RX FOR GLOBAL POVERTY
May 30, 2008
The world's greatest moral challenge, as judged by its capacity to inflict human tragedy, is not global warming; rather, it is global poverty, says columnist Robert J. Samuelson, writing in the Washington Post.
- Of the roughly 6 billion people of the planet, perhaps 2.5 billion survived on $2 a day or less in 2004, says the World Bank.
- By 2050, the world may have 3 billion more people, many of whom will be similarly impoverished.
The solution to being poor is economic growth, says Samuelson. Recently, the 21-member Commission on Growth and Development conducted a study and found that since 1950, 13 economies have grown at an average annual rate of 7 percent for at least 25 years. The panel identified five common elements of success:
- Openness to global trade and, usually, an eagerness to attract foreign investment.
- Political stability and "capable" governments "committed" to economic growth, though not necessarily democracy (China, South Korea, and Indonesia all grew with authoritarian regimes).
- High rates of saving and investment, usually at least 25 percent of national income.
- Economic stability, keeping government budgets and inflation under control, and avoiding a broad collapse in production.
- A willingness to "let markets allocates resources," meaning that governments did not try to run industry.
Source: Robert J. Samuelson, "Rx for Global Poverty," Washington Post, May 28, 2008.
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