Friday, May 31, 2013

The poor will always be with us ... NOT!

As I noted in this commentary at Planetizen, back in 2007, the graduate schooling in the social sciences, after an undergraduate in electrical engineering, was a result of wanting to do something to mitigate the suffering that was all around me, and caused by economic deprivation.

It didn't take much to realize that this was no easy project.  But, that made it all the more intellectually fascinating and an important one from a practical standpoint.  Of course, a few years after wrapping up the doctorate, I went the way of "if you can't, teach!"

It is exciting that even without my contribution to this project of poverty reduction, or perhaps because of me not being involved (ha!), the world has gotten incredibly better off over the two decades.  On a scale that I never imagined possible when I was a worrywart sitting on the railroad tracks by the college in Coimbatore. What an amazing transformation, as the Economist points out:

It's getting better all the time, as the Beatles sang.

The Economist notes that biggest reason, a no-brainer, behind this dramatic reduction:
China (which has never shown any interest in MDGs) is responsible for three-quarters of the achievement. Its economy has been growing so fast that, even though inequality is rising fast, extreme poverty is disappearing. China pulled 680m people out of misery in 1981-2010, and reduced its extreme-poverty rate from 84% in 1980 to 10% now.
In graduate school, and remember this was back when there was no sign that the Cold War would end and China was barely into the Deng reform period, it was a matter of routine for studies to compare India and China.  A theme that I have continued to explore here in this blog too.  There is simply no way any rational person can deny that China has done well, and much better than India, on the issue of tackling economic deprivation. It is a tragedy that India's politics is so dysfunctional that the country continues to be the home to the largest number of people in poverty.

There is a long road ahead.  The Economist identifies some of the issues, via the number of "ifs" that it employs, for instance:
If developing countries maintain the impressive growth they have managed since 2000; if the poorest countries are not left behind by faster-growing middle-income ones; and if inequality does not widen so that the rich lap up all the cream of growth—then developing countries would cut extreme poverty from 16% of their populations now to 3% by 2030. That would reduce the absolute numbers by 1 billion. If growth is a little faster and income more equal, extreme poverty could fall to just 1.5%—as near to zero as is realistically possible. The number of the destitute would then be about 100m, most of them in intractable countries in Africa. Misery’s billions would be consigned to the annals of history.
Consider that first "if" on maintaining the impressive economic growth rates.  For more than a year now, I have been concerned, like in this post, that India's growth rates have slowed down and that it could easily slip back to that old "Hindu rate" of growth.  The latest news further confirms that trend--India's growth rate over the past year was the lowest over the decade.  Not at the "Hindu rate" yet, and was a healthy 5%.  But, that simply isn't enough:
While growth of 5% would be high for a developed Western economy, such a rate is insufficient in India to create enough new jobs for a young workforce.
I noted two years ago (in the pre-Ramesh era of this blog!):
I fear that India will have a tough time tackling poverty while another half a billion is added: the politics in the form that is practiced in India precludes the kinds of direct policy interventions that are necessary. Unless the politics changes, the demographic dividend cannot be realized. But, it doesn't look like politics will change there for the better.
We will hope that better heads will prevail.  As the Economist notes, "The world now knows how to reduce poverty."  That knowledge itself is a world of a difference from when I began graduate school.  There are enough reasons to celebrate--the past quarter-century has been phenomenal in terms of poverty reduction.  Won't it be wonderful if we eliminated that acute deprivation well within two decades from now?


Mike said...

This forecast is exciting.

Here's to "if"!

Ramesh said...

India's lifting of people from poverty is impressive even now. The tragedy is really how much more it could have been. Even going forward, India will do well on poverty reduction, but at an acceptably slow pace

Sriram Khé said...

Yes, really, really impressive.

Did I ever share with you this:

It makes it clear how "Were it not for the Hindi-speaking heartland, India would already be looking at population stabilization and even decline."
If things were quickened in that Hindi heartland ...

Sriram Khé said...

Yes, here's to hoping that the "ifs" will come about ... and sooner, than later

Posts popular the last 30 days