Wednesday, December 27, 2006
The media and academic obsessions with economic "disparities" have gone international. Recent news stories proclaim that 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 non-existent 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 that was 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: "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 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. Innumerable 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 had 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 own 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 half a 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 a senior fellow at the Hoover Institute and author of Basic Economics: A Citizen's Guide to the Economy.