GLOBAL PARADOXES OF POVERTY AND                                      AFFLUENCE                                            ...
Another country in Central Africa Rwanda, devastated by genocide with more than one milliondeaths in the middle of the 199...
in South Asia were 500 million and still today, the World Bank in its South Asia strategy says thenumbers of people under ...
with the mass use of information technology, as mentioned above and along with their dream, visionand intellect, gave peop...
Brown further says that during the―Closing decades of the last century, the number of hungry people in the world was falli...
Moreover, for more than a decade, some agriculturally advanced countries like Japan, South Korea,France, Germany, and the ...
However, new and stronger war partners have emerged. In this new war scenario, when conflictsbreak out, not a few leaders ...
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Global paradox of poverty and affluence

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Global paradox of poverty and affluence

  1. 1. GLOBAL PARADOXES OF POVERTY AND AFFLUENCE Keshav Prasad Bhattarai Amid deep economic crisis and fatal pessimism, noted British Economist John Maynard Keynes saidin 1930 - ―In spite of an enormous growth in the population of the world, which it has beennecessary to equip with houses and machines, the average standard of life in Europe and the UnitedStates has been raised, I think, about fourfold. The growth of capital has been on a scale which isfar beyond a hundredfold of what any previous age had known‖.Standing in stark contrast with the hardest realities of his time and among many cynics Keynespredicted that there would be no poverty in Britain at the time of his grand children. The historydemonstrated that Britain, much earlier than Keynes predicted, eliminated poverty.During 1950s and 1960s, Japan had borrowed some $ 863 million from the World Bank to run itsdevelopment projects, but recently as the World Bank President says - Japan now is the secondlargest shareholder and the third largest donor to the Bank’s fund for the poorest. How Japanevolved from a developing country to a developed one has been a miracle of human history.Japan’s neighbor - South Korea – a country considered as an impossible country without anyresources to survive as an independent nation and that was lingering on just on some $87 per capitain 1960s, has become one of the most successful developed countries.Of late, China and India followed by Indonesia have stood as the real heroes in their war againstpoverty. Only China and India lifted more than 600 million people above poverty level just over aperiod of two decades. They have led the historic transformation of global economy and because ofthis, about 3 billion additional Asians would join the affluent society by 2050, an Asian DevelopmentBank (ADB) publication says.According to Asia 2050: Realizing the 21st Century, by doubling its share of global gross domesticproduct (GDP) to 52 percent by 2050, Asia would regain the dominant economic position it held some 300years ago, before the Industrial revolution. Moreover, the historic march to this prosperity will beled by China, India, Indonesia, Thailand, and Malaysia. Both the Japan and South Korea already thetwo developed Asian countries, undoubtedly will maintain their unparallel edge.Records are made by not only Asia and Americas or Europe. Africa is not behind. Botswana,landlocked and mainly a desert country, bordered to South Africa, Zimbabwe and Namibia, whengained independence in 1966, had only 12 kilometer of paved road, 22 university graduates and 100secondary school graduates. Another impossible country by global standard is now the mostdeveloped country in the continent with highest per capita income.
  2. 2. Another country in Central Africa Rwanda, devastated by genocide with more than one milliondeaths in the middle of the 1990s, has successfully embarked a remarkable development strategyintegrated with vision, vigor and enthusiasm to transform itself from one of the poorest country ofthe region to a knowledge based middle-income country.The last three decades in human history was remarkable in many respects. First, it convinced thepeople around the globe that a world free of poverty is possible within the life span of an averageperson. Second, good and foresighted leaders if are backed by proper policies and effectiveinstitutions, can create immense wealth and prosperity that can offer descent living conditions toall.The third one, the abundance of knowledge and skill – that is easily accessible to all, can ensureevery person equal opportunity to excel in life and attain all those that is possible for any one in anyother developed or developing country.Justin Yifu Lin - the former Chief Economist and Senior Vice President of the World Bank haspresented a vivid picture of economic development. Measured by today’s living standard, Lin saysthat all countries in the world were poor at the beginning of the 18th Century as their economy waspredominantly based on agriculture. The GDP growth that had been lingering around some 0.05percent a year for millennia, jumped to some 1 percent a year in the 19th Century and in another100 years, it went double.―While it took about 1,400 years for world income to double before the 18th Century, the sameprocess took only about 70 years in the 19th Century and only 35 years in the 20th Century‖, JustinYifu Lin asserted in a book published by the World Bank in 2012.Giving reference to some World Bank and International Monetary Fund (IMF) report, EmmanuelSkoufias - a Lead Economist at the Poverty Reduction Group of the World Bank, has accounted thecontinued decline in global poverty over the past 100 years—particularly in the past three decades.He has elaborated that while in 1981, 52 percent of the world population lived on less than $1.25 aday but by 2005, more than half had cut that rate and by 2008, it was just 22.2 percent.MOUNTAINS OF PROSPERITY AND MOUNTAINS OF POVERTY STANDING SIDE BY SIDEWhat we discussed above is a part of the story. The challenges lying ahead are more daunting thanany time in past.In 2001, the World Bank in its World Development Report stated that the people living belowpoverty line were 1.2 billion. Again, in 2012 with its euphoric claims the Bank said that number ofpoor people living below poverty line have fallen everywhere and it was 1.29 billion. Obviously, among6 billion global populations, it was 1.2 billion and when the global populations reached, 7 billion theywere 1.29 billion and now it is 1.3 billion. Every day, 870 million people go to bed without food, and 6.9million children under five dying every year.Strikingly, along with the global buzz of Asian Century led by India and China, South Asia whereboth these countries have been playing a very defining role - has the largest concentration ofpeople below poverty level. Surprisingly, at the beginning of this Century, people in absolute poverty
  3. 3. in South Asia were 500 million and still today, the World Bank in its South Asia strategy says thenumbers of people under this category are the same. However presenting its overview on SouthAsia’s water challenges, the World Bank says, ―Some 600 million people live under US$ 1.25 a day inSouth Asia.‖Indeed, as mentioned above, in the last 20 years only India and China has lifted 600 million peopleabove poverty level: 400 million in China and 200 million in India –a great achievement in humanhistory. However, had India gained more courage and impetus to liberalize its economy with betterinstitutions and policy adjustments in favor of poor, it could have gained much better results - evenbetter than China.On the other hand, India the largest and mightiest country of South Asia – that for its political,military, and economic power as well as in size, population and resources, cannot be compared withany other South Asian countries, also houses the largest numbers of poor in the world - that issome 350 million. In neighboring China, it is just 150 million. When the poor of the India and Chinaare combined, it makes 500 million – half of the world’s poor. Ironically, between the two countries,that house the 50 percent of the world’s poor - one is the largest exporters of weapons and theother is the largest importer of weapons. However, it is to be clear that neither of them buys andsells arms with each other.In South Asia, percentage of people below poverty level has undoubtedly declined butunfortunately, the numbers are rising. It will continue to rise even if China, India, and their SouthAsian neighbors fail to learn a new dimension of poverty that has been emerging from the scarcityof water, rising food crisis – accelerated by population growth and climate change.Therefore, not mere elections and votes but economic growth, development and its distributionamong people gives legacy to a state and the system it adopts. Consequently, it is a matter ofpolicies and priorities followed by competent institutions of people and governments. Above all,peoples’ power accounts much to make state policies accountable to them.Since the beginning of the human civilization, we have had poverty. It was there and remainedalways with us. For generations, people born poor died poor. Never have they complained, ratherthey accepted this as their destiny, so was it continued for centuries.But, when people began to learn that it is not their destiny that they are poor. Their understandingsthat themselves to some extent and largely to some other people in power and authority, someinstitutions near them and some far away are responsible for their poverty, brought a sea change inhuman history. Lastly, the power people enjoyed after the revolution in information technology andpursued by the people like Bill Gates, Steve Jobs, Mark Zuckerberg, Jack Dorsey, Larry Page, andSergey Brin, including some engineers in Bell Labs, Nokia, Samsung, or Huawey, gave them unparallelstrength and confidence to improve their lives. Probably, it was the greatest achievement in humanhistory.For hundreds of years politicians and philosophers discussed millions of hours on how to empowerpeople. Thousands of philosophers, social and political scientist around the world wrote millions ofpages on how to make people empowered and responsive to change, but these few people associated
  4. 4. with the mass use of information technology, as mentioned above and along with their dream, visionand intellect, gave people power a real worth and meaning.PARADOX OF GROWTH, POVERTY, AND FOOD CRISISThere is a saying in Sanskrit that reads - ― ‖. It means how it can beconsidered wrong with anything - whatever a man does when he is hungry. No laws, no legal actions,no moral codes, and no religious scripts have power to control and discipline a hungry person.Anyone who has not experienced poverty or has not lived under it can ever realize the intensity ofits pains. Languages and words most often fall short while explaining the pains of poverty. Asunexplained are its sufferings, so are its multiple results that are inexplicable and unpredictable.It is most inhuman to born poor and remain poor, therefore, no state or a society that does notconsiders itself responsible for the poverty of people and society, has a moral right to expectpoor people abide by the laws the state makes.People who are poor are not only deprived of their basic rights to live a life of dignity and honor,but are also deprived to carry out their duties as an individual and enjoy the rights written in thelaws of their land. That is the gist of the Sanskrit saying ― ‖.Father Joseph Wresinski, an iconic figure of the last Century and perhaps the first strongest voiceagainst poverty and ways to fight it, said that behind any poor community is another, which ispoorer, behind poverty-stricken street there is another even worse and behind a poor family, onecan find another poorer.The crux of the matter according to Wresinski is to build an understanding of the link betweenextreme poverty and human rights. Extreme poverty to Wresinski is conceived as a multidimensionalphenomenon that leads to violations of human Rights in their indivisibility and failures to seek theiropinion, recognize their concerns, honor their hopes, and share their experiences.The experiences worldwide, have confirmed that when a state fails to build people’s assets, realizetheir potentials, and develop the physical and natural resources available in its territory, people fallin poverty. People when are not supported to escape from poverty, they reinforce greater povertycycle, and end up in political, economic failures, social anarchy, and even terrorism.Lester Brown - the founder of the Earth Policy Institute and author of a thought provoking book―Full Planet, Empty Plates, has sketched the global poverty scenario in a stunning way. The bookpublished in September last year states –―Each year the world adds nearly 80 million people. Tonight there will be 219,000 people at thedinner table who were not there last night, many of them with empty plates. Tomorrow night therewill be another 219,000 people.‖
  5. 5. Brown further says that during the―Closing decades of the last century, the number of hungry people in the world was falling, droppingto a low of 792 million in 1997. After that it began to rise, climbing toward 1 billion. Unfortunately,if we continue with business as usual, the ranks of the hungry will continue to expand‖.The 1 billion people who are chronically hungry and malnourished live in the Indian subcontinent orsub-Saharan Africa. Because of this chronic hunger, 48 percent of all children in India becomephysically and mentally stunted. They are undersized, underweight, and likely to have lower IQsthan average.Giving reference to a recent a recent survey by Save the Children, Brown reports that 24 percentof families in India now have foodless days. In Nigeria, it is 27 percent and for Peru, it is 14percent.Ironically, economic growth in many countries has initiated another kind of poverty and food crisis.Indeed, the historic growth as stated above has uplifted millions above the poverty level and it willcontinue to do so in future. This has and will make up a huge and vibrant middle class. With theirnew source of income, they will naturally change their food habit and demand more water intensivefoods like meat, fruits, vegetables, and dairy products. Unfortunately, in the days to come water isgoing to be most precious commodity and it may cause war between and among countries(See the related article Water: Source of International Conflict and Weapon of War, EurasiaReview – October 22, 2012)The global population will reach 9 billion by 2050. With two billion, more than it is today. Supplyingthem food, water and other basic amenities of life will not be an easy job. How the situation s willgo and how more precarious it will be, is described by Food and Agriculture Organization (FAO). TheUN body mentioned earlier has recently predicted that by 2050, food demand will have increased70 percent more than it is today. Only, Asias food and feed demand will be double by that time.Similarly, the FAO also reports that the daily drinking water requirement per person is 2-4 liters,but it takes 2,000 to 5,000 liters of water to produce one persons daily food.Mainly, countries in Asia and Africa, where majority of poor live, are water stressed countries andin less than two other decades, about half of the global population will be living in water scarcecountries.Besides soil erosion and other cause of low food production, Lester Brown lists some new emergingchallenges in this front. They include - depleted aquifers and drying of the irrigation wells in some18 countries that together contain half the world’s people. As for example in the two big grainproducers country of the World – China and India 175 and 130 million people respectively are fedwith grains produced by over pumping.The South Western parts of United States are shrinking its irrigated areas and its depletedaquifers have forced it to divert water from farmland to cities.
  6. 6. Moreover, for more than a decade, some agriculturally advanced countries like Japan, South Korea,France, Germany, and the United Kingdom have not been able to increase their grain production.Similarly, the climate change and rising temperatures has changed the rain cycle and disrupted theagriculture and seafood sources in multiple ways.Meanwhile, the increasing numbers of livestock to supply meat demand for a growing middle classpopulation and the more grains needed to feed them, has created mounting food and water crisesworldwide. On the other hand, a new class of food consumer has emerged and surprisingly they areautomobiles. In countries like United States and Brazil, grains and other crops are used to produceethanol for vehicles. In 2011 in the United States, Brown states that 32 percent of the total grainproductions that accounted to some 127 million tons went to ethanol distilleries. This has posed twoimmediate threats to poor people – food shortages and high price rises in global food markets.THE WORLD HAS SEAS OF IDEAS AND COMMITMENTS TO SOLVE OUR PROBLEMSIndubitably, we have bigger problems, challenges, and paradoxes to the size of our earth.Sometimes, they seem bigger than the Earth itself. Nevertheless, we all know it well that the worldwe live in is extraordinary. Each individual in the earth is amazingly different and the human societyof 7 billion people is a great sea of extraordinary ideas and possibilities. At times people weredefeated but most often they have always succeeded in making the world better, healthier, andhappier place to live in. The challenges they faced were tremendous but the opportunities they livedwith have always been bigger, greater, and prettier.When there were some two dozen countries in world, they always fought each other, but now, thereare some 198 countries and not any two countries are in a state of war. Obviously, people withincountries are fighting for their cause, but mostly by peaceful means. Although some countries areliving in a tensed situation, but the world has instituted some most effective bodies to ensure peaceand help people and countries to assure each other’s concerns so that larger peace could be builtamong them. Even if we are living in a world that is both ―leaderless and defenseless‖, we haveinstitutions to help us with better promises and prospects.All major power countries, even with most advanced nuclear weapons system, are in longest periodof peace in human history. War between America, China, and India, Russia or any other nuclearpower country, is almost nil. More than military rivals, they are partners of their common economicprosperity. They need each other to run their economy and bring peace and stability at home andabroad. They may compete, even fight each other, but not with weapons of war – but with weaponsof trade and commerce. They may find some proxies to take their cause, may develop advanced wargadgets, may buy, and sell them, but a common dependent economy rules over them.Lastly, unless some insane people followed by an accidental rise to power come to rule thesecountries, a more than impossible, it is certain that there will be no war between them and amongthem. This is the most positive development among the countries in from the beginning of humanhistory.
  7. 7. However, new and stronger war partners have emerged. In this new war scenario, when conflictsbreak out, not a few leaders from a joint meeting and with some formal declarations can end thiswar. It will be a war fought with the weapons of poverty. People in poverty and deprivation will makethemselves as a weapon of war - ala a poverty bomb. People engaged in terrorism have been usingthese bombs against their targets.Even then, we have constructed most promising human situation. In a speech delivered on Tuesday (April2, 2013) at Georgetown University, World Bank President Jim Yong Kim proudly announced, ―The firstMillennium Development Goal, to halve extreme poverty, was achieved five years ahead of time.‖ Further,he said, ―eight million AIDS patients have received antiretroviral therapy. The annual number of malariadeaths has dropped by 75 percent. The total number of out-of-school children has fallen by over 40percent.‖People have learnt how imparting better education and skill help to realize the unlimited potentialsof our younger generation and build people’s assets. They are also equipped with the informationthat the modern science, technology, transport, and miracles of global communication system andhuge reserve of knowledge that is available to them by easy means, can offer each individual abetter life than they hope.Most important thing is their confidence that the odd times they are living with – including poverty,are not bestowed upon them by the providence. Instead, they believe that they are living in povertybecause of the defective state policies of their rulers. If the institutions and policy makerssomewhere at Kathmandu, New Delhi, Beijing or at New York, Washington DC, Brussels and at thehead offices of IMF, World Bank and ADB are committed for their cause, they think ,there will beno poverty among them.Obviously, success in reducing extreme poverty to half within 10 years, has established it. What isneeded more - are numbers of more accountable and more responsive global bodies that workingeffectively with international capitals can coordinate effective networks of states and peopleworldwide against issues from poverty and climate change to terrorism and state fragility. And, onlyone thing in this regard is sure - failures to this will ensure success to none. Eurasia Review April 4, 2013 www.eurasiareview.com/author/keshav-prasad-bhattarai/

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