Economic Growth – Page 20 – artdiamondblog.com

Manifesto for a Rising Standard of Living

Source of book image: online version of the WSJ review quoted and cited below.

(p. A13) Mr. Diamandis is the chairman and chief executive of the X Prize Foundation and the founder of more than a dozen high-tech companies. With his journalist co-author, he has produced a manifesto for the future that is grounded in practical solutions addressing the world’s most pressing concerns: overpopulation, food, water, energy, education, health care and freedom. The authors suggest that “humanity is now entering a period of radical transformation where technology has the potential to significantly raise the basic standard of living for every man, woman, and child on the planet.”
. . .
Predictions of a rosy future have a way of sounding as unrealistic as end-is-nigh forecasts. But Messrs. Diamandis and Kotler are not just dreamers. They lay out a plausible road map, discussing, among other things, the benefits of do-it-yourself tinkering–like the work by geneticist J. Craig Venter in beating the U.S. government in the race to sequence the human genome–and the growing willingness of techno-philanthropists like Bill Gates to tackle real-world problems.
The biggest hurdles, however, are not scientific or technological but political. There are still too many corrupt dictators and backward-looking governments keeping millions in penury. But as we have seen lately, the misruled have a way of throwing off despotic governments. With ever more people reaching for freedom, countless millions are tacitly embracing the Diamandis motto: “The best way to predict the future is to create it yourself.”

For the full review, see:
MICHAEL SHERMER. “BOOKSHELF; Defying the Doomsayers; Abundance” argues that growing technologies have the potential not only to spread information but to solve some of humanity’s most vexing problems.” The Wall Street Journal (Thurs., FEBRUARY 22, 2012): A13.
(Note: ellipsis added.)

The book being reviewed is:
Diamandis, Peter H., and Steven Kotler. Abundance: The Future Is Better Than You Think. New York: Free Press, 2012.

Nasar Gives Compelling Portrait of Joseph Schumpeter and His Vienna

Source of book image: http://luxuryreading.com/wp-content/uploads/2011/10/grand-pursuit.jpg

(p. C31) Ms. Nasar gives us Belle Époque Vienna — infatuated with modernity and challenging London in the race to electrify with new telephone service, state-of-the-art factories and power-driven trams — and then a devastating picture of Vienna at the end of World War I: war veterans loitering outside restaurants waiting for scraps, and desperate members of a middle class that saw inflation wipe out all its savings trading a piano for a sack of flour, a gold watch chain for a few sacks of potatoes.
. . .
Among the more compelling portraits in this volume is that of Joseph Alois Schumpeter, the brilliant European economist who argued that the distinctive feature of capitalism was “incessant innovation” — a “perennial gale of creative destruction” — and who identified the entrepreneur as the visionary who could “revolutionize the pattern of production by exploiting an invention” or “an untried technological possibility.”

For the full review, see:
MICHIKO KAKUTANI. “BOOKS OF THE TIMES; The Economist’s Progress: Better Living Through Fiscal Chemistry.” The New York Times (Fri., December 2, 2011): C31.
(Note: ellipsis added.)
(Note: the online version of the article is dated December 1, 2011.)

Paleolithic Homo Sapiens Engaged in Long Distance Trade

(p. 71) At Mezherich, in what is now Ukraine, 18,000 years ago, jewellery made of shells from the Black Sea and amber from the Baltic implied trade over hundreds of miles.
This is in striking contrast to the Neanderthals, whose stone tools were virtually always made from raw material available within an hour’s walk of where the tool was used.

Source:
Ridley, Matt. The Rational Optimist: How Prosperity Evolves. New York: Harper, 2010.

Hunter-Gatherers Suffered Violence, Famine and Disease–No Idyllic Golden Age

(p. 44) The warfare death rate of 0.5 per cent of the population per year that was typical of many hunter-gatherer societies would equate to two billion people dying during the twentieth century (instead of 100 million). At a cemetery uncovered at Jebel Sahaba, in Egypt, dating from 14,000 years ago, twenty-four of the fifty-nine bodies had died from unhealed wounds caused by spears, darts and arrows. Forty of these bodies were women or children. Women and children generally do not take part in warfare – but they are (p. 45) frequently the object of the fighting. To be abducted as a sexual prize and see your children killed was almost certainly not a rare female fate in hunter-gatherer society. After Jebel Sahaba, forget the Garden of Eden; think Mad Max.
It was not just warfare that limited population growth. Hunter-gatherers are often vulnerable to famines. Even when food is abundant, it might take so much travelling and trouble to collect enough food that women would not maintain a sufficient surplus to keep themselves fully fertile for more than a few prime years. Infanticide was a common resort in bad times. Nor was disease ever far away: gangrene, tetanus and many kinds of parasite would have been big killers. Did I mention slavery? Common in the Pacific north-west. Wife beating? Routine in Tierra del Fuego. The lack of soap, hot water, bread, books, films, metal, paper, cloth? When you meet one of those people who go so far as to say they would rather have lived in some supposedly more delightful past age, just remind them of the toilet facilities of the Pleistocene, the transport options of Roman emperors or the lice of Versailles.

Source:
Ridley, Matt. The Rational Optimist: How Prosperity Evolves. New York: Harper, 2010.

Pedro de Verona Rodrigues Pires Wins Ibrahim Prize for Achievement in African Leadership

“Pedro de Verona Rodrigues Pires” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A10) MONROVIA, Liberia — Pedro de Verona Rodrigues Pires, the former president of Cape Verde, the desertlike archipelago about 300 miles off the coast of West Africa, has won one of the world’s major prizes, the $5 million Ibrahim Prize for Achievement in African Leadership.

The record of governing in Africa has been poor enough lately that the Mo Ibrahim Foundation decided not to award the prize for the past two years. In many African countries, leaders have refused to leave office after losing elections, tried to alter constitutions to ensure their continued tenure or gone back on pledges not to run for re-election.
. . .
Mr. Pires served two terms — 10 years — as president until stepping down last month. During that period, the foundation noted, Cape Verde became only the second African nation to move up from the United Nations’ “least developed” category. The foundation says the prize is given only to a democratically elected president who has stayed “within the limits set by the country’s constitution, has left office in the last three years and has demonstrated excellence in office.”

For the full story, see:
ADAM NOSSITER. “Ex-President of Cape Verde Wins Good-Government Prize.” The New York Times (Tues., October 11, 2011): A10.
(Note: ellipsis added.)
(Note: the online version of the article is dated October 10, 2011.)

In 1800 the Life of a Peasant Was Not Pleasant

(p. 12) There are people today who think life was better in the past. They argue that there was not only a simplicity, tranquility, sociability and spirituality about life in the distant past that has been lost, but a virtue too. This rose-tinted nostalgia, please note, is generally confined to the wealthy. It is easier to wax elegiac for the life of a peasant when you do not have to use a long-drop toilet. Imagine that it is 1800, somewhere in Western Europe or eastern North America. The family is gathering around the hearth in the (p. 13) simple timber-framed house. Father reads aloud from the Bible while mother prepares to dish out a stew of beef and onions. The baby boy is being comforted by one of his sisters and the eldest lad is pouring water from a pitcher into the earthenware mugs on the table. His elder sister is feeding the horse in the stable. Outside there is no noise of traffic, there are no drug dealers and neither dioxins nor radioactive fall-out have been found in the cow’s milk. All is tranquil; a bird sings outside the window.
Oh please! Though this is one of the better-off families in the village, father’s Scripture reading is interrupted by a bronchitic cough that presages the pneumonia that will kill him at 53 – not helped by the wood smoke of the fire. (He is lucky: life expectancy even in England was less than 40 in 1800.) The baby will die of the smallpox that is now causing him to cry; his sister will soon be the chattel of a drunken husband. The water the son is pouring tastes of the cows that drink from the brook. Toothache tortures the mother. The neighbour’s lodger is getting the other girl pregnant in the hayshed even now and her child will be sent to an orphanage. The stew is grey and gristly yet meat is a rare change from gruel; there is no fruit or salad at this season. It is eaten with a wooden spoon from a wooden bowl. Candles cost too much, so firelight is all there is to see by. Nobody in the family has ever seen a play, painted a picture or heard a piano. School is a few years of dull Latin taught by a bigoted martinet at the vicarage. Father visited the city once, but the travel cost him a week’s wages and the others have never travelled more than fifteen miles from home. Each daughter owns two wool dresses, two linen shirts and one pair of shoes. Father’s jacket cost him a month’s wages but is now infested with lice. The children sleep two to a bed on straw mattresses on the floor. As for the bird outside the window, tomorrow it will be trapped and eaten by the boy.

Source:
Ridley, Matt. The Rational Optimist: How Prosperity Evolves. New York: Harper, 2010.

Ridley Argues that Our Future Can Be Bright

Source of book image: http://1.bp.blogspot.com/_cheRMv1X2oI/TAOvTFTnoeI/AAAAAAAAAgU/WAp7q0I_5mw/s1600/Ridley+Rational+Optimist.jpg

Ridley’s book is very well-written, well-argued and well-documented. He takes on all the main arguments against a happy future for humans. I agree with most of what he writes. (One exception is that I think he underestimates the importance of patents in enabling a broader group of inventors to continue inventing.)
In the coming weeks, I will be quoting some of the more memorable, thought-provoking, or useful passages.

Book discussed:
Ridley, Matt. The Rational Optimist: How Prosperity Evolves. New York: Harper, 2010.

“Private Life Was Completely Transformed in the Nineteenth Century”

(p. 448) Private life was completely transformed in the nineteenth century – socially, intellectually, technologically, hygienically, sartorially, sexually and in almost any other respect that could be made into an adverb. Mr Marsham was born (in 1822) into a world that was still essentially medieval – a place of candlelight, medicinal leeches, travel at walking pace, news from afar that was always weeks or months old – and lived to see the introduction of one marvel after another: steamships and speeding trains, telegraphy, photography, anaesthesia, indoor plumbing, gas lighting, antisepsis in medicine, refrigeration, telephones, electric lights, recorded music, cars and planes, skyscrapers, motion pictures, radio, and literally tens of thousands of tiny things more, from mass-produced bars of soap to push-along lawnmowers.
It is almost impossible to conceive just how much radical day-to-day change people were exposed to in the nineteenth century, particularly in the second half. Even something as elemental as the weekend was brand new.

Source:
Bryson, Bill. At Home: A Short History of Private Life. New York: Doubleday, 2010.

For-Profit Entrepreneur Brings Good Things to Bangladesh

“INVENTOR Paul Polak creates cheap and effective devices to help the poor.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. D4) If necessity is the mother of invention, Paul Polak is one of its fathers.

For 30 years Dr. Polak, a 78-year-old former psychiatrist, has focused on creating devices that will improve the lives of 2.6 billion people living on less than $2 a day. But, he insists, they must be so cheap and effective that the poor will actually buy them, since charity disappears when donors find new causes.
Inventing a new device is only the beginning, he says; the harder part is finding dependable manufacturers and creating profitable distributorships. The “appropriate technology” field, he argues, is “dominated by tinkerers and short of entrepreneurs.”
His greatest success has been a treadle pump that lets farmers raise groundwater in the dry season, when crops fetch more money. He has sold more than two million, he said.
. . .
Q. What got you interested in poverty?
. . .
Q. And in third-world poverty?
A. My wife’s a Mennonite, and they had programs in Bangladesh. It had hit me between the eyes that homeless people in Denver were living on $500 a month, but there were people overseas living on $30 a month. So I took a trip to Bangladesh.
Some farmers were using hand pumps, but biomechanically, that’s a lousy way to raise water. A Mennonite guy had invented a rower pump that would pull up enough to water a half-acre of vegetables. They had installed 2,000 over five years, and those farmers seemed to be making a lot of money, so I said, “Why don’t we do a project, with an objective of selling 25,000 a year?”
We hit that pretty quickly. One or two Mennonites objected — they considered the idea of selling something to poor people immoral. But we kept at it, and then we found the treadle pump. It was brilliantly simple, it could be manufactured by local workshops, and a local driller could dig a 40-foot well and install it for $25. Studies showed that farmers made $100 in one season on that investment.
We talked to 75 little welding shops where they make things like bedsprings, and jawboned them into making treadle pumps. We went to people who sold things like toilet bowls, and cut a deal with them to be dealers. We trained 3,000 tinkerers to be well-drillers. We hired troubadours to write songs about treadle pumps, and we’d pass out leaflets when they performed. We even produced a 90-minute Bollywood movie.
. . .
Q. What’s the biggest mistake aid agencies make?
A. As we were developing our pump, the World Bank was subsidizing deep-well diesel pumps that could cover 40 acres. The theory was that you’d get a macroeconomic benefit, but it was also very destructive to social justice. The big pumps were handed out by government agents; the government agent was bribeable. The pump would go to the biggest landholder, and he’d become a waterlord.

Q. There have been some well-known failures in this field, like One Laptop Per Child and the Playpump. Can you say why?
A. The laptop was a middle-class device that doesn’t communicate with people who don’t read and write. It cost $100, plus it used the charity model — buy two, give one away. The Playpump, which was a children’s merry-go-round that pumps water, cost $11,000. Women in Africa walk for hours to a well, and then jiggle the pump handle for 60 seconds. This replaces the jiggling. How important is that? And they break. For $11,000, you could dig five wells and eliminate the walk.

Q. What are your principles for success?
A. In 1981, I said, “I’m going to interview 100 $1-a-day families every year, come rain or shine, and learn from them first.”
Over 28 years, I’ve interviewed over 3,000 families. I spend about six hours with each one — walking with them through their fields, asking what they had for breakfast, how far their kids walk to school, what they feed their dog, what all their sources of income are. This is not rocket science. Any businessman knows this: You’ve got to talk to your customers.

For the full story, see:
DONALD G. McNEIL Jr. “A CONVERSATION WITH PAUL R. POLAK; An Entrepreneur Creating Chances at a Better Life.” The New York Times (Tues.,September 27, 2011): D4.
(Note: ellipses added; bold in original.)
(Note: the online version of the article is dated September 26, 2011.)

More on Jobs Haiku

My Jobs haiku has received some discussion in the blogosphere.

It is reproduced, along with haikus submitted by other economics bloggers, in an entry of the blog of the Economist magazine:
http://www.economist.com/blogs/freeexchange/2011/10/poetry?fsrc=scn/tw/te/bl/theeconomyinhaiku

I especially like a comment to the Economist blog entry:

CaitP

Oct 26th 2011 7:59 GMT

What a creative way to describe the economy. It is so interesting to see how everyone interprets the economy through poem. I personally like the “jobs and Jobs” one. I think it describes our economy, and gives a snapshot of a major moment in our history.

kbuch5

Nov 2nd 2011 1:41 GMT

It is interesting to see people’s opinions about the economy being put into haikus. My favorite out of these is the haiku that refers to the fact that we have lost Steve Jobs and many jobs for US citizens. And in order to regain these jobs we are going to need more people to contribute in ways Steve Jobs has.

(Note: I added kbuch5’s comment on 11/7/11.)

CNBC correspondent Jane Wells describes my haiku as “poetic” on her blog:
http://www.cnbc.com/id/45078738