BusinessWeek Online, October 10, 2002 "Why 'Trade, not Aid' Isn't Good Enough"
Question and Answer Session with Jeffrey Sachs.

Q: Why can't countries in these regions pull themselves out?
A: One characteristic of the historically poorer performers is they're farther away from the major markets, so they don't have market forces pulling them. So Mexico is better than Central America, and Central America is better than central South America. Central Asia does much worse than coastal Asia.

For a lot of the poorest places, I don't think we have an economic theory for getting a lot of growth going. I challenge anyone to debate me on how you are going to make Mongolia prosper. I've been there many times, and I haven't had a good idea yet. It's basically 1,500 kilometers away from big population centers and has a few million people.

Half of the people live in yurts. Their connectivity is low. They have no viable industry right now. They sell some camel hair but can't process it because they get a higher price by selling it to China, which processes it at much lower costs and gets it out of the ports cheaper than they can do by having a knitting factory in Ulan Bator. The real economic answer for Mongolians is to leave. But that's not the answer for Mongolia.

That's an extreme example. But let me put the positive side on that. No Mongolians need to die of extreme deprivation. Africans do not need to die of these pandemic diseases. Everyone should be able to have a basic education. But in some places, it can't all be paid for out of local resources. And my belief is that we ought to have a global system that enables a Burkina Faso or a Mongolia to have a shot at the future, rather than dying.

Now the really interesting thing to do is look internally; look locally. What happens when you replace "Mongolia" in the previous conversation with, say, farming communities in America? Textiles manufacturers? Inner-city Detroit for crying out loud? The cost of capitalism is the worship of efficiency. It doesn't matter if a way of life is desireable for social stability or cultural heritage--if you aren't efficient, you must change. We don't want local farmers, local musicians, local artists, local flavor, neighborhoods--we want everything mass-produced and available at Wal Mart.

And when you've become inefficient, you're laid off and sent to a nursing home.

If it were just us--just America--I'd say fine. But we're changing--some would say demolishing--the rest of the world. We're demanding free trade, mass market capitalism, and the destruction of incompatible lifestyles. It's the Western conquest of America all over again: become a consumer/producer or watch yourself become marginalized and die.

One time I taught my little sister a card game. And then I proceeded to annihilate her at it time and time again. I was better at the game than my little sister; she didn't know the tricks, the ins and outs. If we had been playing for money, soon she would have had none. And I would have it all.

One time in Russia, they decided to privatize the state industry. But no one had played that game before. Now 80% of the wealth is concentrated in the hands of 20% of the population. The rest live with what they can to get by. With interest rates hovering around 18%, business investment is difficult to come by. Those with money, make money. Those without cannot generate the capital to begin. Marx's capitalist oppressors are back!

And now the US wants the world to play a new game, a game called free trade. Long-developed, efficient American businesses want access to less-developed markets. Who will win this game?