A dan­ger­ous eco­nomic ob­ses­sion

The Washington Times Weekly - - Commentary - Thomas Sow­ell

The me­dia and aca­demic ob­ses­sions with eco­nomic “dis­par­i­ties” have gone in­ter­na­tional. Re­cent news sto­ries pro­claim most of “the world’s wealth” be­longs to a small frac­tion of the world’s peo­ple.

Let’s go back to Square One. Just what is “the world’s wealth”?

You can check in your lo­cal phone book, surf the In­ter­net or do ge­nealog­i­cal re­search: There is no one named “The World.” How can a nonex­is­tent be­ing own wealth?

Hu­man be­ings own wealth. Once we put aside lofty po­etic non­sense about “the world’s wealth,” we at least have a fight­ing chance of talk­ing sense about re­al­i­ties.

Who are th­ese mi­nor­ity of the world’s pop­u­la­tion who own a ma­jor­ity of the world’s wealth?

They are the pop­u­la­tion of the United States, West­ern Europe, Ja­pan and a few other af­flu­ent coun­tries. How did th­ese par­tic­u­lar peo­ple come to pos­sess so much more wealth than other peo­ple?

They did it the old-fash­ioned way. They pro­duced the wealth that they own. You might as well ask why bees have so much more honey than other crea­tures.

The rhetoric of clever peo­ple can ver­bally col­lec­tivize all the wealth pro­duced in­di­vid­u­ally, and then they be­come aghast at the “dis­par­i­ties” that are mag­i­cally turned into “in­equities” in the dis­tri­bu­tion of “the world’s wealth.”

Have all the peo­ple in the world had an equal chance to pro­duce wealth? No, nowhere close to an equal chance — ei­ther in the world or within a given so­ci­ety.

Ge­og­ra­phy alone makes the chances grossly un­equal. How were Eski­mos sup­posed to grow pineap­ples or the be­douins of the desert learn to fish? How were peo­ple in the Balkans sup­posed to have an in­dus­trial revo­lu­tion like that of West­ern Europe, when the Balkans had nei­ther the raw ma­te­ri­als re­quired by an in­dus­trial revo­lu­tion nor any eco­nom­i­cally vi­able way of trans­port­ing raw ma­te­ri­als from other places?

The ge­o­graphic hand­i­caps of Africa would fill a book. French his­to­rian Fer­nand Braudel said:

The quick fix is to trans­fer wealth. But more

than a half-cen­tury of try­ing to do that with

“for­eign aid” has left a dis­mal record of fail­ure

and even ret­ro­gres­sion in Third World coun­tries.

“In un­der­stand­ing Black Africa, ge­og­ra­phy is more im­por­tant than his­tory.” What are we sup­posed to do about th­ese dis­par­i­ties? File a class-ac­tion law­suit against God? The U.S. 9th Cir­cuit Court of Ap­peals might ac­cept such a law­suit, but they are un­likely to be able to do much about the sit­u­a­tion.

Ge­o­graphic dis­par­i­ties are just the tip of the ice­berg. Innu- mer­able cul­tures have evolved dif­fer­ently in dif­fer­ent places and among dif­fer­ent peo­ples in the same places. No given in­di­vid­ual con­trolled this process and each gen­er­a­tion be­gan with the par­tic­u­lar cul­ture that gen­er­a­tions be­fore them cre­ated. Some cul­tures proved to be more eco­nom­i­cally pro­duc­tive at given places and times, and other cul­tures proved to be more eco­nom­i­cally pro­duc­tive at other places and times. In our time, the eco­nomic ef­fects of th­ese cul­tural dif­fer­ences of­ten dwarf the ef­fects of dif­fer­ences in ma­te­rial things like nat­u­ral re­sources.

Nat­u­ral re­sources in Uruguay and Venezuela are worth sev­eral times as much per capita as nat­u­ral re­sources in Ja­pan and Switzer­land. But in­come per capita in Ja­pan and Switzer­land is about dou­ble that of Uruguay and sev­eral times that of Venezuela.

No­body likes to see poverty in a world where tech­nol­ogy and eco­nomic know-how al­ready ex­ist that could give ev­ery­one ev­ery­where a de­cent stan­dard of liv­ing. All you have to do is change peo­ple. But have you ever tried to do that?

The quick fix is to trans­fer wealth. But more than a half-cen­tury of try­ing to do that with “for­eign aid” has left a dis­mal record of fail­ure and even ret­ro­gres­sion in Third World coun­tries.

Some coun­tries have them­selves made changes that lifted them from poverty to pros­per­ity. In­deed, the af­flu­ent coun­tries of to­day were once liv­ing in poverty. But they didn’t do it with quick fixes or by turn­ing a dan­ger­ous power over to politi­cians.

Thomas Sow­ell is as na­tion­ally syn­di­cated colum­nist.

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