Jeffrey Sachs and his pipe dream

Grandpa asked me to tell him what I thought of this article by Jeffrey D. Sachs, "Rapid Victories Against Extreme Poverty". Dr. Sachs, I used to think that you were really smart and that we just disagreed. Now, I think that you need to revisit some of the basic texts of economics and development theory. Not to mention come visit me in South America.

His definition of poverty is ok, even if his "basic needs" are a bit broad to be basic. I'm not sure that people "need" telecommunications.

However, his proposed solution doesn't at all address what created the situation of poverty in the first place, if not corruption, mismanagement, and weak institutions. It almost seems as if he is saying that poverty is its own cause, which is a tautology. Not to mention, if corruption, mismanagement, and weak institutions are not a problem, what does he think is going to happen to the schools and clinics and roads that are built under his plan? That they are just going to spontaneously rejuvenate themselves? That individuals will suddenly buck the trend of the problem of the commons that has existed since time untold and take care of them in some sort of hokey cooperative utopia? I thought this guy was an economist!

Furthermore, where is the magic market that will absorb, without displacement of market share, distortions, and price issues, all of this suddenly increased agricultural production? What about the environmental effects of increased fertilizer use and run-off? What is the incentive for farmers to re-invest in their farms if they are being subsidized? I thought that this guy was an economist!

Basically, his whole idea is going right back to the charity of early "development" efforts, and there is no reason to believe that the results will be any different. Decaying clinics, schools with no teachers (the corrupt governments aren't paying them enough to be there now, does he think that building a new school will change that?), rusting farm equipment in fields, empty irrigation trenches, etc. If I didn't know that he has traveled extensively in the developing world, I'd think he'd never been here before.

Finally, it is not the responsibility of the developed world taxpayers to relieve the governance burden from corrupt, mismanaged, and weak developing country governments. It is their responsibility to govern. We can provide services to help them do that better, but no way do we take this on ourselves. Then we will be doing it into eternity, while the leaders of these countries while away their time on the beach or at the country club.

That's what I think.