Global poverty

The newest crusade to be dragged to the launching pad is the war on global poverty, a theme that has inspired rock concerts and all sorts of fashionable expressions of social righteousness.

If you’re wondering how a rock concert can end global poverty…well, join the club. I’m mystified by that one myself.

The big idea is that if the productive countries give more (and more and more) money to unproductive countries, that the world will live in prosperity. In actuality, though, diverting resources from productive places to be dissipated in non-productive places will result in a net loss of productivity. Result: less, not more, prosperity.

The causes of poverty are no mystery. Corruption and heavy handed governments (or some combination thereof) are what keep poor countries poor, because they cause distortions in the market place. Economic aid sent to such places often flows into the pockets of the corrupt and the powerful–the very ones behind the market distortions–which is a recipe for continued poverty, more economic “aid,” and a never ending round of putting out fires with gasoline.

Taking a look at the heavy handed government issue, it’s not something confined to dictators and despots. The real story is that democracies often bring heavy handed government policies to the economy, because that’s what the people want. If we were to create a committee of people rounded up on the street to design a bridge, the results would be a joke. Is it any wonder that the same approach doesn’t always bring great results when building economies?

Indeed, you can’t divorce the science of economics from the realities of human nature. Will a rock concert change human nature? No. Foreign assistance and economic aid packages? C’mon. Some people are hard working, some are lazy. Some are honest, some crooked. Some are smart, some are dingbats. Some are pioneering, some are cowardly. All these elements are present in all economies and societies, though in differing proportions. A rock concert and mouthy (though well intentioned) gibberish about blotting out “global poverty” can’t change the fact that humanity itself seems to have a split personality.

Economic and social crusades that try to change the very essence of human nature are comically ineffective at best, and brutally deadly at worst. As for the latter case, consider the 30 million people who are said to have starved to death when China collectivized farms.

As far as our fair island goes, there’s a lot of talk about economic programs, economic plans, economic this and economic that, but the fundamental elements of human nature are the real story. Hard work and efficient markets will bring economic growth; a lack of hard work or a distortion in markets will poison the economic well. That’s not just the story here, it’s the story everywhere.