If poor get richer, does world see progress?

By , Staff writer of The Christian Science Monitor

In Shanghai this month, bicyclists found themselves banned from certain portions of main thoroughfares. By next year, this ubiquitous two-wheel mode of transportation will have been kicked off such roads altogether. Why? To make way for all the new cars - 11,000 more every week - pouring onto Chinese streets and highways.

A sure sign of growing affluence in the developing world? Without a doubt. A consumer trend portending a better world? That depends on one's point of view.

"Rising consumption has helped meet basic needs and create jobs," says Christopher Flavin, president of the Worldwatch Institute, a Washington, D.C., think tank. "But as we enter a new century, this unprecedented consumer appetite is undermining the natural systems we all depend on, and making it even harder for the world's poor to meet their basic needs."

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That's the message underlying Worldwatch's annual "State of the World" report, an influential book-length collection of data-packed chapters that has been used by supporters as ammunition and by critics as a pincushion since 1984.

This year's report focuses on the growing global "consumer class" - defined as individuals whose "purchasing power parity" in local currency is more than $7,000 a year (roughly the poverty level in Western Europe). As economies expand - accelerated by globalization that has opened up markets, greater efficiency in manufacturing, and advancing technologies - that consumer class has grown rapidly. It's the main reason there are more than 1 billion cellphones in the world today.

The consumer class now includes more than 1.7 billion people. High percentages in North America, Western Europe, and Japan (85 to 90 percent) are no surprise.

But nearly half of all consumers now are in developing nations. China and India alone account for 362 million of those shoppers, more than in all of Western Europe. That can be a good thing to the extent that it improves health rates, education levels, and social conditions (like the status of women).

"The almost 3 billion people worldwide who barely survive on less than $2 a day will need to ramp up their consumption in order to satisfy basic needs for food, clean water, and sanitation," says Brian Halweil, codirector of Worldwatch's "State of the World 2004" project. "And in China, the rush to meet surging consumer demand is stimulating the economy, creating jobs, and attracting foreign investment."

But there are troubling indicators here as well, say Worldwatch researchers:

• Damage to forests, wetlands, ocean fisheries, and other natural areas as resources are used and pollution created.

• Higher levels of obesity, personal debt, and chronic time shortages as people work longer hours to satisfy the demand for consumer goods.

• Indications that increased consumption doesn't necessarily mean a better quality of life. In the United States, for example, average personal income more than doubled between 1957 and 2002. There now are more cars than licensed drivers, and the typical house is 38 percent bigger than it was in 1975, even though fewer people live in it. But when asked to rate how they feel about their lives, the same portion of Americans as a generation ago - only about one-third - describe themselves as "very happy."

• Growing disparities between rich and poor. More than 1 billion people still do not have reasonable access to safe drinking water. More than twice that number live without basic sanitation. (It's estimated that hunger and malnutrition could be eliminated globally for less than is spent on pet food in Europe and the US; universal literacy could be achieved for one-third of what is spent annually on perfumes.)

On the other hand, critics argue, the swelling numbers of consumers reflect the improvement in material conditions that has paralleled the progress of nations since the dawn of civilization. And historically, when Malthus and other analysts pointed to factors that would limit future growth, human ingenuity has found ways around those obstacles, these critics point out.

"Rather than contributing to global destruction and third-world poverty, consumerism actually promotes technologies that serve to better environmental and human well-being," says Ezra Finkle of the Competitive Enterprise Institute in Washington, D.C.

The question is: Will the growing tide of new consumers in the developing world - joining an increasingly aware body of consumers who've known relative affluence all along - contribute to the solution or simply add to the problem?

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