I can state with 90% certainty that your Great Great Great Great Great Great Great Grandfather, in the middle of the 18th century, lived just above the absolute poverty line. He was likely a subsistence farmer, making barely enough to feed and clothe his family. The reason for my accuracy is that 90% of the world (probably higher) lived on the border of absolute poverty before the dawn of free markets and capitalism.
It is useful to keep in perspective how much free markets have delivered in solving absolute poverty. Today, the majority of the world has wealth not dreamed of by our ancestors. However, there are still those who suffer in absolute poverty, and we don’t need to go far in our globalised world to see this.
Even closer to home for many, we can see poverty as a relative issue, which produces its own terrible by products. The effects and suffering of either are the same today as they were in Gandhi’s India. Whether taken as an absolute or relative idea, poverty remains perhaps the most complex issue facing our civilisation today.
A friend once reminded me of the need to talk about solutions rather than just problems (as I offered him that feedback on a book he wrote). However, I have come to realise that it would take great hubris on my part to propose a magic bullet solution to an issue as complex as poverty. There are extraordinarily talented people at either end of the economic/political spectrum who can make very logical and compelling cases, which may be diametrically opposed.
As with many things, there is a rational middle ground we can reach that combines the best of both into a higher synthesis of understanding. To paraphrase a younger John McCain, from an Australian perspective:
“We should not be defined by pandering to the outer reaches of Australian politics and the agents of intolerance, whether they be Dean Mighell on the left or Andrew Bolt on the right.”
At one end of the spectrum, Bono, Jeff Sachs and the entire Make Poverty History coalition largely build their case around a massive increase in foreign aid. There are legitimate concerns with this, when considering that a trillion dollars has been spent over half a century for little return.
We can create all the moving tributes that give us warm feelings inside, but surely the end result of people’s lives being altered should be our aim.
Go and watch the ‘We Are The World’ (http://www.youtube.com/watch?v=Jcrwu6WGoMs) clip from 25 years ago. In the midst of one of the worst famines seen, the West banded together to help Ethiopia. It’s a beautiful clip. Visiting the slums of Addis Adaba a couple of months ago, I would venture to say that little has changed for the average Ethiopian, with majority still living in absolute poverty. Recent BBC reports has shown that much of the aid was siphoned off to purchase guns and prolong a civil war that killed a quarter million people. The long term issue of poverty in Ethiopia was not solved by Michael Jackson et al.
At the other end of the spectrum, a Jim Rogers, Dambisa Moyo or Tim Wilson would argue that the solution is as simple as dumping all aid and opening up these countries to free markets. The problem is, in many cases, we have already done that and it hasn’t solved the issue.
I worked in Zambia for their leading microfinance company, and found the complete absence of textile manufacturers as clients to be quite vexing. Zambian textiles actually have preferential access to European markets over China, but you would be hard pressed to find a Zambian tailor on the streets of Lusaka. The reason is on the cost side of the equation, where they are simply uncompetitive against China, and likely will be for another generation.
As for aid, despite the dependency that it creates, it does save lives in the short term, so dumping all aid will quite simply condemn millions to death.
However, this dependency of aid, stemming from our paternalistic, some would argue patronising attitude towards much of the world over centuries (aid is only the most recent manifestation), creates what economists would call, ‘negative externalities’. Something breaks in your heart when you see a Zambian girl, no more than five, with her skin bleached into a completely unnatural white. I had read about this happening in West Africa, with everything from acid washes, bleaches and steroids being used to lighten skin tone. From my experiences in Central Africa, I wouldn’t be surprised to see this occurring all over Africa.
These are the negative externalities of our behaviour, and it doesn’t stop there. Brazilian Social Minister Romulo Paes de Sousa has talked about the issues of ‘old poverty’ (lack of access to basic needs) and ‘new poverty’ (including drug addiction, family breakdown, violence and environmental degradation).
Those last four points would sound very familiar to a westerner, as they are the problems that we battle with in our own societies. It would be prudent if, in trying to achieve the laudable goal of ending absolute poverty, we didn’t simply create the negative externality of importing the west’s problems of new poverty.
Today, more than ever, the solution lies in a hazy, grey middle ground. A former WTO Director once told me the analogy of draining a lake to free markets. Initially, you can see a lot of gain for little effort as you drain the lake. However, when you start to reach the lake bed, it is much more difficult, in dealing with everything left over on that lake bed. Today, we are at that point, where simplistic solutions at either end of the spectrum will no longer hold.
A vast majority of countries in the world are now trying to pass the Doha Trade Round, which would give unimagined benefits to the developing world. The previous (Uruguay) round took 8 years to get 123 countries to agree. Doha, born in the wake of the 9/11 attacks to demonstrate global solidarity has an even more ambitious agenda, in trying to include the developing world. In light of history, it is understandable that it has gone on for 9 years, with no resolution as yet. It is perhaps the most ambitious negotiations undertaken in human history, so allowing for practicality would help us recognise that it won’t pass tomorrow.
At the aid end of the sale, after a trillion dollars over half a century, it is time to focus on a new model. Encouraging progress is being made here, with the Tories in Britain promising a ‘pay for results’ model, and Obama changing the USAid metrics to focus on lives changed rather than dollars spent. It will be slow progress, and is not a magic bullet solution, but perhaps over the next 50 years it can be part of a wider solution.
Across much of the developing world, in particular Africa, territorial sovereignty remains a large issue. It is no coincidence that many success stories such as the Asian Tigers are more ethnically homogenous. In Africa, a continent three times the size of Europe, one of the sad legacies of colonialism is that there are roughly the same numbers of countries as Europe. In Zambia by itself, 73 different languages are spoken.
Giving these groups the right to determine their own destiny will take time, from both a political and cultural perspective. The split of north and south Sudan, or Ethiopia and Eritrea, both took decades as well as genocidal civil wars to achieve. These are not issues that will be solved in years, but will rather take decades and centuries.
Here in Sri Lanka, I feel I am finally seeing the beauty of the land and people that my parents and grandparents saw. I am a proud Australian, and my heart will always be in my birthplace of Melbourne. However, my soul is trapped somewhere across the Indian Ocean, between these two lands.
As globalisation intensifies the free movement of labour across the planet, we will continue to see negative externalities of new poverty, as cultures clash, disappear and are born afresh.
This is not an issue that can be solved in our lifetime. William Wilberforce ended slavery in the British Empire in the early 19th century, yet nearly two centuries later slavery still takes place in many different forms across the globe, from debt bondage in Dubai to sex slavery in Thailand and a myriad of others. In a similar vein, let’s not set unrealistic goals such as the false dawn of ending poverty in a generation, when we are in many cases creating new sets of problems that are just as difficult and intractable. We can make progress, but it will be up to future generations to carry on the fight.
The best and brightest will continue to work this issue from all ends of the spectrum, and we should continue to discuss and debate old and new ideas. There is no simplistic solution or ten point plan we can enact to solve the issue, but rather, a complex web that will eventually create a higher synthesis of understanding. :)
