Friday, July 15, 2011

800- million and Falling

Number of people living on $1 a day

Global Poverty Rate

Four years ago this past May, Paul Collier's book The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It told of the rapid fall of poverty rates that affected about 80% of the world's population. He noted that there were about one billion people who were still living on less than $1.00 per day and all means to lower that number was defying all traditional means. He had held out little hope for change if the them current handout schemes continued.

Earlier this month, an article posted at Yale Global Online reported something that garnered almost no fan-fare, that the number of desperately poor, had not just slipped below one billion, but was dropping by 70 million a year, according to the authors, Laurence Chandy and Geoffrey Gertz. Their data flies off the pages as evidence that the world is moving towards a middleclass majority.
It is customary to bemoan the intractability of global poverty and the lack of progress against the Millennium Development Goals. But the stunning fact is that, gone unnoticed, the goal to halve global poverty was probably reached three years ago.

We are in the midst of the fastest period of poverty reduction the world has ever seen. The global poverty rate, which stood at 25 percent in 2005, is ticking downwards at one to two percentage points a year, lifting around 70 million people – the population of Turkey or Thailand – out of destitution annually. Advances in human progress on such a scale are unprecedented, yet remain almost universally unacknowledged.
This should be heartening to every living soul. What is means besides, providing new markets for developed and the fast developing countries but less conflict as noted in this observation by the authors as to the possible causes and effects.
How and why sustained high economic growth in developing countries took hold are questions likely to be debated by economic historians for many decades. Already one can point to a number of probable sources emerging or accelerating around the turn of the century: an investment boom triggered by rising commodity prices; high growth spillovers originating from large open emerging economies that utilize cross-border supply chains; diversification into novel export markets from cut flowers to call centers; spread of new technologies, in particular rapid adoption of cell phones; increased public and private investment in infrastructure; the cessation of a number of conflicts and improved political stability; and the abandonment of inferior growth strategies such as import substitution for a focus on macroeconomic health and improved competitiveness.
Read more, and the linked report below:
With Little Notice, Globalization Reduced Poverty

Poverty in Numbers:

This information is something that grand strategist and advocate of the American model of liberal free trade Thomas PM Barnett, has written and spoken about for almost a decade. He defines this moment in history as:

•Globalization IV (2001-present), is defined by the enormous structural changes wrought by the simultaneous rise of numerous great powers and the emergence of a global middle class.
Some used to find his optimistic views hard to swallow, the proof is coming in spades to show that the world is moving towards being mostly middleclass. The truth is that he has been spot-on in defining the age. It is high time that Americans get on board the boat and discover that we have to embrace those new markets and go forth like our ancestors did when the built this grand experiment that has primed the very pump leading to the world being better off than any time in history. Barnett, writes this week about what he called a must read article in the Wall Street Journal that explains how the west mis-understands the economic growth in China. Barnett excepts the best nuggets of the article and add a rich sauce to enhance the author Liu Junning's words.

Read his analysis:
What is eternal and Ephemeral about China and this modern world system we call globalization

Number of US Jobs from Exports. Map from East-West Center

Now all this might make Americans say okay, our own country is hurting, what is Globalization and free trade doing for us? This next article also from Yale Global Online, will illustrate how connected America's economy has become with Asia.
“Jobs” is now a fraught four-letter word for America. With unemployment in the United States hovering around 9 percent, the word resonates for millions of struggling individuals and families, not to mention politicians and policymakers. And no other geographical region in the world today receives more attention in that context than Asia. “Jobs lost to Asia” is a refrain of politicians and media, yet the facts tell a different story. Trade and investment with Asia creates jobs in the US.

Student Economic Impact on US. from East-West Center

In a detail rich article the author Satu Limaye relates how job growth created by Asian trade has risen to 850,000 jobs in the United States. He points out that Japanese foreign direct investment in the U.S. account for 665,000 jobs. One of the proposals Thomas Barnett has made is an increase in Chinese direct investment in American businesses to stimulate job growth, instead of buying Treasury bonds. The article goes on to note the jobs and money generated by everything from students to tourism and immigration where the contribution of the 10 million foreign born Asians are contributing to the economy, culture and politics.

Read more:
Asia Matters For America

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