Aasof’s Reflections

This week on Facebook: Is prosperity and wealth the same thing I wonder.  My conclusion is that it depends on how you define each word and who that definition applies to. Oxfam¹ thinks that $8-coffee-drinking millennials with student debt are amongst the world’s neediest and they are if you define wealth without taking into account its context. A millennial who can indulge in an $8 cup of coffee may not be wealthy but is certainly prosperous.

The World Economic Forum is less attention grabbing in its report² but both reports highlight the potential of persistent long-term trends, such as inequality and deepening social and political polarisation. Trends that exacerbate risks associated with, for example, the weakness of the economic recovery and the speed of technological change.

The reports point out the disparity between the global rich (wealthy) and the global poor but global prosperity is an abstraction. If prosperity — as defined by the SOED — means; to be successful, to thrive, to have good fortune, to have well-being, some or all of these may be prerequisites that can lead to the accumulation of wealth. However, it may be possible to prosper without being wealthy. Click on the link below and ask yourself if you are wealthy and prosperous on a global scale. Can one exist without the other? How much of each is enough? What does global economic growth mean to you?

Wealthy? Click on the image to find out!

I’m beginning to have very mixed thoughts arising from this week on Facebook, particularly in finding a suitable article for Wednesday. The one I finally settled on is a review of a book that most of us will not read. What caught my attention was the reference to what I took to be essentially discretionary income but — to my mind — assumes a global increase in income and wealth with a corresponding global increase in needs and wants.  While the debate about the causes of climate change will continue, where will any debate about the strain on the global infrastructure take us to? Perhaps sometime in the future this book will rediscovered and may even prompt another debate about the philosophies of Malthus and Bartlett.

A Peace of Keynes – The Cake: Nearly 100 years ago John Maynard Keynes wrote — No one would be much the better off  if the cake were shared all round, it was really very small in proportion to the appetites of the consumers (even at that time). Society was not working for the small daily pleasures but for the future security and improvement of the race —in fact for “progress.” If the cake were allowed to grow in proportion with the population — and with compound interest — perhaps a day might come when there would at last be enough to go round. The two pitfalls to this prospect were that the population would outstrip the accumulated growth of the cake and, however much grown, the cake would be consumed prematurely as in a war.

Taking Modernisation Seriously: Can everyone on Earth live a modern life? Can most or all countries succeed in economic development? Is it possible over time for the entire human race to enjoy the living standards of most inhabitants of today’s advanced industrial economies?

Global Economic Growth Will Bring New Challenges: As incomes rise, consumers worldwide are projected to spend proportionately less on food and more on transportation, energy, and services, which will in turn strain the global infrastructure and accelerate climate change.

Global prosperity is at its highest point in the past decade: Whether we look at the global average or weight countries’ scores by their populations, the picture remains the same: global prosperity is now three percent higher than it was in 2007. Driving this trend towards higher global prosperity are improvements in Personal Freedom, particularly in Western Europe and Central and Latin America; improvements in Health and Education in Asia; and a better Business Environment in the Middle East and North Africa, Sub-Saharan Africa, and Eastern Europe.

Can long-term global growth be saved? Over the past 50 years, global economic growth was exceptionally rapid. The world economy expanded sixfold. Average per capita income almost tripled. Hundreds of millions of people were lifted out of poverty. Yet unless we can dramatically improve productivity, the next half century will look very different. The rapid expansion of the past five decades will be seen as an aberration of history, and the world economy will slide back toward its relatively sluggish long-term growth rate