Economics 101

How Do We Cure Poverty Worldwide?

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Editor’s note: Dr. Anne Bradley was recently featured in an interview with Praxis Circle. Below are a few highlights of that conversation centered around the failure of socialism. You can watch the interview in full here.

Question: How do we help cure poverty worldwide?

Anne’s response: How do we cure poverty worldwide? I love this question. I would say first, we are curing it! It’s not a “how to” in the sense that we don’t know what to do, that we’re starting from zero. 

In 1990, about 45% of the population on the planet lived in abject poverty (we define that today as living under $1.90 a day). 45% in 1990—that’s not that long ago! Today, it’s under 10%, under 1 billion people. While that rapid run and escape from poverty has happened, the population is going up, not down. So that’s phenomenal! The population is growing and we’re all getting richer. So I think we are escaping poverty, we are curing poverty

And what’s happening? Well, it’s people being included in market trade, it’s people being able to have agency over their choices. And when they get just a little bit of that agency it’s like a thousand flowers bloom and it’s an amazing thing to watch. 

When we see, in developing economies, the poor—extreme poor—get a little bit of an increase in their income, it goes directly to technology. Because imagine being poor, living in a village that’s remote and unconnected from the world, and now having a cell phone. What we’re seeing is that this is a great entrepreneurial opportunity, in particular for women. Women will save up and buy these cell phones, they’ll go to the middle of their village and they’ll sell minutes—because not everyone in the village can afford a cell phone. 

And imagine what it’s like if you’re living in grinding poverty and you have to take your child to the doctor. It’s not like the world we live in where my doctor texts me to make sure I’m going to show up on time for my appointment. No, you have to walk. It could be four miles away. And sometimes the doctor is sick. So you walk four miles with your kids in tow who are sick, and the doctor is not there to help you. Imagine the time savings that a phone gives you. It’s profound. 

And so I think that the technology age that we live in is really hastening the pace that we escape from poverty. I really am just so optimistic about the future. So it’s not how do we cure poverty, it’s let’s keep curing poverty by letting people participate in market trade.

(Watch this part of the interview here.)

How important are the “little people” in an economy?

Anne’s response: It’s all about the “little people” all the time. Even if I think of very western, wealthy examples. I mean, Bill Gates certainly wasn’t poor when he was tinkering around in his parents garage, but he had a little bit of leftover time and he put his creativity to use. That’s what we need to empower ordinary people to do. 

You know, most of us are ordinary people, so it’s about being able to tinker, being able to have the chance of entrepreneurship. So to me it’s all about the little people. You and I are the little people, right! 

It’s not about figuring out who’s going to run the steel mills and putting someone in charge of that. It’s actually about, in the steel industry, what are the little the tweaks and adjustments we can make. That often happens at the ground level from little firms, who then maybe grow into big firms. But entrepreneurship is always local. We need to think about what it takes for people to be empowered, to have just little entrepreneurial opportunities that can grow into bigger ones.  

(Watch this part of the interview here.)

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