Feature
The crusader
by Rachel Morris
Jeffrey Sachs, the “Indiana Jones of economics”, is driven by moral outrage to campaign for the end aof poverty.
On the first day of the G8 summit, Jeffrey Sachs flew to London, arriving in time for the Make Poverty History rally at St Paul’s Cathedral. Sachs is a renowned economist, an adviser to UN Secretary-General Kofi Annan, director of Columbia University’s Earth Institute and, famously, a friend of Bono. He is also the author of The End of Poverty, in which he argues – with trademark certainty – that extreme poverty can be eliminated in 20 years. At 50, Sachs has a boyish thatch of brown hair and an expression of implacable earnestness.
As crowds at St Paul’s spilled onto the streets, Sachs’s presence in London was fitting. In the past decade, he has become a relentlessly effective force in the movement to persuade the developed world to spend a fraction of its wealth on the very poor. The G8 could launch “historic days for Africa”, Sachs told the Financial Times. “Or they can be days filled with rhetoric and spin.”
Sachs shared the widespread hopes for the G8, the annual summit of leaders from the UK, US, France, Italy, Germany, Japan, Canada and Russia. Commentators noted promising circumstances: Tony Blair’s determination to extract real results on aid and global warming, a rare absence of security issues on the agenda, and intense public pressure rustled up by Bob Geldof.
Tragically, security issues overshadowed the proceedings, after all, but the summit in Scotland more or less fulfilled expectations: $US50 billion in aid by 2010, with $25 billion earmarked for Africa, debt cancellation for 18 African nations, no progress on trade subsidies. In an otherwise vague statement on global warming, negotiators scored one diplomatic coup – persuading George W Bush to sign a document acknowledging that humans contribute to climate change.
Not everyone was pleased. “The debt relief is a pittance – it excludes 45 countries,” says Rick Rowden, policy director of Action Aid USA. But Sachs’s assessment was surprisingly positive. After the bombs exploded in London on Thursday morning, he slipped out of the city minutes before police closed the roads, then flew to Ghana. This is normal behaviour for Sachs, who seems to spend about as much time on planes as he does on land. The bombings may have weakened the global warming agreement, he agrees, speaking by telephone from Ghana hours after the summit ended, “but they probably spurred a stronger statement on poverty. I think it actually delivers something real and significant.”
Sachs is already grappling with the difficulty of converting diplomatic rhetoric into actual money. As a UN adviser, he works on the Millennium Development Goals: a set of targets to end severe poverty by 2015. The World Bank and UN warn that the goals can’t be met without more money. Blair hoped to persuade the G8 nations to deliver 0.7 percent of gross national product, an amount that the developed world pledged in 1970, and again in 2000. The US, which spends 0.15 percent of GNP on aid, accounts for half of the funding shortfall, Sachs says. At Gleneagles, the EU promised to reach 0.7 percent by 2015, but the US resisted all deadlines. The final agreement provided the “lowest acceptable figure”, says Sachs. Blair also failed to win unanimous support for a proposal to issue bonds on the pledges to raise immediate cash.
Consequently, aid officials in Ghana told Sachs that they don’t expect to see any new money for two or three years. “This is not a straightforward process, where all these commitments readily materialise,” he says. “But I feel good about the summit, because the G8 has subscribed to the notion that there needs to be a significant increase in assistance. That’s important, because two or three years ago that argument was far from as accepted as it is now.”
Every morning our news-papers could report, ‘More than 20,000 people perished yesterday of extreme poverty,’” Sachs writes in his book. Perhaps because such eloquence is rare in macroeconomists, The End of Poverty reached 15th place on the New York Times bestseller list this year. It’s both a detailed blueprint to help the 1.1 billion people who live on less than $1 a day, and an account of Sachs’s extraordinary career.
The son of a labour lawyer, Sachs grew up in Detroit. He studied international finance at Harvard, then became a professor there. One day, he attended a talk by some visiting Bolivians distressed by their country’s hyperinflation. Sachs strode to the blackboard. “Here’s how it works,” he announced.
“If you’re so smart, why don’t you come to La Paz and help us?” one of the Bolivians demanded. He did. Sachs also designed controversial liberalisation plans for Poland, Russia and Slovenia; the New York Times called him the “Indiana Jones of economics”. On his travels, Sachs started noticing geographic, historic and social circumstances that lock countries into poverty traps. He became convinced that, with targeted investments to overcome these obstacles, poor countries could develop themselves. All it would take, he argues, is the money the rich world has already promised.
But hasn’t the world already lavished vast sums on African kleptocracies? Do the maths, Sachs says. In a dissection of the US aid budget, he deducts administrative costs, emergency and debt relief (because they don’t provide tangible long-term benefits), and consultants’ fees, which consume 80 percent of US aid.
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