Prosperity: What About the Remaining Poor

After more than a two week break I’m returning to the final posts of my Cycle of Prosperity posts.

Recap

Just to refresh our memories, I began this series talking about shalom and its many facets as presented in the Old Testament. I explained that while life certainly consists of far more than material concerns, we are material beings created for stewardship and regency in a material world. Integral to shalom is the idea of community-wide prosperity and abundance. Yet the human condition throughout recorded history has been one of very low life expectancies (20 to 30 years) and barely sustainable lives for the overwhelming masses of society. This is not the shalom-filled world God envisioned for humanity.

Over the past two or three centuries, unprecedented improvement has come to the world. It began first in western nations and is now spreading around the globe. Life expectancy worldwide is more than 65 years. Economic prosperity has expanded around the globe. The recent downtown in the world economy will no doubt bring some setbacks but the long term trajectory is quite astonishing. What brought this on?

I’ve made the case here that this change has sprung from the discovery of network of relationships and values that, when combined together, form a cycle of prosperity. The featured components are technology, food production, human capital, economic growth and wealth, and trade. The soil from which this organism springs is the material environment where the society lives and the cultural environment of the human population.

So why did the explosion in economic prosperity originate in Europe? Economic historians frequently disagree about the degree of emphasis that should be given to various factors but four standout: Evolution of property rights, scientific rationalism, the formation of capital markets, and improvements in technology and infrastructure. I briefly pointed out that Europe’s geographic configuration made for easy transportation and tended to work against centralized control. But even more critically, certain unique values and beliefs emerged that were shaped and nurtured by a Judeo-Christian heritage. 

As the knowledge of the cycle of prosperity has spread throughout the world, we have seen unprecedented improvements in the lives of billions of people. A generation ago we could talk about the First World (Europe, USA, and other economically advanced nations), the Second World (Soviet Union, China, and nations under communist rule) and the Third World (which consisted of nations containing billions of poor people all living at deplorable levels of existence.) This taxonomy not longer works. We now have a continuum of economies ranging from the very wealthy to the very poor with many gradations in between. We have considerable variations within some countries. Many nations have moved well up the road from grinding poverty to greater economic prosperity. There is every evidence that continued movement down that path will lead to them catching up to advanced nations in a couple of generations.

What about the remaining poor?

However, there are some nations that seem hopelessly stuck and there are still about one billion people who have been largely untouched by these changes. These nations are highly concentrated in sub-Saharan Africa, though not exclusively so. Nations like India and China still have a great many people living in grinding poverty, although their proportion of the population has been shrinking the past couple of decades. But what about those who are still stuck?

One answer is that these nations simply need to engage in free trade. Yet a variety of efforts by organizations like the World Bank and the International Monetary Fund have sought to impose such a system several times on a variety of nations and it has usually met with disaster. Another answer is to blame globalization and to promote isolationism. Yet Africa is probably the continent least integrated into the global economy and is the most untouched by the rising prosperity. Still another answer is to engage in “big push” aid initiatives that will turn things around. Yet enormous amounts of aid have been pumped into African nations generating little substantive change. So what to do?

In my closing posts, I’m going look to Paul Collier’s book The Bottom Billion for some insights. Collier is an expert on these issues and he offers for interrelated traps that create barriers to the expansion of prosperity to the poorest of the poor.

• The Conflict Trap
• The Natural Resource Trap
• The Landlocked with Bad Neighbors Trap
• The Bad Governance in a Small Country Trap

We turn now to the conflict trap.

[Index]

Comments

[Ted]

Some obvious hindrances to economic prosperity: lack of education, chronically corrupt government leaders, and harsh weather cycles like drought.

Several years ago I visited Cambodia. Made me appreciate what a long-term, stable government that promotes economic freedom and opportunity can produce.

[Michael W. Kruse]

"Made me appreciate what a long-term, stable government that promotes economic freedom and opportunity can produce."

Amen!

[Jim Martin]

Michael,
Just want to thank you for the work you do on your blog. I know of no other source for good, solid, Christian reflection on economic issues.

Thanks

[Michael W. Kruse]

You're welcome, Jim. Thanks for your affirmation.