Good Things Are Happening

It is common for humans to pay more attention to bad than good things.  Being attentive to dangerous situations or negative news protects us from harmful risks.  But not paying enough attention to good things has its own risk of depriving us from useful information on which we can capitalize to achieve more progress. 

Case in point is an international survey from 2016 reported by Max Roser who runs the site Our World in Data.  Surveyed about the state of the world, only 10% of Swedes, 6% of Americans and 4% of Germans had a positive opinion.  Even after accounting for the usual pitfalls of surveys, that’s a remarkable discrepancy between public perception and the actual state of the world.  (You may recall that I had covered this tendency to miss the positive in an earlier blogpost based on the book Factfulness.)

So, I thought it would be a useful exercise to remind myself and others of what good things have happened or are under way, so that we can feel a bit better about ourselves despite our current miseries and discontents.  I will end the post by explaining why, in my opinion, attention to these good developments gives us a springboard for further progress.

Let’s start with global good news.  In 2021 the percentage of people around the world experiencing extreme poverty (living on less than $1.90 per day) was 9.2% compared to 75% in 1950.  In 2021, eighty-six percent of the world population was literate with women closing the gap with men.  Instead, back in 1930, only one third of the world population could read and write.  Measured by child mortality, the rate was 27 per 1000 children in 2020 compared to 200 children in 1950.  Despite some slippage toward authoritarianism during the past ten years, democracy, even with flaws, is the political system of the majority of countries in the 21st century, appreciably higher than the number of democratic countries in the 20th century.  Although fertility rates (especially in rich countries) have dropped the world population has doubled the last 100 years thanks to advances in health care that have helped extend life expectancy. 

These good global developments mean that as a species we are becoming more educated, healthier, less in the grip of the want for food and shelter, and importantly more tolerant to the rights of others as institutions of governance come under greater control of the people.

The above information reflects mostly the mega trends taking place on a global scale.  We also have significant current developments that exemplify our good side notwithstanding other darker events.  The primary piece of evidence in this connection is the global response to the covid-19 pandemic and the war in Ukraine.

The last two and a half years the world has come together to provide a collective response against the devastating health and economic dangers unleashed by the pandemic.  Thus, the world summoned its scientists to design and produce vaccines against the virus in record time.  National governments used their fiscal powers to shield their populations and industries from economic ruin and hardship and rich nations extended their assistance (no matter how inadequate some would claim) to poor nations.

Moody’s Analytics has estimated that the response to the pandemic came to about $9 trillion worldwide.  Obviously, the richest countries dedicated much higher sums to help their citizens than poorer nations.  Thus, the US government allocated 25% of its GDP to fight the pandemic while the European Union countries threw $1 trillion to the same cause.  According to the International Monetary Fund, the fiscal response to the pandemic was indeed worldwide.  And an OECD study found that states and official donors contributed $179 billion to developing nations, a record amount (on an annual basis). 

The war in Ukraine and the resultant crisis in the energy markets presented additional opportunities to governments to display their care for their hard-pressed citizens.  The EU has earmarked $350 billion for aid to households and industries while the UK plans to spend $172 billion to fight economic hardship due to rising inflation.

This vast global operation of fiscal largess has no doubt received a lot of criticism by orthodox economists (because of the fear of inflation) and conservative policy experts (because of aversion against governments doing too much).  From the left, the criticism refers to the one-off nature of most of these measures which fail to address the structural causes of insufficient economic resilience. 

What matters though is that current and past fiscal measures to fight poverty have improved the lives of millions of people.  In the US alone there has been a sustained downward trend in child poverty, which by 2019 had declined by 44% since the early 1990s and dropped further thanks to fiscal measures during the pandemic years.  Overall, the number of Americans living in poverty in 2021 was 25.6 million down from 50 million in 2011! 

The important implications of how governments around the world reacted to the pandemic and the war in Ukraine have to do with what they tell us about attitudes toward solidarity and the role of government.  It is extremely important, for example, that the assistance programs were undertaken by both conservative and liberal governments.  In the face of acute crises, governments reacted in a humane and altruistic manner.  They put aside ideological and policy principles to ensure that no one was left behind (a hyperbole perhaps but it captures the spirit).  To paraphrase Warren Buffett’s reaction to the government’s response to the 2008 financial crisis “You first need to put the fire out and then worry how to rearrange the furniture.”

These government responses are important in another respect.  They demonstrated that governments do matter.  In times of acute crises, it is only organized governments that stand between human sustainability and ruin.  Furthermore, and I think this is even more important, our worldwide response to these crises showed that we have the moral and practical wisdom to act on behalf of our collective common good instead of acting selfishly.  It is in such moments our scope of “We” expands to include more of “Them.”

Our world is still a messy and hard place for many of our fellow men and women.  But hardships caused by illness, illiteracy and oppression are affecting fewer and fewer of us.  That along with our expanding social consciousness give us hope we can become a better species or at least not a worse one.

Unknown's avatar

Author: George Papaioannou

Distinguished Professor Emeritus (Finance), Hofstra University, USA. Author of Underwriting and the New Issues Market. Former Vice Dean, Zarb School of Business, Hofstra University. Board Director, Jovia Financial Federal Credit Union.

Leave a comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.