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  • R H
  • Chicago, IL
  • United States

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Why do we NOT invest effectively in the poor and marginalized so they can participate in the global economy?

Nearly half of the world's population cannot effectively participate or contribute to the global economy. Basic economic theory holds that each 'participant' in the economy is a 'unit of productivity' providing a return on investment. In other words, it's more profitable to have people working and consuming than not. Yet nations continue to allow and accept that the poor and marginalized are - to borrow from another popular phrase - 'too big to succeed'.

In my view, the (relatively) small investment in infrastructure, education, and basic healthcare in the poor and marginalized will be more than made up by their increased productivity and spending. The rich think they're rich now, just imagine the wealth created by having 3 billion more people buying their stuff? I know there are obvious problems with this: corruption, unified effort, immediate ROI, etc. - but why is this such a 'tough sell' to national leadership? They're always looking for ways to increase the tax base.

3+ billion people now contribute to the world gross productivity. What if that were doubled? To me, this is the next threshold of economic growth -bringing in those who have been left out. Yet, we don't even talk about it. What do you think?

Topics: economics society
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    Oct 24 2012: One answer is that people have widely varied views as to which strategies and investments are most beneficial. Everyone agrees universal education and basic infrastructure are (sanitation, transportation, utilities), but there are varied views as to whether supply side or demand side approaches are most effective beyond this. That is, for example, is increasing skills via things like publicly funded training programs viable relative to improving business environments so that businesses hire and train on the job?
    Both are typically underway, along with the aforementionned investments, but the mix depends on what people think is most promising in the moment.
    I am curious when you say "Yet, we don't even talk about it." Take, as a case, Chicago, which I take because you live there. Do people in city government, in the non-profit sector, in the media, in the local private sector, or in the creative community not talk about the plight, problems, and strategies to improve the lives and prospects of your urban poor? My perception that this is a pressing concern of large numbers of people across sectors may be skewed, because I have always worked and volunteered in this area along with many, many others engaged in this effort professionally and personally. But in today's mail I got a magazine from a leading university with the lead article "Children in crisis: Rescuing the World's Dispossessed."

    I would have said this subject is discussed all the time.
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      R H 20+

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      Oct 25 2012: Thanks for responding Fritzie. Ok, I would certainly agree. There are many heroic efforts, and much research, going on for decades, to improve the plight of the poor and marginalized - those left behind by the aggressive 'survival of the fittest' wealth generating economy that has evolved since the Middle Ages. I think it's the focus though, that I'm questioning. Those efforts that you referred to I have been involved with also. I consider the current and past approaches to the situation as a 'repair'. Humanitarian efforts exist because, in my opinion, the system is unbalanced and - let me be so bold - primitive. Those who seek to equalize the opportunity and participation of the poor and marginalized in the economy are funded by 'donations' and 'grants'. The successful of the world must turn their attention from the wealth generation that they're good at to an obligatory 'payment' in either taxes (which they abhor) or a foundation that demonstrates concern for society while they decimate their competitors. Approaching the situation from an economic opportunity viewpoint rather than a humanitarian relief one changes the onus from 'another' undesirable payment/bill/tax to an investment opportunity for massive returns. I do believe though that you are correct and that many people 'on the ground' are actively seeking ways to bring the poor and marginalized into full economic participation. My hope is that more cooperation at the int'l gov't level, along with private interests, will create new economic tools for such an expansion. I see such 'social' and 'policy' efforts lagging behind, or merely and afterthought from, our technological accomplishments, efforts, and advances..
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        Oct 26 2012: Just an observation, but to me it seems like you are more concerned with where the money comes from for the improvement rather than the money itself. Bill Gates set up a foundation and contributed $30+ Billion of his own wealth to it to try and accomplish many of the things you say need to be done to achieve the same results you are aiming for. Would the $30+ Billion he donated to the foundation have been more effective if he paid it in income taxes to the government first, then they used it? Would it even have been used by the government in the same way?

        And $30+ Billion for Gates was over 50% of his total individual wealth. Would you expect every average middle class worker to donate over 50% of their individual wealth to help solve the problem(s)?

        People who end up establishing those foundations or funds became able to do so BECAUSE they used (your quote from above), "an investment opportunity for massive returns." That's how they got "rich" and had the opportunity to establish the foundations/funds in the first place.

        I'm confused by the sentence in your topic narrative that states, "The rich think they're rich now, just imagine the wealth created by having 3 billion more people buying their stuff?" Well, if that happens, aren't the rich just going to keep getting richer? Seems OK to me if they do as long as they keep establishing those foundations and funds to try to help the not-so-rich...err, I mean the poor.

        You also stated you view current efforts as a "repair" attempt, because the "system" is unbalanced. The system is always going to be unbalanced with 7 billion people on the planet. If you started off right now with everybody having an equal amount of everything, it would become unbalanced as soon as anyone traded something to somebody else, whether it be actual goods or money for goods or services. In a very short time you would be able to start categorizing people into different "wealth groups" again.
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          R H 20+

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          Oct 27 2012: Thanks Rick for responding. Let me see if I can give better clarity to my approach. Such complex issues are a struggle for me to put into language that wholly represents the idea. I believe the current economic system can evolve into a more inclusive system yielding greater returns. Just like we're evolving our lifestyles and mastering our physical universe through technology, we can evolve our economic system to be more productive. I don't believe we'll accomplish that by redistributing the wealth currently created. That would be a dis-incentive to the creators of that wealth, and has proven to be a target for corruption. My question raises the idea of an alternate approach to the poor and marginalized from a donation/rescue/cost approach to an investment/high-returns one. I'm attempting to parallel the developed world's investment in education, safety, infrastructure, and healthcare for 'the half' that can participate in the economy and 'transplant' that approach towards productivity to the other half that currently doesn't participate fully - or at all. I posed this question/approach to the TED community to see if it has any merit whatsoever. The fact that so many have given so much over such a long period of time with such marginal results has brought me to this point. Another reality that keeps presenting itself to me is that for those of us in the developed world (the participating half), where would we be, how would our lives be, if we were born in the other half? So it is not individuals (ultimately) that succeed solely through their efforts, it is the arena of opportunity they get to play in that allows them to flourish. Hopefully that clarify's somewhat. Thanks again and let's continue if you care to...

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