The End of Poverty: Economic Possibilities for Our Time | Jeffrey D. Sachs

The End of Poverty: Economic Possibilities for Our Time | Jeffrey D. Sachs | i really do like it

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The End of Poverty...

	The End of Poverty: Economic Possibilities for Our Time Jeffrey D. Sachs Penguin Press, 2005 - 416 pages average customer review:based on 116 reviews view larger image
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highly recommended

Comprehensive Solution

I just finished a book that was as much a page-turner as it was an eye-opener: The End of Poverty: Economic Possibilities for Our Time by Jeffrey Sachs. If you pick up this book, you won't be able to put it down. And after you're done, you'll never look at global poverty, history, and politics the same way again. When Sachs talks about ending poverty, he is specifically talking about ending extreme poverty, which he defines as the over 1 billion people who live on less than a dollar a day, by the year 2025. I came away from this book believing that it is entirely possible within our lifetimes.

Sachs is uniquely qualified to write such a book. Here is the book cover introduction, "Hailed by TIME as one of the world's 100 most influential people, Jeffrey Sachs is world renowned for his work around the globe advising economies in crisis. He has advised a broad range of world leaders and international institutions on the challenges of hyperinflation, disease, post-communist transition, and extreme poverty." He is now director of the Earth Institute at Columbia University and a leading advocate of debt relief and aid for developing countries.

The first two chapters take us on a tour of global poverty starting with the current situation followed by a brief history of development. Chapters 3 and 4 do away with the status quo and simplistic answers to why some economies fail to thrive, and give us a road map for diagnosing "sick" economies.

Chapters 5-10 are country specific chapters based on Sachs' own experience working with government leaders and education as an economist. He served as an adviser to Bolivia's government during the hyperinflation crisis of the mid-80s, Poland's government as the budding democracy freed itself from Soviet rule, Russia's government after the fall of the Soviet Union, China's government as the fastest growing economy increasingly opens up to free-market reforms, and India's government as it leads the world in an IT revolution. Thought the entire thrust of the book constantly directs the reader's attention toward Africa, there is also a specific chapter dedicated to its unique problems and development.

The final chapters discuss the political situation in the U.S. in the wake of 9/11, the actual on the ground solutions and financing need to end extreme poverty, how the rich can afford to help the poor, common "myths and magic bullets" used to argue against aid, and a final philosophical challenge to our generation.

Three observations come to mind specifically that I either learned from the book or were solidified by it. First, letting democracy and free-market capitalism run their course is not sufficient. While this is a necessary ingredient, poverty is a multi-faceted problem that doesn't have such a simple solution. Sachs does fine job describing how the poorest of the poor are not even on the ladder of development due to disease, lack of education, poor infrastructure, adverse climate conditions, and geopolitical issues. People at this lowest level (less than $1 per day) cannot begin to climb the ladder of development as they have no disposable income. They merely subsist.

Second, the solution to this is a comprehensive effort which addresses each of the obstacles to development. Opening up a market to free trade is not enough. Fixing the roads is not enough. Feeding the hungry is not enough. Providing security alone, providing education alone, or providing health care alone is not enough. In fact, even if we provide all of these at the same time, it may not be enough if we don't provide it in sufficient quantity to lift them onto to the first rung of the development ladder. The idea is that once they are on this first rung, then they have the ability to climb on their own.

To take the analogy of giving someone a hand up, it is not enough to just grab someone's hand and slightly tug (an illustration of small aid packages) or to just tug with our arm and not use our leg strength to lift (an illustration of just focusing on one aspect of the problem). As Sachs describes, what we need is the 21st century equivalent of The Marshall Plan.

Third, and speaking of The Marshall Plan, it is in the best interest of national security, our own economic development, and world peace that we take up this challenge. Poverty breeds failed states, and failed states breed terrorism. Take Afghanistan for example or look further back in history to the rise of Hitler, which was due, in part at least, to the demand of the victor nations of World War I of war reparations and debt repayment. This sent Europe into the economic depths and fueled hatred and ultimately World War II. Contrast this with our economic response after WWII, no reparations, no debts forgiven, and in fact an amount of aid greater than 1% of U.S. GDP. The Marshall Plan was one of the most successful foreign policy initiatives in the history of the U.S. and helped to contribute to a lasting peace in Europe through shared economic prosperity.

In addition to the main thesis, there are many juicy tidbits and valuable pieces of information throughout the book about topics as broad as the failures in U.S. development history, including the Clinton and Bush administrations, information on AIDS and Malaria, successful movements such as smallpox eradication, the civil rights movement, and the shaking off ("intifada" in Arabic, by the way) of the chains of colonial powers by Gandhi-led India and others.

There is also information about agriculture, technology that can be used to end poverty, the anti-globalization movement, practical economic theory, a fascinating inside look into Sachs' work with government leaders on solving financial crisis, corruption, the industrial revolution, and positive steps we can take to lead the campaign.

What I've said above barely scratches the surface of value found in this book. All in all, Sachs message is not one of continued charity and throwing money at problems but rather justice and economic development through efficient aid and effective policies.

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i really do like it

if you think about how stinjy (stingy) the 1st world is, it makes you sad. but if you read this book, you'll at least realize that something can be done. hopefully it'll make you feel a little bit better ^_^

Another partial diagnosis of poverty

For some populist reasons, many pundits think that poverty in poor countries, notaby in Africa, is the result of the lack of investment or commitment of western nations. Unfortunately, Dr. Sachs is one of them. In this book, he only stresses the external factors deepening extreme poverty in Third World countries, not the significance of domestic variables like the obvious lack of commitment and weak incentives to eradicate poverty. The latter is a confluence of factors, both indigenous and external. Using history as our guide, one can almost certainly say that growth has failed because of weak domestic incentives. Failing to recognize that and calling for a large-scale investment in poor countries is an unadulterated promotion of utopianism. Without prior government commitments( not those based on short-term policy reforms but historical performance), all prescriptions will be worse than the desease.

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If War Didn't Exist, Poverty Could Be Eradicated

Dr. Sachs' basic argument is this: "[W]hen the preconditions of basic infrastructure (roads, power, and ports) and human capital (health and education) are in place, markets are powerful engines of development."

This statement by Dr. Sachs is a valid description of the 19th century, and the first half of the 20th century. His statement does not, unfortunately, describe the reality of the 21st century -- a century in which the world is flooded with cheap weapons (the world will very soon be flooded with cheap nuclear weapons as well). Observe, for example, that all of Dr. Sachs' "preconditions" for economic prosperity exist in Iraq (or at least these conditions did exist, in the recent past), and yet one would not describe the Iraq of 2007 as a delightful place in which to raise children and grow old.

Dr. Sachs refuses to estimate the economic cost of containing this 21st century "flood of weapons". What is an order-of-magnitude estimate of this cost? In Iraq, the cost of containment is currently $100 billion per year, in a nation of 24 million souls. The forces of social disruption are spending less than $100 million per year. In other words, the cost ratio of containment:disruption is at least 1,000:1, and may be 10,000:1 or higher.

Nor is the Iraq example atypical. Afghanistan, Pakistan, Somalia, Sudan and Columbia provide wonderful examples of disrupted economic and social systems. In any one of these countries, an estimated annual expenditure of $10 billion or $100 billion would be required to maintain social order, so that the "powerful engine of economic development" can work its magic. Where will all of this money come from? On this question, Dr. Sachs is silent, and his silence is deafening.

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