Population and Poverty

By Michael Miller, Acton Institute Director of Programs.

Amid the hoopla surrounding the resignation of World Bank president Paul Wolfowitz, few noticed another battle going on within the World Bank on the question of population. According to press reports Bank Managing Director and former Finance Minister for El Salvador, Juan Jose Daboub, came under fire for a memo he sent allegedly directing that reproductive health measures be removed from a World Bank package to Madagascar. He was accused of imposing his religious beliefs on long standing policies of the bank involving reproductive health and family planning.

European delegates from Belgium, Norway, Germany, and France along with various non-governmental organizations including Planned Parenthood, CARE International UK, and Global Population Education also opposed U.S. attempts to limit abortion as part of health care. With the Wolfowitz affair absorbing most of its energy, the United States yielded to European pressure and reversed its opposition to World Bank funding of sexual and reproductive health programs that include abortion.

The real issue is: Why is the World Bank funding abortions in the first place? Supported by 185 member countries -- the United States is its largest donor -- the World Bank has supplied funds to developing countries for 60 years. According to a World Bank memo this includes over $2 billion within the last 10 years for “reproductive health” which includes abortion. What does this agenda have to do with its mission to “Create a World Free from Poverty”?

Of course the common perception is that population growth causes poverty, so reducing population should also reduce poverty. But the facts do not bear this out. Neither do basic economics.

The idea that population growth causes poverty comes from the ubiquitous zero-sum-game fallacy: the idea that the economy is a pie with only so much to go around. But the economy is not a pie -- economies can grow, and population growth can actually help development. A growing population means more labor, which along with land and capital are the main factors of production.

Behind much of the zero-sum thinking concerning population is the theory of Thomas Malthus, who in 1798 predicted the earth was heading for an impending food shortage because population was growing geometrically while the food supply was only increasing arithmetically. Thus, he predicted that the number of people would soon outstrip the food supply and lead to mass starvation by about 1850. Among his mistakes was the failure to account for technology -- a product of human creativity.

Not only did Malthus’ prediction not come true; today there exist food surpluses despite the fact that the earth’s current population is six times what it was in 1850. Famines today are not caused by lack of food, but by corruption, war, and bad economic policies. Despite evidence to the contrary, anti-population forces still hold fast to Malthusian predictions and continue to see people solely as consumers inhibiting economic growth. But people do more than consume; they also produce. They innovate and create wealth.

Statistics show no real correlation between population and poverty. If population were a determinant of poverty, it would be hard to explain places such as Hong Kong, Japan, South Korea and the Netherlands. All have high population densities and yet are wealthy. The United Kingdom has about three times the population density of Ghana, and eighty-one times the per capita GDP. There are many causes of poverty, but population is not one of them.

Despite the evidence, the World Bank continues lavishing American tax dollars on population control when that money could be put to better use on such things as infrastructure, telecommunications, and fighting corruption. Perhaps the World Bank has become captive to ideologues more concerned with the eugenic visions of Planned Parenthood than with actually helping families climb out of poverty.

Literally billions of dollars have been spent to reduce populations in developing countries, but have yielded no real economic progress. We know the factors that create economic growth and development: consistent rule of law for all citizens, property rights, sensible regulation, and a culture that encourages and rewards entrepreneurial behavior. These traits have never existed perfectly anywhere on earth, but the degree to which they have been present reflects the degree to which prosperity has been achieved. Conversely, where they remain absent -- as in much of the developing world today -- poverty and misery are found in their stead.

Many of the same people who protest the “cultural imperialism” of multi-national corporations like McDonalds, Coca-Cola and Wal-Mart vigorously support forcing the Western, secular sexual morality of contraception and abortion on women in Latin America, Africa and Asia -- many of whom view them as moral evils and a violation of their dignity.

People can choose whether to eat a Big Mac or shop at Wal-Mart, but when foreign aid is made contingent on reproductive health policies that include abortion -- and there is no choice -- that is real cultural imperialism. It is ironic that Europe, the very continent facing an economic crisis because of population decline, is busily promoting its own disease as a panacea for what ails the developing world.