Many people consider economic well-being to be a basic human right—the right to fulfill vital needs for food, shelter, health care, and education. Economic well-being is also linked to the issue of peace. War can harm or destroy economic well-being, and arms races consume valuable resources that could be better used to fight poverty. Similarly, economic well-being and ecological health are also closely related. For example, economic well-being calls for a sensible balance between population and resources, and both pollution and the imprudent use of resources affect the quality of economic life. This chapter focuses on the following problem: What creative breakthroughs can promote greater economic well-being?

While pockets of poverty are found in the developed world, the preponderance of poor people live in the approximately 158 countries designated as developing. Of those, forty-eight are designated as least developed countries (LDCs), where poverty is rampant. While significant progress has been made in challenging poverty over the past fifty years, the distribution of gains has been uneven, and the gap between the richest countries and poorest countries of the world is widening. The largest concentrations of poverty are in South Asia and Sub-Saharan Africa.

Some observers believe that the explanation for the persistence of poverty is to be found in the vagaries of geography and demography. For others, the cause lies in adverse trade and financial conditions that are merely carryovers from European colonialism, in what is known as neoimperialism. Regardless of the cause, chronic poverty has serious political consequences beyond human suffering, not the least of which are civil wars, coups, revolutions, and territorial wars.

Chapter 14 examines four broad strategies for confronting poverty: liberal capitalism and liberal democracy, egalitarian communism, illiberal capitalism and right-wing authoritarianism, and democratic socialism.

In general, supporters of liberal capitalism and liberal democracy maintain that a threefold strategy is required. First, poor people and nations must help themselves through the building of stable and reasonably efficient political and administrative structures. Second, richer nations must help developing nations in a variety of ways. Third, private enterprise must assist through investment. This strategy emphasizes peaceful, evolutionary development as well as political, economic, and social freedom. It taps people’s interest in their own improvement and connects the self-interest in reasonable profits to the satisfaction of human needs. Critics argue that capitalists are motivated by profits, not by social justice, and that liberal democratic capitalists are financially too tied into the dominant system of exploitation to respond to the claims of the least developed.

Egalitarian communism is characterized by virtually no (or very little) private property. The major means of production are owned by the state, and the regulation and management of virtually the entire economy is by the state. The underlying premise is that society is a collective, and maintaining the welfare of the collective is the fairest, most equitable, most just means of running the economy. In some cases, like China’s, life has improved for the vast majority, and the worst ravages of starvation and abject poverty have been overcome. But this assessment must be tempered with the knowledge that the most successful communist systems are those, like China’s, that have been rapidly shifting toward free market reforms. While some egalitarian economic progress has been made in more purely communist systems, the overall record in places such as North Korea, Cuba, and certainly the now-collapsed Soviet Union is not very good. Critics also contend that there is a high price to be paid for opting for such a system, not the least of which are the destruction of the regime’s opponents and the authoritarian control of speech, press, and culture. Above all, communist systems do not rely on individual incentives as a prime motivator, and there are few, if any, other incentives to work harder, produce more, or innovate.

Illiberal capitalism and right-wing authoritarianism is a form of capitalism that emphasizes capital growth at the expense of or in disregard of economic and social justice. Wealth must be created before it can be equitably distributed. Right-wing authoritarianism provides necessary stability while wealth is generated. Critics charge that the cost of such a strategy—political repression, illegal arrests, imprisonment, and torture—is excessive.

The democratic socialism option assumes the possibility of public ownership of key economic and social services. Agriculture may or may not be publicly owned. Small businesses and service industries remain in private hands. This option also assumes a two-party or multiparty system, political competition, and civil liberties. The strengths of this option lie in its commitment to meeting basic human needs within a framework of freedom, and supporters argue that this model makes particular sense for developing countries. On the other hand, democratic socialism may be vulnerable to attacks from the left or the right. Critics on the right are frightened by socialism and democracy. The left is uncomfortable with the government ownership of the large economic and social service industries.

Chapter 14 concludes with observations about the valuable roles played by international organizations, nongovernmental organizations, and state-based foreign aid programs.