Monday, May 03, 2004

Foreign Policy: A Magazine Review 

I'll be posting a long and serious article later today on the "Ranking the Rich" project run by Foreign Policy magazine. "Ranking the Rich" is an important and valuable contribution to the debate on international affairs. FP regularly comes out with worthwhile centerpiece articles like this, and often features short, informative pieces from top academics and policymakers. At the very least, it offers entertaining petty intra-academic fights like the one continued in this month's issue by Kenneth Rogoff's swipe at Joseph Stiglitz (hiss! snarl!).

But the rest of the magazine seems to go out of its way to court controversy, in sometimes surprisingly stupid ways. There has been a lot of attention paid by other bloggers to last month's "the latinos are coming to get us" Samuel Huntington article in FP, but this month's crop of articles has some even more ridiculous examples. Representing the silly-to-loony left, we have a piece by Ted Rall ('nuff said).

Representing the market-maniac center-right, we have an article [requires free registration] by Allen L. Hammond & C.K. Prahalad which veers sharply into self-parody. The piece, which is presented as a daring and innovative approach to ending poverty around the globe, advocates saving the world's poor by marketing products to them more effectively:
In reality, low-income households collectively possess most of the buying power in many developing countries, including such emerging economies as China and India. If businesses ignore the bottom of the economic pyramid, they miss most of the market. Another myth is that the poor resist new products and services, when in truth poor consumers are rarely offered products designed for their lifestyles and circumstances, leaving them unable to interact with the global economy. Perhaps the greatest misperception of all is that selling to the poor is not profitable or, worse yet, exploitative. Selling to the world's poorest people can be very lucrative and a key source of growth for global companies, even while this interaction benefits and empowers poor consumers.
I'm perfectly willing to believe that consumers everywhere and across all social strata can benefit from things like lower prices and greater choice. And I definitely agree that providing individuals with opportunities to improve their economic fortunes is generally a good thing.

But the strategies propounded in the piece (using Amway-style person-to-person sales techniques, offering layaway plans) don't really seem all that likely to improve lives in meaningful ways. Furthermore, the pictures accompanying the text (not available online) would make anyone with the slightest concern about the environmental and cultural ramifications of globalization very nervous: one shows an Avon lady selling deodorant to Brazilian Tembe indians living in a thatched hut; another is an image of women in New Delhi using single-serving detergents to wash clothes in a river. The piece also includes this weirdly pollyannaish statement:
Beyond such benefits as higher standards of living and greater purchasing power, poor consumers find real value in dignity and choice. In part, lack of choice is what being poor is all about. In India, a young woman working as a sweeper outdoors in the hot sun recently expressed pride in being able to use a fashion product—Fair and Lovely cream, which is part sunscreen, part moisturizer, and part skin-lightener—because, she says, her hard labor will take less of a toll on her skin than it did on her parents'. She has a choice and feels empowered because of an affordable consumer product formulated for her needs.
Look: I'm all for increasing the opportunities of poor people around the world to better their lives. I also think that private corporations can be a force for positive change on this front, and that half of the "trade is good for the poor" story is about consumers, not just producers (i.e. not just about poor people selling agricultural commodities to rich world consumers, but about poor people getting lower prices on traded goods that they buy). But is this the best way to sell this idea? Who on earth would read this article and say, "Yes! That's absolutely right! And the policy implications are clear."

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