World hits wealth milestone

Great news from the Centre for Independent Studies:

World hits wealth milestone

Eugenie Joseph

12 OCTOBER 2018 | IDEAS@THECENTRE

 

The world reached an incredible milestone last month. For the first time in recorded history, more than 50% of the entire global population can be classified as middle class or wealthier.

The US-based Brookings Institution has estimated that over 3.8 billion people now have enough discretionary income to be classified as middle class or wealthier. And most of the recent growth in the middle class has occurred in the developing countries of Asia. The Brookings Institution’s estimate is based on the number of households that spend between $11 and $110 (in US dollars) per person each day.

Obviously, any definition of ‘middle-class’ is subjective and contestable (for example, some might argue that home ownership is critical to being middle class). Nonetheless, these developments represent an unambiguous triumph over poverty — which would have been unimaginable even 20 years ago, let alone 200 years ago.

However, it seems the news has attracted little attention in Australia — despite the fact that many Australians care deeply about tackling global poverty. It seems we are blasé — or perhaps just oblivious — when developing countries make huge strides in lifting the living standards of their citizens.

In part, it could represent uncomfortable truth for some of us: that free markets and liberalised trade actually work. And not just for the rich; but also for the millions who lift themselves out of poverty each year. But it could also reflect the negativity bias in news generally. Bad news sells; and people are simply less interested in good news.

It also doesn’t help that statistics are difficult to ‘sell’ as a story. Statistics do not resonate easily with most people or stir up empathy or emotion. A proclamation that the global middle class will reach four billion by 2020 does little to engage a person’s emotions.

But if you say that a mother in India can now afford a refrigerator and washing machine for her home — there’s a story we can all comprehend and celebrate. And she is one of those 3.8 billion people.

 

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