Re: Only facts, please:

[Huzefa Mehta <hmehta@equator.com>]

Dear Friends,

I would agree that growth increases the wealth of the poor, but more
important is whether it increases the purchasing power (wealth linked
with
inflation) of the poor? My reading of popular (and un-reviewed)
literature
suggests that lower wage rates do not keep up with inflation wage rates.

Hence purchasing power of the poor does indeed decrease.

How does the study cited by Sanjeev below measure poverty?

Please correct me if I am wrong.

Huzefa


Sanjeev Sabhlok wrote:
>

>
> b) Capitalism causes growth. Growth eliminates poverty (NOT
inequality:
> that is not my concern at all in this lifetime: I am only concerned
with
> poverty. Next time when I am born I will deal with inequality!). This
> fact is elaborated at:
>
>         ../debate/Notes/study1.html
>
> I quote:
>
> "Working with time-series data, Ahluwalia, Carter, and Chenery (1979)
> and Fields (1980) found that an increase in poverty with growth is
very
> much the exception. Fields (1991) tested the hypothesis that economic
> growth tends to reduce poverty and found that out of 18 countries,
> poverty fell in 14, rose in three and exhibited no clear tendency in
> one. Fields (1991) also found that rapid economic growth tends
strongly
> to reduce poverty. The East Asian miracles are sufficient proof of
this.
>
> "In the same vein, the contrary position, of economic decline, is seen

> to increase poverty. Addisson and Demery (1985), World Bank (1986),
> Edgren and Muqtada (1986), and Lee (1987) find that this is what
> happened in many developing countries that experienced negative
economic
> growth in the 1980s. In two of the three cases where poverty rose, the

> economies suffered an economic decline."
>
> I have much more data showing that Korea and others were able to
> virtually wipe out poverty within a decade of opening up their economy

> even slightly to capitalism (crony capitalism, that is).
>
> I am unaware of any data which shows that capitalism makes the poor
> poorer. The only conclusive proof I have is of socialism making the
poor
> poorer. If what you say were to have been true, the janitors (i.e.,
the
> sweepers) of USA must have been wallowing in pig manure as my Harijan
> friends in Dhubri town (where I worked as Additional Deputy
Commissioner
> for nearly 3 years), whom I have described earlier at length. The
> workers of US factories should have been without a 3 bedroom house and
2
> cars each. I notice that the sweepers of USA live an exceedingly nice
> lifestyle, almost equivalent to that lived by Joint Secretaries
(honest
> ones) of the government of India. That was also true of Australia. The

> competitive system has driven wages up uniformly across the board (in
> general) for over 200 years in the USA. People have moved to
occupations
> which pay even more; thus leaving the jobs of Janitors to the Mexican
> immigrants and some blacks who are just beginning to emerge from
> oppression.
>
> Dear Professor, at the expense of appearing disrespectful (which I am
> not), I would like us to return to basics and substantiate this
> statement. As a proponent of the SCIENCE of economics, I would like to

> discuss facts, not fiction. I will not let anyone promote incorrect
> facts on IPI, if I can avoid it (i.e., if my hands which are beginning

> to pain badly again, will allow), not by closing down IPI, but by
> requesting substantiation of such things. An exactly similar claim was

> once made on this list (before you joined us) by Prof. Sitaramayya Ari

> of Oakland University, who failed to produce any evidence.
>
> The reason why I started IP was to teach (and learn) basic facts to
> India through argumentation and debate. That's all I wish to do. If I
> find better and more convincing facts from any source, I will teach
> that, and I will instantly change my mind. Please persuade me. I have
> been the most avid student of science all my life. Facts and facts is
> all I care for. Correlations and causality. Theories and emprical
proof.
> Observation of peoples' behavior and their actual actions rather than
> imagination.
>
> Contrary to your claim, all data points only to the following:
>
>         Capitalism does not guarantee the rich any riches unless they
>                 compete hard to retain and expand their riches.
>         It makes everyone work harder and reach their potential.
>         It makes everyone's living standard better off through
>                 higher productivity in the country.
>         It eliminates poverty better than any governmental
intervention.
>
> With warm regards,
>
> Sincerely,
>
> Sanjeev
>
>
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--
-----------
Huzefa Mehta
Equator Technologies Inc.,
off:   (408) 369-5436
fax:   (408) 371-9106
email: hmehta@equator.com




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