Kruse Kronicle

The World Is Becoming A Better Place To Live For Most People

The great majority of people throughout most of human history have precariously been able to subsist. (See Level 1 below.) A great divergence began just over two centuries ago. Global life expectancy at birth has more than doubled, and abject poverty as a percentage of the population has declined. 

The average life expectancy at birth used to be about 30 years. That doesn't mean no one lived to old age. One in four children born alive died before their first birthday, so the average life expectancy at birth was skewed downward. But life expectancy at every age has improved, especially over the past century.

The researchers at Gapminder have constructed this informative chart showing anticipated improving economic status over the next twenty years. (These numbers attempt to account for changes in the value of "a dollar" over time and across national borders.) Each block equates to 100,000 people. As you can see, the population is larger in twenty years, but a higher percentage of people have moved rightward on the continuum to greater prosperity. Many people find these numbers too abstract. What does this mean in practical terms? Gapminder has constructed this helpful chart to describe what life is like at the four levels. 

You can learn more about these four levels here. 

Three truths. The world has become profoundly better in recent generations and is improving. There is much suffering and injustice as vast room for improving our world. We can make the world a better place.

Calmly Considered: Scarcity or Abundance-- Which Is Our World?

Last month, Dr. Allan Bevere and I got together to discuss the nuances of "scarcity and abundance" from theological perspectives. Too often people from the two fields talk past each other with unfair characterizations on this topic. Our conversation hopefully shines some light.

Maternal Mortality Rates Are 27 Times Higher Globally Than In Europe. Why That Is A Good Thing

The chart below is based on maternal mortality rates, the number of women per 100,000 who die from pregnancy-related causes in a year. The first bar shows how many women die each year, while the second bar shows how many would die if they had Europe's living standards. What conclusions would you draw?

The global rate is 216, while the European rate is 8. The global rate is 27 times higher! About 290,000 women die each year because they do not have the living standards of the most affluent countries.

I would hope this would spark a sense of injustice. Something is wrong with a system that creates such a disparity in outcomes. Surely, we must upend this inequitable system and replace it with something just.

Now look at the second chart. What conclusions would you draw?

Before 1800, the global maternal mortality rate was 900. Today it is 216! It has dropped by 75%. By historical standards, this borders on miraculous. Something is right about a system that radically improves human well-being. How can we preserve and extend the improvement? (Note: The global rate dropped steadily from 385 in 1990 to 216 in 2015. The trajectory continues rapidly downward.)

A holistic view of human well-being will consider this chart, including all three bars.

Some observations.

First, we would have a more equitable maternal mortality rate without the systems that developed over the past two centuries. No place on earth would have a rate of eight deaths OR 216 deaths. We would still have a very equitable world of 900 deaths. Is that "equality" preferable to today's eight vs. 216 inequality? I do not think many would agree. The eight vs. 216 differential is good relative to the historical alternative.

Second, that some locales have a rate of eight, points to the possibility of a world where this level of well-being spans the globe. Justice requires that we pursue this equitable outcome. We must look back to understand what brought us to where we are and be discerning about obstacles blocking this objective going forward.

Third, I am using maternal mortality rates as a symbol of broader improvement in human well-being in recent generations, sometimes called the Great Divergence. Appreciating this significant divergence from human history neither requires us, in some consequentialist way, to a) embrace all that has developed in the past couple of centuries nor b) to refrain from asking rigorous questions about justice going forward. There have been profound injustices and inequities in the past two centuries. There are today. And yet, the Great Divergence happened, and it continues. Lack of historical context and blindness to trajectories can lead us to snap-shot-in-time views that inspire us to well-intentioned but destructive actions, destroying good in the process. Keep what works and adjust with discernment. Neither revolution nor complacency will do.

Why Population Control Is Not The Answer to Climate Change

Population control is sometimes championed as a way to fight climate change. Bernie Sanders recently raised this idea. The world population is growing. There are 7.7 billion people today. According to United Nations estimates, there will be nearly 11 billion in 2100. Extra people mean extra CO2 emissions. While two children per woman may seem reasonable, women in the poorest countries can average five or sex. Sanders and others believe this excess fertility is why the world population is growing. Fewer children will mean less CO2. Unfortunately, this perception is decades out of date.

We are already at "peak children." Globally, there are 680 million children under the age of five. U.N. projections show a peak of 700 million in about 2060. There are projected to be 650 million children in 2100, fewer than today. Yet the overall population will grow by nearly 50%. How can that be? The compounding effect of people already born will drive population growth over the next century, not excessive birth rates.

Trends in Fertility

Assume women have two children over their lifetime. They replace themselves and one other. Population size will be stable from generation to generation. (The actual replacement fertility rate for an affluent nation is 2.1 children per woman.) Throughout history, the total fertility rate has been six or seven children. One-quarter of children died before their first birthday. Another sizable percentage died before age five. Many of those who made it past five died before marrying and having children. High fertility rates ensured a couple of children would survive to continue the family.

As affluence emerged and health practices changed (first in Europe and then spreading elsewhere), more children survived into adulthood. We needed fewer births to perpetuate a family, but it took a while for customs related to fertility to adjust downward. That lag between declining death and fertility rates led to the population explosion that began two centuries ago. That growth accelerated into the twentieth century and continues into its final stages today. As recently as the 1960s, the global total fertility rate was as high as five children per woman.

Today, the global total fertility rate is about 2.4 and dropping, but the rate is not evenly spread worldwide. Europe, the Americas, China, Japan, and other regions have fertility rates below the replacement rate, well below it in many nations. A handful of smaller poor countries have fertility rates of five or six, but they also have some of the highest child death rates. The world average is fast approaching the 2.1 replacement rate. However, because the global fertility rate has usually been higher than the replacement rate for most of us now living, it means the cohort of people born one year is usually larger than those born the previous year. So let us think about what that means for the future.

The Compounding Effect in Future Fertility

To keep things simple, assume going forward that we birth the same number of children each year, the death rate stays the same, and no one lives past one hundred years. Now say there are 100,000 people aged 100. By next year, all will have died. The group that was 99 will now be 100. Because more of them were born, there will now be maybe 105,000 people 100 years old. After two years have passed, the new group of 100 hundred-year-old people will be the people who are 98 years old today. They will be a still larger group. That will continue for one hundred years.

At the other end of the age continuum, we have the largest number of children ever born in a year and the largest age cohort alive. A year later, this youngest age cohort will replace a smaller cohort a year older than them. But keep in mind that the number of women of childbearing age will increase yearly for the next forty-five years. Therefore, each year the total fertility rate will need to fall slightly below the replacement rate if the population is to stabilize. It can then rise to the replacement rate after forty-five years. This will continue until 2120, when each age cohort is the largest age cohort that has ever existed for that age. This is the primary driver of population growth in the future, but there is at least one other key factor. (Clearly, I am oversimplifying to illustrate my point. We are not down to replacement rate fertility, so there is still some marginal population growth due to "excess" fertility.)

Furthermore, actual global death rates are not constant. They are dropping. People are living longer. So not only is each age cohort larger than before, but it is also living slightly longer. This, too, contributes to population growth over the coming decades.

Therefore, we would need considerably less than replacement-rate fertility to limit global population growth substantially. In fact, there are credible projections of a population peak of fewer than nine billion. Demographers once assumed transition to low fertility and death rates would stabilize at about the replacement rate. Instead, the fertility rate has dropped well below the replacement rate in nearly every affluent nation, in some cases nearly one child per woman. This may look like a good thing from the narrow view of CO2 emissions. From a holistic standpoint, many social scientists are troubled. Depopulation can be as destructive to human well-being as overpopulation.

The Depopulation Problem

A vibrant society needs a critical mass of productive workers relative to its dependents (primarily children and the elderly.) This is the dependency ratio (dependents divided by workers multiplied by 100). With excessively low fertility rates, it is possible to have a great imbalance with many seniors and too few workers to provide for society. We have already seen that current U.N. projections say we will have nearly the same number of children now as in 2100, but the overall population will be almost 50% larger at eleven billion. That growth is a consequence of a burgeoning number of elders. A smaller population of nine billion may mean fewer total people but an even worse dependency ratio.

Modest help may come from lengthening the number of years people work or a higher participation rate in the workforce for working-age people but at some point, that will be insufficient. Then consider the possibility of medical breakthroughs that cure cancer or dramatically reduce heart disease. That means more people living longer, intensifying the dependency ratio imbalance.

As an ever-shrinking number of people (potentially a minority of the population) is expected to support everyone else, improving living standards will begin to stall and possibly reverse, making the world ripe for any societal dysfunctions. It will not take eighty years for this challenge to become real. Japan is already struggling with these issues. China is already headed down this road. One can envision China opening up to immigration from the remaining regions with the highest fertility rate and investing its resources in growth economies. However, if every nation is headed to fertility rates well below the replacement rates, it is only a temporary fix. The dependency ratio for a world with eleven billion people is already a challenge. The only way to get a peak population under nine billion people is to achieve fertility rates well below replacement rates, substantially intensifying the dependency ratio imbalance just a generation or two down the road. (For more detail, see the Brookings' piece, How will we cope when there are too few young people in the world?)

Decoupled Economic Growth

At the most basic level, climate policy must be about economic growth decoupled from CO2 emissions. Population growth is one issue driving this need for economic growth. But also consider people are advocating for a $15 living wage for every worker in the United States. That would put nearly every U.S. worker in the top 10% of wage earners in the world. Meanwhile, despite astonishing improvements in human well-being around the world and the dramatic reduction in extreme poverty, there are still hundreds of millions of people in extreme poverty. A couple billion more have more stable lives but still live well below standards we would consider tolerable. If it is a matter of justice that everyone in the U.S. has a $ 15-an-hour living standard, then it is only just that all citizens of the world have something approximating that standard. The only way that happens is through economic growth. Measures like population control are shortsighted and potentially disastrous. The principal mission is decoupling economic growth from fossil fuel consumption and other disruptive measures like decoupling land use from agricultural production.

Global Childhood Deaths In Steep Decline

Worldwide, there were 12.6 million deaths of children under five in 1990. As of 2017, there were 5.4 million. Keep in mind that the world population grew by 50% during this time. Had death rates continued at the 1990 rate, there would have been about 19 million childhood deaths.

(Where in the world are children dying.)

Our ancestors did not live in balance with nature. They died in balance with it.

One of the most important observations (among many) from the late Hans Roslings' Factfulness:

When a population is not growing over a long period of time, and the population curve is flat, this must mean that each generation of new parents is the same size as the previous one. For thousands of years up to 1800 the population curve was almost flat. Have you heard people say that humans used to live in balance with nature?

Well, yes, there was a balance. But let's avoid the rose-tinted glasses. Until 1800, women gave birth to six children on average. So the population should have increased with each generation. Instead, it stayed more or less stable. Remember the child skeletons in the graveyards of the past? On average four of six children died before becoming parents themselves, leaving just two surviving children to parent the next generation. There was a balance. It wasn't because humans lived in balance with nature. Humans died in balance with nature. It was utterly brutal and tragic.

Today, humanity is once again reaching a balance. The number of parents is no longer increasing. But this balance is dramatically different from the old balance. The new balance is nice: the typical parents have two children, and neither of them dies. For the first time in history, we live in balance. (pp. 87-88)

Demographers refer to this as the Demographic Transition – the move from high fertility and mortality rates to low fertility and mortality rates. A few centuries ago, living standards in some regions began to rise via technology, specialization of labor, and extensive trade. That trend dramatically accelerated about 250 years ago with the Industrial Revolution. Fewer people died young, and more people lived to old age, but the fertility rate lagged in its decline. The population explosion of recent generations was due to this lagging decrease in the fertility rate relative to the falling mortality rate.

The Demographic Transition began in Europe, but we have seen it repeated in every part of the world in recent generations. The global fertility rate is now below 2.5 children per woman, down from 5.0 fifty years ago and heading toward "balance" at 2.1 children within about twenty years.* Furthermore, life expectancy at birth in recent generations has risen from about thirty years throughout human history to seventy-tw0 today – in excess of eighty in some affluent countries.

Every time I reflect on these numbers, I think of Isaiah 66:20, where Isaiah describes the new creation:

Babies in Jerusalem will no longer live only a few days. Old people will not fail to live for a very long time. Those who live to the age of 100 will be thought of as still being young when they die. Those who die before they are 100 will be considered as having been cursed by God.

We are approaching that reality. The world we live in today was positively Utopian until the past generation or two.

We did not get here by being content to die in harmony with nature. We decoupled from nature. We become radically more innovative and productive. The key to future well-being and the planet's welfare lies in greater decoupling – climate-friendly fuels, environment-friendly production, more productive agriculture, and the eventual transition to endlessly recycled materials. It must be a world where everyone experiences abundance through participation in productivity and exchange networks. That is what "living in balance with nature" truly is.

(Note: At replacement rate fertility, the global population will grow from about 7.7 billion to between nine and eleven billion by the century's end. The children born in 2020 will likely have children at about the replacement rate. However, the population born in 2010 is larger than the coming 2020 population, and the population born in 2000 is larger than in 2010. If all these age cohorts replace themselves in the next few decades, the population will continue to grow but at a decelerating rate.)

World Social Indicators: Global Per Capita Income

We have seen that life expectancy has been improving all across the planet. It is one of the most important measures of well-being. Yet most people think of income when they think of prosperity. Rightly so. Income is correlated with other factors that allow us to move beyond surviving to thriving.

Today's common refrain is "The rich are getting richer and the poor are getting poorer." It is widely repeated. It is a sentiment that often finds its way into the unison prayers of confession in congregations of my tradition. N. T. Wright, a theologian whose work I've found very helpful, writes:

And now we have the new global evils: rampant, uncaring, and irresponsible materialism and capitalism on the one hand; raging unthinking religious fundamentalism on the other. As one famous book puts it, we have ‘Jihad versus McWorld.” (Whether there is such a thing as caring capitalism, or for that matter thoughtful fundamentalism, isn’t the point at the moment.) …. It doesn’t take a Ph.D in macroeconomics to know that if the rich are getting richer by the minute, and the poor poorer, there is something badly wrong. (Simply Christian, 8)

It also doesn't take a Ph.D. in macroeconomics to verify such claims either. ;-) The truth is much more complicated than this declaration and certainly is not true if we take the long view of multiple generations. What can we say about per capita income on a historical basis?

Comparing income across eras is difficult. Inflation and other variables make direct comparison impossible. Furthermore, comparing contemporary currency-based economies to barter economies will not do. Economic historians have developed a concept called "purchasing power parity" (PPP) to aid this process. The value of a dollar at a fixed point in time is chosen, and the value of income at all other points is pegged to the purchasing power of the fixed dollar. We will use a PPP measure of "2011 International Dollars" (I$) for our purposes. Annual per capita Gross Domestic Product (the total market value of all final goods and services produced within a given country in a given period, usually a year) will be used as a proxy for income.

Not all economists agree on how to achieve parity between the present and more distant eras. Angus Maddison, one of the foremost authorities on this topic, suggested that about I$1,000 per capita (using 2011 dollars) is a subsistence income level and was typical of subsistence living before the industrial revolution. However, economist Brad Delong, who has done his own analysis, claims:

“A large proportion of our high standard of living today derives not just from our ability to more cheaply and productively manufacture the commodities of 1800, but from our ability to manufacture whole new types of commodities, some of which do a better job of meeting needs that we knew we had back in 1800, and some of which meet needs that were unimagined back in 1800.” (Brad DeLong)

Therefore, DeLong puts historic subsistence living at a lower level, but both scholars end up with similar income estimates in recent eras. Here is the change over the last 2,000 years using Maddison's estimates.

 

The following chart shows their estimates between 1700 and 2015:

You can see that the growth accelerates beginning in the early nineteenth century. Many have suggested that the industrial revolution began not long after 1750, and many inventions indeed came into being not long after that time. However, there was a lag time of a few decades between the advent of various technologies and their placement into productive use. Maddison argues for a beginning point of 1820 (as do other economic historians.) Regardless, keep in mind that the world population grew more than sixfold from less than 1 billion to more than 6.6 billion from 1750 to 2000 during this explosion in per capita income.

So in the aggregate, we can see that growth in worldwide per capita income is astounding. But how broadly spread is the economic expansion?

[Series Index]

World Social Indicators: Child Mortality

Alongside life expectancy, a second measure of prosperity demographers frequently use is the child mortality rate. The child mortality rate is the number of children that die between birth and their fifth birthday per 1,000 live births. Because the first years of life are when human beings are most vulnerable, their ability to survive the first years of life says a lot about the state of their society; thus, the significance of the child mortality rate.

So what can we say about this measure of prosperity throughout human history? Here are estimates of the infant mortality rate (deaths by age one) typical of social scientists and economists who study these issues:

In the year 1000, the average infant could expect to live about 24 years. A third died in the first year of life. Hunger and epidemic disease ravaged the survivors. By 1820, life expectation had risen to 36 years in the west, with only marginal improvement elsewhere. (Angus Maddison, Contours of the World Economy, 1-2030 AD, 69)

Before industrialization, at least one out of every five children died before reaching his or her first birth day; that is infant mortality measured as the number of children dying before the age of one, typically exceeded 200 per 1,000 live births. … In the United States, as late as 1900, infant mortality was 160; …” (Indur Goklany, The Improving State of the World, 27)

Estimates are that child mortality was over 40% before 1800.

Let's look at the change in the child mortality rate for the last 200 years:

Globally, that is a drop from forty children per 1,000 to four children per 1,000. This graphic compares nations in 1800, 1950, 1990, and 2013.

Note that the 2013 child mortality rate for all but a few small lagging countries is lower than the rate for all but a few of the wealthiest countries in 1950. The worst country in 2013 has a rate of half that of the best country in 1800.

This is not to say that every nation, every region within a nation, or every subgroup within a nation, has prospered equally well. Still, there is a dramatic improvement in all regions of the world.

During the 1990s, there was a small increase in the rate for the former Soviet nations, but that trend has turned positive again. There are disparities between Anglos and non-Anglos in the United States. The African AIDS epidemic has been harmful. Other regions face other challenges. Yet the overall trend is dramatically downward.

Using child mortality as a measure of prosperity, the world is far more prosperous than ever, and the gap is narrowing between the top and bottom rungs of the global social ladder. Again, most of this change occurred when the world population grew sixfold, from less than one billion in 1800 to about 6.6 billion today!

So as we look at the trajectory of change in the world, we find an unprecedented rise in prosperity. It is an uneven improvement, but every corner of the planet has improved, and the gap between top and bottom nations is closing.

Next, we will look at economic issues.

[Series Index]

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World Social Indicators: Life Expectancy

Demographers commonly use life expectancy rates as a measure of societal well-being. Life expectancy is the number of years someone is expected to live when born based on actuarial science. Long life is a universal indicator of prosperity across cultures and time. It is an important measure to demographers because achieving it requires a complex mix of variables, like a sustained nutritious food supply, a sanitary and safe environment, relatively little disease, the absence of war, and a stable society.

So what can we say about this measure of prosperity throughout human history? Here are estimates of two social scientists and economists typical of those who study these issues:

For most of its existence, homo sapiens lived in far-flung hunter-and-gathering communities, each of which was quite small and barely able to reproduce itself. Life expectancy at birth was hardly twenty-five years on average, and those persons who survived childhood often died violently, in combat with other hunters, at relatively young ages. (Robert William Fogel, The Fourth Great Awakening and the Future of Egalitarianism, 48)

For much of human history, average life expectancy used to be 20-30 years. By 1900, it had climbed to about 31 years … By 2003 it was 66.8 years. (Indur Goklany, The Improving State of the World, 31)

To put the last statement by Goklany in perspective, let's graph the estimated life expectancy on a chart:

If we show only the last 250 years, we get a clearer picture of what has happened:

Source

Using life expectancy as a measure of prosperity, the world is far more prosperous than ever. The gap is narrowing between the top and bottom of the global community. More amazing, most of this change occurred over a time when the total world population grew sixfold, from less than one billion in 1800 to about 6.6 billion today!

This is not to say that every nation, every region within a nation, or every subgroup within a nation, has prospered equally well. AIDS has been devastating in regions of Africa. War and discord have harmed some nations. Yet over the past forty years, we have seen broad improvement in the world. Keep in mind that the global population nearly doubled during this time:

Interactive Source

The trajectory of change is an unprecedented rise in prosperity. It is uneven growth, but every corner of the planet has improved, and the gap between top and bottom nations is closing.

Next, we look at infant mortality rates.

[Series Index]

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Don't Forget the Good Stuff

It is easy to become obsessed with the challenges and threats we see before us today. It is easy to lose sight of the bigger picture and not see the tremendous good happening in the world. Here are six social indicators pointing to improving the quality of life for billions around the globe. Setbacks and brief reversals are inevitable, but increasingly, the challenges we face are of our own making, like tribalism and authoritarianism. Let us be vigilant in addressing our challenges without losing sight of the bigger picture.

Shrinking the World, 1800-1930

Satirist and humorist Douglas Adams, probably best known for The Hitchhiker's Guide to the Galaxy, once wrote:

"Anything that is in the world when you're born is normal and ordinary and is just a natural part of the way the world works. Anything that's invented between when you're fifteen and thirty- five is new and exciting and revolutionary and you can probably get a career in it. Anything invented after you're thirty-five is against the natural order of things."

We tend to view our era as a time of unprecedented change while assuming the world before our birth was virtually stagnate. In fact, rapid, radical change has been the norm for at least the past few centuries. The case can be made that the generations living just before our generation experienced changes every bit as disorienting as ours.

I recently came across this graphic from The Atlas of Historical Geography of the United States, published in 1932. These maps show the improvement in travel times from New York from 1800 to 1930.

I remember first coming across similar maps in Allan Pred's Urban Growth and the Circulation of Information: The United States System of Cities, 1790-1830. Pred demonstrates that not only did travel times shrink, but the cost per mile of travel shrank as well.

Early in the nation's history, most travel was by water. We built cities on major waterways. Most states in the eastern half of the United States have a major river or the ocean as a boundary. This meant that each state had access to the water transportation superhighway. Traveling by land was exceedingly difficult. There were few roads. It took days to reach even nearby cities by stagecoach, and each night meant fees for food and lodging that were not part of the stagecoach price. You had the labor of a driver spread across a few people. The cost of travel for even short distances could consume a week or more of wages for a typical working person. Only the wealthy and merchants could afford such travel.

I believe it was Pred who said travel from New York to Pittsburgh did not typically take a route across Pennsylvania. It involved boarding a boat in New York, sailing down the east coast around Florida to New Orleans, and then navigating up the Mississippi and Ohio to Pittsburgh. Boats could handle far more people per trip, required no extra lodging expenses, food was generally provided on board, and laborers per person were much smaller. Water travel was also far more energy efficient and thus less costly.

As turnpikes and canals were built, and with the advent of the steamboat in the 1820s, travel times shrank, and so did the prices. Depending on travel destinations, Pred shows the cost of travel per mile between 1800 and 1840 dropped by 50-90%. Railroads shrank the distance and decreased costs even more. Today, we can fly from New York to Los Angeles in a few hours for one or two days' wages for someone earning around the US median Salary.

The world continues to change significantly but let us not fool ourselves into thinking that our age is the first to encounter sweeping technological and economic changes.

[Note: If you are interested in American economic history, you need to investigate the interactive Atlas of the Historical Geography of the United States.]

You may also find this clip by Louis C. K. sums up well our lack of appreciation.

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Why Are We Not Running Out of Farm Land?

One of the most persistent worries about population and economic growth is that we will eventually use up all our resources and land. It is based on the intuitive (but false) assumption that if it takes X acreage of land to feed a person today, then it will take two times X acreage to feed double the population in the future. This thinking does not allow for ongoing innovation and adaptation.

This graph shows the total global hectares used in farm production from 1960-2009. Note that the global population grew from three billion in 1960 to 6.8 billion in 2009.

(Source: Nature Rebounds)

The population will likely grow again by half over the next fifty years. Note that the projections are for the number of hectares used for farming to actually decline. The alternative projection assumes we adopt more efficient food consumption and stop growing crops for fuel. In either case, we will use significantly less land than in 1960.

This is one example of decoupling, where two seemingly connected trends become disconnected. We see this in water consumption, CO2 produced per dollar of produced goods, and the amount of natural resources we use. The direst predictions about resources and climate tend to minimize or ignore these decoupling developments. We should not allow dire predictions that ignore decoupling to frighten us away from growth and achieving prosperity for the whole world.

Challenges? Yes. But we are not at the edge of doom.

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An Improving World

Life expectancy at birth is one of the single best indicators of societal well-being. So many things have to work well for the great majority of people to live long lives that the high life expectancy is a proxy for holistic well-being. The measure is of particular value in that it measures something relatively concrete, as opposed to income (which has varying impacts relative to local living standards and exchange rates) or happiness (a highly subjective term.)

Throughout human history, global life expectancy at birth was about 30 years. This does not mean that everyone died before age thirty. It is an average age of death. One in four children died before their first birthday (it is less than 1% in developed nations today). Some people lived to be quite old. But on average, people lived to be thirty.

Over the past two hundred years, something has changed. Global life expectancy at birth has more than doubled and is still improving. I won't give a dissertation on why that might be but rather invite you to realize that contrary to our intuitions, news reports, and personal biases, we are living through the most astonishing improvement in human flourishing in human history.

Here is a chart showing the trend.

This chart offers an animated presentation of the improvement by nation.

More Evidence of an Improving World - HDI

The world is becoming a better place. It is not a utopia. We are not without substantial challenges. But we are becoming (as in movement along a trajectory) better (as in measurably improved according to a standard.) 

The Human Development Index is a United Nations measure of well-being combining income, literacy, education, and life expectancy data. Here is the index for the world nations in 1980 and 2012. The reality is that we are living through the most astonishing transformation toward human well-being in all of history. You can find the interactive version of the chart at Our Data.

 

Rosling Univeristy (How to be smarter than a chimp)

Are you smarter than a chimp? There is a good chance you are not when it comes to knowledge about global socioeconomic trends. For years, Swedish global health expert, Hans Rosling, has been giving Ted talks and making presentations about global trends. One of his favorite teaching tools is to ask people a question like this:

Globally, over the past 20 years, the rate of extreme poverty has:

1. Doubled.
2. Stayed the same.
3. Decreased by more than half.

Now chimps will randomly select, giving each answer a 33% chance. Yet when Rosling asks audiences, at least half will say A, a sizable percentage will say B, while a few will say C. Yet C is the correct answer! This is the case with one variable after another. Audiences routinely score worse than chimps, choosing the most negative option.

An old adage states, "It isn't what we don't know that gets us in trouble. It's what we know that ain't so." That we routinely pick the wrong answer more often than chimps shows that we have bias.

In the Ted talk, How not to be ignorant about the world, Hans' son Rosling notes that part of the problem is our education system. Teachers go to college at a particular point in time and learn the state of the world at that time. But they tend not to learn about ongoing developments. The data has often been hard to come by and hard to interpret. So teachers are biased by what they learned years ago. (Reporters have the same problem.) But there are other factors.

During our evolutionary history, our brains became wired to notice threats. Hunters walking through the brush who were attentive to the possibility of tigers lying in wait likely survived those who went about carelessly enjoying a beautiful day. So when we reflect on broad human trends, we fixate on perceived threats. What was useful for us in the wild is counterproductive as we try to interpret socioeconomic trends. If you want to outscore a chimp on an exam about global well-being, Ola Rosling suggests that you must drop your predispositions and adopt these four rules of thumb:

1. Assume most things are improving.
2. Assume most people are in the middle of a distribution, not a binary of rich and poor.
3. Assume social development precedes becoming wealthy. (Don't assume that a population must be rich before meeting basic social needs.)
4. Assume you are exaggerating the threat if the topic is something you personally fear.

Additionally, Hans, Ola, and others have been working to build the Gapminder website to provide you with data that can be presented in meaningful ways. But one of the most important contributions the Roslings have made is their collection of entertaining and informative videos. In this post, I include every video I can find with a brief annotation. (I'll add more as I find any.) Many videos overlap or cover similar data but are all well worth viewing. So here is your resource for becoming smarter than a chimp. Don't say I never gave you anything.

(This link also has links to most of these videos, including some shorts not listed here: Gapminder Video)

Hans Rosling's 200 Countries, 200 Years, 4 Minutes (2010)

If you are just getting acquainted with Rosling, I'd begin here. This four-minute presentation gives you a quick sense of what he is talking about.

 

Hans and Ola Rosling: How not to be ignorant about the world. TED June 2014

This is the second video to watch. The front half is Hans making his case that the world is improving, and the back half is Ola explaining, as I recounted above, why we are so disinclined to see positive change.

 

Hans Rosling: The magic washing machine. TED December 2010

This is the third one to watch. This is one of my favorites. While fully embracing the concern about the environmental impacts of economic growth, Rosling shows the importance of economic growth through the story of the washing machine.

 

THE REST ARE IN CHRONOLOGICAL ORDER

Hans Rosling: The best stats you've ever seen. TED February 2006

The TED presentation that kicked it all off. He focuses on the positive changes underway in the world. He points to his efforts to liberate, integrate, and animate data and to find ways to present data the public finds understandable.

 

Hans Rosling: New Insights on Poverty. TED March 2007

Rosling shows that social development tends to precede economic development. He addresses the issue that, unfortunately, economic development has always been based on fossil fuels. Higher yields, technology, and markets are key to ending poverty, but more dimensions like human rights, environment, governance, economic growth, education, health, and culture need our attention. The ending has a great surprise!

 

Human Rights and Democracy Statistics- Gapminder c. 2008

Rosling describes why human rights are so hard to describe and evaluate.

Source

Yes they can! - Gapminder c. 2008

Rosling explains that poor nations will one day become prosperous, and we should welcome that.

Source

Poor Beats Rich in MDG Race - Gapminder c. 2008

Rosling shows that countries that have developed from poverty to well-being have done so faster than Western nations. Poor countries today can make the transition much quicker because of what previous countries have learned.

Source

What stops population growth? - Gapminder c. 2008

Small families are the key to ending population growth, and the key to small families is childhood survival.

Source

Hans Rosling: Insights on HIV, in stunning data visuals. TED February 2009

Uses Gapminder data to show nuances in how AIDS has spread and what it takes to defeat it.

 

Hans Rosling: Let my dataset change your mindset. TED June 2009

This is the third video you should watch. Rosling deconstructs the dichotomy of wealthy and developing nations and challenges the idea of thinking in sweeping terms like "Africa."

 

The Joy of Stats with Professor Hans Rosling - Gapminder c. 2010

Rosling shows how making data available and animating empowers people to make better decisions, sometimes without realizing they are using statistics.

Source

Hans Rosling: Asia's rise -- how and when. TED Nov 2009

Rosling forecasts when China and India will catch up with the USA and UK.

 

 Hans Rosling: Global population growth, box by box. TED June 2010

 Rosling says that child survival is the new green. This video explains why.

 

Hans Rosling: The good news of the decade? We're winning the war against child mortality. TED September 2010

Rosling breaks down the remarkable trends in child mortality. Education of women accounts for at least 50% of the drop.

 

 

Hans Rosling: Religions and babies. TED April 2012

Religion is not a factor in family size. There is no significant difference between Islamic and Christian countries regarding births per woman. The defining difference is economic well-being.

 

 DON'T PANIC — Hans Rosling showing the facts about population. BBC November 2013

 A one-hour investigation into the dynamics of population growth using stories about real live families interspersed with Rosling's entertaining presentation of data.

 

Don't Panic - How to End Poverty in 15 Years. BBC September 2015

No embed is available.

You can view the video here.

Here is a link to a series of short videos on how to use development data visually.

An introduction to visualising development data

 

Hans and Ola Rosling: How not to be ignorant about the world

Hans Rosling and Ola Rosling are truly brilliant and entertaining. The first part of this video highlights how poorly we assess what is happening in the world. The back half gives some simple tips on how to avoid developing false perceptions and suggests why it is important that we do so. Enjoy!

 

It's The End Of The World As We Know It, So Why Don't We Feel Fine?

It’s the end of the world as we know it – because it is improving remarkably! Almost every indicator of human well-being shows improvement on a global basis. We live in the best era in human history. How does that make you feel? Like the old REM song, does it make you feel fine? Or does it maybe make you feel incredulous? Defensive? Offended?

I’ve been writing and linking stories about global improvements on social media for at least ten years. I’ve learned that people usually respond with a sad acknowledgment of a problem if I point to a negative trend. But if I mention a positive trend, I routinely get pushback. I get everything from personal anecdotal evidence to accusations of callousness toward those who continue to suffer from some particular problem. This becomes particularly true if a strong political agenda is connected with a trend. Conservatives don’t want to hear that crime is in steady decline. Progressives don’t want to hear there is a steady decline in church arson, race motivated or otherwise.

Why is it so hard for us to see and accept that the overall state of the world is improving? A recent article at Slate again documents the improving state of our world, The World Is Not Falling Apart: Never mind the headlines. We’ve never lived in such peaceful times. (Now I know that it is because the article is from Slate that my conservative readers already have their defenses up. When the exact same information gets presented by groups like CATO, progressives go into the same mode. That is yet another feature of the problem.) The data is interesting and well worth reading, but I think the following four paragraphs are particularly insightful. It goes a long way to explaining why it’s the end of the world as we know it and we don’t feel fine.

How can we get a less hyperbolic assessment of the state of the world? Certainly not from daily journalism. News is about things that happen, not things that don’t happen. We never see a reporter saying to the camera, “Here we are, live from a country where a war has not broken out”—or a city that has not been bombed, or a school that has not been shot up. As long as violence has not vanished from the world, there will always be enough incidents to fill the evening news. And since the human mind estimates probability by the ease with which it can recall examples, newsreaders will always perceive that they live in dangerous times. All the more so when billions of smartphones turn a fifth of the world’s population into crime reporters and war correspondents.

We also have to avoid being fooled by randomness. [Roger] Cohen laments the “annexations, beheadings, [and] pestilence” of the past year, but surely this collection of calamities is a mere coincidence. Entropy, pathogens, and human folly are a backdrop to life, and it is statistically certain that the lurking disasters will not space themselves evenly in time but will frequently overlap. To read significance into these clusters is to succumb to primitive thinking, a world of evil eyes and cosmic conspiracies.

The only sound way to appraise the state of the world is to count. How many violent acts has the world seen compared with the number of opportunities? And is that number going up or down? As Bill Clinton likes to say, “Follow the trend lines, not the headlines.” We will see that the trend lines are more encouraging than a news junkie would guess.

To be sure, adding up corpses and comparing the tallies across different times and places can seem callous, as if it minimized the tragedy of the victims in less violent decades and regions. But a quantitative mindset is in fact the morally enlightened one. It treats every human life as having equal value, rather than privileging the people who are closest to us or most photogenic. And it holds out the hope that we might identify the causes of violence and thereby implement the measures that are most likely to reduce it. Let’s examine the major categories in turn.

6 New Rules of Business for the Next Industrial Revolution

Alan Murray at Fortune summarizes a lengthier piece by Geoff Colvin called Why every aspect of your business is about to change. Here is my summary of Murray's summary:

1. You don't need a lot of physical capital. ...

2. Human capital will matter more than ever. ...

3. The nature of employment will change. For the rest of your employees, gig work will grow. ...

4. Winners will win bigger, and the rest will fight harder for the remains. ... McKinsey Global Institute puts it: "tech and tech-enabled firms destroy more value for incumbents than they create for themselves."

5. Corporations will have shorter lives. The average life span of companies in the S&P 500 has already fallen from 61 years in 1958 to 20 years today. It will fall further.

6. Intellectual property knows no natural boundaries. 

Fascinating stuff.

Global Inequality in Decline

This chart comes from Timothy Taylor's post, The Shifting World Distribution of Income. One notable thing I saw was that median annual income (measured in purchasing power parity dollars) doubled from 2003 to 2013. This chart suggests it will double again within about 20 years. Of course, the most obvious change is the collapse of the spike at the low end of the chart, indicating the rapid decline in the number of people living in or near extreme poverty. See Taylor's post for more details.

World Bank: Extreme poverty 'to fall below 10%'

BBC: World Bank: Extreme poverty 'to fall below 10%'

The World Bank has said that for the first time less than 10% of the world's population will be living in extreme poverty by the end of 2015.

The bank said it was using a new income figure of $1.90 per day to define extreme poverty, up from $1.25.

It forecasts that the proportion of the world's population in this category will fall from 12.8% in 2012 to 9.6%. ...

... However, the report's authors said the "growing concentration of global poverty in sub-Saharan Africa is of great concern".

Extreme poverty in that region is seen as falling from 46.2% in 2012 to 35.2% at the end of 2015. ...

... The World Bank says the downward trend is due to strong growth rates in developing countries and investments in education, health, and social safety nets. ...

... And the bank warned that poverty is "becoming deeper and more entrenched in countries that are either conflict ridden or overly dependent on commodity exports".

1990: 1,959 billion = 37.1% of world's population.
1999: 1,747 billion = 29% of world's population.
2012: 902 million = 12.8% of world's population.
2015: 702 million = 9.6% of world's population.

How GDP shares have shifted across the world since 1000 AD

Business Insider: How GDP shares have shifted across the world since 1000 AD

Interesting graph.

Don't Panic - How to End Poverty in 15 Years (Hans Rosling)

YouTube: Don't Panic - How to End Poverty in 15 Years (This World documentary)

"The legendary statistical showman Professor Hans Rosling returns with a feast of facts and figures as he examines the extraordinary target the world commits to this week - to eradicate extreme poverty worldwide. In the week the United Nations presents its new goals for global development, Don't Panic - How to End Poverty in 15 Years looks at the number one goal for the world: eradicating, for the first time in human history, what is called extreme poverty - the condition of almost a billion people, currently measured as those living on less than $1.25 a day.

Rosling uses holographic projection technology to wield his iconic bubble graphs and income mountains to present an upbeat assessment of our ability to achieve that goal by 2030. Eye-opening, funny and data-packed performances make Rosling one of the world's most sought-after and influential speakers. He brings to life the global challenge, interweaving powerful statistics with dramatic human stories from Africa and Asia. In Malawi, the rains have failed as Dunstar and Jenet harvest their maize. How many hunger months will they face when it runs out? In Cambodia, Srey Mao is about to give birth to twins but one is upside-down. She's had to borrow money to pay the medical bills. Might this happy event throw her family back into extreme poverty?

The data show that recent global progress is "the greatest story of our time - possibly the greatest story in all of human history". Hans concludes by showing why eradicating extreme poverty quickly will be easier than slowly.

Don't Panic - How To End Poverty In 15 Years follows Rosling's previous award-winning BBC productions Don't Panic - The Truth About Population and The Joy Of Stats."

Trends in Extreme Poverty (Spoiler: The Poor Are Not Getting Poorer)

Globally, the number of people living in extreme poverty ($1.25 a day) is shrinking. The global poor are not getting poorer. The world population grew from 4.5 billion people in 1981 to 6.9 billion in 2010 - a 60% increase. The percentage of people living in extreme poverty in developing nations dropped from over 50% to 21%. (From about 1.95 bil. to 1.2 bil., estimates are now well below one bil. in 2015.)

That doesn't mean life just above the extreme poverty line is desirable. That doesn't mean there isn't a great deal more to do. But let's be honest about the trajectory. And let's also be honest that central to the decline in extreme poverty has been the inclusion of the poor in networks of productivity and exchange - that is to say, they embraced some form of market capitalism. Unqualified dismissal of "capitalism" (rarely defined by critics), as some religious leaders are prone to do, should be challenged.

Source: World Bank - State of the Poor

A Richer World... but for whom?

BBC: A Richer World... but for whom?

We are getting richer. Not every human being on the planet and not every country. But the average person has an economic standard of living that's far better than it used to be.

One way of measuring it is to look at the amount of goods and services produced per person - gross domestic product or GDP per capita.

For the global population that rose almost fourfold in the 60 years up to 2010.

There were some marked divergences between countries. In China the increase was a stunning eighteen-fold. South Korea and Taiwan managed even more. On average, they are 25 times richer than in 1950.

A few countries, mainly in Africa, lost ground. In the Democratic Republic of Congo average living standards fell by more than half in the same period. ...

... One benefit from that is that we are living longer. In the middle of the last century a new-born baby could expect to live 50 years. Now the figure is 70. Once again there are large variations between countries but the favourable trend in that period is present in almost every nation - Botswana is the only one where life expectancy declined (by a few months). ...

... There is of course a debate, a rather vigorous one, to be had about just how bad a thing rising inequality really is. That is even more true of the question of what, if any, government policies should be employed to tackle it.

Rising inequality is a reminder that, richer though the world is, some people don't feel it.

This article does a good job of highlighting positive trends while also recognizing that improvements are uneven. The article touches on concerns about inequality, but the environmental impact and resource depletion issues must be raised. The key to wisdom is understanding that these positive and negative trends are all interconnected.

Is the greater concentration of wealth at the top (to the degree it is really happening) a by-product of the same forces lifting hundreds of millions of people out of poverty? If so, blindly attacking wealth inequality may thwart the progress of millions climbing out of poverty.

Is global economic growth improving the living standards of so many people also causing damage to the climate and environment to the point that one day soon, we will all see our living standards diminish? If so, blindly pursuing economic growth may diminish our quality of life.

The key is to think holistically. Populist movements usually take us in the opposite direction.

Why I Won't Shut Up About Positive Changes in The World

Most people are exceptionally illiterate about the trajectory of demographic and economic changes in the world, believing the world is decaying. That leads many to disengage in hopelessness. Globalization combined with investment in human capital and infrastructure has put extreme poverty in rapid retreat. The global poor are not getting poorer. The world is getting better!

I have continuously pointed to evidence of these developments through social media for more than a decade. Not infrequently, posts about positive trends are met with incredulity and even anger. How can I speak of an improving world when so many are suffering? It is as if nothing positive may be acknowledged until total success is achieved. Yet the relentless focus on the negative, attempting to shame and guilt people into action (often with distorted and exaggerated data) drives people away from action into donor fatigue and hopelessness. There must be hope that things can get better.

A recent guest preacher recounted a scene from the end of Schindler’s List. Schindler, who saved 1,200 Jews from the Nazis, reproofs himself as he realizes that he might have saved at least one more person if he had sold his car or other possessions. He finds himself in a difficult place. How can he celebrate the lives saved when so many still died? But how can he not celebrate 1,200 lives that were indeed saved?

Endless fixation on the negative leads to despair and diminishes the value of lives that have improved. Such fixation is unwarranted and counterproductive, so I will continue with stories of hope and improvement. We need balance. We need hope. And based on the Barna data below, there is much work to do.

The World is Not Falling Apart

Slate: The World is Not Falling Apart

Never mind the headlines. We've never lived in such peaceful times.

I've repeatedly revisited the theme in my blogging that the world is improving in many ways. That is routinely met with skepticism, even outrage. How can I be so insensitive as to say the world is getting better while millions are suffering and dying? Of course, the short answer is that I didn't say that the world has achieved perfection but only that it has gotten better.

I love these five paragraphs in the intro to this lengthy article:

... How can we get a less hyperbolic assessment of the state of the world? Certainly not from daily journalism. News is about things that happen, not things that don't happen. We never see a reporter saying to the camera, "Here we are, live from a country where a war has not broken out"—or a city that has not been bombed, or a school that has not been shot up. As long as violence has not vanished from the world, there will always be enough incidents to fill the evening news. And since the human mind estimates probability by the ease with which it can recall examples, newsreaders will always perceive that they live in dangerous times. All the more so when billions of smartphones turn a fifth of the world's population into crime reporters and war correspondents.

Amen!

We also have to avoid being fooled by randomness. Cohen laments the "annexations, beheadings, [and] pestilence" of the past year, but surely this collection of calamities is a mere coincidence. Entropy, pathogens, and human folly are a backdrop to life, and it is statistically certain that the lurking disasters will not space themselves evenly in time but will frequently overlap. To read significance into these clusters is to succumb to primitive thinking, a world of evil eyes and cosmic conspiracies.

Human beings are natural pattern seekers. Psychological studies show we often identify patterns where none exist.

Finally, we need to be mindful of orders of magnitude. Some categories of violence, like rampage shootings and terrorist attacks, are riveting dramas but (outside war zones) kill relatively small numbers of people. Every day ordinary homicides claim one and a half times as many Americans as the number who died in the Sandy Hook massacre. And as the political scientist John Mueller points out, in most years bee stings, deer collisions, ignition of nightwear, and other mundane accidents kill more Americans than terrorist attacks.

The only sound way to appraise the state of the world is to count. How many violent acts has the world seen compared with the number of opportunities? And is that number going up or down? As Bill Clinton likes to say, "Follow the trend lines, not the headlines." We will see that the trend lines are more encouraging than a news junkie would guess.

I love the distinction between trend lines and headlines! Consider that adage stolen.

To be sure, adding up corpses and comparing the tallies across different times and places can seem callous, as if it minimized the tragedy of the victims in less violent decades and regions. But a quantitative mindset is in fact the morally enlightened one. It treats every human life as having equal value, rather than privileging the people who are closest to us or most photogenic. And it holds out the hope that we might identify the causes of violence and thereby implement the measures that are most likely to reduce it. Let's examine the major categories in turn. ...

The quantitative mindset is indeed the most morally enlightened. It compensates for the human tendency to privilege information on what is happening to those geographically and culturally nearest to us. But it also counters a "parochialism of the present," where we discount the often greater suffering of those in the past relative to those who suffer in the present because the present is our context.

Be sure to read the whole thing. Here are just a few charts:

It's Time To Admit It: The World Is Becoming A Better Place

Business Insider: OK, Haters, It's Time To Admit It: The World Is Becoming A Better Place

The article includes this graph:

Then this one about poverty:

Many other graphs could be shown about a host of important social indicators, but the article closes with the most important one: life expectancy. Improvements in life expectancy require that a wide range of variables move in a positive direction. For that reason, improving life expectancy is often a proxy for overall well-being.

The author closes with the following:

So complain all you want about how horrible everything is. There's certainly a lot left to fix. But as you complain, remember:

The world is getting better all the time.

Preach it!

23 Charts That Show Why This Is The Best Moment In History To Be Born

Business Insider: 23 Charts That Show Why This Is The Best Moment In History To Be Born

Here are a few of my favorites. Click through to see the rest. The big question is not how to stop the world from spiraling into chaos. The big question is how we get an improving world to improve more quickly and broadly. We have challenges ... climate and ecosystem impacts, evolving energy challenges, shift to renewable/recyclable resources ... but we have always had challenges. This is the golden era of humanity as it relates to material, physical, and political well-being. We just have to keep pushing to make it golden for everyone.

 

How not to be ignorant about the world - Hans and Ola Rosling

Hans Rosling, and his son Ola, nail it again. Excellent video. I have more to say about this in a coming post.

Reasons to Be Cheerful

Matt Ridley: Reasons to Be Cheerful

We are prone to fixate on problems and threats. The news concentrates on Ebola, the Middle East and Ukraine violence, and the discord in Ferguson, Missouri. But it is important to keep present challenges (and they are more decidedly real) in context. Matt Ridley offers twelve reasons to be cheerful when we look at broader trends.

So let’s tot up instead what is going, and could go, right. Actually it is a pretty long list, just not a very newsworthy one. Compared with any time in the past half century, the world as a whole is today wealthier, healthier, happier, cleverer, cleaner, kinder, freer, safer, more peaceful and more equal.

1. The average person on the planet earns roughly three times as much as he or she did 50 years ago, corrected for inflation. If anything, this understates the improvement in living standards ...

2. The average person lives about a third longer than 50 years ago and buries two thirds fewer of his or her children (and child mortality is the greatest measure of misery I can think of).

3. The amount of food available per head has gone up steadily on every continent, despite a doubling of the population. Famine is now very rare.

4. The death rate from malaria is down by nearly 30 per cent since the start of the century. HIV-related deaths are falling. Polio, measles, yellow fever, diphtheria, cholera, typhoid, typhus — they killed our ancestors in droves, but they are now rare diseases.

5. We tell ourselves we are miserable, but it is not true. ...

6. education is in a mess and everybody’s cross about it, but consider: far more people go to school and stay there longer than they did 50 years ago.

7. The air is much cleaner than when I was young, with smog largely banished from our cities. Rivers are cleaner and teem with otters and kingfishers. ... Forest cover is increasing in many countries and the pressure on land to grow food has begun to ease.

8. We give more of our earnings to charity than our grandparents did.

9. Violent crimes of almost all kinds are on the decline — murder, rape, theft, domestic violence.

10. Despite all the illiberal things our governments still try to do to us, freedom is on the march.

11. The weather is not getting worse. Despite what you may have read, there is no global increase in floods, cyclones, tornadoes, blizzards and wild fires — and there has been a decline in the severity of droughts. ... there has been a steep decline in deaths due to extreme weather.

12. As for inequality, the world as a whole is getting rapidly more equal in income, because people in poor countries are getting richer at a more rapid pace than people in rich countries. ...

By all means, let us address the problems at hand, but let us also tap down the tendency to see only the negative and give in to gloom and despair.

The Hockey Stick of Human Prosperity

From MRUniversity, Everday Economics:

"We are pleased to announce a brand new course at MRUniversity, Everyday Economics. The new course will cover some of the big ideas in economics but applied to everyday questions. The first section, premiering now and rolling out over the next several weeks, features Don Boudreaux on trade. Tyler will appear in a future section on food. You can expect more from me as well. Indeed, you may spot both Tyler and I in some cameos (ala Stan Lee) in some of Don’s videos!

Here’s the first video on trade and the hockey stick of human prosperity."

Why the West Progressed in Ways No One Else Had

I just read Cathedral, Forge, and Waterwheel: Technology and Invention in the Middle Ages by Frances & Joseph Gies. The book focuses on technological development during the 1,000 years from 500-1500 C.E. The Middle Ages was once cast as an age of regression from the golden age of Greece and Rome until the Renaissance and the Enlightenment saved the day. Furthermore, capitalism is often seen as a product of the last two or three centuries. Modern scholarship debunks these characterizations. This book does a great job at showing the cultural and technological ferment of the Middle Ages, as well as showing how many of the key components of the modern economic world (companies, risk management, double-entry bookkeeping, finance, technological innovation, labor specialization, factories, to name a few) were already coming to flower by 1500. Here are two insights from the end of the book:

… "Asian priority in a wide range of [technological] innovations is established. Asia, however, showed little inclination to borrow, and so, after giving much to others, allowed its own technology to wither, as demonstrated in the history of the two epoch-making inventions of printing and firearms. Each originated in China, but each was allowed to languish, while Europe seized them in both hands to make them major instruments of change. An authority [Timo Myllyntaus] on technology transfer in the modern world asserts that the process 'is not just a matter of moving some piece of hardware from one place to another… A material infrastructure is not enough. There must also be sufficient nonmaterial infrastructure.' In the 'nonmaterial infrastructure' of medieval Europe was a spirit of progress whose ingredients included intellectual curiosity, a love of tinkering, an ambition 'to serve God' and also 'to grow rich as all men desire to do.'

A sense of progress implies a sense of history, something missing among the Egyptians, Greeks, and Romans. 'Lacking any objective understanding of the past – that is, lacking history,' says [D. S. L.] Cardwell, 'the hierarchical and slave-owning societies of classical antiquity failed to appreciate the great progress that had been achieved by and through technics.' On the contrary, the ancients were fond of looking back to what they conceived as a vanished 'golden age,' a conception the reverse of progress. The Christian Church, whose pioneering monastic orders made many practical and material contributions to medieval technology, also supplied a noncyclical, straight-line view of history that allowed scope for the idea of progress." (287-288)

The book concludes with this paragraph:

"' Technology,' says Melvin Kranzberg, founder of the Society for the History of Technology, 'is neither good nor bad; nor is it neutral.' It is what each age and each society make of it. The Middle Ages used it sometimes wisely, sometimes recklessly, often for dubious purposes, seldom with a thought for the future, and with only a dim awareness of the scientific and mathematical laws governing it. But operating on instinct, insight, trial and error, and perseverance, the craftsman and craftswoman, the entrepreneurs, the working monks and the clerical intellectuals, and the artist-engineers all transformed the world, on balance very much to the world's advantage." (291)

I've read a number of books on the history of technology. This is one of the best short surveys I have read, reading more like a novel than a history book.

The Poor Will NOT ALWAYS Be With Us

Excellent!

The Poor Will Not Always Be With Us - Dr. Scott Todd from Compassion International on Vimeo.

3 Myths That Block Progress For The Poor (2014 Gates Annual Letter)

2014 Gates Annual Letter:  3 Myths the Block Progress for the Poor

"By almost any measure, the world is better than it has ever been. People are living longer, healthier lives. Many nations that were aid recipients are now self-sufficient. You might think that such striking progress would be widely celebrated, but in fact, Melinda and I are struck by how many people think the world is getting worse. The belief that the world can't solve extreme poverty and disease isn't just mistaken. It is harmful. That's why in this year's letter we take apart some of the myths that slow down the work. The next time you hear these myths, we hope you will do the same." - Bill Gates

I sometimes have issues with Gates' optimism about aid, but he does a fairly balanced job in this piece. There were also two graphs that I really liked. They demonstrate once again how misguided so many doomsayers are. There is reason for hope. The big question is how we can get more of this good stuff to happen better and faster, in sustainable ways.

50 Reasons We're Living Through the Greatest Period in World History

Huff Post Business (The Motley Fool): 50 Reasons We're Living Through the Greatest Period in World History

I recently talked to a doctor who retired after a 30-year career. I asked him how much medicine had changed during the three decades he practiced. "Oh, tremendously," he said. He listed off a dozen examples. Deaths from heart disease and stroke are way down. Cancer survival rates are way up. We're better at diagnosing, treating, preventing and curing disease than ever before.

Consider this: In 1900, one percent of American women giving birth died in labor. Today, the five-year mortality rate for localized breast cancer is 1.2 percent. Being pregnant 100 years ago was almost as dangerous as having breast cancer is today.

The problem, the doctor said, is that these advances happen slowly over time, so you probably don't hear about them. If cancer survival rates improve, say, one percent per year, any given year's progress looks low, but over three decades, extraordinary progress is made.

Compare health-care improvements with the stuff that gets talked about in the news -- NBC anchor Andrea Mitchell interrupted a Congresswoman last week to announce Justin Bieber's arrest -- and you can understand why Americans aren't optimistic about the country's direction. We ignore the really important news because it happens slowly, but we obsess over trivial news because it happens all day long.

Expanding on my belief that everything is amazing and nobody is happy, here are 50 facts that show we're actually living through the greatest period in world history.

1. U.S. life expectancy at birth was 39 years in 1800, 49 years in 1900, 68 years in 1950 and 79 years today. The average newborn today can expect to live an entire generation longer than his great-grandparents could.

2. A flu pandemic in 1918 infected 500 million people and killed as many as 100 million. In his book The Great Influenza, John Barry describes the illness as if "someone were hammering a wedge into your skull just behind the eyes, and body aches so intense they felt like bones breaking." Today, you can go to Safeway and get a flu shot. It costs 15 bucks. You might feel a little poke.

3. In 1950, 23 people per 100,000 Americans died each year in traffic accidents, according to the Census Bureau. That fell to 11 per 100,000 by 2009. If the traffic mortality rate had not declined, 37,800 more Americans would have died last year than actually did. In the time it will take you to read this article, one American is alive who would have died in a car accident 60 years ago. ...

Hans Rosling: Don't Panic — The Facts About Population

This is just fantastic! Hans Rosling pulls together many of his various presentations over recent years and melds them into a one-hour-long presentation about the astonishing way our world is improving while pointing to the challenges ahead. I know this is long, but if you watch this closely and learn, you will be well-positioned to accurately reflect on the alarmist claims of environmentalists, neo-cons, and other ideologies. If I were teaching a demography or economic development class, this video would be the first hour of the first class of the semester.

Are Economic Output and Energy Consumption Decoupling?

Washington Post: Can we sever the link between energy and economic growth?

This is a very important story that is easily overlooked. Why?

People genuinely concerned about global economic growth frequently default into a Malthusian thought process. It goes something like this. We have X amount of economic activity today, and that economic activity requires Y amount of energy and resources. If the whole world grows to our level of economic activity, then there must also be proportional growth in the amount of energy and resources consumed. (Economic growth and resource use are perfectly coupled.) It will exhaust the earth's reserves of energy and resources. The global economy will collapse. We must stop growth and embrace natural limits. Now this is true only given one very huge assumption that most people make without thought. The assumption? GDP (economic output) and the energy/resource consumption rate are inextricably linked. Is this true?

Economic records for the United States show that food production and acreage of land devoted to food production were strongly linked before 1910. There were 310 million acres in production in that year. The United States population would triple over the next century. If you took Dr. Who's Tardis back to 1910 and told them this tripling was coming, they could easily tell you how much land would be needed to feed the extra mouths: 300 million multiplied by 3 equals 900 million acres … equivalent to all the land area east of the Mississippi. How many acres were in production in 2010? There were 310 acres, just as in 1910. Food production and acreage usage decoupled. Improvements in farming techniques and technology fed the extra mouths with the same amount of land and created surpluses that could be shipped abroad.

This chart suggests that the same thing is happening with energy usage. The things we use are becoming more energy efficient. For instance, appliances use half the electricity of their counterparts from thirty years ago. Energy used in manufacturing and distribution keeps getting more energy efficient. The graph shows that GDP and energy use were coupled until about the 1980s. Since that time, it appears they are decoupling. It is conceivable that in the next century or so, we could have a growing economy while actually stabilizing or declining energy usage. (I don't totally dismiss the objections by environmental economists like those mentioned in the article, but I am skeptical that the limitations are as severe as they claim.)

I suspect we will see a similar decoupling of GDP from natural resources before very long. Technology like 3-D printing, still in its infancy, promises to reduce waste in manufacturing and construction processes. Nanotechnology, using robots about 15 times bigger than an atom, can break down substances and recombine the pieces into new substances at the molecular level. It is possible to imagine a day when almost everything we use comes from renewable substances or from nonrenewable substances that are endlessly reconfigured. Furthermore, more of the global economy will likely be about services and digital products instead of physical products.

Now, the growth opponents will raise concerns about the impact these changes will have on the nature of work and our communities. There are questions about endless consumerism, attempting to fill our lives with stuff and evermore exhilarating experiences. These are important questions, but they are questions apart from the question of unsustainability, the idea that accelerated growth will, of necessity, lead to the exhaustion of energy and material resources and the destruction of the environment. The latter is true only if you assume no innovation and creativity, the very traits that have been the hallmark of the global economy in recent generations. Moralists may be right that we should reign in our desires and change our relationship to possessions, but we need not do so because of inevitable collapse. Appreciating this is critical to useful reflection on what it means to be the church in the twenty-first century.

Proof Jesus Was Not a Capitalist: The Richest 1 Percent Own Half the World's Wealth - My Response

Rev. Dr. Susan Brooks Thistlethwaite has a post at the Huffington Post today titled Proof Jesus Was Not a Capitalist: The Richest 1 Percent Own Half the World's Wealth. Here is my response.

She writes:

...Biblically speaking, probably not. As Jesus warned, you have to choose. Either money rules you, or your highest values rule you. There's no middle ground. "No one can serve two masters. Either you will hate the one and love the other, or you will be devoted to the one and despise the other. You cannot serve both God and money." (Luke 16:13)

Jesus was not a capitalist.

God's rules on economics, as articulated both by the prophets and Jesus of Nazareth, are strikingly clear. Not small concentrations of great wealth and the vast majority of people in poverty, but 'each under their own vine and fig tree, living without fear.' (Micah 4:4) Jesus announces his ministry as "good news to the poor" (Luke 4:18), that is, the "Jubilee," the really radical redistributive economic strategy of ancient Israel.

So, is it likely the leaders gathered at the World Economic Forum in Davos serve that vision, a vision of a reasonable abundance shared by all, or are they in service to the vast accumulated wealth of the 1 percent? Is it going to be possible for people at that meeting to enact policies that start to close this disastrous economic gulf between the rich and the poor? ...

First, advanced agrarian societies of the Near East and Rome are the contexts of the Bible (Hebrew and Christian Testaments.) To the limited degree they thought in macroeconomic terms, the economy was a zero-sum game. Land and labor were the two inputs for production. Both were relatively fixed. There was little you could do to alter land productivity, and one person's labor was not substantially different from another's. Consequently, with variable productivity off the table, economics was constrained to considerations of consumption and distribution. Both personal and societal abundance was cyclical, and sharing the fixed pie was essential for community survival.

The great divergence of the past two centuries is the realization that productivity can be radically altered. Productivity can be altered radically by applying technology, energy, exchange, stable institutions, and improving human capital. But these changes have included concentrating wealth into productive assets and assuming larger risks to achieve greater productivity effectively. We live in a different world from advanced agrarian societies, and applying morals from their context directly to ours is useless.

Second, the Jubilee was categorically not a "radical redistributive economic strategy." Land was to revert to its perpetual owners every 50 years. Jubilee stated that if someone needed to "sell" their land, the price would be determined based on the number of crops gathered between the "sale" date and the next Jubilee. Then the land would revert to the perpetual owner. In other words, it was a lease. A person could "sell" their labor under the same conditions. These provisions only applied to agricultural land and had nothing to do with non-agricultural land or other private property. Significantly, it ensured that everyone had access to at least a minimal level of capital (land and labor) to provide for themselves and to produce goods for exchange, living individually and corporately as God's stewards. That has interesting theological implications for economics, but it was not radical redistribution.

Third, from where does abundance come? Apart from air and sunlight, name one thing humans use that does not require human action to transform matter, energy, and data from a less useful form to a more useful form. Absent human action, there is near absolute scarcity of the things that humanity uses. If we each had to provide for ourselves and our families alone, our days would be precarious, doing little else but hunting and gathering our way through life. But we achieve high productivity levels through specialization, technology, the concentration of wealth in productive enterprises, and trade (i.e., capitalism), resulting in unprecedented abundance. Had Jesus known that productivity could be radically altered, I suspect he may have offered different guidance (and I don't mean a blanket blessing of the American economic system.)

Fourth, just what is the negative impact of inequality that should give us pause? The article doesn't say, but it is strongly implied: If wealth is becoming concentrated at the top, then it must be that it is being taken from others, making them poor (1% are wealthy while 99% are in poverty) ... the rich are getting richer, and the poor are getting poorer. She is not alone in this thinking. A recent survey of Americans showed that 66% of respondents think that the proportion of the global population living in poverty has doubled in the past twenty years and another 29% think there has been no change (total of 95%), when in fact the proportion has been halved:

Source: Brookings

Furthermore, the number of well-paying jobs is expanding around the world. Life expectancy at birth, the most holistic measure of human well-being, is now at seventy years and closing in on the eighty-year mark enjoyed by the wealthiest nations. Studies show that inequality within nations is increasing, but inequality between nations is falling.

Now none of this is to say that rising inequality is good or bad. We have to be specific about what metric we use. If the metric is that inequality means more poverty and is therefore bad, then the assertion that inequality is "bad" isn't true. People are not getting poorer. That doesn't mean inequality isn't problematic for other reasons, but we must be specific about what we are tackling.

Finally,

"Unregulated market capitalism has only one master, and that is money. And that is why 85 people control half the wealth of the whole world."

Dr. Thistlethwaite, if you identify one nation on the face of the earth with "unregulated market capitalism," I will write you a check for $1,000 here and now. They don't exist! This issue is not unregulated market capitalism but corporatism. If there is a governance problem, it is that the biggest corporate entities and government have joined together to stack things in favor of their mutual interests over and against market forces that might threaten them. That is corporatist business capitalism and antithetical to market capitalism. Furthermore, economists have not reached a consensus on why there has been an increasing concentration at the top, but the idea that it is summed up in "unregulated market capitalism" is just absurd.

With all that said, I'm not saying that growth in inequality isn't a problem and isn't worthy of theological and moral reflection. I am asking for a more responsible discussion.

I will also agree that change begins from the bottom up. Muhammad Yunus uses the image of a bonsai tree. The seed that grows into the tiny bonsai tree is the same seed that grows into the tall tree in the forest. The difference is that the bonsai grows from the limited foundation of the flowerpot, while the tall tree has the rich foundation of the forest bed. The poor are bonsai people. By improving the soil in which they grow, instituting property rights and the rule of law, and including them in networks of productivity and exchange, they too can flourish as people in wealthier nations have. Trickle-up capitalism is a promising strategy. It is already at work around the world. Let's join them and support them. Populist ideological warfare about poorly defined issues and remedies is nothing but a moralistic distraction. The world deserves better from Christian thinkers.

A 200-Year Look At Automation And How It Has Improved Our Lives

Will There Be Any Poor Countries Left in the World in 20 Years?

Atlantic: Will There Be Any Poor Countries Left in the World in 20 Years?

Bill and Melinda Gates Foundation:

We hear these myths raised at international conferences and at social gatherings. We get asked about them by politicians, reporters, students, and CEOs. All three reflect a dim view of the future, one that says the world isn’t improving but staying poor and sick, and getting overcrowded.

We’re going to make the opposite case, that the world is getting better, and that in two decades it will be better still. ...

... By 2035, there will be almost no poor countries left in the world. Almost all countries will be what we now call lower-middle income or richer. Countries will learn from their most productive neighbors and benefit from innovations like new vaccines, better seeds, and the digital revolution. Their labor forces, buoyed by expanded education, will attract new investments.

How far you could get from New York in one day—back in the day

Quartz: How far you could get from New York in one day—back in the day. (1800 vs. 1934)

We like to think of the 20th century as a time of unprecedented change. But was the change of the 19th century even more profound? Geology and evolution changed our perception of deep history. People and information were liberated to move across the land at speeds faster than a horse. Human productivity exploded. Some would make the case that most change since that time has merely been an extension of nineteenth century changes from the ancient order of things. The map is a great illustration of the radical change that happened in transportation.

 

Why We Need Ghosts of Economic Past, Present, and Future

I watched the 1950 version of "A Christmas Carol" on Christmas Eve. There is an interesting part of the story that I suspect few even notice. In the exchange between Scrooge and the Ghost of Christmas Past, it comes out that both Scrooge's mother and sister died giving birth. Can you imagine a case in our society where both mother and daughter die in childbirth? Such a thing would be so strange that we might look for some hereditary or environmental connection between the events.

Scrooge's mother likely died in the 1780s and his sister in the early 1800s, based on Scrooge's age and calculating back from 1843 (when the book was written.) While certainly tragic, you get no sense that this was especially odd. That's because in 1843 and prior, it wasn't odd. Throughout history, many women died in childbirth, and upwards of one in four children born alive died before their first birthday. The average life expectancy at birth was around 30 years old. (That doesn't mean that some people did not live much longer, but so many died so early that the overall average from birth was quite low.) Today it is nearly 70 years globally and 80 years in advanced nations.

The interesting thing to me is how people of Scrooge's day would have seen our life expectancy today as miraculous. Yet once society moves into the "new normal" of high life expectancy, the miracle is quickly forgotten and seen as the natural order. We are entitled to the new normal, and we come to see those not living in the new normal as victims of some injustice or malady that caused their abnormal plight.

I see this over and over with a range of socio-economic problems. For instance, I've seen countless books that examine what "causes" poverty. Yet, if you were to go back 300 years, you would see that the norm was the overwhelming majority of people living just below or just above subsistence levels. By today's standards, the difference between those below and above was marginal. Someone looking forward from 300 years ago would have seen many of the poorest communities in Africa or Asia today and not been particularly surprised. Their question would not have been what causes poverty. They would have wanted to know what caused the astounding rise in prosperity in other parts of the world.

As I see it, the human propensity to cocoon within "new normals," losing all perspective on how change occurred, is one of the biggest challenges to creating a better world. It causes us to be ungrateful for the good we have inherited and to ask bad questions as we seek the welfare of others. Maybe we need ghosts of the economic past, present, and future to help us see more clearly.

Bjorn Lomborg: The Improving State of the World

Bjorn Lomborg at TED.

Economics Links

1. Your personality type determines your paycheck

2. New York Times editorial: Yes, Economics Is a Science

... But the headline-grabbing differences between the findings of these Nobel laureates are less significant than the profound agreement in their scientific approach to economic questions, which is characterized by formulating and testing precise hypotheses. I’m troubled by the sense among skeptics that disagreements about the answers to certain questions suggest that economics is a confused discipline, a fake science whose findings cannot be a useful basis for making policy decisions.

That view is unfair and uninformed. It makes demands on economics that are not made of other empirical disciplines, like medicine, and it ignores an emerging body of work, building on the scientific approach of last week’s winners, that is transforming economics into a field firmly grounded in fact.

It is true that the answers to many “big picture” macroeconomic questions — like the causes of recessions or the determinants of growth — remain elusive. But in this respect, the challenges faced by economists are no different from those encountered in medicine and public health. Health researchers have worked for more than a century to understand the “big picture” questions of how diet and lifestyle affect health and aging, yet they still do not have a full scientific understanding of these connections. Some studies tell us to consume more coffee, wine and chocolate; others recommend the opposite. But few people would argue that medicine should not be approached as a science or that doctors should not make decisions based on the best available evidence.

As is the case with epidemiologists, the fundamental challenge faced by economists — and a root cause of many disagreements in the field — is our limited ability to run experiments. ...

For a related post: People Are Wondering If Economics Is Really A 'Science'

3. The Guardian: Economics students need to be taught more than neoclassical theory

... Despite this dominance, the few who did predict the financial crisis were economists from non-mainstream backgrounds. This clearly shows that alternatives have much to contribute to the discipline of economics. Neoclassical economics is the mainstream and it is vital for economics students to understand it, and there are reasons it has proved so alluring to so many great minds. While in recent decades it has often been used to advocate free markets, it can be used to argue for a socialist economy, and indeed was in the 1930s. So it doesn't necessarily restrict us to a single political viewpoint. However, it does not comprise the whole of economics – and nor should it. This is not about ideology, it is about improving economics education. ...

4. Does Studying Economics Breed Greed?

... Consider these data points: 

Less charitable giving: In the US, economics professors gave less money to charity than professors in other fields—including history, philosophy, education, psychology, sociology, anthropology, literature, physics, chemistry, and biology. More than twice as many economics professors gave zero dollars to charity than professors from the other fields.

More deception for personal gain: Economics students in Germany were more likely than students from other majors to recommend an overpriced plumber when they were paid to do it.

Greater acceptance of greed: Economics majors and students who had taken at least three economics courses were more likely than their peers to rate greed as “generally good,” “correct,” and “moral.”

Less concern for fairness: Students were given $10 and had to make a proposal about how to divide the money with a peer. If the peer accepted, they had a deal, but if the peer declined, both sides got nothing. On average, economics students proposed to keep 13% more money for themselves than students from other majors. ...

The author offers some remedies.

6. Six signs you’re reading good criticism of economics

1. The criticism is by an economist ...

2. They know the difference between academic economists, economic consultants, business, bureaucrats and politicians ...

3. They distinguish “good for business” and “good economics” ...

4. They criticise a particular, clearly defined area or use of economics ...

5. They criticise a specific economist ...

6. They recognise that economics and values cannot be untangled, no matter who is doing the analysis ...

5. We Don’t Need a ‘Third Way’, We Need More Non-Profits

The problem with advocating for third way economic system between capitalism and socialism is, as Matt Perman notes, there is no realistic third way. Fortunately, a third way isn’t needed since capitalism can do everything that so-called “third alternative” (e.g., distributism) want their system to do. For instance, one aspect of how capitalism can create a more “people-centered economy” is to increase the amount of capital that is dedicated to non-profits. ...

6. Deficits have fallen to 4% of GDP: Source

7. So why, exactly, is labor’s share of income on the decline?

... But e21′s Scot Winship trots out a differently theory (as seen below in a reverse-order Twitter exchange). He theorizes that the labor share of income used to be artificially high, reflecting overpayment to workers during the strong union era so wives could stay at home and raise the kids. Then as women entered the workforce, there was a “Great Correction” where male compensation stagnated, female compensation rose, and the labor share fell. Looking forward to Winship’s extended essay and research on the topic.

8. 1 In 8 Suffers From Chronic Hunger Globally, U.N. Report Says

Worldwide, roughly 1 in 8 people suffered from chronic hunger from 2011 to 2013, according to a new report from three U.N. food agencies.

They concluded that 842 million people didn't get enough food to lead healthy lives in that period, a slight drop from the 868 million in the previous report. ...

 9. BBC: Economy woes pile up for Latin America's leftists

Since the start of the global economic crisis, left-leaning Latin American politicians and pundits have been foretelling the end of economic "neo-liberalism" in their part of the world.

But now, five years after the collapse of US bank Lehman Brothers, we may instead be witnessing the twilight of economic "neo-leftism" in Latin America. ...

10. Why China’s middle class supports the Communist Party

... The common belief of the last 20 years outside China is that economic growth, a growing middle class, and the rise of entrepreneurs inevitably lead to democracy. Everyone knows democratic countries do not go to war with each other, and that a democratic China means thereby less of a "China threat."

The China threat may indeed disappear, but this is unlikely to be because of a rising middle class. The problems with these various equations are that different meanings of the middle class have been elided, even though they may have nothing in common. However it is conceptualized, the middle class in China is actually small despite the current rhetoric. And last but by no means least, China’s socio-political experience is not that of Europe or North America. The middle class in China remains an essential part of the state from which it has emerged and is not very likely to be the Chinese equivalent of the European or North American bourgeoisie with whom it is often equated. ...

11. How to Cut the Poverty Rate in Half (It's Easy)

... Using the dataset from the latest Census poverty report, I determined that if we cut a $2,920 check to every single American—adults, children, and retirees—we could cut official poverty in half. Economists consider this sort of across-the-board payment a “universal basic income.” You can think of it as Social Security for all, not just the elderly. 

The upside of giving everybody about $3,000 is that it’s a very easy policy to run and a surefire way to cut poverty in half. But it's a large program: it would require about $907 billion in 2012, or 5.6 percent of the nation’s GDP. (In a real implementation, we might exclude the more than 45 million Americans receiving OASI Social Security benefits from a basic income, bringing the cost down substantially.) ...

A challenge with this model is that as someone's income rises to the top of the poverty line, they will lose the $3,000 payment as they move past that line. They need a jump of $3,000 over the line to break-even. Some method is needed for the transition out of poverty if people are not to be trapped there.

12. NPR: Debate: For A Better Future, Live In A Red State?

13. Adam Smith on Self-Interests, Not Greed

... Smith’s views were clear: we are in “almost constant occasion for the help of[(our]brethren, and it is in vain for [us] to expect it from their benevolence only. [We] will be more likely to prevail if [we] can interest their self–love in [our] favour, and shew them that it is for their own advantage to do for [us] what [we] require of them”. 

Of course the same is true for solely self-interested greedy “butchers, brewers, and bakers”!  They will prevail only if they “lower their” price demands to what their customers “can go along with”.  For both self-interested buyers and for self-interested sellers they must mediate their self-interests to arrive at successful transactions.

The process by which they mediate their self-interests is by persuasion, as outlined by Adam Smith in his “Theory of Moral Sentiments” and how that is best achieved in negotiations or bargaining exchanges is explained in the sentence immediately before the “butcher, beer, baker” example: “Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of.” (Wealth Of Nations, above).

I hope this is made clear by tutors at Harvard University and that you also make it clear in your classes too.

Greed is not good!  That is the opposite of what Adam Smith taught.

 14. PBS: The Three Reasons Countries Get Rich: Location, Location and Location (I'm not endorsing this view. It is much too deterministic. But it makes for interesting discussion.)

 15. Emerging Economies Nearing Half of Global Warming Emissions

... Developing nations' emissions are rising fast and the report predicted that their share of cumulative emissions would reach 51 percent by 2020. ...

Economics Links

1. Did living standards improve during the Industrial Revolution?

... So, while the Industrial Revolution ultimately led to big increases in wealth, progress was unsteady. For much of the period, the average person was not reaping the benefits of economic change.

So much for wages. Other measures of standard of living should be considered. ...

This a great piece highlighting the methods economic historians use to evaluate standards of living.

2. Annual Food Inflation

3.  Robert Reich on free markets

... In reality, the "free market" is a bunch of rules about (1) what can be owned and traded (the genome? slaves? nuclear materials? babies? votes?); (2) on what terms (equal access to the internet? the right to organize unions? corporate monopolies? the length of patent protections? ); (3) under what conditions (poisonous drugs? unsafe foods? deceptive Ponzi schemes? uninsured derivatives? dangerous workplaces?) (4) what's private and what's public (police? roads? clean air and clean water? healthcare? good schools? parks and playgrounds?); (5) how to pay for what (taxes, user fees, individual pricing?). And so on.

These rules don't exist in nature; they are human creations. Governments don't "intrude" on free markets; governments organize and maintain them. Markets aren't "free" of rules; the rules define them....

All true, but the rules were not arbitrarily written yesterday. Centuries of trial and error are reflected in the rules. That doesn't make them all just or above modification, but neither are they a game thrown together at a whim. To claim there are no free markets because government frames elements of exchange is like saying there is no such thing as free speech because government frames elements of public dialog.

4. American Farmers Say They Feed The World, But Do They?

... So I called , an economist at Cornell University who studies international agriculture and poverty.

They're both right," he says, chuckling. "Sometimes the opposite of a truth isn't a falsehood, but another truth, right?"

It's true, he says, that bigger harvests in the U.S. tend to make food more affordable around the world, and "lower food prices are a good thing for poor people." ...

... But Mellon is right, too, Barrett says. The big crops that American farmers send abroad don't provide the vitamins and minerals that billions of people need most. So if the U.S. exports lots of corn, driving down the cost of cornmeal, "it induces poor families to buy lots of cornmeal, and to buy less in the way of leafy green vegetables, or milk," that have the key nutrients. In this case, you're feeding the world, but not solving the nutrition problems. ...

 5. Why the U.S. Needs to Fall Out of Love With Homeownership

... Less developed countries have consistently higher levels of homeownership, while more advanced nations combine higher levels of economic development with substantially lower levels of homeownership.  (The correlation between the two is -.40 overall and it rises to -.58 when she removed outliers Singapore, Norway, Luxembourg and Switzerland). American political rhetoric tends to equate rising homeownership rates with strong economic development. Instead, the opposite is true. The rate of homeownership declines as nations get wealthier.

One reason for this may be because people in less developed nations have fewer options of where to put their money. In agrarian economies, land ownership is the basic source and measure of wealth. In more advanced capitalist economies, people have many more investment options. Many of the places with the highest rates of homeownership are in former Communist nations of Eastern Europe. ...

... And numerous studies have found that excessive homeownership significantly distorts the economy, diverting investment away from much more needed areas like technology and knowledge.

Homeownership continues to make sense for many Americans. But for those whose income is limited or who are still building their careers, a house can be an anchor than limits their ability to move to where jobs are.  ...

6. Household Incomes Remain Flat Despite Improving Economy

7. Brazil's New Middle Class: A Better Life, Not An Easy One

Tens of millions of Brazilians have risen out of poverty over the past decade in one of the world's great economic success stories. The reasons are many: strong overall economic growth, fueled by exports. A rise in the minimum wage. A more educated workforce. And big government spending programs, including direct payments to extremely poor families.

But becoming middle class in Brazil means a better life, not an easy one. The new, lowest rung of the middle class is what in the U.S. would be called the working poor, with monthly incomes of between $500 and $2,000.

Yet this group is driving consumer spending in Brazil as they cobble together enough money to buy a television, a cell phone or pay for their children to go to a private school. ...

What was the Great Divergence?

Economist: What was the Great Divergence?

"A FEW centuries ago it would have been difficult to tell Europe apart from the rest of the world—in economic terms, at least. Indeed, half a millenium ago Europe might justly have been considered a laggard. The three inventions which, in the words of Karl Marx, "ushered in bourgeois society" were not invented in Europe. Gunpowder, the compass and the printing press were probably all invented in China.

But by the 19th century, things were rather different. Western Europe and parts of North America had become fabulously wealthy. Almost everywhere else was horribly poor. Economic historians refer to this as the "Great Divergence". ..."

I'll add that failure to seriously wrestle with what is going on here and incorporating that into theological implications for work, addressing poverty, and general ethics, is one of the biggest reasons the church finds itself unable to address current issues constructively. Ideologies of Western supremacy or Western exploitation as the driving features are insufficient.

Need for Historical Perspective on Poverty

One of my favorite niche economics blogs is Gavin Kennedy's Adam Smith's Lost Legacy. Many of his posts go after people using Adam Smith's "invisible hand" metaphor. He tirelessly points out that Smith used the metaphor only twice in The Wealth of Nations, and on neither occasion was it used to describe the economics in the way attributed to Smith by economists in the second half of the Twentieth Century. But his larger concern is rampant illiteracy about Smith, but also about our economic past in general. He recently encountered someone who wants to replace the "invisible hand" with the "invisible heart." Here is part of his response in his post Need for Historical Perspective on Poverty.

... It seems to be another blueprint to save the world from the only phenomenon called 'capitalism' that has raised millions from poverty to standards of living beyond anything achieved in previous millennia, including the frightful poverty experiences of Soviet-style communism.

Much of the ancient curse of poverty persists in large geographical spaces of the world affecting billions of people, though the total numbers living on $1 a day has diminished at an historical high also by a billion or so since the 1960s.   The poor in the richer countries have lower standards than the very rich, but those poor are incomparably richer than the richest minority living in the millennia before the change from agriculture and primitive commercial markets, including the richest Emperors, Kings, War Lords and Conquerors. I

It would help if those who seek to "tackle the problem of poverty" for the very best of humanitarian reasons, like Terry Hallman and Sir Ronald Cohen, and many others, would get some historical perspectives on the relative scale of human poverty over the last 1,000 years. ...

Amen!

About That Overpopulation Problem

Five years ago, I wrote a piece called, Technophysio Evolution and Demographic Transition, explaining the dynamics and trends of global population growth and decline. Slate has an excellent article explaining the Demographic Transition Model.

Slate: About That Overpopulation Problem

Research suggests we may actually face a declining world population in the coming years.

The world’s seemingly relentless march toward overpopulation achieved a notable milestone in 2012: Somewhere on the planet, according to U.S. Census Bureau estimates, the 7 billionth living person came into existence.

Lucky No. 7,000,000,000 probably celebrated his or her birthday sometime in March and added to a population that’s already stressing the planet’s limited supplies of food, energy, and clean water. Should this trend continue, as the Los Angeles Times noted in a five-part series marking the occasion, by midcentury, “living conditions are likely to be bleak for much of humanity.”

A somewhat more arcane milestone, meanwhile, generated no media coverage at all: It took humankind 13 years to add its 7 billionth. That’s longer than the 12 years it took to add the 6 billionth—the first time in human history that interval had grown. (The 2 billionth, 3 billionth, 4 billionth, and 5 billionth took 123, 33, 14, and 13 years, respectively.) In other words, the rate of global population growth has slowed. And it’s expected to keep slowing. Indeed, according to experts’ best estimates, the total population of Earth will stop growing within the lifespan of people alive today.

And then it will fall. ...

... Why is this happening? Scientists who study population dynamics point to a phenomenon called “demographic transition.”

“For hundreds of thousands of years,” explains Warren Sanderson, a professor of economics at Stony Brook University, “in order for humanity to survive things like epidemics and wars and famine, birthrates had to be very high.” Eventually, thanks to technology, death rates started to fall in Europe and in North America, and the population size soared. In time, though, birthrates fell as well, and the population leveled out. The same pattern has repeated in countries around the world. Demographic transition, Sanderson says, “is a shift between two very different long-run states: from high death rates and high birthrates to low death rates and low birthrates.” Not only is the pattern well-documented, it’s well under way: Already, more than half the world’s population is reproducing at below the replacement rate. ...

... One of the most contentious issues is the question of whether birthrates in developed countries will remain low. The United Nation’s most recent forecast, released in 2010, assumes that low-fertility countries will eventually revert to a birthrate of around 2.0. In that scenario, the world population tops out at about 10 billion and stays there. But there’s no reason to believe that that birthrate will behave in that way—no one has every observed an inherent human tendency to have a nice, arithmetically stable 2.1 children per couple. On the contrary, people either tend to have an enormous number of kids (as they did throughout most of human history and still do in the most impoverished, war-torn parts of Africa) or far too few. We know how to dampen excessive population growth—just educate girls. The other problem has proved much more intractable: No one’s figured out how to boost fertility in countries where it has imploded. Singapore has been encouraging parenthood for nearly 30 years, with cash incentives of up to $18,000 per child. Its birthrate? A gasping-for-air 1.2. When Sweden started offering parents generous support, the birthrate soared but then fell back again, and after years of fluctuating, it now stands at 1.9—very high for Europe but still below replacement level.

The reason for the implacability of demographic transition can be expressed in one word: education. One of the first things that countries do when they start to develop is educate their young people, including girls. That dramatically improves the size and quality of the workforce. But it also introduces an opportunity cost for having babies. “Women with more schooling tend to have fewer children,” says William Butz, a senior research scholar at IIASA. ...

 

Hans Rosling: 5 TED Talks That Shaped My Worldview

Hans Rosling is one of my favorite social scientists. Mashable has a post Hans Rosling: 5 TEDTalks That Shaped My Worldview.

"Data visionary Hans Rosling has given nine TEDTalks over the years, focusing on global trends in health, economics and population growth. His favorite talks, naturally, keep an eye toward these global themes — from business in Africa to youth culture in China."

I've only seen a couple of the five he lists. I'm looking forward to viewing the others. Here are two of my favorite Rosling videos.

and

Is the world getting better?

Dallas Morning News: Is the world getting better?

Centre College professor Beau Weston operates an interesting blog, the Gruntled Center. He put up a post last week that draws from a lecture he recently gave at his Kentucky college. In the post and lecture, Weston, a Presbyterian, makes the argument that the world has gotten better.

He notes how violence is down in most "competent" nations, authoritarianism is in retreat worldwide, various forms of discrimination have diminished, food production is growing exponentially, air quality has improved, the population bomb has been a dud and transportation costs are cheaper. He lists a number of other indices, which you can read about on this link.

So, here is the question for the week:

Is the world getting better?

We certainly read a lot in, yes, newspapers about things going awry. Republican candidates making the case against Barack Obama offer ample examples of the world being a mess. And many a book has been sold about the next coming crisis.

But are we looking at all this the wrong way. Is it indeed the case that the world is getting better? ...

The article goes on to list the responses of several religious leaders. Weston looked at a wide range of social indicators. While we can quibble about precise definitions of better, it is without question that, on balance, the overwhelming majority of manifestations of what social scientists generally associate with well-being are getting better for more people.

I have written on this topic several times, and I know how determined people are to hear me (and people like Weston) say what was not said, so let me be clear. "Better" is not a synonym for perfect. "Better" is not a synonym for the consummated Kingdom of God. "Better" is an adjective that refers to the condition of something being more desirable than another state. Things are improving on most of the key measures of human well-being.

The profound reluctance by many people in theological institutions to acknowledge that the world is improving on various measures never ceases to amaze me. If you read some responses, people counter the claim that we live in a rapid decline in worldwide violence by pointing to events in Syria. Imagine if there were 100 house fires in your city last year and there were only ten this year. Would you say there has been an improvement in the rate of house fires? And what would you say to someone who pointed to a neighbor's house (one of the ten that burned) as evidence there was no improvement in house fires?

One of the respondents was Cynthia Rigby at Austin Presbyterian Theological Seminary. She writes:

In the year 2000, the United Nations made a "Millenium Goal" of eradicating extreme global poverty by the year 2015. This goal will not be reached, nor will any significant strides have been made toward reaching it.

The goal was not to eliminate poverty but to cut extreme poverty in half by 2015. From yesterday's New York Times: Dire Poverty Falls Despite Global Slump, Report Finds:

WASHINGTON — A World Bank report shows a broad reduction in extreme poverty — and indicates that the global recession, contrary to economists' expectations, did not increase poverty in the developing world.

The report shows that for the first time the proportion of people living in extreme poverty — on less than $1.25 a day — fell in every developing region from 2005 to 2008. And the biggest recession since the Great Depression seems not to have thrown that trend off course, preliminary data from 2010 indicate.

The progress is so drastic that the world has met the United Nations' Millennium Development Goals to cut extreme poverty in half five years before its 2015 deadline.

"This is very good news," said Jeffrey Sachs, director of the Earth Institute at Columbia University and the United Nations' special adviser on the Millennium Development Goals. "There has been broad-based progress in fighting poverty, and accelerating progress. There's a lot to be happy about."...

Rigby continues:

Food production may be growing, but there are more undernourished people living on the planet than there were fifteen years ago (the Food and Agricultural Association of the United Nations reports that there were 824 million undernourished people in 1996 and 925 million in 2010). This is the case even though (according to statistics provided by the Word Bank), the number of people in the world making less than $1.25 a day decreased from 1.94 billion to 1.29 billion from 2005-2008. The large number of natural disasters, in recent years, is one reason why there are more undernourished people even though there are fewer people who make less than $1.25 a day. There are roughly 100 million people, worldwide, who do not have homes (think: 12 times the population of New York City).

How should people of faith interpret these statistics?

Here is how this person of faith interprets those statistics. There were 5,766,435,620 people in 1996, and there were 6,840,423,256 in 2010. So let's do some math:

Percentage of the world population undernourished:

• 1996: 14.3% = 825 million / 5,766 million
• 2010: 13.5% = 925 million / 6,840 million

We have a modest improvement in the percentage of people that are undernourished. The growth in the absolute number of undernourished people is about to plateau and then begin to decline. In other words, the world is getting better! Responses like the ones in the newspaper article are indicative of the mindset in the Mainline theological establishment.

I routinely reflect on where this hyper-sensitivity to acknowledge improvement comes from. What I think I read between the lines is a fear that if improvement is acknowledged, this somehow is an invitation to stop pursuing an even better world. If I have a friend who is trying to lose fifty pounds and tells me that he has lost thirty-five pounds so far, then is acknowledging that his weight has gotten "better" a signal that he should stop trying? Can there be no celebration until the fiftieth pound is lost? If anything, my friend will be motivated to press on. Celebrating milestones gives us greater motivation, just as those wrestling with human flourishing issues around the world get encouraged by improvement and want to see more of it, better and faster.

At any rate, Bill Clinton was right, "There is a lot of good news out there. We are going to have to learn to deal with it."

For some excellent resources, I would recommend three interesting books:

Abundance: The Future is Better Than You Think by Peter H. Diamandis and Steven Kotler

The Rational Optimist: How Prosperity Evolves by Matt Ridley

Upside: Surprising Good News About the State of our World by Bradley Wright

You need to see Hans Rosling's four-minute video below for the best video that illustrates what is happening in the world. The Diamandis video just came out, and it is very helpful as well.

Peter Diamandis: Abundance is our future

Extraordinary video. I've ordered his book. I can't wait to read it.