[Imc-thailand] The End of Poverty: An Interview with Jeffrey Sachs
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Mon May 9 13:52:24 PDT 2005
*The End of Poverty*: An Interview with Jeffrey Sachs
*News: One of the world's top economists offers a blueprint for
transforming the developing world. *
* Interviewed By Onnesha Roychoudhuri*
May 6, 2005
In February of this year, UN Secretary General Kofi Annan remarked
<http://www.globalpolicy.org/reform/0210kofispeech.htm>: "We will not
defeat terrorism unless we also tackle the causes of conflict and
misgovernment in developing countries. And we will not defeat poverty so
long as trade and investment in any major part of the world are
inhibited by fear of violence or instability." The point was that a
broader global security strategy needed to go hand in hand with a
poverty reduction strategy. To that end, the UN set about drawing up its
Millennium Development Goals (MDGs). Adopted by all member countries in
2000, the MDGs aim to achieve everything from eradicating extreme
poverty to ensuring universal primary education and basic health care
access, all by the year 2015.
In order to figure out /how/ to reach these goals, Annan organized a
panel of over 250 development experts to lay out practical strategies
for promoting rapid development. Headed by economist Jeffrey Sachs, the
panel published their final report
in January of 2005. The report calls for both an increase in aid from
Western countries and a reallocation of funding priorities in the
developing countries themselves. The report also calls for more aid to
be given on a local level. By bypassing governments, the UN hopes to
spark more immediate and effective development. For instance, in one
test case conducted in Kenya
<http://www.nytimes.com/2005/05/05/opinion/05thu1.html>, UN funding went
straight to the village of Sauri, where the schools were able to provide
much-needed food for their students, and hence jumped in ranking from
68th to 7th in the district.
Shortly after the release of the UN report came the publication of
Sachs' book, /The End of Poverty/
in which he laid out his own strategies for eradicating poverty by 2025.
Sachs, who gained renown for advising Latin American and Asian
governments on economic reform, has gained popularity as "can-do"
economist amidst a cacophony of naysayers on development. But his
optimistic attitude has also attracted quite a bit of skepticism. Why is
it that decades of development economics haven't achieved the
elimination of poverty? What makes Sachs' proposals so special? Is
eradicating poverty a feasible goal to achieve in our lifetime? Sachs
recently sat down with /Mother Jones/ to discuss these issues.
*Mother Jones:* What makes your plan to end poverty so different from
the development efforts that were tried in the 1950s and 60s? Why hasn't
five decades worth of development work been very successful thus far?
*Jeffrey Sachs:* I think so far there's been a lack of appropriate
effort, which includes many things. For development to work, rich
countries need to help poor countries make certain practical investments
that are often really very basic. Once you get your head around
development issues and realize how solvable many of them are, there are
tremendous things that can be done. But for decades we just haven't
tried to do many of these basic things. For instance, one issue that has
been tragically neglected for decades now is malaria. That's a disease
that kills up to 3 million people every year. It's a disease that could
be controlled quite dramatically and easily if we just put in the
effort. It's truly hard for me to understand why we aren't.
*MJ:* What do you say to critics who argue that it's a waste to put more
money into a development system that hasn't used that money very
effectively thus far?
*JS:* Well, we have to be smart about whatever we're doing. But I'm
quite convinced that, broadly speaking, economic development works. The
main arguments of the Millennium Project Report, and the main argument
of my book is that there are certain places on the planet that, because
of various circumstances--geographical isolation, burden of disease,
climate, or soil--these countries just can't quite get started. So it's
a matter of helping them get started, whether to grow more food or to
fight malaria or to handle recurring droughts. Then, once they're on the
first rung of the ladder of development, they'll start climbing just
like the rest of the world.
*MJ:* So do you believe that past efforts, to get these less-developed
countries on the "first rung," haven't been pragmatic enough?
*JS:* Part of it is that many of these countries are invisible places,
neglected by us politically, neglected by our business firms, by
international markets, and by trade. We tend to focus on these countries
only when they're in such extraordinary crises that they get shown on
CNN because they're in a deep drought or a massive war, which is
something that impoverished countries are much more prone to falling to.
There haven't been too many stories in our press about Senegal, Ghana,
Tanzania, Malawi, or Ethiopia, other than when the disasters hit. And
yet these are places that are in very deep trouble all of the time, but
with largely solvable problems. And those are the kinds of the places
that I'm talking about as being stuck in extreme poverty.
*MJ:* If there's been no real effort to draw the world's attention to
those places, is there any hope that funding will go there?
*JS:* The world got side-tracked from development issues during the
post-9/11 crisis period. During the war in Iraq there were bitter
divisions in the world community, and the idea of being able to focus on
the problems of extreme poverty or malaria or drought and chronic hunger
in Africa were just not at the top of the world's debate.
But I think the tsunami in the Indian Ocean last December, in which we
could all see the scope of the devastation on our television screens,
shifted discussion towards the plight of the world's poor. So now there
are some positive signs. Tony Blair has pushed for an Africa Commission
which just produced a report
<http://18.104.22.168/english/report/introduction.html> in March that
focuses on poorest of the poor in Africa. There will be a UN poverty
summit this September which is predicted to be the largest gathering of
world leaders in history. And I'm traveling extensively around the world
talking about these issues. So I think that even in our country, there
is a growing discussion.
*MJ:* I know that former World Bank employee and economist William
Easterly has criticized your proposals
and called for what he terms a "piecemeal reform" approach in which
development efforts are carried out one step at a time, with subsequent
evaluation. What is your response to this?
*JS:* Basically, I don't think that we should be choosing between
whether a young girl has immunizations or water, or between whether her
mother and father are alive, because they have access of treatment for
AIDS, or whether she has a meal at school, or whether her father and
mother, who are farmers, are able to grow enough food to feed their
family and earn some income. Those all strike me as quite doable and
practical things that can be done at once.
I make the analogy that farmers, to grow their food, need good soil,
sunshine, proper rain, and heat. If you don't one of those, even if you
have the other three, your crop is still not going to grow. A lot of
life in a poor village is like that. If you have a clinic but you don't
have safe drinking water, or if you have safe drinking water and a
clinic, but you don't have bed nets to fight malaria, you just don't get
the kind of needs met and the basic quality of life that gives you a
chance. I think that Bill Easterly misunderstands what I propose. I'm
not proposing a single global plan dictated by some UN central command.
Quite the opposite, I'm proposing that we help people help themselves.
This can be done without legions of people rushing over to these
countries to build houses and schools. This is what people in their own
communities can do if we give them the resources to do it.
*MJ:* Part of Easterly's argument is that if you implement different
strategies all at once, it will be difficult to isolate and understand
which strategies worked effectively, and which did not. Do you share
*JS:* I have been working with over 250 of my colleagues on the
Millennium Development Report. Everybody here is an expert on a
different thing. The soil scientists really know a lot about how to
improve soil nutrients and the doctors really know a lot about how to
keep children alive. The malariologists really know how to control
malaria and the hydrologists really know how to get safe drinking water
in a community. One doesn't have to test whether it's good to have more
food production, or malaria bed nets or doctors or teachers. These are
proven technologies. If we were introducing something new, that would be
different, but ours is not an approach based on new discoveries, this is
an approach based on the best of proven technologies.
*MJ:* Some critics have expressed concern that the Millennium Goals may
set unrealistic targets for certain countries. What if those countries
fail to meet the specified level of development and then disillusioned
donors decide to lower their funding?
*JS:* First, it should be understood that the goals in most cases are
set proportionate to a given country's situation. So we'll reduce by 2/3
the child mortality rate, or by 3/4 the maternal mortality rate. We're
not aiming at the same absolute standard in every country. I think that
the other thing that is really important to understand is that as I have
been working with the UN on this for the last 3 years and meeting
leaders all over the world. What I've found is that their concern isn't
that the goals are too high. Exactly the opposite: They actually /want/
these UN goals, they want them to be ambitious, and they want to be held
to account. And they want their development partners, the developed
world, to be held to account on following through on commitments. Again,
this all goes towards pressuring rich nations to set aside 0.7 percent
of GNP for development aid. That is not a goal that I set, or that the
UN set, this is a goal that was adopted 35 years ago by the world
community and the goal that was set again in the Monterrey consensus
<http://www.un.org/esa/ffd/aconf198-11.pdf> signed by the U.S. in 2002.
*MJ:* What about aid being sent to countries that have a serious problem
with corruption? Some have argued that large amounts of aid will merely
prop up those regimes. Can poverty be eradicated while corrupt
politicians are in office?
*JS:* My experience is that there's corruption everywhere: in the U.S.,
in Europe, in Asia, and in Africa. It's a bit like infectious
disease--you can control it, but it's very hard to eradicate it. And
yes, there are some cases where the corruption is so massive that unless
you are really, really clever and come up with some radically new
approach to the issue, you're going to have a hard time accomplishing
many development goals. It's quite hard in a place like Zimbabwe, now,
where the current government, in a quite despicable way, clings to
power. Or, in a country where there is absolutely no transparency or
where you have a family ruling violently to stay in power. It's very
hard to do a lot of the things that really need to be done to build an
effective school system, a health system, and so on. I don't have any
magic solution for those situations.
But, let me note that the world successfully eradicated small pox, and
not just in countries that scored high on a governance index but in all
parts of the world. This was an international effort which targeted a
specific outcome undertaken by professionals using a proven technology
and a very extensive monitoring system. And that's the general model for
our aid proposals. Nothing is done on trust. Everything should be done
on a basis of measurement and monitoring. When you really focus, there
are so many ways to be clever about how to do this to make it work
better. Don't just send money; send bed nets, send in auditors, make
targets quantitative. There are a lot of tricks, a lot of ways, that if
one is practical about this, one can get results.
But what happens is that everyone's wringing their hands about
corruption without trying to solve practical problems. And right now,
we're not even helping the /well/-governed places, the places where we
are capable of finding absolutely practical and effective approaches to
turning help into real success on the ground. The basic issue is not to
lecture about morality and governance. The basic issue is, is there a
way for us to help to fight AIDS, TB, malaria, and other killers which
are taking an incredible number of lives? I've seen these children
dying, each time I visit these clinics. And these are absolutely
*MJ:* Now you suggest in your book that we need to assess ailing
economies just as doctors assess patients. You call it "clinical
economics." Does the current academic curriculum for development
economics provide a sufficient framework for educating people to ensure
that the MDGs will be achieved by future economists?
*JS:* No it doesn't. I realized 10 or 15 years ago that the students in
economics departments write dissertations about countries that they
never stepped foot in because their advisor gives them a database from
Nigeria or Kenya or some place else, and they do their thesis that way.
That's like becoming a doctor without ever seeing a patient. We don't do
case studies. We don't train students to understand the differences
across countries. There are a tremendous number of loose generalizations
made all the time
Similarly, people aren't trained in the practical experiences of being
operational. Sometimes people say, "We teach academic things, we don't
teach operational things." But, frankly, to do development right, you
have to do something that's more like going through medical school and
having a clinical hospital where you actually learn about different
cases, and do case analyses. When something goes wrong, you study it.
There are what are called "M&M rounds" in hospitals--morbidity and
mortality rounds. When something doesn't work, when a patient dies or
doesn't get better, the doctors get together to discuss the case. We
don't do that in academic economics. For me, the field is not properly
organized right now to really take on these challenges adequately and
I'm hoping that the field will become more like a clinical science.
*MJ:* In your book, you recount some of your experiences in developing
countries. In one passage you note, "One day in Goni's office we were
brainstorming and hit on the idea of establishing an emergency social
fund that would direct money to the poorest communities to help finance
local infrastructure like water harvesting, or irrigation, or road
improvements. I picked up the phone and called the World Bank. Katherine
Marshall, the head of the Bolivia team at the Bank immediately
responded, "You're right, let's do this." Why is it that a whole World
Bank team specializing in Bolivia hadn't come up with the idea that you
*JS:* Well, sometimes they have ideas, sometimes I have ideas. It just
so happened in this case that the idea came from me. But I do feel that
in Washington over the last 25 years, especially during this era called
"the structural adjustment era," there hasn't been a lot of actual
problem-solving. There has been a lot of concern about budget-saving on
the part of the rich countries. A lot of what was really happening in
Washington had a subtext: "Keep poor people away from our taxpayers,
tell them to tighten their belts, tell them to solve their own problems,
tell them to keep sending their debt payments to us."
It was, in my view, a very unhappy and unsatisfactory period and there
were, no doubt, a lot of creative people that were prepared to do a lot
of things but they weren't given assignments to do that. I was
absolutely shocked and aghast when I learned that in the late 1990s the
World Bank and other donors weren't paying a penny to help treat people
dying of AIDS.
Rarely do rich countries say, "Look, we're just not prepared to spend
money to save poor people's lives." Instead, you get a lot of
skepticism. "You can't do this, this is impossible. We're doing
everything we can after all. We've tried everything. Let's go slowly.
Let's do one thing at a time." I don't buy those arguments. I think that
they all essentially stem from a vision that has been forced on the
professional staff of these agencies because they have no money to
spend. And they have no money to spend because in the end, the United
States and other rich countries aren't giving them the resources to
enable them to think ambitiously enough. One of the reasons why that is,
is because the American people think we're doing everything we can be
doing and frankly because they're told that there's nothing more we can do.
*MJ:* Do you think the U.S. will ever agree to dedicate 0.7 percent of
its GNP to development aid?
*JS:* I don't think that any leading politician believes we're going to
do that right now. It's not the conventional wisdom. The way it's going
to happen is if the public tells the politicians, "Yes, we want to do
this, we want to follow through on our word, it's good for us, and it's
good for the world."
I've found in talks and discussion about the Millennium Project that
people are very surprised to find out what the U.S. is and is not doing
vis-à-vis the world's poor. Opinion surveys show, and I find this
verified in audiences, e-mails, and discussion groups, that people tend
to overestimate U.S. assistance efforts, usually by a factor of about 25
or 30. People think that we give several percent of our annual income
and several percent, maybe even a quarter of budget to foreign aid and
they're shocked to find out that it's actually much less than 1 percent
of our budget. They're shocked to find that throughout Africa, the kind
of practical investments that I'm talking about run to about 1 penny out
of every $100 of our GNP. They can't believe it, but that's the
unfortunate situation. When they find that out, and they see that we're
spending $500 billion on the military and only about $1 to $2 billion on
investments in Africa, they're concerned because I think that they feel
this is probably not the best choice for America.
*MJ:* What do you think of two recent proposed strategies--President
Bush's Millennium Challenge Accounts
(MCA), and Britain's International Financing Fund (IFF), proposed by
Tony Blair and Gordon Brown--as means of promoting global development?
*JS:* They're both good ideas. But by now, the MCA was supposed to have
dispersed $1.7 billion dollars, $3.3 billion in the second year, and $5
billion in the third year. It has missed all its targets. In three
years, it's only committed about $100 million dollars to one project. It
has not yet been turned into a reality.
Brown's is also a very good idea. Unfortunately the U.S. basically said
"no" to participation in that. I think the European countries will
undertake the IFF, but not with any U.S. support. But the IFF is a very
good concept--the idea is that Britain and six other countries have
announced a timetable to reach a goal of dedicating 0.7 percent of their
GNP to development by the year 2015. So what this would do is allow them
actually to borrow against the rising trend so that they could frontload
some of the money.
What the Africa Commission, the Millennium Development Report, the World
Bank and IMF have all found is that right now poor countries could
usefully absorb a tremendous increase of money and use it properly. The
IMF and World Bank recently released a report called the Global
which said that aid should be doubled. There is a professional
understanding that the money is needed to break the poverty trap and
save lives and that the money can be effectively used.
* Onnesha Roychoudhuri is an editorial fellow at /Mother Jones/.
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