Sunday, July 1, 2007

New Book About World Poverty

Like many Episcopalians, my wife have made a major commitment to helping fund the Millennium Development Goals. We view efforts to reduce extreme global poverty to be a moral imperative for Christians. Still, while we want Jeffrey Sachs to be right about the steps being taken to reduce world poverty, we still wonder: will it work?

I was therefore very interested to read a review by historian Niall Ferguson in the New York Times Sunday Book Review of a new book by Paul Collier, the director of the Center for the Study of African Economies at Oxford University, about just that. The book is THE BOTTOM BILLION: Why the Poorest Countries Are Failing and What Can Be Done About It.

Collier is not the optimist that Sachs is, but he does offer some thoughts on how we can achieve great progress.

Here are some highlights from the review:

It is perhaps a sign of how far sub-Saharan Africa still has to go that the most vigorous — and certainly the best publicized — debate about its economic future in recent years has been between two American economists based in New York. On one side of the argument is Jeffrey D. Sachs, the director of the Earth Institute at Columbia University and the author of “The End of Poverty.” On the other is William Easterly of New York University, whose ironically titled “White Man’s Burden” lampoons Sachs as a modern version of a 19th-century utopian.

. . .

Now comes another white man, ready to shoulder the burden of saving Africa: Paul Collier, the director of the Center for the Study of African Economies at Oxford University. A former World Bank economist like Easterly, Collier shares his onetime colleague’s aversion to what he calls the “headless heart” syndrome — meaning the tendency of people in rich countries to approach Africa’s problems with more emotion than empirical evidence. It was Collier who pointed out that nearly two-fifths of Africa’s private wealth is held abroad, much of it in Swiss bank accounts. It was he who exposed the British charity Christian Aid for commissioning dubious Marxist research on free trade. And it was he who pioneered a new and unsentimental approach to the study of civil wars, demonstrating that most rebels in sub-Saharan Africa are not heroic freedom fighters but self-interested brigands.

Collier is certainly much closer to Easterly on the question of aid. (He cites a recent survey that tracked money released by the Chad Ministry of Finance to help rural health clinics. Less than 1 percent reached the clinics.) Yet “The Bottom Billion” proves to be a far more constructive work than “The White Man’s Burden.” Like Sachs, Collier believes rich countries really can do something for Africa. But it involves more — much more — than handouts.

Collier’s title refers to the 980 million people living in what he calls “trapped countries,” those that are “clearly heading toward what might be described as a black hole.” Not all these people are Africans. Some live in Bolivia, Myanmar, Cambodia, Haiti, Laos, North Korea and Yemen. But 70 percent of the bottom billion live in Africa, and there is good reason to expect that proportion to rise.

The notion of the bottom billion matters because most of today’s development strategies (for example, the United Nations’ Millennium Development Goals) focus much less discriminatingly on all developing economies — what used to be called “the third world.” But the world is no longer (as it used to be) one-sixth rich and five-sixths poor. Thanks to explosive growth in Asia, it will soon be more like one-sixth rich, two-thirds O.K. and one-sixth poor. It is this last group, according to Collier, that we need to worry about. Average life expectancy for the bottom billion is just 50 years. Around one in seven children dies before the age of 5.

Collier’s is a better book than either Sachs’s or Easterly’s for two reasons. First, its analysis of the causes of poverty is more convincing. Second, its remedies are more plausible.

There are, he suggests, four traps into which really poor countries tend to fall. The first is civil war. Nearly three-quarters of the people in the bottom billion, Collier points out, have recently been through, or are still in the midst of, a civil war. Such wars usually drag on for years and have economically disastrous consequences. Congo (formerly Zaire, formerly the Belgian Congo) would need 50 years of peace at its present growth rate to get back to the income level it had in 1960. Unfortunately, there is a vicious circle, because the poorer a country becomes, the more likely it is to succumb to civil war (“halve the ... income of the country and you double the risk of civil war” is a characteristic Collier formulation). And once you’ve had one civil war, you’re likely to have more: “Half of all civil wars are postconflict relapses.”

. . .


The other traps include having great mineral wealth, being landlocked, and being badly governed. And his prescription is focused on these traps, and not development aid or even trade:

Reflecting on the tendency of postconflict countries to lapse back into civil war, he argues trenchantly for occasional foreign interventions in failed states. What postconflict countries need, he says, is 10 years of peace enforced by an external military force. If that means infringing national sovereignty, so be it.

At a time when the idea of humanitarian intervention is selling at a considerable discount, this is a vital insight. . . . Collier concedes that his argument is bound to elicit accusations of neocolonialism from the usual suspects (not least Mugabe). Yet the case he makes for more rather than less intervention in chronically misgoverned poor countries is a powerful one. It is easy to forget, amid the ruins of Operation Iraqi Freedom, that effective intervention ended Sierra Leone’s civil war, while nonintervention condemned Rwanda to genocide.

Still, it would be wrong to portray Collier as a proponent of gunboat development. In the end, he pins more hope on the growth of international law than on global policing. Perhaps the best help we can offer the bottom billion, he suggests, comes in the form of laws and charters: laws requiring Western banks to report deposits by kleptocrats, for example, or charters to regulate the exploitation of natural resources, to uphold media freedom and to prevent fiscal fraud. We may not be able to force corrupt governments to sign such conventions. But simply by creating them we give reformers in Africa some extra leverage.

Although it stands on a foundation of painstaking quantitative research, “The Bottom Billion” is an elegant edifice: admirably succinct and pithily written. Few economists today can match Collier when it comes to one-liners. “A flagrant grievance is to a rebel movement what an image is to a business.” Calling the present trade negotiations a “development round” is like calling “tomorrow’s trading on eBay a ‘development round.’ ” And “If Iraq is allowed to become another Somalia, with the cry ‘Never intervene,’ the consequences will be as bad as Rwanda.”

If Sachs seems too saintly and Easterly too cynical, then Collier is the authentic old Africa hand: he knows the terrain and has a keen ear. They know it’s garbage, one aid official told him when he queried Christian Aid’s research, “but it sells the T-shirts.”

As Collier rightly says, it is time to dispense with the false dichotomies that bedevil the current debate on Africa: “ ‘Globalization will fix it’ versus ‘They need more protection,’ ‘They need more money’ versus ‘Aid feeds corruption,’ ‘They need democracy’ versus ‘They’re locked in ethnic hatreds,’ ‘Go back to empire’ versus ‘Respect their sovereignty,’ ‘Support their armed struggles’ versus ‘Prop up our allies.’ ” If you’ve ever found yourself on one side or the other of those arguments — and who hasn’t? — then you simply must read this book.



Read the entire review here.

I welcome readers of this blog who know something about development to comment on Colliers' book. Ferguson has, shall we say, an almost colonial view of the world, so I take his comments with a great big grain of salt. Still, my wife's expedience as an expert on Colombia and other Andean Ridge countries bears out what Colliers has to say--lack of security is a huge impediment to development.

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