Most helpful critical review
172 of 190 people found the following review helpful
One Harvard professor's attempt to solve poverty
on August 20, 2005
A wonderful thesis. The initial tone and first-hand accounts and analyses (Chapters 1-4) are great. Sachs' first few chapters read like Thomas Friedman, only Sachs publishes in journals and Friedman publishes in the New York Times. And Friedman has a few best sellers. Sachs is a very smart, accomplished, compassionate economist.
Sachs tries to provide some context. He seems to have personally saved first Bolivia (Chapter 5), then Poland (Chapter 6), then Russia (Chapter 7), then China (Chapter 8), and then India (Chapter 9), not from poverty, but from the mistakes of (American) foreign policy, greedy bankers, and the IMF. He always seems to get it right and they're wrong. He decries their solutions in favor of his own: demand debt forgiveness.
Then Sachs shifts into using his economic, statistical, and networking skills to propose solutions to eradicate poverty. His fundamental argument is that the rich countries need to give more money to the poor countries, and he seems pretty angry about the lack of compassion, especially from the United States, for the world's poor. Perhaps Sachs could start with his home institution, Harvard. This university has an almost egregious endowment in excess of $22 billion, pays its top fund manager $50 million a year, and employs Andrei Shleifer who "was discovered by the U.S. government to be making personal investments in Russia at the same time that he was on a U.S. government contract to advise the Russian leadership on privatization." (p. 144) This privatization effort, as Sachs reports, sold $100 billion in assets for $1 billion. Sachs thinks that we should then forgive the Russian government its debts. Rather than forgive debt, why not transfer some of that $100 billion to the creditors and not to political cronies favored by the government?
Look at China. Sachs commends their two thousand years of "a workable model of political organization" and their "remarkably little internal violence," only to show how China spent the last thousand years watching its GDP decline from 120% to 5% of western European GDP and employing policies, even recently, where "tens of millions of deaths resulted." Starving tens if not hundreds of millions of your own people is internal violence. Wiping out 95% of your GDP advantage is hardly a "workable model". And now, after a thousand years of self-imposed misery, China has climbed back from 5% to 10% of western European per capita GDP and their economic development is seen as a triumph. And Sachs laments how under British rule Indian GDP per capital grew at a 0.2% rate from 1870 to independence in 1947; compared to China's self-managed decline, British rule might be commended.
Sachs disdains the "money down the drain" argument (p. 310) against foreign aid, an argument that trillions have already been given, but counters it with an annual per capita expenditure calculation that doesn't counter the "money down the drain" argument. He describes Hernando DeSoto's "Mystery of capitalism" argument for deeds and titles to land for the poor as " a single factor ... to explain single-handedly the failures of development." (p. 321) Yes, economic development is more complicated than that, but isn't this a better, enduring, sustainable start than the "mystery" of one-time debt forgiveness? And DeSoto focuses on what Sachs ignores: self-help, or micro enterprises, as a grass roots alternative to repeated, well-intentioned but top heavy governmental interventions.
Sachs cites a study (pp. 322-23) that concludes that African men have fewer sex partners than men in Brazil and Thailand, to show that morals are not the cause of African AIDS, citing migrant workers and the lack of circumcision as possible explanations, but he does not seem to want to assign a root cause for the widespread prevalence of AIDS in Africa, moral or migratory. But the best cure for AIDS is prevention, not cheap AIDS drugs or foreign aid. And what does he think causes AIDS to spread in Africa? Dirty needles? Tattoo parlors? I once asked a Marshall Scholar applicant if she would consider adding an abstinence argument to her condom distribution AIDS prevention program in Central America. She declined, saying that she would not want to impose her morals on the people. It is a matter of biology, not morality, but sometimes moral admonitions can solve biological problems. People need information more than money, prevention more than drug treatments.
Sachs lauds the west, especially Britain, for acting against its own self-interest to abolish the slave trade (pp. 361-62) but fails to note the presence of slavery in Africa and Asia today. He wants to "rescue the IMF" (p. 366), the same organization that for most of the book he sees as unfit to deal with the debt crisis (see John Perkins' "Confessions of an economic hit man"), but he offers no rescue plan. He concludes by trying to dispel other "myths" (Chapter 16) and offering three pages (pp. 365-67) of argumentative platitudes, e.g., "redeem" the United States, which he claims is the world's "most feared and divisive country."
But all is not lost. The Institute for International Economics has reported that world poverty fell from 44% of the global population in 1980 to 13% in 2000, its fastest decline in history. This result indicates that the United Nations main Millennium Development Goal (p. 211) -- reducing world poverty below 15 percent -- has already been met. Another Harvard professor, David Landes, provides a more thorough historical context and explanation in "The wealth and poverty of nations," including the effects of culture, climate, and tropical diseases on poverty. C. K. Prahalad's "The fortune at the bottom of the pyramid" shows how basic business and marketing practices are lifting people out of poverty more than any government, NGO, or debt-forgiveness program. "The new heroes," from the recent PBS series, funded in part by a foundation started by the founder of eBay, shows micro enterprises that work. Sachs shows that Hillary Clinton's take on the African proverb, "It takes a village," doesn't seem to be working in African villages. I really wanted to love and recommend this book. A telling sign might have been when Sachs describes Kofi Annan as "the world's finest statesman." (p. 205) Rather than just give poor countries fish (or recommend that poor countries tear up their bills for their fish), rich countries ought to teach people how to raise a diverse, sustainable economy.