How to End Poverty

Bono, of U2 fame has asked Yahoo Questions, “What can we do to make poverty history?” The first thing that struck me, was that the entire question is framed wrong. Instead of asking how to end poverty, ask, “How do we make the whole world richer (and not leave anyone behind)?” The first question immediately brings to mind soup kitchens, donations and starving kids in Africa, whereas the second one makes me imagine Europe, Japan, and South Korea destroyed by wars and rebuilding their entire economies in a couple of decades. In order to end poverty, the governments of most of the affected countries would have to change. Corruption, instability, and wars are not good growth mediums to build riches. On the other hand, Africa is saddled with diseases that are destroying the entire population. Solving AIDS and Malaria is probably the first step on that journey. They can’t start boot-strapping their countries until they start living longer than a median of 30-something. Once disease is solved, there are some deep rooted cultural issues that are holding back many countries in poverty. What makes South Korea rebound from occupation, war, military dictatorships, and being surrounded by hostile nations to becoming one of the Asian Tigers and one of the most wired nations in the world? For fun, compare and constrast North Korea with South Korea. Obviously the people in both countries have roughly the same potential for success, yet North Korea is a world pariah and many of the people are imprisoned in gulags or starving. The U.S.A. through the Marshall Plan, provided the following for war torn Europe after World War II:

The United States offered up to $20 billion for relief, but only if the European nations could get together and draw up a rational plan on how they would use the aid. For the first time, they would have to act as a single economic unit; they would have to cooperate with each other. Marshall also offered aid to the Soviet Union and its allies in eastern Europe, but Stalin denounced the program as a trick and refused to participate. The Russian rejection probably made passage of the measure through Congress possible. The Marshall Plan, it should be noted, benefited the American economy as well. The money would be used to buy goods from the United States, and they had to be shipped across the Atlantic on American merchant vessels. But it worked. By 1953 the United States had pumped in $13 billion, and Europe was standing on its feet again. Moreover, the Plan included West Germany, which was thus reintegrated into the European community. (The aid was all economic; it did not include military aid until after the Korean War.)

I believe that the Marshall Plan was one of the greatest things that America did in the 20th century. However, a similar plan for Africa would fail miserably due to corruption in the governments of Africa. Even before Africa, how do we provide Mexico with a similar path to economic success? The whole immigration debate seems to miss the fact that if Mexico was as rich as Canada, we wouldn’t have any immigration problems. Anyone who has been to a border city like El Paso, Texas and stared over the wall to Mexico has a good appreciation of why people immigrate to the United States. Almost any rational person would do the same, at whatever the cost. I wonder if anyone has outsourced Spanish tech support to Mexico. Perhaps one thing that Mexico could do is start switching their schools to English and try to compete with India for some of that business. They are on the same time zone and for whatever reason, Americans seem to find a Spanish accent more pleasant than an Indian one. However, yet again I think that corruption in the government is holding down the entire country. Perhaps to solve poverty, we need to solve corruption first. You could donate all the money you like, but if all of it is intercepted by warlords or despots, you’ve done no good, and in fact you’ve made things worse, because you are keeping these dictators in power. So bottom line, solve culture and corruption and we have a chance to solve poverty. Do neither and just donate billions of dollars and make the situation worse. _PS, the people who are saying prayer obviously haven’t heard the saying, “When your boat springs a leak, pray to God, but row to shore.” _