Demographers
estimate the world’s current population is 7 billion people. Half of the world’s people are poor. Sachs illustrates the various economic levels
of world society using a ladder. At the top
of the economic ladder are approximately 1 billion people considered “high
income” or affluent. They live in rich
countries and in major cities enjoying all contemporary affluence offers. Down a step on the ladder are those
considered “middle-income,” approximately 2.5 billion people. Incomes on this level would be in the range
of a few thousand dollars—hardly middle-class by rich
country standards but very much so in a country like India. Down the next step of the ladder are the
“poor.” On this level, approximately 2.1
billion people earn $2 a day or less.
They struggle each day to find food, safe drinking water and fight
chronic financial hardship. Although
life is difficult, death is not imminent.
Finally, at the bottom of the ladder exists approximately 1.4 billion
people known as the “extreme poor” or the “poorest of the poor.” The first step on the economic ladder is too
high for them to even think about reaching.
Life at this level is difficult; it is a fight to survive each day. People living in extreme poverty may earn
pennies a day but rarely as much as a dollar [The End of Poverty: Economic Possibilities for Our Times (New York: Penguin Books, 2005),
18-19].
The
majority of the “bottom billion,” as Paul Collier identifies them, is found in
Sub-Saharan Africa. Collier served as
Director of the Development Research Group of the World Bank from 1998-2003 and
currently is an economics professor at the University of Oxford Africa . The other 30 percent he labels as “… ‘Africa
+’ with the + being places such as Haiti, Bolivia, the Central Asian countries,
Laos, Cambodia, Yemen, Burma, and North Korea” [The
Bottom Billion: Why the Poorest Countries Are Failing and What Can Be Done
About It (New York: Oxford University Press, 2007), 7.].
Sadly the number of extreme poor in Sub-Saharan Africa
has almost doubled from 1981-2001 from 164 million to 316 million living below
$1 per day. The depth of poverty in
Sub-Saharan Africa grows as the “…income of Africa’s poor has been falling….
The mean income of those living under $1 per day in Africa was $0.64 per person
per day in 1981 and fell to $0.60 in 2001.”
Chen and Ravallion note, “Poverty has become shallower in the world as a
whole, but not in Africa.” [Shaohen
Chen, Martin Ravallion, and Prem Sangraula, “A Dollar a Day Revisited”, Policy
Research Working Paper # 4620, The World Bank Development Research Department
Group, May 2008, 21].
The number of people living in extreme poverty in East
Asia has noticeably lowered due primarily to the economic progress made in
China. “Looking back to 1981, China’s
incidence of poverty (measured by the percentage below $1 per day) was roughly
twice that for the rest of the developing world; by mid-1990’s, the Chinese
poverty rate had fallen well below average.
There were 400 million fewer people living under $1 per day in China in
2001 than 20 years earlier, though a staggering half of this decline was in the
period 1981-1984….The most plausible explanation would appear to be China’s
reforms starting in the late 1970s; the reforms decollectivized agriculture and
introduced the ‘household responsibility system’ giving farmers considerably
greater control over their land and output choices…” [Chen and Ravallion, “How Have The World’s
Poorest Fared Since The Early 1980s?”
World Bank Policy Research Working Paper 3341, June 2004. 17]. William Easterly noted that while rich
countries discussed how to help poor countries, “…the citizens of just two
large poor countries – India and China – were generating an increase in income
for themselves of $715 billion every year.
The Gang of Four – Hong Kong, Korea, Singapore, and Taiwan – went from third world to first over the last
four decades” [The White Man’s Burden: Why the West’s Efforts to Aid
the Rest Have Done So Much Ill and So Little Good (New York: Penguin Group,
2006), 27].
