The Path to Global Prosperity
How can we help the developing world weather the pandemic and keep the global economy afloat? In Episode 3 of Reimagine with Eric Schmidt, Nobel Prize-winning economist, Esther Duflo, and former Finance Minister of Chile, Andrés Velasco, share their experiences.
The coronavirus has dealt a traumatic blow here in the United States and in many other developed countries. But, the crisis is even worse in the developing world. It’s time to rethink how we can help the poorest and most vulnerable.
In a recent discussion on my new podcast Reimagine, it was clearer than ever that we cannot afford to see the world as anything but deeply interconnected. We will all suffer if developing countries suffer. It seems obvious, doesn’t it?
So often we focus on the economic health of countries while missing the connection to the global community we’re all a part of. The intersection of science, technology and society is making life better around the globe. However, it has not gotten better for everyone. Too many people are excluded from the economic growth of the past three decades. It doesn’t matter if you are in America or Angola, India or Italy. For anyone experiencing poverty, life is almost impossibly difficult. COVID has made all of this more difficult. In fact, absent global leadership to stem the economic contraction in the developing world, we could be in for a “mega recession” that does not go away in six months. It could be around for six years. And in the end, we would all lose.
Lifting up the neediest brings exponential return. When we find ways to help people achieve their basic needs, it does more than just treat the pain caused by poverty. It frees up their mental space to exercise and develop their talents and build lives and livelihoods that benefit everyone.
The good news is that around the world, there are brilliant and visionary people who are dedicated to eradicating poverty and lifting billions of people into better lives. Schmidt Futures has been delighted to support a few of them, ranging from people focused on serving undocumented and incarcerated communities in the US, to entrepreneurs building a more robust and equitable agricultural system in the developing world. These efforts, while only a start, offer the possibility for many of us to contribute to a better future.
To better understand what works, we should build on the breakthrough progress in development economics — such as the work using random control trials being done by Esther Duflo and her colleagues — to see what approaches work best. Leadership — like that shown previously by Andrés Velasco — will require courage to make short-term decisions that might be unpopular but creates great success in the long term. And a focus on education and opportunity in the form of entrepreneurship can promote even greater prosperity over the long term.
Philanthropy alone can’t solve this problem. Governments can and must be key players in this essential work. But the stakes are simply too high for us as COVID threatens the lives and livelihoods of so many to focus narrowly on our daily and local experiences. If we want our global community and the global economy to survive this crisis and come out even stronger, helping the most vulnerable needs to be important to all of us.
