Common Wealth: Economics For A Crowded Planet
RS 695 PP 386
Currently, there is a global food crisis and riots have erupted in Egypt, Burkina Faso, Haiti and Bangladesh. US president George Bush set off a political firestorm by blaming the increasingly prosperous Indian middleclass for higher food prices.
But the global crisis reflects the complex interplay of various factors rather than any single one. Perceptive economists like Jeffrey Sachs have argued that practical solutions to this raging global problem exist "but we'll have to start thinking ahead and acting globally".
Bush, for his part, responded to this crisis by offering $200 million in emergency aid to help African and other nations where surging food prices threaten widespread hunger and violence.
As the richest economy in the world, the US also happens to be the largest provider of food aid to the developing world of more than $2.1 billion in 2007. For a sense of perspective, this is close to what the Pentagon spends a day on defence! The big question is whether such aid is adequate to address the global food crisis.
Sachs' latest book Common Wealth: Economics for a Crowded Planet forcefully argues that aid from rich donor countries like the US is often a pittance in relation to the scale and severity of the problem of hunger, besides the great problems of our time such as fighting climate change, loss of biodiversity, rapid population growth and extreme poverty. The costs of investments necessary to tackle these global problems are not large but must be equitably shared among the world's rich nations.
According to him, the conversion of our global energy system, which threatens devastating climate change, into a sustainable energy system costs well under 1 per cent of annual world income.
A bold policy to stabilise the world's population costs less than onetenth of 1 per cent of the annual income of rich countries. The tab for ending extreme poverty is less than 1 per cent of the annual income of the rich world. The big challenge is to get the rich countries, like the US, to agree to fund these modest costs of action.
These global problems form an essential part of the UN Millennium Development Goals that have time-bound objectives to improve the condition of the poorest of the poor by 2015 in the areas of income, hunger, disease control, education and environment sustainability. To attain these goals, the biggest priority clearly is to step up levels of development assistance from the existing 0.28 per cent of the income of rich donor countries to 0.7 per cent. This is indeed a make-or-break time for attaining these goals.
But so long as the world's most powerful country, the United States, remains preoccupied with its ongoing war on terror and resists committing itself to a roadmap to increase its level of development assistance, the going will be somewhat difficult. With the current inadequate levels of funding, there is no way that these goals can be met, especially in the heart of darkness of sub-Saharan Africa where 450 million subsist on $1 a day and millions of young children and mothers perish from Aids, TB and malaria.
Although there is a compelling case for increasing aid, the US provides only a niggardly 18 cents of bilateral assistance per head to subSaharan Africa beyond aid in the form of technical cooperation as against estimates of the financing gap amounting to $ 65 per head. This is indeed the basis for arguing for doubling existing levels of aid to Africa. If there is no sense of urgency on the part of donors, these Millennium Development Goals will forever recede from the reach of the poorest countries of subSaharan Africa.
Back to the global food crisis, Sachs makes the point in his writings that quick-impact interventions are efficacious and can be scaled up. Malawi, a famine-prone country in southern Africa, is one such example. Three years ago, it established a special fund to help its farmers get fertiliser and highyield seeds and harvests doubled after just one year. A fund based on the Malawi model costs a mere $10 per person annually in the rich world or $10 billion, argues Sachs. This sort of fund can fight hunger as effectively as the Global Fund to Fight Aids, TB and Malaria is controlling those diseases.
Sachs' views in the book are articulated with a crusader's zeal. The message is hammered home that tackling problems of sustainable development require new forms of global cooperation as "humanity shares a common fate on a crowded planet".
To address the problems of climate change, population growth and ending extreme poverty, the new forms of global cooperation include a revitalised UN - "that remains the world's repository of shared commitments on global objectives" - and alliances between diverse stake holders like foundations, global business, academic institutions and NGOs.
Tackling these objectives cannot depend on US' leadership alone as its dominance may well decline in the 21st century with new powers like China and India rising in the world.