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Profound, visionary, with achievable goals,
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This review is from: The End of Poverty: How We Can Make it Happen in Our Lifetime (Paperback)
In the first two chapters fascinating information is revealed about wealth creation and the resulting global wealth inequality in just two centuries. In 1820 the per capita income in USA was only threefold higher than in Africa namely 1,200 versus 400 dollars that is then the whole humanity was poor. To-day the per capita income in USA is 25fold higher than Africa. It is also a myth that this was the result of exploitation of the rich western countries of their former colonies though the author readily acknowledges that such exploitation occurred. The true engines of wealth creation are science and technology, division of labour and trade. Wealth creation is a no zero sum game that is one country does not get rich at the expense of another, all countries can escape from the poverty trap.
The author cites the evolution of wealth in parallel to the evolution of technology and industrialization with the resulting urbanization.
It all started in mid-eighteenth hundred century that is around 1750 with the invention of steam and its application in the textile industry and the steam boats. Then around 1850 the rapid mobility of people, merchandise and information with the invention of rail trains and telegraph. And around the end of the nineteenth century and beginning of the twentieth of the internal combustion engine and electricity and the exploitation of fossil fuels as a source of energy. Also he attributes credit to German Chemistry for the techniques of extracting nitrogen from the atmosphere to make fertilizers and thereby increase crop yields.
The rest of the book is stimulating and articulates the thesis of the author that with International Aid, extreme poverty which he defines as people earning one dollar or less per day and now afflicting 1.3 billion of humanity or roughly one fifth can be eliminated by the year 2025. This cannot be achieved on their own because these people are caught in a poverty trap in that they earn so little so they do not have the basic needs to survive much less to save and invest in things like infrastructure, health, education and research and development. He computes that this can be effected if rich countries invest in Overseas Development Assistance 0.7 percent of their Gross Domestic Product. The current assistance by USA is just 0.15 percent.
In the process he gives fascinating statistics. In one table he gives the Gross Domestic Product (GDP) of four Sub-Saharan countries and specifically Botswana, Nigeria, Senegal and Uganda which collectively have 161,000,000 inhabitants with a collective GDP of 57 billion dollars which he compares with the collective income of the 400 richest American individuals who possess 69 billion dollars. The comparison is staggering.
The fascination and beauty of the book is that professor Sachs who incidentally at the age of 28 had a tenured faculty position at Harvard having been employed there at the age of 25 is that he relates his story drawing on his personal experience as Economic Advisor in several develoing countries and specifically in Bolivia in Latin America, in ex Socialist countries and specifiacally Poland and Russia, in Far Eastern counties and specifically India and China and several African su-Saharan countries which are the world's poorest having 40 percent of their 800 million population living in extreme povery and in addition afflicted by debilitating diseases like HIV/AIDS, Malaria and Sleeping Sickness.