Economists, is a future scenario possible where all nations on earth are rich?

Factual Questions
21

That site also says that we are consuming resources 25% faster than they are being produced. That set my BS detector off instantly, because if that were the case there would be huge increases in the price of raw materials. Now, some materials have certainly gone up in price recently, but others are near all-time lows.

Studies of the ‘carrying capacity’ of the earth are all over the map. One on extreme end, some environmentalists claim the true number is under a billion people. Others say the number is in the hundreds of billions.

Those worst-case estimates generally also assume that we’ll get no better at knowing how to use our resources, that we won’t find alternatives when some resources become too expensive, that our values and lifestyles won’t change to accomodate new economic realities, etc. In other words, they pull the number out of their ass by assuming the worst of everything and the best of nothing, and by ignoring many known sources of energy and materials to propagate the alarmist message they want to deliver.

That sounds like a really lousy economics book. People aren’t poor today because they are resource poor. They are poor because their economies are arranged poorly, because they aren’t allowed to innovate, to build businesses, and to have rights to their own property. Or they are ensnarled in taxes and regulations, and hounded by corruption. Resource availability has nothing to do with it. The rich countries didn’t just grab up all the resources and refuse to share. They mined or created resources, and anyone else can do the same.
It’s certainly true that some specific resources will become more scarce in years to come. But at the same time, other new resources come into play that didn’t even exist before. Plastics replace steel. Carbon fiber and composites replace plastic. Telecommuting replaces travel. Information and flexible assembly lines reduce the need to ship goods around the world.

Today in the west, we use about half of the oil per dollar of GDP generated than we did 25 years ago. This is due to effiiency gains across industries and societal change. That trend will continue. For example, entertainment for wealthy people used to be a high-energy affair. People went out to movies, to drive-ins, they went for Sunday drives, they bought boats and RVs. Today, people are more likely to stay in the house and watch the big screen, or sit in front of their computers or video game consoles.

When energy and raw materials get more expensive, the world will adapt - and still get wealthier.

The average world income is around $8,000. The average 3rd world income is 1/10 of that. The average 1st world income is around $16,000, if I recall correctly. Bringing the 3rd world up to 1st world standards does not require mansions - only the top 1% in the first world live in mansions anyway. But even if the 3rd world got to a standard of living where everyone had a decent apartment or small home, an internet connection, a satellite dish, access to basic health care, and a supply of healthy meals, you could say that the entire world is ‘rich’ from a human comfort and satisfaction standpoint. And that does not require massive amounts of physical resources or energy.

What’s needed is economic freedom, political stability, property rights, and education (education will follow if the other conditions are met).

22

I don’t think it’s possible for everyone to be rich; I feel that term indicates somebody who has substantially more than the people around him. Being rich is like being tall; if everyone was two meters tall, then two meter tall people would just be normal.

I think it is possible however to have a society where nobody is poor. Poor can be a relative term like rich but I think it more correctly indicates that a person lacks some or all of the basic needs of life. And I can imagine a society where everyone has these basic needs.

23

The obvious example here would be that most First World countries have vanishingly small rates of actual poverty. Even people in really desperate straits in Canada or Italy or Germany can find food, shelter, clothing and basic material needs that would be the envy of many Africans. Hunger is usually a short term state even for the very poor. The only people who are genuinely poor to the point of it being physically dangerous are the chronically homeless, and in most cases those folks have mental or substance abuse problems that prevent them from taking advantage of the social safety net.

But that wasn’t always true.

If France, Spain and the USA can eliminate almost all absolute poverty, anyone can do it. But has others have pointed out, countries with a lot of absolute poverty are usually failed states or dictatorships, or were very recently so and are just changing their ways recently. There’s no reason Zimbabwe has to be a shithole, but Robert Mugabe (with the support of many of his people) makes it so.

24

The World Bank put out a really interesting study two years ago in which they said that most of a country’s wealth was the result of institutions not assets - what they called intangible capitol. Things like property rights and education and lack of corruption are more determinate of whether a country is rich or poor than things like factories and roads and oilfields. Basically, if the country has only the intangible assets then the tangible assets will be brought in. But if the country lacks the intangible assets, then any tangible assets it has will most likely be wasted.

25

American’s represent 5% of the world population but 26% of its resource usage.

‘Wealth’ in all the ways we are now describing it is simply utilization of resources. There is not enough to go around for the current world population. So unless we either find a new hunk of resources or significantly reduce the world population the answer is no.

26

The billion currently starving are rich by the standards of what year?

27

He’s not talking about those currently starving, he’s arguing for future technologies.

WRT the rest of the thread, it should be considered that wealthy people generally have fewer kids than poor (Japan is a good example, I think). 6,6 billion still isn’t a good starting point, but there might be hope if we’ve only got the time.

28

Since the debate about why poor countries are poor is unsettled, you will not find a factual answer to your question.

I would argue that the major barriers to raising the plight of currently poor countries to a non-poor level will not be resolved within any reasonable timeframe. These barriers include:

  1. Populations which do not seem to contain a high-enough percentage of educable citizens. While this relationship between intelligence and the creation of wealth is highly controversial (and has been debated elsewhere), it is my personal position that the relationship is real, and that the inhomogeneity of population distribution is not going to be substantially altered any time soon. If anything, the intelligentsia of poor countries tend to abandon them, leaving behind an even less capable and increasingly dependent population.
  2. In the same way that money goes to money, poverty goes to poverty. Disease, poor government and the inability to ameliorate external circumstances create a vicious cycle.
  3. Poor countries are the geopolitical equivalent of beggars. They provide an outlet for the altruistic needs of wealthier countries, but in the end they suffer from the vicissitudes of circumstances utterly beyond their control, and that business model is doomed to failure. When the homeless panhandler living off the same ten passersby loses a major donor, his fortunes change for the worse. Should a potential wealthy donor country divert a large part of its treasury to a war, for instance, less is left for giving to the poor of the world. :wink:

So much for the harsh reality. I should like to add that the bleak outlook for the poor in no way diminishes my personal responsibility to do what I can. While it may be true that we always have the poor with us, there is no accomplishment in being born to privilege, or born with a set of capable genes, or born to supportive circumstances. There but for grace (or luck) go all of us.

29

I think you may have misunderstood my point. I elaborated a little in this thread:

I invite you to respond there.

30

I don’t think I did. When you said, “So yeah, I think we’ll probably all be rich by today’s standards.”, your ‘we’ refers to “we (westerners)”. However, the question posed by An Gadaí was, “Is it possible that at some future date all nations on earth will be rich?”. When you make the assumption that the advance of technology is the inevitable march towards the betterment of Mankind you must also have to assume that it has already been happening for the 8000 odd years our technology has been advancing, yeah? And in that I disagree.

31

No, you misunderstood my post.

32

Here is a cite on the so-called “law of accelerating returns”:

http://www.kurzweilai.net/articles/art0134.html?printable=1

33

He didn’t make that assumption. He assumed that one, very specific, technology could work for the betterment of mankind. Advance in technology doesn’t happen along a uniform scale, like the growth of a specific person, since ‘technology’ is a group of vaguely related things. And as an example as to how technology can have varying impacts, look at the environment: It’s technology that’s created the problems we are facing, but technology might well be the way to get out of them, as well.

nitpickedit: growth in height, and simplified at that. Of course we grow in all directions.

34

What? It’s the cyclical argument above that I’m disputing. Technology is one step forward (Penicillin) and one step back (machine gun). An even greater equalizer is when we develop an advance (more food production, faster transportation) it is offset by making more people we have to feed and transport. I fail to see how buying an air conditioner cheaper than Cornelius Vanderbilt II has proved the net increase in resources and products for all of mankind. Technological advances may increase exponentially, but so do those in need. In fact the difference in advances for a minority will create an ever increasing divide between the have and have nots, I don’t see that as an improvement over today.