Common Wealth: Economics for a Crowded Planet

Jeffrey Sachs is special adviser on the UN's Millennium Development Goals to UN Secretary-General Ban Ki-Moon. He urges that the principles of social justice should guide economic forces, not profit, and he argues that problems need diplomacy and development, not war, sanctions and threats. Development brings security, not vice versa. As he notes, "A world of untrammelled market forces and competing nation-states offer no automatic solutions." "Market forces by themselves do not optimally allocate society's resources." "Market forces alone will not overcome poverty traps." He shows in detail that market forces cannot deliver R & D or ensure the adoption of new technologies or control population growth or protect the environment or prevent species loss or get medicine to the poorest. The market pays no heed to future generations. As we can all now see, capitalism is self-reinforcing, not self-correcting. We have the technology, industry and resources to solve all our problems. As Sachs writes, "Earth has the energy, land, biodiversity, and water resources needed to feed humanity and support long-term economic prosperity for all. The problem is that markets might not lead to their wise and sustainable use." He urges countries to convert commons from open-access to community management, not privatise them. So within each country we need to develop and spread technologies suitable for that country, like carbon capture, drip irrigation, desalination, drought-resistant crops, high-yield wheat (which increased India's harvest from 11 million metric tons in 1960 to 55 million in 1990), vaccines for tropical diseases, and turning coal into petrol by Fischer-Tropsch liquefaction. Within each country, we should promote welfare. Social welfare states like Denmark and Finland do better than free market states like Britain and the USA. They have higher employment rates, higher GNPs per person and more equality. We can cut fertility rates, and therefore increase growth, by providing free access to health services, especially emergency obstetric care and family planning services, and by improving child survival rates. This is a humane and hopeful book. Sachs proves that we can raise incomes, end extreme poverty, stabilise the population, protect the environment and establish peace. Each needs public action, public funding, long-term thinking and planning, and we all have to take the responsibility.

Famed economist Jeffrey Sachs manages to deliver pessimistic news in an optimistic way. Yes, the Earth faces dire threats from global warming, poverty, war, deforestation and mass extinctions. Yet Sachs asserts that these severe problems are manageable. Fixing them will cost $840 billion - a massive amount indeed, but, as Sachs argues, only 2.4% of the rich world's gross national product. Sachs doesn't shy away from politically touchy pronouncements. He argues against the U.S. war in Iraq and for legalized abortion. Still, throughout the fray, his book strikes the unlikely balance of delivering a message that's both frightening and promising. getAbstract recommends this book to anyone seeking insight into the world's most pressing problems.

This is yet another classic from Jeffrey Sachs. Here is the most comprehensive and compelling list of issues facing Mother Earth in the twenty first century and also some excellent prescriptions for sustainable and inclusive global economic growth. The list of "six earth changing trends" starts with convergence. Thanks to globalization and relatively peaceful environment despite some regional tensions, most developing countries are catching up fast for the lost time in the last three decades. Sachs explains the concept of convergence and a thumb rule for forecasting faster growth rates of poorer countries, relative to their income levels. The good news is that poorer countries can grow faster. The flip side is that there are about 6 times more people on this planet today than in 1830 and this is expected to grow by another 40 % to 9.2 billion by 2050. Assuming steady economic growth rates, the global GNP is expected to reach around $ 400 Trillion from the current $ 67 Trillion, a six fold increase. The bad news is that this may not be achievable if we continue to adopt conventional technologies that deplete natural resources that have an adverse impact on the already fragile environment. Sachs quantifies his using the I = P*A*T equation, where the environmental impact of development equals the product of population, average income and the negative effect of conventional technologies. That means that by 2050, we would have environmental pollution levels that are about 8.4 times than today, which is clearly unsustainable. Hence the urgent need for adopting sustainable technologies on a rapid scale, whereby I=P*A/S where S in the denominator stands for sustainable technologies. The impact of global warming is also explained extremely well. Global warming caused primarily by CO2 is discussed in detail. The analysis of the rise in global temperatures as a consequence of CO2 levels rising from 280 ppm in 1950 to around 380 ppm today is alarming. Global warming is a vicious cycle since more CO2 in the atmosphere traps more infrared rays from being reflected back into outer space, thereby further increasing atmospheric temperatures. The warmer oceans in turn release the dissolved CO2 into the atmosphere, adding fuel to fire. Sachs points out to the availability of vast carbon resources that can be gainfully utilized to meet our energy needs, while simultaneously using Carbon Capture and Sequestration Technologies to contain CO2 emissions. Larger populations need more food. Increasing incomes and urbanization means we have lesser people in villages to grow more food from the same acreage of land. It is interesting to note that in the year 2008, for the first time in the history of humanity, 50% of the people are now living in urban areas. The net addition of population from now till 2050 is likely to be added in urban areas. This calls for substantial increase in agricultural productivity in rural areas. Unfortunately, water emerges as a major constr

This book presents about as complete a description you can find about the causes of extreme poverty and environmental threats and what can be done about it. The analytical part presents compelling evidence that without drastic action the world will be in deep trouble. For example. One the main causes of the poverty trap in poor countries is large family size. Even with the most effective fertility reduction program combined with a reduction of infant mortality (these two changes must be combined) the population of Africa will from 2005 to 2050 increase with 750 million.When only infant mortality is reduced the increase will be more than a billion. Most of this increase will be in the poorest countries. The book describes in detail how different negative trends reinforce each other leading to self reinforcing loops. It concerns, water shortage, shortage of oil and gas, overfishing, reduction of forest cover, reduction of arable land, pollution and an increase in temperature. Fortunately the author describes precise programs how these problems can still be solved. Also, what the free-market can and cannot do. The complementary roles of global organisations like the UN, national governments, business and NGOs are described. An example of such a detail is that the main problems cannot be solved without scientific and technological breakthroughs. For example there is plenty of fossil fuel in the form of coal. But a solution has to be found to sequestrate the harmful gases produced otherwise it will lead to environmental disaster. The author believes I think correctly, that fundamental research around this problem has to be organized and funded on a global scale by governments. This is not happening to day. It requires an integrated global approach, already at the R & D level. The author may be overoptimistic about governments, business and people in general to make short term sacrifices for long term gains. Historical events have been driven primarily by greed, national self-interest; wars, conquests, internal wars, colonilisation, slavery, overfishing, the financial crisis in 2008 are all examples. China rightly wants to increase the standard of living of its inhabitants; as yet almost regardless of the environmental consequences. The US and Europe have made little progress in reducing energy consumption even though they talk a lot about it and set ambitious targets. The missing link is how to change the attitudes from governments, business and people to be not only concerned about their own well being the next few years, but to be concerned for the well being of others over the next 20 years. It is urgent; it is not just a question of concern for the next generation. Fortunately, the book presents many examples of successful radical change projects. The challenge is to scale up to the level of the world.

Truly a must-read. I assure non-economists wary of econojargin: if you read books, this one's accessible enough for you. The book sheds light onto the roots of the world's problems from a UN economist's perspective. The complex web of cause and effect, and of problem and solution, occasionally seems to present contradictions, but it ultimately serves to reveal how complicated things truly are, and therefore, just how delicate, prescriptive, and adaptable the next generation of policies must be.