Category: Economics

This post compares the life of a regular guy today with one of the richest people about a 100 years ago. :

If Mark Hopkins or any of his family contracted cancer, TB, polio, heart disease, or even appendicitis, they would probably die. All the rage today is to moan about people’s access to health care, but Hopkins had less access to health care than the poorest resident of East St. Louis. Hopkins died at 64, an old man in an era where the average life span was in the early forties. He saw at least one of his children die young, as most others of his age did. In fact, Stanford University owes its founding to the early death (at 15) of the son of Leland Stanford, Hopkin’s business partner and neighbor. The richest men of his age had more than a ten times greater chance of seeing at least one of their kids die young than the poorest person in the US does today.

And also:

Here is a man, Mark Hopkins, who was one of the richest and most envied men of his day. He owned a mansion that would dwarf many hotels I have stayed in. He had servants at his beck and call. And I would not even consider trading lives or houses with him. What we sometimes forget is that we are all infinitely more wealthy than even the richest of the “robber barons” of the 19th century. We have longer lives, more leisure time, and more stuff to do in that time. Not only is the sum of wealth not static, but it is expanding so fast that we can’t even measure it. Charts like those here measure the explosion of income, but still fall short in measuring things like leisure, life expectancy, and the explosion of possibilities we are all able to comprehend and grasp.

See full article. If you are one of the people who keeps complaining about “progress” as a bad thing, you should read it carefully.

Earlier I had pointed to an article by an African economist complaining about how aid to Africa is doing more harm than good. Now Uzodinma Iweala an African author has another interesting article that is in a similar vein, but makes a slightly different point:

Why do the media frequently refer to African countries as having been “granted independence from their colonial masters,” as opposed to having fought and shed blood for their freedom? Why do Angelina Jolie and Bono receive overwhelming attention for their work in Africa while Nwankwo Kanu or Dikembe Mutombo, Africans both, are hardly ever mentioned? How is it that a former mid-level U.S. diplomat receives more attention for his cowboy antics in Sudan than do the numerous African Union countries that have sent food and troops and spent countless hours trying to negotiate a settlement among all parties in that crisis?

See the full article. It makes some rather interesting points.

Speigel has a very interesting interview with Kenyan economics expert James Shikwati where he says that aid to Africa is doing more harm than good. Excerpts:

Huge bureaucracies are financed (with the aid money), corruption and complacency are promoted, Africans are taught to be beggars and not to be independent. In addition, development aid weakens the local markets everywhere and dampens the spirit of entrepreneurship that we so desperately need. As absurd as it may sound: Development aid is one of the reasons for Africa’s problems. If the West were to cancel these payments, normal Africans wouldn’t even notice. Only the functionaries would be hard hit. Which is why they maintain that the world would stop turning without this development aid.

And later:

Why do we get these mountains of clothes? No one is freezing here. Instead, our tailors lose their livlihoods. They’re in the same position as our farmers. No one in the low-wage world of Africa can be cost-efficient enough to keep pace with donated products. In 1997, 137,000 workers were employed in Nigeria’s textile industry. By 2003, the figure had dropped to 57,000. The results are the same in all other areas where overwhelming helpfulness and fragile African markets collide.

I know nothing about Africa, or aid to Africa. I don’t have enough information to decide whether to agree with Shikwati or not. But this sure is a contrarian viewpoint – a side to the argument that most people are unfamiliar with. Hence, I believe it is a must read. I love contrarian points of view. Read the full article.