AEIdeas

The public policy blog of the American Enterprise Institute

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Discussion: (10 comments)

  1. Walt Greenway

    Most of the people I know don’t care about the poverty rate in other countries. They are more interested in competing with the outward displays of wealth they see around them (even if much of that wealth is accumulated through debt that often cannot be repaid). You probably have to get into either an academic or church group to find much interest in discussing how to reduce world poverty.

    1. Jon Murphy

      I think you are right. I think it is largely about the outward displays of wealth people see around them.

  2. Seattle Sam

    Because we have an entire political party that is simply a coalition of victim groups. As they are less and less actual victims, it becomes critical to remind them that they are still relative victims.

    1. morganovich

      sure, you have a big TV and plenty to eat and get to go on vacations, but THAT GUY has a nicer car than you do!

      someone needs to do something about that!

      the politics of envy are very, very ugly.

      hell, we have one of the first societies in all of history where the poor people are fat. (and fatter than the rich)

      our poor are staggeringly well off relative to historical standards.

      but there is an unfortunate fact of human nature that has been demonstrated over and over again in economics experiments (i myself replicated this as an undergrad in an experimental econ/game theory class):

      given a game, paid out in real money and a choice between 2 outcomes, one in which you get $5 and i get $7 and one in which you get $3 and i get $2, most people choose the latter.

      they actually chose $3 over $5 very consistently because relative status is more important to them than absolute wealth.

      this is precisely why democracies cannot be trusted to redistribute wealth and why, when they do, they wind up making the society poorer.

  3. Jon Murphy

    This poverty rate thing may be the single largest humanitarian action no one is talking about.

  4. morganovich

    a question:

    is that chart in nominal or constant dollars?

    1. Jon Murphy

      Constant.

    2. Sorry, I quickly added an old chart and have replaced it with a newer version that shows that it’s in constant dollars.

  5. Jon Murphy

    The spread of free trade to the rest of the world (via globalization) has caused an explosion of global living standards and has brought true poverty and true hunger to the verge of elimination. Is it a coincidence that this has occurred as economies became liberalized? I think not.

    I suspect when the history of this time period is written, they will say: In the end, it wasn’t grand schemes or massive works of charity that ended poverty and hunger in the world. It was good old fashioned cooperation.

  6. “None of this is meant to imply that people are wrong to resent inequality in income or wealth, or be bothered about the winner-take-all features of executive pay in recent decades.”

    Actually, yes, it should wrong to resent others’ wealth and executive pay. In such cases it’s none of your business you only focus only your own income and wealth.

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