In my new book, The End of Poverty, I show how extreme poverty can be ended by 2025, but only if the rich world follows through on its promise to help the poorest countries.
In order to thrive, and to foster the private-sector investment needed for long-term growth, an economy requires functioning health and education systems, investments in soil nutrients and water management, and basic infrastructure such as electricity and motorized transport. Yet the poorest countries, even well governed ones, lack the resources to finance these investments.
Lack of adequate foreign assistance is one of the greatest disgraces on our planet, and the US has been the biggest laggard of all. It is urgent that the US wake up to global realities, and that it follow through on its commitments.
The most famous single promise by the rich countries has been to provide aid to the poorest countries equal to at least 0.7 percent of their gross national product (GNP). The commitment began 44 years ago, in 1961, when the UN General Assembly adopted the objective that foreign assistance should increase significantly, "so as to reach as soon as possible approximately 1 percent of the combined national incomes of the economically advanced countries." At the time, foreign assistance was about 0.5 percent of rich-country income.
Despite the promises, aid continued to decline. By the early 1990's, official development assistance was still around 0.33 percent of donor GNP, and by the early 2000's, it had declined to around 0.22 percent of GNP. Now it is roughly 0.25 percent of GNP. But the long-term decline in the ratio of aid to GNP did not stop the rich world from promising time and again to reach 0.7 percent of GNP, including at the Rio Earth Summit in 1992 and the Copenhagen Summit on Social Development in 1995.
At the start of the new millennium, the world's leaders got together to adopt the Millennium Development Goals, the global commitment to halve extreme poverty by 2015.
To implement these commitments, world leaders, including US President George W. Bush, met again in Monterrey, Mexico, to adopt the Monterrey Consensus on how to achieve the breakthrough from poverty. The personal presence of Bush is notable, because the rich countries once again adopted the target of 0.7 percent of GNP, with the US being a signatory.
The US government often declares these days that it is not bound by any "arbitrary" numerical target such as 0.7 percent of GNP. Top officials even declare that the US never signed on to such a goal. Yet the US and other countries did sign the Monterrey Consensus urging "developed countries that have not done so to make concrete efforts towards the target of 0.7 percent of GNP as official development assistance." It could hardly be more clear. Alas, the US has shown absolutely no "concrete efforts" towards keeping this commitment.
In fact, US official development assistance amounts to just 0.15 percent of America's GNP, which is less than one-fourth the global target. This contrasts with the 4 percent of GNP that the US spends on its military, roughly US$500 billion this year. So the US spends around 30 times more on the military than it does on peaceful development aid for the poorest countries.
From a global point of view, there are currently five countries that have reached 0.7 percent of GNP in aid: Denmark, Luxembourg, the Netherlands, Norway and Sweden. Six more countries, all in Europe, have recently set a timetable to reach 0.7 percent of GNP by the year 2015. They are Belgium, Finland, France, Ireland, Spain and the UK.
UN Secretary-General Kofi Annan, in his report in advance of the UN summit of world leaders in September, has called on all donor countries to reach at least 0.5 percent of GNP in aid by 2009, and 0.7 percent by 2015. He also noted that countries like Germany and Japan that aspire to permanent UN Security Council membership have a particular responsibility of global stewardship in reaching the target.
Sadly, the ideological mouthpieces for the super-rich in the US, especially the editorial page of the Wall Street Journal, remain bitterly opposed to foreign aid, even if it's just US$0.70 per US$100 of income! In criticizing my book, a Wall Street Journal review said that I was calling for "Giving till it hurts."
But there is a limit to greed. I am quite sure that the Wall Street Journal does not really represent the interests or views of many or even most of American rich people, including the millionaires and billionaires whose contributions to aid could make a huge difference to the lives of millions of people.
Many remarkable philanthropists, such as Bill Gates, are already leading the way. I believe that few wealthy people would refuse to contribute a small portion of their huge wealth for the chance to save the lives of millions of people each year and help the poorest countries get the first foot on the ladder of economic development. They will know that they would not only save lives, but also contribute to a much safer and more prosperous world.
Instead of worrying that US$0.70 per US$100 is giving till it hurts, our slogan in the rich countries should be "Giving till it heals."
Jeffrey Sachs is professor of economics and director of the Earth Institute at Columbia University.
Copyright: Project Syndicate
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