The Yoga Sutras of Patanjali say, "When you are inspired by some great purpose, some extraordinary project, all your thoughts break their bounds. Your mind transcends limitations, your consciousness expands in every direction, and you find yourself in a new, great and wonderful world." The "new, great and wonderful world" that we have witnessed is the economic engine of free market capitalism, both small scale and large and the power it has to do good and transform whole societies. For example, China has moved between 250-400 million people out of poverty in the last 15 years without using one Western development dollar. That is more people than live in the United States.
By contrast, the International Development industry, funded mostly by Western government tax revenues, has spent trillions of dollars over the last 60 years. Yet through the methodology used by this industry, poverty not only still exists but has worsened in many of the countries where enormous aid has been extended and free market economics restricted; ultimately, very little has been accomplished. The reasons for this are complex and the books in the recommended reading list below, explain them in greater depth. The bottom line is that a new philosophy is required to change the course of poverty.
Whole Planet Foundation, a Whole Foods Market non-profit, supports microlending in developing countries, in order to ignite thousands of small-scale entrepreneurs and to catalyze a grass roots transformation of communities through their own ingenuity and hard work. On this page you find books, articles, videos and links that I think are important tools for understanding what has been done in the past, often poorly, and what needs to be done now and in the future to eliminate global poverty by the end of this century. In my opinion, this goal is not only doable, but is almost infallible IF we in the West will let go of some of our centuries-old habits. These habits include the demeaning and condescending cultural and economic imperialism which seems to perpetually burden the poor. In light of world poverty, trade barriers, quotas, farm subsidies and the like, are unconscionable. We must let the developing world emerge from this poverty through an economic partnership with the developed world through free trade while encouraging and incentivizing them to free their economies and establish honest rule of law, including (at least somewhat) democratic, yet limited, government.
On this page, you will find resources that support this relatively straightforward solution to ending world poverty. The opinions and recommendations expressed here are my own and do not necessarily reflect those of Whole Planet Foundation or Whole Foods Market.
Conscious Capitalism by John Mackey, CEO and Chairman of the Board
For 30 years, I have observed John expand his perspectives on many salient issues while he spearheaded Whole Foods Market from one store to the world's leading natural and organic grocery store with over 270 stores. We have both witnessed firsthand the tremendous good that capitalism can have on society. We have also noticed how "bad" capitalism, which almost always involves poor government, can do so much harm. It is this errant capitalism that gives the black eye and what is usually represented in the media. John's evolving work on Conscious Capitalism aims to turn that perspective around.
The following quote from John Mackey, illustrates his current view on capitalism that has been shaped over time through the creation and growth of a company that exemplifies capitalism at its best.
"The old paradigm of maximizing profits and shareholder values as the sole purpose of business has created negative unintended consequences. Businesses and corporations are seen as greedy, selfish, and evil. Business therefore has a very bad brand. The good news is that we can remove most of the hostility toward business and capitalism if we change the way we think about it. Business needs to become holistic and integral with deeper, more comprehensive purposes. Corporations must rethink why they exist. If business owners/entrepreneurs begin to view their business as a complex and evolving interdependent system and manage their business more consciously for the well-being of all their major stakeholders while fulfilling their highest business purpose, then I believe that we would begin to see the hostility towards capitalism and business disappear."
— John Mackey on Conscious Capitalism
To learn more and read his entire treatise on the subject, please see the PDF link below.
Root Causes of Poverty
The charts in the PDF below are compiled from several reputable sources that are noted at the end of each chart. The charts indicate that poverty elimination is more easily accomplished if three things are present in a country:
- A free or mostly free economy
- A democratic, honest government including judiciary
- Relative ease of doing business
To best understand the information presented by the charts, start with the Index of Economic Freedom Chart on the far left of the spreadsheet. Note the color code for each category of economic freedom - Free; Mostly Free; Moderately Free; Mostly Unfree; Repressed and Non Rated. Follow the colors through the subsequent chart to the right of the Economic Freedom Chart - Ease of Doing Business; Corruption Index; GNI; GDP Per Capita; GDP Volume Rank and Gender Gap Index.
What becomes apparent is that countries with free, democratic and honest governments where doing business is relatively easy, are wealthy and prosperous. Those that aren't, are poor or at least poorer.
We believe that poverty can be eliminated in the 21st Century and the task at hand isn't that formidable. To see how this goal can be accomplished in our lifetimes, with resources currently available, I highly recommend that you spend an hour on the Copenhagen Consensus Website.
Note where the three global warming issues fall in the top 30 issues that, according to the Consensus, need addressing to end poverty. The group is made up of 50 economists including five Nobel Laureate economists and headed by environmentalist/political scientist Bjorn Lomborg, who is Adjunct Professor at Copenhagen Business School. Finally, go to Hans Rosling's Gapminder Website and have your consciousness expanded by the motion charts he has compiled that essentially show the same thing.
Recommended Reading List
close all Microcredit in International Development - Banker to the Poor, by Muhammad Yunus
- This is the seminal work on microcredit and the Grameen Method by the winner of the 2006 Nobel Peace Prize. Highly recommended and a must for anyone interested in microcredit or international development.
What Went Wrong with Traditional Development Models - Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa, by Dambisa Moyo
- Moyo, an Western educated African, suggests that Western development aid is actually harming Africa far more than it is helping it, as it seems to support corrupt governments, promotes corruption and crony capitalism. Compelling reading and a must read for anyone interested in African development.
- The White Man's Burden - Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good, by William Easterly
- Easterly is an ex-World Bank economist and can clearly make a case for what went wrong and how to change our approach. He is considered on the opposite philosophical spectrum as statist Jeffery Sachs. This is a must-read.
- The Elusive Quest for Growth - Economists' Adventures and Misadventures in the Tropics, by William Easterly
- This is Easterly's first book and if I had to choose one over the other, I would choose The White Man's Burden. Nevertheless, this book has the best explanation I've read on why capital fundamentalism, the approach to economic development based on the work by economist and Nobel Prize winner Robert Solow, was such a dismal failure in the Third World. However, as Solow pointed out decades ago, the model was never intended for developing economies of the Third World. Easterly clearly shows that we have been wedded to this failed economic development philosophy for the last 50+ years.
- The Trouble with Africa - Why Foreign Aid Isn't Working, by Robert Calderisi
- Calderisi is another 30-year veteran of the World Bank and an expert on Africa. His assessment of Africa concurs with Easterly's, and is also as "politically incorrect," as it bucks the status quo that for 50 years has failed to do much except spend huge amounts of money. Recommended, but if you read "White Man's Burden," this is not a must-read.
- The Bottom Billion - Why the Poorest Countries are Failing and What Can Be Done About It, by Paul Collier
- Recommended by The Economist as a middle point between Sachs' statism and Easterly's approach. I concur, except the "middle point" is about 80% towards Easterly's position.
- The Other Path - The Economic Answer to Terrorism, by Hernando de Soto
- De Soto is the famed Peruvian economist most known for his work in showing the importance of rule of law, especially property rights, in the alleviation of poverty. In this 1989 book he shows how with a few but vital changes in Peruvian law, Peru was able to defeat the Maoist terrorist threat known as The Shining Path, simply by taking away its main weapon - chronic systemic property rights abuse on the rural peasant population. Read at least the preface written in 2002 and Chapter 1.
- The Mystery of Capital - Why Capitalism Triumphs in the West and Fails Everywhere Else, by Hernando de Soto
- The Economist magazine says of this book, "The most intelligent book yet written about the current challenge of establishment capitalism in the developing world." The challenge he refers to, of course, is that, apparently, four-fifths of the world's population has been left out of the program and how that problem can be remedied.
Alternative Ideas on Development and Related Subjects - The Rational Optimist: How Prosperity Evolves, by Matt Ridley
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Ridley starts at the very beginning going all the way to start of the the Paleolithic and then traces human development forward. Reading this book is an awesome experience. It will dispel any doom and gloom one might have about where we are heading and how fast we have gone from a world where everyone was living in abject poverty to the near future when poverty as we know it will be remembered only in museums. A thoroughly enjoyable and enormously entertaining and informative work. Highly recommended.
- Heaven and Earth: Global Warming the Missing Science, by Ian Plimer
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One might say that before Climategate there was Plimer, twice winner of Australia’s highest scientific honor and a professor in the School of Earth and Environmental Sciences at The University of Adelaide, raising the alarm against the climate change alarmists and challenging the notion that the global warming science is settled. Highly opinionated, but opinions that appear to be solidly backed by data or the lack thereof, as the case may be. If you want to read one book written by a climate scientist that disagrees with the global warming proponents, this would be a good place to start.
- Power Hungry: The Myths of "Green" Energy and the Real Fuels of the Future, by Robert Bryce
- The West got rich on cheap power, but now many Western radical environmentalist elites are getting all neurotic about climate change and want to shut down the whole economic juggernaut just as it is reaching billions of the neglected and abused poor. This is the absolute height of hypocrisy, and Bryce does a good job dispelling many of the myths of the green energy movement. Bryce himself was once considered an extreme green. Now he is just a moderate green. Through his years of thoroughly researching the subject of alternative energy for several books, he is now considered somewhat of a pariah by the extreme greens, since he can no longer honestly support many of the myths surrounding alternative energy. Green ideologists beware and be forewarned – don’t read Bryce’s book unless you are prepared to join him in the ranks of the “unwashed non-believing deniers”. The world’s poor may someday thank Bryce for what one admirer claims is an absolute honest intellect who simply follows the facts and is willing to leave his old notions by the side of the proverbial road. A wise man. And a must read on alternative energy and its mostly negative impact on the developing world.
- Cool It, by Bjorn Lomborg
- Bjorn Lomborg is the Danish environmentalist statistician who is trying to bring some calm rational sense to environmental spending and the cost to achieve the desired climate changes. Ostensibly, this book is about global warming, but it is really about how we should spend our money to fix the solvable problems and the return on investment we can expect on the various endeavors.
His book is about half notes and references, and shows that much of the global warming scare is alarmist with the most likely scenarios not coming close to approaching the apocalyptic vision put forth by many. In fact, according to Lomborg and others, the most likely climate change is actually not that bad and certainly a lot better than if the planet were cooling. According to Lomborg analysis, the problems that will arise over the next 100 years are solvable, especially with a wealthier world better able to afford the fixes.
- Copenhagen Consensus Website, by Bjorn Lomborg et al
- Lomborg is the founder of the Copenhagen Consensus. I highly recommend this approach to solving world poverty. If you read nothing else, read the first two chapters of his book, Cool It, and then spend an hour on the Copenhagen Consensus website
- The Fortune at the Bottom of the Pyramid-Eradicating Poverty Through Profits, by C.K. Prahalad
- Big business is finally getting what "Banker to the Poor" Professor Yunus has been saying for 30 years. There is a lot of money at the bottom of the economic pyramid, even if it is only a few pennies from each, because there are 4 billion people "down there" and most have at least a few pennies to spend each day. This book advocates businesses serving the poor with the same products the rich have access to, although packaged, marketed and distributed much differently. This will enrich their lives in many ways, including creating the business of distributing these products to themselves. Treating the world's poor with dignity, as decent, hard working and valuable assets of the world instead of as a huge collective charity case is paramount to changing poverty consciousness. I highly recommend reading at least the first two chapters.
- Creating a World Without Poverty - How Social Business Can Transform Our Lives, by Muhammad Yunus
- This book is about Yunus' next "Big Idea", which is a new type of social business that will retain all profits to reinvest in social programs like health, education and infrastructure. The owners or original investors in the business will not receive dividends; however, they will be bought out by the enterprise from the ensuing profits. He proposes that the stock be sold on a new stock exchange developed for this kind of business. This is an intriguing idea for the wealthy to ponder what and how to invest their excess capital. This type of business would not increase wealth for its owners, but rather, attempt to transfer wealth to the poor by foregoing capitalist benefits.
Classic Economics that Supports Our Economic Development Model P - The Road to Serfdom, by F.A. Hayek
- This book by the Nobel Prize winning economist deals with "the relation between individual liberty and government authority." He won the Medal of Freedom, as well.
- Free to Choose, by Milton and Rose Friedman
- If you read only one book on market economic theory, read this classic "inquiry into the relationship between freedom and economics."
- Capitalism, Socialism and Democracy, by Joseph A. Schumpeter
- First published in 1942, this rather academic treatise is still a must read, as it thoroughly establishes entrepreneurial capitalism as superior to socialism in any of its many guises.
Other Recommended Reading in Development - Poor People, by William T. Vollmann
- A book about the poor by someone who is not only talking to the poor, but also listening to what they are saying. Vollmann is a wonderful writer, too.
- Good Capitalism, Bad Capitalism - And the Economics of Growth and Prosperity, by William J. Baumol et al
- Not a must, but an interesting read, nonetheless
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