Academic journal article The Cato Journal

Wealth, Poverty and Politics: An International Perspective

Academic journal article The Cato Journal

Wealth, Poverty and Politics: An International Perspective

Article excerpt

Wealth, Poverty and Politics: An International Perspective

Thomas Sowell

New York: Basic Books, 2015, 328 pp.

In 2015, Thomas Sowell turned 85 and published a new book. In it, he interjects himself foursquare into the debate over income inequality. He has written on the topic before, but never so comprehensively. His analysis of the topic is systematic and cuts across the main lines of the current debate.

Sowell divides the factors influencing economic growth and income into four broad categories: geographic, cultural, social, and political. He then examines each set of factors in separate chapters. He rejects determinism. People can surmount the circumstances into which they are born, but the geographic, cultural, social, and political hands that individuals are dealt in life can advantage or disadvantage them.

If there is one overriding theme, it is the rejection of randomness in outcomes. Not one of the causal factors he considers is remotely random in its distribution among groups, countries, or continents now or in the past. To expect, then, a random distribution of income in society is absurd in his view.

Second, there is a brute fact of human history. "Poverty--genuine poverty--has been the lot of most of the human race for most of the existence of the species." It is economic growth and the accumulation of wealth that must be explained. Poverty is the default. Once a society, or subset, experiences economic growth, there wall be income inequality.

I follow Sowell's development of his thesis by beginning with geography. "Geography is not egalitarian," he begins the account. The Sahara is the largest desert in the world, and has for centuries isolated the blacks of sub-Saharan Africa to the south. Additionally, there is a dearth of good harbors. Both facts have limited contact with the outside world. Consequently, sub-Saharan Africa has been blocked from trade in goods and ideas. Both are detriments to economic development.

Africa has a number of great rivers, but most are not navigable for their entire length and at all times of the year. Africa is twice as large as Europe, but the African coastline is shorter than Europe's. The European coastline has many twists and turns, creating many natural harbors. By contrast, Africa's coastline is smooth with few good natural harbors. Europe was thus advantaged for trade and exposure to the world, as Africa was disadvantaged.

Within Europe, the rivers of the west, east, and south are quite different and contributed differently to economic development. The rivers of Western Europe flow into seas warmed by the Gulf Stream, which proved to be an advantage. It is one exploited mightily by the Hansa beginning in the 12th century and lasting for 500 years. It began as an association of north German merchants and evolved into a league of cities. At its peak, it reached 200 cities. It was neither a state nor a sovereign power, but a trading association (Dollinger 1970).

The rivers of Eastern Europe are subject to freezing. When they flow, it is often into lakes or inland seas rather than the sea. Rivers flowing into the Arctic, as is true for Russian rivers, are not as advantageous for trade as ones flowing into the Atlantic or Pacific.

The rivers of Southern Europe are fewer in number and adversely affected by the region's climate. The winter sees torrential downpours and the heat and dryness of the summer can dry up the rivers.

The United States is a story of a continent blessed by great navigable rivers (e.g., the Mississippi and Hudson). The Great Lakes are a tremendous advantage. And there are numerous natural harbors on both the Atlantic and Pacific coasts. Once there were inhabitants with the skills to take advantage of these natural assets, the United States was in a geographically advantaged position. But this is despite natural geographical disadvantages. …

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