Worldwide, poverty is decreasing dramatically, thanks to freedom

“Did you hear the breaking news?” he asks. “Yesterday, 138,000 people rose out of extreme poverty. Another 138,000 rose out of extreme poverty the day before. And the day before that, too. Of course you didn’t, because a plane crash or a terrorist attack is news, but slow and steady progress is not. Even 50 million people rising out of poverty in a single year is not news. But this happens to be the most important story of our time: poverty, as we know it, is disappearing from our planet.”

Things are, in fact, getting better all the time.

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At the United Nations Millennium Summit in 2000, the world’s countries set the goal of halving the 1990 incidence of extreme poverty by 2015,” Norberg reminds us. “This was met five years ahead of the deadline. And even though the world population grew by more than two billion between 1990 and 2015, the number of people who live in extreme poverty was reduced by more than 1.25 billion people. This marks a historic rupture. For the first time in human history, poverty is not growing just because population is growing. As a result, the number of people in extreme poverty is now slightly less than it was in 1820. Then it was around one billion; today it is 700 million.”

What’s happening? It’s not complicated; free trade has resulted in a dramatic decrease in poverty.

What has held developing countries back, Norberd says, is “oppression, colonialism, Communism and protectionism.” He could also have listed corruption.

“The poor in many places got more freedom to farm, manufacture and sell their goods and services than they had before,” Norberg points out. “If you have ever visited an African slum area you notice that people there are not lazy; they are working very hard, not least because they have to get around regulations, restrictions and corruption as well. ‘It’s not safe to carry cash,’ as the saying goes in Kibera, ‘because there are too many policemen.’

When that control and oppression is lifted, even in the slightest, people can devote more of that hard work to more productive uses.”

Here’s the real point: Socialism didn’t work. Foreign aid didn’t help much. What worked was free trade and free markets - which allow people to better their own circumstances.

“The world’s poor made themselves rich, rather than waiting for someone else to do it,” Norberg writes. “They weren’t ‘lifted out’ of poverty; they rose out of poverty.”

We still have a lot of work to do, even here at home.

But history is clear; freedom and opportunity are the key to helping the poor. And that’s where our focus should be.

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