So, can we dare to be opstimistic?
We those of course do
Is that a billion people have been stuck living in economies that have been stagnant for 40 years , and hence diverging from the rest of mankind .
So ,the real question to pose is not ,can we be optimistic?
It is how can we give credible hope to that billion people?
That ,to my mind ,is the fundamental challenge now of development .
What I am going to offer you is a recipe , a combination of the two forces that changed the world for good, which is the alliance of compassion and enlightened self interest.
Compassion,because a billion people are living in societies that have not offered credible hope..
That is human tragedy.
Enlightened self-interest,because if that economic divergence continues for another 40 years ,
Combined with social integration globally,it will build a nightmare for our children.
We need compassion to get ourselves started ,and enlightened self-interest to get ourselves serious.
That is the alliance that changes the world
So ,what does it mean to get serious about providing hope for the bottom billion?
What can we actually do?
Well ,a good guide is to think what did we do last time the rich world got serious about developing another region of the world?
That gives us ,it turns out ,guite a good clue, except you have to go back quite a long time.
The last time the rich world got serious about developing another region was in the late 1940s,
The rich world was you ,American,and the region that needed to be developed was my world ,Europe.
That was post-war Europe.
Why did American get serious? It was not just compassion for Europe,though there was that.
It was that you knew you had to .because,in the late 1940s,country after country in central Europe was falling into the Soviet bloc,and so you knew you had no choice.
Europe had to be dragged into economic development.
So ,what did you do ,last time you got serious?
Well,yes ,you had a big aid program.thank you very much.
That was Marshall aid: we need to do it again.Aid is part of the solution.
But what else did you do?
Well,you tore your trade policy,and totally reversed it.
Before the war,America had been highly protectionist.
After the war,you opened your markets to Europe,you dragged Euope into the then-global economy,which was your economy, and you institutionalized that trade liberalization ,through founding the General Agreement on Tariffs and trade.
So,total reversal of trade policy,did you do anything else?
Yes,you totally reversed your security policy.
Before the war ,your security policy had been isolationist.
After the war,you tear that up,you put 100000 troops in Europe for 40years.anything else?
Yes,you tear up the ELEVENTH Commandment ,national sovereignty.
Before the war ,you treated national sovereignty as so sacrosanct that you were not even willing to join the League of Nations.
After the war,you found the United Nations,you found the Organization for Economic Cooperation and Development,you found the IMF,you encouraged Europe to create the European Community.
All systems for mutual government support, that is still the waterfront of effective policies:
Aid,trade,security, governments.
Of course,the detail of policy are going to be different ,because the challenge is different.
It is not rebuilding Europe,it is reversing the divergence for the bottom billion,so that they actually catch up.is that easier or harder?
We need to be at least as serious as we were then.
Now,today,I am going to take just one of those four.
I an going to take the one that sounds the weakest,the one that is just motherhood and apple pie_ governments,mutual systems of support for governments-
And I am going to show you one idea,in how we could do something to strengthen governance,and I am going to show you that that is enormously important now.
The opportunity we are going to look to is a genuine basis for optimism about the bottom billion,and that is the commodity booms.
The commodity booms are pumping unprecedented amounts of money into many ,though not all,of the countries of the bottom billion.
Patrtly,they are pumping money in because commodity prices are high,but it is not just that .there is also a range of new discoveries.
Uganda has just discovered oil,in about the most disastrous location on earth
Ghana has discovered oil, guinea has got a huge new exploitation of iron are coming out of the ground. So a mass of new discoveries.
Between them,these new revenue flows dwarf aid.
Just to give you one example, Angola alone is getting 50billion dollars a year in oil revenue.
The entire aid flows to the 60 countries of the bottom billion last year were 34 billion.
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