Illustration by Victor Kerlow.
A FEW YEARS AGO, a friend’s intelligent and well-read teenage son saw Hotel Rwanda and said, “I didn’t know they had houses in Africa. I thought they all lived in shacks.” I suspect that was a common reaction. Wars, famines and floods may make for good entertainment, but the media’s relentless portrayal of the developing world as a cauldron of endless disasters is so seriously skewed that most Westerners have no understanding of what life there is really like.
Enter the dismal science. We may not grok other languages or cultures, but everyone understands money. Reducing life to dollars is a massive oversimplification, of course, and can be misleading, but it can also be extremely illustrative. Let’s start with a particularly stark example: the Taliban.
Afghanistan’s GDP per capita is $750, one of the lowest in the world. The USA has never been this poor; it bottomed out at $1,200 per person, circa 1820. But in the years leading up to the American Civil War, the South produced roughly half as much per person as the North. When you run the numbers, that comes out to some $800 per capita—meaning Afghanistan today is economically equivalent to the Southern slave states in the Civil War. Think of the Taliban’s military mullahs as General Lees armed with AK-47s and improvised explosive devices.
The similarities don’t end there, but a direct comparison seems unfair. While the Taliban are horrifically evil, the Confederate States were much worse: they owned and traded slaves. The Taliban only took up drug trafficking when they had to, to support their warfare. (When they were in power the Taliban actually wiped out the entire Afghan opium harvest.) The Taliban treat women like animals, destroy ancient icons of other religions and inflict a barbaric perversion of justice—but the South was little better on any of those counts.
Today, the many who regard the Confederate States wistfully through rose-coloured, slave-erasing glasses, tend to write off such crimes against humanity as simply “of their era.” Which is true; just as it’s true that in Afghanistan, the Taliban are very much of their era, thanks to thirty years of invasions and civil war. They’re not deranged monsters, but simply a natural product of their times, no different from the American slaveowners whom many now remember so fondly. Maybe Afghan television decades hence will feature a local version of Dukes of Hazzard, with the Taliban’s black-and-white Shahada flag adorning the roof of the brother-jihadis’ car, and Daisy Duke in a burqa.
Let’s get back into our economic time machine and see what some other comparisons can tell us. Next stop: Haiti (pre-quake), Myanmar and Nepal, all of which have per capita incomes of some $1,200, roughly the same as London in the early 1800s—the Dickensian era. Imagine the squalid streets and orphanages of Oliver Twist and Nicholas Nickleby. Now imagine them with cell phones and battered Yamaha motorcycles. Voila: Port-au-Prince a few short months ago, Kathmandu and Rangoon today.
Onwards to India, Pakistan and Vietnam, whose collective 1.4 billion people produce some $2,800 of GDP apiece, the same as Western Europeans in 1899, the year of Heart of Darkness. Put another way, India and Pakistan today are as wealthy per person as all-conquering nineteenth-century Europe. Next, Africa: specifically, Kenya and Cameroon, whose GDPs average to about $1,900 per head, or the same as the Soviet Union shortly before World War II.
China and Egypt, producing $6,000 per person, are exactly as rich as the US during the “Roaring Twenties.” Then, in 1945, American soldiers came home from World War II to find an economy equivalent to that of Colombia or Thailand today. During the halcyon 1950s—immortalized in Beat novels and Tom Waits songs—America’s economy was on par with those of modern Brazil, Costa Rica and South Africa; and in 1967, the year of the Summer of Love, the US was poorer per person than Mexico today.
Sounds counterintuitive, doesn’t it? Most people think of contemporary Mexico as much poorer than late-sixties America, and Africa as vastly more destitute than Russia when it invaded Poland. Is the data wrong? Do we look at our own history through a distorting lens of wistful nostalgia? Or is it because of vastly greater income inequality within modern nations?
None of the above. America and Mexico have roughly equal Gini coefficients (the standard measure of income inequality), and Thailand’s is actually lower. It’s certainly true that statistics from cash-strapped nations and repressive governments should be taken with high doses of salt. But what really happened was that, in 1965, Gordon Moore accidentally redefined wealth.
Moore was neither politician nor statistician: he was an engineer and entrepreneur who co-founded mighty Intel. In 1965 he predicted that—to oversimplify—computers would double in power every two years, while their price remained constant. He was right. And he has been right ever since. His prophecy is now referred to as “Moore’s Law,” and it is easily the single most important observation of the last fifty years. That kind of exponential growth doesn’t happen much in nature, and when it does happen, it certainly doesn’t last. But Moore’s Law has held true for forty-four years, long enough that we now take it for granted, and is probably good for another twenty-two yet.
It is difficult to overstate its impact. In 1967 you could not have bought a cell phone for a billion dollars; today, only the poorest of the world’s poor cannot afford one. Meanwhile, better computers have enormously accelerated all the other flavours of science and engineering, including medical and pharmacological research.
So if a cell phone was priceless in 1967 and $20 today, how much wealthier have we become? Exactly how much are cancer or malaria or glaucoma treatments worth? Or a dirt bike compared to a donkey cart? Let’s leave those headaches to the economists. The point is that technology has become a currency: wealth, once counted in real estate, livestock and commodities, is increasingly measured more by your tech and what you can do with it. There are billions of people out there with little in the way of land or livestock or goods who are vastly wealthier than their forefathers, purely in terms of their gadgetry.
This trend will only accelerate. It won’t be long before the Third World is full of communities with wireless broadband and ubiquitous smartphones but no running water or grid power, impoverished kids checking TMZ and downloading the latest slasher movies on their solar-powered phones—something that five years ago even the richest kids in the world could only dream about.
That’s real progress. The despotic fanatics of the Taliban are no more or less evil than any of their predecessors. Like the Lord’s Resistance Army in Uganda, or the Revolutionary Armed Forces of Colombia, they’re simply an inevitable outgrowth of thirty years of poverty, ignorance and war. Moore’s Law can’t help with that last one, but it is the mortal enemy of the first two. Give it a little more time and it just might bring down the Taliban and their ilk all by itself.
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