LITMIR.BIZ

      PART TWO

      WEALTH &

      POVERTY

      The two decades up to 2008 were hardly still waters in the global economy,

      and the sense of safety and certainty about the economy that opinion-leaders

      and policy-makers in the rich countries often expressed was always somewhat

      shallow and misleading. There was a severe downturn at the turn of the 1980s

      into the 1990s, followed by Japan’s lost decade, and the costs and upheavals

      in eastern Europe and the former Soviet Union as they went through a massive

      economic transformation, then an Asian economic crisis in the late 1990s

      and the collapse of many new technology companies in the early years of this

      century. And in the countries where there was more or less steady economic

      growth, there were plenty of losers as well as winners, while global poverty

      persisted. But there was also an unmistakable – and now absent – sensation

      of forward movement, a confidence that economic problems were open to

      relatively straightforward solutions, and trust in many countries that the hands

      on the economic tiller were competent and dependable.

      Today it feels so very different. And in the change of conditions brought about

      by economic events since 2008, it is sometimes hard to disentangle what

      has really changed and what not. As always, not everybody gains and loses

      equally. One line of inequality has been narrowing and there is every reason

      to expect it to continue to do so: the old idea of a sharp division in the world

      between rich countries and poor countries no longer holds in the same form.

      The contrasts are now more subtle, as other lines of inequality are getting

      broader. Some countries are richer than others, but in the rich countries there

      remains much poverty. India is no longer one of the poorest countries, not

      even when wealth is measured per head of the population. But there are more

      people living in poverty in India than in any other country. Worldwide, the

      number of people living below $1 a day is declining, but the number on less

      than $2 a day is over 2.5 billion – more than one person in three in the

      global population.

      World leaders committed themselves at the start of the century to a major

      effort at international social and economic development, with the richer

      countries pledging to spend more on aiding development. Promises were

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