The Current Discussion: In the future, global prosperity will present more of a threat than poverty, according to a recent Post op-ed. Is this just rich-American rhetoric, or is the world really getting too prosperous for its own good?

Will prosperity be more of a threat than poverty in the future? If GDP keeps rising the world over as it has in recent years, poverty will virtually disappear by any absolute yardstick (like the World Bank’s benchmark of consumption per capita of $1 per day in PPP, or purchasing power parity, terms) in, say, 50 years. For most countries, however, poverty has become a relative concept, not an absolute one. Countries have a habit of constantly adjusting the poverty line upwards as they get richer. The U.S. poverty line is $10,400 per year for an individual, against just US$200 per year in India. So by Indian standards, the American “poor” are fabulously well off. Yet the concern of Americans about their “poor” is as genuine and strong as it is in India.

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The Current Discussion: If countries around the world are doing so well economically, why are they still catching a cold when the United States sneezes?

Countries around the world have been doing very well precisely because globalization has greatly strengthened economic opportunities and linkages across countries. Even African countries, which grew at no more than 2.4% (lower than population growth) in the 1980s and 1990s, have averaged almost 6% growth per year in the last four years. A rising global tide has lifted all boats. The U.S. has contributed much to that rising tide, but so have many others (notably China and India).

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