Jeffrey Sachs: Poverty must end

Most likely the most sought-after economic advisor in the world, Jeffrey David Sachs effused once again high-octane confidence that "poverty COULD and SHOULD be history" during the recent Regional Ministerial Meeting on Millennium Development Goals (MDGs) in the Asia Pacific from Aug. 3 to Aug. 5 in Jakarta.

Many naturally find it hard to resist his "trade and aid development" theory that has drawn both praise and skepticism. Particularly after he was elected director of the United Nations (UN) Millennium Project and special advisor to UN Secretary General Kofi Annan on the MDGs.

Sachs was born in Michigan in 1954. He earned his B.A. from Harvard College in 1976, and later his M.A. and Ph.D from Harvard University in 1978 and 1980 respectively. He was promoted to Full Professor in Harvard three years later.

Recently included on Time magazine's current list of the world's 100 most influential people, Sachs has a long and controversial track record in curing the world's economic woes.

Sachs became famous as a macroeconomic prodigy when he rescued Bolivia in 1985 from economic crises, and consecutively treated other "patients" from Latin America through Eastern Europe to Asia afterwards.

Along the way, he has garnered a degree of celebrity rare in his profession, held private sessions with popes and presidents, and joined rock stars in poverty alleviation campaigns.

The Jakarta Post had the entertaining chance to talk to Sachs recently, and below are highlights of the interview.

Question: You talk about poverty and your mission is to make it history. How did you first become interested to the issue?

Answer: First, it's so unnecessary and so ridiculous. Here we are in the 21st century; we've learned so much and figured out so much.

I live in a country that has so much wealth, it's sometimes unimaginable. The rich don't know what to do with their wealth, so they buy not hundred foot yachts, but two hundred.

And now, even middle-class Americans are driving bigger and bigger cars that they're not even cars anymore, the SUVs and everything else.

You have more than a billion people extremely under-nourished, and you have a billion people that are over-nourished. Somehow, we could do a better job on the planet to solve these problems of the poorest people.

In general, I don't believe it's a matter of simply taking away from the rich. I think it's mainly a matter of empowering the poor so that they too have the tools to be productive.

Because the essence of wealth is technology, and the essence of poverty is the lack of technology, the lack of tools. So in that sense, I see poverty as so unnecessary, and of course it's tragic because it means death actually. It's not just inconvenience. Are you witnessing an effective work of the international communities in resolving poverty, especially five years after the inception of the MDGs?

To me, it's a little bit mystifying that we're not solving these problems more effectively than we are. And then, as I've been saying earlier, I see a lot of the world's instability emanating from our failure to address these issues adequately.

And if there were more of a common spirit on the planet to solve the problems, I think there would be a lot more common cause and a lot less cause for conflict ... resolved with more sense of fairness and justice in the world, that the powerful and the rich are out to help the poor, not out to ignore them or turn their backs on them.

I think it's a matter of what we could accomplish and the reasons why we ought to do it.

You have asserted that these MDGs are indeed feasible. Would you please elaborate?

These are ambitious objectives of poverty reduction that were set in September 2000 for the year 2015. So, they gave a 15 year lead. Unfortunately, many countries have lost the five years since they were announced without making enough progress.

The MDGs require a partnership of rich and poor countries for the goals to be met, and the rich countries certainly did not do their part during this five year period.

So now, we are down to 10 years.

I still believe that they can be met, but we really are running out of time, and it's very important for all countries that have extreme poverty to really focus attention on the next 10 years to make very specific plans of actions on investments that can end the extreme poverty.

The theme of our report is that the key to ending poverty is investment, that is targeted at the needs of the poor, it's investment of many different kinds.

Some is investment in public health, for instance, clinics, some is in basic infrastructure, roads, rural electricity, ports and so forth that make the economy function better.

Some is investment in physical environment, in land conservation, in forest conservation, in proper water management and so forth. But by and large, we think that the key is to raise the investment rates on these critical needs.

The first things we suggest to countries is to make a strategy, an investment strategy, to identify the needs and to also identify the ways that that can be financed, and to the extent that those needs can not really be paid for out of domestic revenue, then we say that that's where the international community, the rich countries come in, to get more aid, more debt relief and other kinds of help to enable low income countries to carry out that investment. Yet despite the criticism and discouraging predictions, you seem to remain confident about the MDGs and that the goals are achievable.

Well, I do know that it's worth the fight. I don't know if all is going to work but I suspect we'll get something good things out of this. But I don't think you can predict, I think you can only choose to act and see how far you get. Do you have any particular view on Indonesia?

The Indonesian case here is an example where there is a lot of variation across the provinces of the country in levels of not only income and poverty, but all of these different aspects of poverty in the health outcomes, in the extent of hunger, in access to drinking water and sanitation.

So, a strategy here really requires not only national policy but also a pretty detailed program of investments across the different provinces, and what to do about the eastern part of the country which is poorer in many ways, that would be part of the strategy obviously.

We recommend not only the government makes specific plans but also to take into account in those plans the whole poverty map; where are the problems located geographically within the country; how to account for the differences within countries and so on. You seem to have made Africa an essential focus in your discussions and you try to draw other people's attention to the continent as well.

In 1995, Africa showed me the most extreme poverty that I really hadn't felt before because the burden of AIDS, and malaria and other diseases are so great that you see not just poverty, but death on a lot larger scale and that shocked me.

It made me feel the urgency of this even more because when you see a child dying of malaria, and you know that two dollars would save that child, buy a few pills over the next few days, and yet the money's not there because the health system doesn't work at all.

The government is impoverished and it doesn't have enough money to keep the clinics stocked, and then you ask why aren't the donors doing it, and then it turns out they're not giving almost anything for that purpose.

Then it leads to a sense of urgency and frustration that's even bigger. And that is what really grew on me over the last decade. With the amount of aid that well-off countries are giving poor ones, do you think that these leaders haven't seen enough ?

Seeing changes things. It helps people to understand. So my first view is people don't understand the issues.

Everybody has their stereotypes of what the problem is, but very few people know enough technically or by experience to really diagnose the problems.

I tell the aid officials also don't just sit in Jakarta, but go to Papua. Look, go to the villages. Don't just sit in Nairobi, go to the villages of western Kenya. And when they do, they really see a lot and learn a lot. Was there any specific moment in your life when you realized that this was something you want to be involved in?

I came into economics because I was interested in understanding what would make for a well-functioning, effective society that could address the needs of its people.

That was the first question I asked myself back in 33 years ago when I started studying economics. I didn't know much about it then, and I couldn't really formulate the questions very well, but I was interested right from the beginning.

But my life changed a lot when I began working in 1985 in Bolivia, which was the first time I took the things that I'd learned in school and was writing in articles, and tried to apply it in practice.

For example, I didn't understand the debt crisis until I started working on the ground in Bolivia because I thought, well, these debts should be paid, to be stretched out, or paid over time to ease the burden.

But I didn't realize how crushing this burden was politically and socially until I saw it face to face.

I learned in my life that I couldn't really understand these things without seeing them, and also comparing them in other parts of the world because, if you have in mind Jakarta, you can't really see Timbuktu.

I learned to see a whole range of places to understand the differences and similarities.

So I began to focus on this in 1985, but like everything else, it's taken me 20 years to understand more and more about this issue, and it is still continuing to learn about it. With the tight schedules you have and the time you spend visiting many parts of the world, how do you entertain yourself in your spare time?

I try to sleep once in a while (laughing).

But these past three years of being special advisor to Kofi Annan has certainly been the most intensive period of my life because first I've learned in practice there really are a lot of countries in the United Nations, and I've visited a lot of them, and met a lot of people and been to a lot of parts of the world as part of this job.

So, this summer I've been on extended travel.

It is now as much part of my life as career, so it's not separate. I feel very much at home and privileged to be visiting different places in the world and it's work but it's more general living to get to meet a lot of people and to see a lot of the world.

My family comes with me on these trips. My wife's a doctor, and she works on a lot of the public health issues, my children know a lot about these issues. It's very much a family venture, otherwise this would not be possible for me because of the amount of time, basically, around the clock is so much. Is there anything that you miss before all of these activities occupied your life? Something you used to do?

Well, I miss my sleep.

It's actually quite exhilarating and, this trip, even in the last few weeks I've been in villages in Tajikistan, Yemen, Mali, Timbuktu, Malawi. You meet remarkable people doing fantastic things. So many intelligent, well-directed people anywhere in the world. It's very exciting. Plus you get to work with Bono...

You get to work with Bono, that's not a bad thing.

That's a pretty good thing, cool thing.

We went to see the Pope John Paul II a few years ago. We went to his (Bono)'s summer residence. Then we left in a van and the gates opened. The van went out and then hundreds of fans started running behind the van. I turned to Bono and I said, you know, they always do that for macroeconomists.

He did not believe me (laughing). How are your children doing with your schedule and activities?

One of our three children is here with us in Jakarta. The three were a part of the trip in Africa, and another time, only two out of the three. So they travel a lot.

And our oldest two kids have been to about 80 countries together with me, and our 10-year-old child has been to 50 countries.

Our oldest daughter's studying international affairs, master's degree. And our son is taking sustainable development and environment.

Our youngest, who's in fifth grade is very interested in MDGs, and she gives talks to her class about foreign assistance.

On election day in the U.S, her teacher sent us an e-mail that said, "just wanted you to know that your daughter gave a little impromptu speech to the class about the importance of foreign assistance in this year's election" (laughing).

The above article was based on an interview by The Jakarta Post's journalists Riyadi Suparno, Ati Nurbaiti, Zakki P. Hakim, Tony Hotland and Anissa S. Febrina.