Global Poverty and Economic Depression Have Worsened
The development industry, for their own expediency (to celebrate their efforts, raise funds, etc.) and with mere tweaking of data at their will, determines when we are poor and when we are not, no matter our circumstances
The crux of the matter with the worsening of poverty and economic depression can be summarized thus:
- Except in China, poverty has worsened globally—and we have been misled about this time and again
- The wealth and financial earnings of the middle class have stagnated and worsened, respectively, over the last 30 years
- Furthermore, Latino and African American wealth has declined over the last 20 years and is expected to be ZERO Within 20 Years
Why has globally poverty worsened
To understand the story of poverty across the global South countries (the "poor" or developing countries) over the last 70 years and why poverty has worsened over the past 40 years for people in many developing countries, let's allow anthropologist Dr. Jason Hickel, professor at University of London and contributor to The Guardian, to elucidate what has transpired between the global South countries and the Western powers (aka the North) and the why poverty has worsened:
Across the global South, newly independent countries were ignoring US advice and pursuing their own development agenda... From the 1950s through the 1970s, incomes [in these countries] were growing, poverty rates were falling and the divide between rich and poor countries began to close for the first time in history. And we shouldn’t be surprised; after all, global South countries were using the exact same policies that Western countries had used during their own periods of economic consolidation.(Jason Hickel, “The Divide”, 2018)
In the halls of the United Nations, governments of the South argued for a fairer international order, and they were succeeding. Given the new rules of global democracy, the North seemed powerless to stop the rise of the South. But in the early 1980s that suddenly changed. The United States and Western Europe discovered they could use their power as creditors to dictate economic policy to indebted countries in the South, effectively governing them by remote control, without the need for bloody interventions. Leveraging debt, they imposed ‘structural adjustment programmes’ that reversed all the economic reforms that global South countries had painstakingly enacted. In the process, they went so far as to ban the very policies that they had used for their own development, effectively kicking away the ladder to success.
Structural adjustment – a form of free-market shock therapy – was sold as a necessary precondition for successful development in the global South. But it ended up doing exactly the opposite. Economies shrank, incomes collapsed, millions of people were dispossessed and poverty rates shot through the roof. Global South countries lost an average of $480 billion per year in potential GDP during the structural adjustment period. It is now widely acknowledged by scholars that structural adjustment was one of the greatest single causes of poverty in the global South, after colonialism. But it proved to be enormously beneficial to the economies of the North.(Jason Hickel, “The Divide”, 2018)
Further, Dr. Hickel adds:
For many years, the development industry has told us that absolute poverty has been steadily declining. But it is very misleading. First, almost all of the gains against poverty have happened in one place, China. Second, the good-news story relies on proportions instead of absolute numbers. If we look at absolute numbers—the original metric by which the world’s governments agreed to measure progress—we see that the poverty headcount is exactly the same now as it was. There has been no improvement over thirty-five years. And that’s according to the lowest possible poverty line. In reality, the picture is even worse.
If we measured global poverty at this more realistic [$4 a day] level? We would see a total poverty headcount of about 4.3 billion people. That’s more than four times what the United Nations would have us believe, and more than 60 per cent of humanity. We would also see that poverty has become worse over time, with more than 1 billion people added to the ranks of the poor since 1981.(Jason Hickel, “The Divide”, 2018)
The World Bank and IMF and Aid Organizations, Sometimes with Good Intention, Have Tried Many Remedies, But Continue to Fail
One of the most prominent economists from the World Bank, Dr. William Easterly, passionately excoriates the West for its continued failure to make a meaningful impact in alleviating poverty in poor countries. Dr. Easterly highlights the misguided economic strategies and policies and the staggering amount of aid dollars (Trillions) spent:
Like the ancient questors, we economists have tried to find the precious object, the key that would enable the poor tropics to become rich. We thought we had found the elixir many different times. The precious objects we offered ranged from foreign aid to investment in machines, from fostering education to controlling population growth, from giving loans conditional on reforms to giving debt relief conditional on reforms.
None has delivered as promised. The poor countries that we treated with these remedies failed to achieve the growth we expected. The region we treated most intensively, sub-Saharan Africa, failed to grow at all. Latin America and the Middle East grew for a while, but then spiraled into a growth crash in the 1980s and 1990s.(William Easterly, “The Elusive Quest for Growth”)
Sixty years of countless reform schemes to aid agencies and dozens of different plans, and $2.3 trillion later, the aid industry is still failing to reach the beautiful goal. The evidence points to an unpopular conclusion: Big Plans will always fail to reach the beautiful goal.(William Easterly, “The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good”)
Black and Latino Families heading towards ZERO Wealth
Note the following from a comprehensive study (detailed in Report: The Road to Zero Wealth) by the Institute for Policy Studies:
The divide between the wealth of a typical Black family and a typical White family today is vast. A median Black family has just $1,700 in wealth—total assets minus total debt. Thirty years ago, that same family had $6,800 in today’s dollars. Latino families at the median have similarly small assets, just $2,000, also seeing a decline over the past three decades.
By 2053, just 10 years after the country is projected to become majority non-White, Black median families will own zero wealth if current trends continue. Twenty years later, Latino median families will follow suit. Institute for Policy Studies