Chapter 7. Eradicating Poverty, Stabilizing Population: A Poverty-Eradication Budget
Many countries that have experienced rapid population growth for several decades are showing signs of demographic fatigue. Countries struggling with the simultaneous challenge of educating growing numbers of children, creating jobs for swelling ranks of young job seekers, and dealing with the environmental effects of population growth are stretched to the limit. When a major new threat arises—such as the HIV epidemic—governments often cannot cope.
Problems routinely managed in industrial societies are becoming full-scale humanitarian crises in developing ones. The rise in deaths in several African countries marks a tragic new development in world demography. In the absence of a concerted effort by national governments and the international community to accelerate the shift to smaller families, events in many countries could spiral out of control, leading to more death and to spreading political instability and economic decline.
There is an alternative to this bleak prospect, and that is to help countries that want to slow their population growth to do so quickly. This brings with it what economists call the demographic bonus. When countries move quickly to smaller families, growth in the number of young dependents—those who need nurturing and educating—declines relative to the number of working adults. In this situation, productivity surges, savings and investment climb, and economic growth accelerates. 77
Japan , which cut its population growth in half between 1951 and 1958, was one of the first countries to benefit from the demographic bonus. South Korea and Taiwan followed, and more recently China, Thailand, and Viet Nam have benefited from earlier sharp reductions in birth rates. This effect lasts for only a few decades, but it is usually enough to launch a country into the modern era. Indeed, except for a few oil-rich countries, no developing country has successfully modernized without slowing population growth. 78
The steps needed to eradicate poverty and accelerate the shift to smaller families are clear. They include filling several funding gaps, including those needed to reach universal primary education; to fight infectious diseases, such as AIDS, tuberculosis, and malaria; to provide reproductive health care; and to contain the HIV epidemic. Collectively, the initiatives discussed in this chapter are estimated to cost another $77 billion a year. (See Table 7–1.) 79
The heaviest investments in this effort center on education and health, which are the cornerstones of both human capital development and population stabilization. Education includes both universal primary education and a global campaign to eradicate adult illiteracy. Health care includes the basic interventions to control infectious diseases, beginning with childhood vaccinations. 80
As Jeffrey Sachs regularly reminds us, for the first time in history we have the technologies and financial resources to eradicate poverty. As noted earlier, the last 15 years have seen some impressive gains. For example, China has not only dramatically reduced the number living in poverty within its borders, but, with its trade and investment initiatives, it is helping poorer countries develop. China is investing substantial sums in Africa—investments often related to helping African countries develop their abundance of mineral and energy resources, something that China needs. 81
Helping low-income countries break out of the demographic trap is a highly profitable investment for the world’s affluent nations, a way of reducing the number of failing states. Industrial-country investments in education, health, and school lunches are in a sense a humanitarian response to the plight of the world’s poorest countries. But more fundamentally, they are investments that will shape the world in which our children will live.
Table 7–1. Plan B Budget: Additional Annual Funding Needed to Reach Basic Social Goals
|Goal||Funding (billion dollars)|
Universal primary education
|Eradication of adult illiteracy||
|School lunch programs for 44 poorest countries||
|Assistance to preschool children and pregnant women in 44 poorest countries||
|Reproductive health and family planning||
|Universal basic health care||
|Closing the condom gap||
77. UNFPA, The State of World Population 2004 ( New York: 2004), pp. 14–15.
78. United Nations, World Population Prospects: The 2004 Revision ( New York: 2005); UNFPA, op. cit. note 77, p. 39.
79. Costs of meeting social goals in Table 7–1 based on the following sources: universal primary education from U.K. Treasury, op. cit. note 15; adult literacy campaign is author’s estimate; school lunch program from McGovern, op. cit. note 17; assistance to preschool children and pregnant women is author’s estimate of extending the U.S.’s Women, Infants, and Children program, based on ibid.; reproductive health and family planning from Speidel et al., op. cit. note 33, p. 10, and from Speidel, op. cit. note 33; universal basic health care from Sachs and Commission on Macroeconomics and Health, op. cit. note 39; closing the condom gap estimated from UNFPA, Donor Support for Contraceptives and Condoms, op. cit. note 59, and from UNFPA, Achieving the ICPD Goals, op. cit. note 59.
80. Sachs and Commission on Macroeconomics and Health, op. cit. note 39.
81. Ibid.; Wu Xiaoling, “Statement of Madam Wu Xiaoling, Deputy Governor of the People’s Bank of China,” speech delivered at the 39th Annual Meeting of the Board of Governors of the African Development Bank (Group), Kampala, Uganda, 25–26 May 2004.
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