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The pot of gold could soon be accessible to all

By J. Bradford DeLong

Monday, Sep 04, 2006, Page 9

For quite a while now -- certainly since the terrorist attacks on the US on Sept. 11, 2001, and before as we watched the slaughter in Kosovo, Sarajevo, Srebrenica, Rwanda and Congo on our televisions -- the news has been dominated by war and rumors of war, by violent death and threats of violent death. Everyone, everywhere is keenly aware of the power of our weapons. From nuclear-tipped missiles down to trucks full of fertilizer or explosives worn as belts, we have used our technology to greatly amplify the dark parts of our nature as a violent -- and not even a properly predatory -- species.

I certainly do not want to downplay or dismiss this side of humanity's history and our current events. I do not want anyone to forget the outbreak of World War I and the famine that followed Mao Zedong's (毛澤東) "Great Leap Forward," when so many people were shot, gassed, stabbed, burned, or starved to death by his or her fellow human beings.

But that is not the whole story. Indeed, the human abattoirs of the 20th century -- and even the slaughterhouses that various humans are preparing now -- may not appear from the perspective of the future to be the most important part of our experience and condition, and of what our descendants will regard as their history.

For them, the most important features of what our experience may instead be very different.

The experiences could include what UN demographers foresee as the end of the population explosion: the halting of the growth of the human population at 10 billion or so around the middle of this century.

They could include the coming of a truly humane world as the numbers of those engaged in subsistence agriculture -- or those whose wages are kept at subsistence levels by labor market pressure from those who have migrated from the countryside into teeming cities -- fall to a small fraction of the human population.

For most of the 20th century, large chunks of the world remained desperately poor for one or more of four related reasons: one, criminal misgovernment; two, lack of the machines to do anything useful and productive in the world economy besides subsistence agriculture and unskilled service work; three, lack of the public education system needed to give people the literacy and the skills to operate machines; and four, barriers (legal and physical) that kept people where demand was low from selling the products of their work where demand was high.

But over the course of the late 20th century, these four causes of desperate poverty have largely fallen away. Governments as bad as Kim Jong-il's in North Korea are now extremely rare. Nearly all countries in the world are at most one generation away from near-universal literacy. The fast pace of technological progress has created a cornucopia of invention and innovation that is open to every place that can send someone away to get a master's degree in engineering.

Most important, the barriers to making goods and services in Mauritius, Mozambique, or Mauritania and selling them in New York or Berlin, Santiago or Tokyo are dropping swiftly. The gargantuan container ships that first appeared a generation ago brought one revolution to world trade.

The use of information technology to manage transportation and distribution channels is likely to have a similarly profound effect. Moreover, the advent of the Internet and the fiber-optic cable will do as much to make service-sector work internationally tradable as the coming of the iron-hulled steamship a century and a half ago did to make bulk agricultural products and manufactures internationally tradable.

It will take at least a generation for these changes to make themselves felt in most corners of the world. But inside the industrial core of the world's rich countries there is already concern about these looming revolutions. Indeed, this concern will only become sharper and stronger, as citizens in rich countries fear that as the remaining barriers to international trade fall, industrial-core income distributions, social orders, and politics will be shaken to their foundations.

For the world as a whole, however, the next two generations are ones that will bring an extraordinary opportunity for economic growth and world prosperity. Perhaps at the end of history there is a pot of gold, after all.

J. Bradford DeLong is professor of economics at the University of California at Berkeley and was assistant US treasury secretary during the Clinton administration.

Copyright: Project Syndicate
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