Many people don’t know about the enormous progress most countries have made in recent decades – or maybe the media hasn’t told them. But with the following five facts everyone can upgrade their world view.
1. Fast population growth is coming to an end
It’s a largely untold story – gradually, steadily the demographic forces that drove the global population growth in the 20th Century have shifted. Fifty years ago the world average fertility rate – the number of babies born per woman – was five. Since then, this most important number in demography has dropped to 2.5 – something unprecedented in human history – and fertility is still trending downwards. It’s all thanks to a powerful combination of female education, access to contraceptives and abortion, and increased child survival.
The demographic consequences are amazing. In the last decade the global total number of children aged 0-14 has levelled off at around two billion, and UN population experts predict that it is going to stay that way throughout this century. That’s right: the amount of children in the world today is the most there will be! We have entered into the age of Peak Child! The population will continue to grow as the Peak Child generation grows up and grows old. So most probably three or four billion new adults will be added to the world population – but then in the second half of this century the fast growth of the world population will finally come to an end.
2. The “developed” and “developing” worlds have gone
Fifty years ago we had a divided world.
There were two types of countries – “developed” and “developing” – and they differed in almost every way. One type of country was rich and the other poor. One had small families, the other large families. One had long life expectancy, the other short. One was politically powerful, the other was politically weak. And between these two groups, in the middle, there was hardly anyone.
So much has changed, especially in the last decade, that the countries of the world today defy all attempts to classify them into only two groups. So many of the formerly “developing” group of countries have been catching up that the countries now form a continuum. From those nations at the top of the health and wealth league, like Norway and Singapore, to the poorest nations torn by civil war, like DR Congo and Somalia, and at every point in between, there are now countries right along the socio-economic spectrum. And most of the world’s people live in the middle. Brazil, Mexico, China, Turkey, Thailand, and many countries like them, are now in most ways more similar to the best-off than the worst-off. Half the world’s economy – and most of the world’s economic growth – now lies outside Western Europe and North America.
3. People are much healthier
Fifty years ago, the average life expectancy in the world was 60 years. Today it’s 70 years. What’s more, that average of 60 years in the 1960s masked a huge gap between long lifespans in “developed” and short lifespans in “developing” countries.
4. Girls are getting better education
The better education of girls is just a first step on the long road to gender equity. But sadly it is also changing the character of gender inequity. Violence against young women and restrictions on their rights to choose how to live their lives are now replacing lack of schooling as the main gender injustice.
5. The end of extreme poverty is in sight
What is “extreme poverty“? Economists define it as an income of less than $1.25 per day. In reality, it means that a family cannot be sure from one day to the next that they will have enough to eat.
Children have to work instead of going to school. Children die from easily preventable causes such as pneumonia, diarrhoea and malaria. And for women it means uncontrolled fertility and families of six or more children.
But the number of people in extreme poverty, according to the World Bank, has fallen from two billion in 1980 to just over one billion today. Though many people in the world still live on a very low income, six out of seven billion are now out of extreme poverty and this is a critical change. These families have fewer children, of whom the vast majority survive, get enough food and go to school.
In fact, for the first time ever, the evidence suggests it is now possible for the last billion to also get out of the misery of extreme poverty in the next few decades. It will mainly be through their own hard work – but it will only happen if they receive, from their governments and from the world at large, the focused help they need to stay healthy, get educated and increase their productivity.
Note:- We gave an Essay in our E02 essay test -“Will we be leaving the world a better place than we found it ? ” and this article can help give positive spin to the essay. Although the essay also requires one to write on the negative aspects as well- such as 300% increase in terrorism compared to last decade, Environmental degradation and increase in violence against women and many other issues.
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Steve Ovett, the famous British middle-distance athlete, won the 800-metres gold medal at the Moscow Olympics of 1980. Just a few days later, he was about to win a 5,000-metres race at London’s Crystal Palace. Known for his burst of acceleration on the home stretch, he had supreme confidence in his ability to out-sprint rivals. With the final 100 metres remaining,
[wptelegram-join-channel link=”https://t.me/s/upsctree” text=”Join @upsctree on Telegram”]Ovett waved to the crowd and raised a hand in triumph. But he had celebrated a bit too early. At the finishing line, Ireland’s John Treacy edged past Ovett. For those few moments, Ovett had lost his sense of reality and ignored the possibility of a negative event.
This analogy works well for the India story and our policy failures , including during the ongoing covid pandemic. While we have never been as well prepared or had significant successes in terms of growth stability as Ovett did in his illustrious running career, we tend to celebrate too early. Indeed, we have done so many times before.
It is as if we’re convinced that India is destined for greater heights, come what may, and so we never run through the finish line. Do we and our policymakers suffer from a collective optimism bias, which, as the Nobel Prize winner Daniel Kahneman once wrote, “may well be the most significant of the cognitive biases”? The optimism bias arises from mistaken beliefs which form expectations that are better than the reality. It makes us underestimate chances of a negative outcome and ignore warnings repeatedly.
The Indian economy had a dream run for five years from 2003-04 to 2007-08, with an average annual growth rate of around 9%. Many believed that India was on its way to clocking consistent double-digit growth and comparisons with China were rife. It was conveniently overlooked that this output expansion had come mainly came from a few sectors: automobiles, telecom and business services.
Indians were made to believe that we could sprint without high-quality education, healthcare, infrastructure or banking sectors, which form the backbone of any stable economy. The plan was to build them as we went along, but then in the euphoria of short-term success, it got lost.
India’s exports of goods grew from $20 billion in 1990-91 to over $310 billion in 2019-20. Looking at these absolute figures it would seem as if India has arrived on the world stage. However, India’s share of global trade has moved up only marginally. Even now, the country accounts for less than 2% of the world’s goods exports.
More importantly, hidden behind this performance was the role played by one sector that should have never made it to India’s list of exports—refined petroleum. The share of refined petroleum exports in India’s goods exports increased from 1.4% in 1996-97 to over 18% in 2011-12.
An import-intensive sector with low labour intensity, exports of refined petroleum zoomed because of the then policy regime of a retail price ceiling on petroleum products in the domestic market. While we have done well in the export of services, our share is still less than 4% of world exports.
India seemed to emerge from the 2008 global financial crisis relatively unscathed. But, a temporary demand push had played a role in the revival—the incomes of many households, both rural and urban, had shot up. Fiscal stimulus to the rural economy and implementation of the Sixth Pay Commission scales had led to the salaries of around 20% of organized-sector employees jumping up. We celebrated, but once again, neither did we resolve the crisis brewing elsewhere in India’s banking sector, nor did we improve our capacity for healthcare or quality education.
Employment saw little economy-wide growth in our boom years. Manufacturing jobs, if anything, shrank. But we continued to celebrate. Youth flocked to low-productivity service-sector jobs, such as those in hotels and restaurants, security and other services. The dependence on such jobs on one hand and high-skilled services on the other was bound to make Indian society more unequal.
And then, there is agriculture, an elephant in the room. If and when farm-sector reforms get implemented, celebrations would once again be premature. The vast majority of India’s farmers have small plots of land, and though these farms are at least as productive as larger ones, net absolute incomes from small plots can only be meagre.
A further rise in farm productivity and consequent increase in supply, if not matched by a demand rise, especially with access to export markets, would result in downward pressure on market prices for farm produce and a further decline in the net incomes of small farmers.
We should learn from what John Treacy did right. He didn’t give up, and pushed for the finish line like it was his only chance at winning. Treacy had years of long-distance practice. The same goes for our economy. A long grind is required to build up its base before we can win and celebrate. And Ovett did not blame anyone for his loss. We play the blame game. Everyone else, right from China and the US to ‘greedy corporates’, seems to be responsible for our failures.
We have lowered absolute poverty levels and had technology-based successes like Aadhaar and digital access to public services. But there are no short cuts to good quality and adequate healthcare and education services. We must remain optimistic but stay firmly away from the optimism bias.
In the end, it is not about how we start, but how we finish. The disastrous second wave of covid and our inability to manage it is a ghastly reminder of this fact.