I’m not an economist (although I did stay at a Holiday Inn once), but just wondering:
Will this free money come from the Money Tree?
Foreign aid has its place in the quest to eradicate global poverty, but one economist believes free cash can go pretty far, too.
John McArthur, senior fellow at the Brookings Institution, wrote in a recent blog post that 66 countries in the developing world could theoretically afford to end poverty tomorrow, just by awarding citizens direct cash transfers….
McArthur’s proposed solution involves empowering countries to do more with what they’ve already got. Relying partly on the World Poverty Clock, a real-time ticker of how many people live in poverty worldwide, McArthur finds countries such as India, Indonesia, and Brazil could lift every extremely poor citizen out of poverty for less than 1% of each country’s gross national income.
Costs above 1% could cripple these countries in other important areas. They are place “where government revenues are typically equivalent to about 10 to 15% of the overall economy,” McArthur wrote. “Those budgets already need to cover an array of crucial expenditures like hospitals, schools, roads, courts, and police, separate from any direct transfers.”….
Let’s recap what has been shown to not work in eliminating poverty.
Price controls.
Mandatory Living wage.
Currency deflation.
Welfare.
In sum, Central Economic Planning.
One significant reason statist economic central planning doesn’t work; it doesn’t/can’t accurately account for corruption. Because the corruption starts with the political planners who refuse to see themselves as anything but saving angels.
Realize that, in many sectors of our economy, simply giving money to people to spend is less expensive than what we are otherwise doing. EX. Healthcare.
As with anything you subsidize, the more you subsidize poverty, the more poverty you will get.
Fabulous. How does a contributing writer for “The Economist” abandon the fundamentals of economics? My guess is that he was radicallized as an undergrad and didn’t venture out of the University system until he was a well-groomed, Engles-loving Marxist. Best of luck to him in all of his nonsensical adventures in the real world.