proposes that it might be more harmful to the global community if those who are able, the wealthy, do not help the poor. It is not a question of ability, but a suggestion that if they don’t, the consequences will outweigh the modest costs. Sach’s provides five reasons why the effort to help the poor will not be as taxing as many people believe:

  • The numbers of extreme poor have declined to a relatively small proportion of the world’s population
  • The goal is to end extreme poverty, not all poverty
  • Success in ending the poverty trap will be much easier than it appears
    • Get practical, investments in specific areas
      • Roads, power, water, sanitation
    • The rich world today is so vastly rich
      • Modest increase in taxation or a burst of large-scale philanthropy
    • Our tools are more powerful than ever

The End of Poverty targets less than one percent of the rich-world income for foreign aid. Highlighting the role of a few big countries, such as the United States, Japan, and Germany, Sachs’ proposes that they would account for ninety percent of the increase. While many Americans are displeased with the widening gap between the rich and the poor and I agree with Sach’s proposition, the reality may hinder progress. A 0.7 percent of GDP to foreign aid (USA) is not unfathomable, but political strain and economic stability could make things difficult.

“All of the incessant debate about development assistance, and whether the rich are doing enough to help the poor, actually concerns less than one percent of the rich-world income” (288 Sachs).

In Ghana, the sector breakdown of ODA highlights the extreme need for aid directed at education, health, and infrastructure. By supporting financial investments in basic needs, Ghana will see significant improvement.

I believe that the taxing the rich is a sustainable solution in the short run, but could be damaging in future years. Even Sachs’ realizes this is not feasible long term, for the actual economic flow may be much smaller than we realize. His proposal is, ““not meant to suggest that money in such amounts should automatically be levied on the rich and turned over to the poor” (Sachs 292). The actual transfer of funds must be based on rigorous, country-specific plans that are developed through open and consultative processes. Sachs is assuming that high-income countries will meet their MDG commitments, increasing aid and gross ODA, ““MDGs can be financed within the bounds of the official development assistance that the donor countries have already promised” (Sachs 301). But he does identify future problems, highlighting the effects of climate change on developing countries, for they require substantial assistance. This could mean a potentially large expense as the countries adapt to changing climates.

The world looked a lot different in 2004, when Sachs predicted extreme poverty would have declined to about twenty percent in 2015.

He anticipated that most of the developing world would have been freed from the poverty trap, which is not necessarily the case. About 15% of the world still lives in extreme poverty. While the rate of extreme poverty has fallen, places such as Sub-Saharan Africa are still suffering (World Bank).

Kenya’s poverty rates:

2004: 57% (poverties.org)

2014: 45.9% (World Bank)

Sachs identifies a number of ‘myths’ about Africa’s economic and social values, attempting to combat the incorrect assumptions about the continent’s inability to sustain development. Here are some of the examples:

  • Any aid would go right down the drain
  • Education levels are so low that even previously successful programs would fail
    • I disagree slightly with Sachs’ suggestion that this is a myth. Without basic education, many advancements in technology and health would be obstructed
  • Africa lacks modern values and institutions of a free market
  • If our aid saves Africa’s children there will just be a population explosion and a lot more hungry people

To say that African lacks modern values is extremely ethnocentric and I believe that Sachs accurately evaluates the harm caused by such myths. The prejudices against Africa are historically rooted, but also contemporarily expressed. I have heard people attempt to make the argument that Africa is underdeveloped due to the lack of democracy and modern values before. Democracy is not right for ever country and to try to impose our social and political values on a place we know almost nothing about is ignorant. If we think globally about the benefits from eliminating extreme poverty, perhaps we can establish a coherent global society. To think globally means rising above the conventional rich-world wisdoms about Africa that oppresses continuing development. We must understand that the poor are not condemned by their cultures or values, but that they are merely different than ours.

Part II: Dead Aid

opening_remarks32__01__300-3

The Chinese strategy to become a dominant force in Africa included an aggressive investment assault, using its “muscle of money”. Moyo emphasizes the objections and concerns voiced by the European Investment Bank, the editor-in-chief of Foreign Policy magazine. Between the human rights violations during the 2008 Olympics and the undercutting of social and environmental conditions by Chinese lenders, it is not hard to understand the objections to China in Africa. Moyo goes on to say that there is a decidedly positive view of China in Africa and, “to say that the average African is not benefitting at all is falsehood,” (Moyo 109). Favorable views outnumber critical judgments and the majority believes China is more beneficial than America. China’s involvement in rebuilding the Nigerian railroad can be seen as another attempt to tighten their financial grip on Africa. Offering an investment with no strings attached is an example of how Chinese pragmatism can overshadow international forces, such as the World Bank.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s