Standards of Living: Comparing Development Throughout the World

Standards of Living: Comparing Development Throughout the World Counter Points Chapter 14

I Can… • Explain how the world’s resources are unevenly divided • Describe the history of Developed and Underdeveloped countries

History of Global Development • Started during the 19th Century, when European country’s began to colonize the world • Countries used their power and authority to establish governments in colonized countries • Example. Britain was an Imperial Empire, which controlled the governments of many countries (ex. India)

History of Global Development • By the end of WWII, Imperial Empires had been dismantled • Colonized countries were left with very little governmental structures • Countries were left in political turmoil • Political turmoil meant that countries were unable develop proper infrastructure to support their people • Countries and their people were then lead into poverty

History of Global Development • 1949, U.S. President Henry Truman first used the term developed and underdeveloped nation • He was referring to the a country’s infrastructure; communication links, electric-power, schools and hospitals • The world First and Third World was used to describe developed and underdeveloped

I Can… • explain poverty is measured • Explain how standards of living are measured • describe the different between the indicators used to classify LEDs & MEDs

UN Charter of Rights Article 25. • (1) Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control. Is this statement idealistic?

Standards of Living • Measures peoples quality of life •  income, health, levels of nutrition, life expectancy, literacy, and the status of women and children

Developed and Underdeveloped • More Economically Developed Countries are industrialized, have developed infrastructures, such as schools, hospitals, communications links, distributed electric power systems and housing • Less Economically Developed Countries have few schools, hospitals (doctors), roads, railways and electrical power systems

Terms: • developed countries (wealthy countries) • newly industrialized ( building infrastructure) • developing countries ( lack of modern infrastructure) •  nations in debt to developed countries are termed “highly indebted poor countries” (HIPCs)

UN Human Development Report • United Nations yearly Human Development Report ranks its member countries on specific indicators Ex. Adult literacy, gross domestic product GDP, unemployment • The purpose of the U.N.’s report is to give a indication of the different levels of social and economic development around the world • Reveals the huge gap between wealthy and poor

Indicators • Adult Literacy, percentage of people 15 of age or older who can read and write a short simple passage • People Living Below $1.25US a Day, percentage of people living below $1.25US a day • Unemployment Rate, percentage of people without paid employment • Expenditure of Public Health, current spending by government of public health

Top 10 Ranked • Norway • Australia • New Zealand • United States • Ireland • Liechtenstein • Netherlands • Canada • Sweden • Germany

Lower Ranking Countries 160. Mali 161. Burkina 162. Faso 163. Liberia 164. Chad 165. Guinea-Bissa 166. Mozambique 167. Brundi 168. Niger 169. Congo

Measuring Poverty • Poverty is measured differently in developed and developing countries • The minimum income required to pay for basic needs is the most common method to measure poverty • Absolute poverty line is $1.25 per person a day (2005) • A closer way to measure poverty is to look at ones inability to afford the minimum amount of food, clothing, shelter, health care, and education services

Poverty in Canada • Stats Canada uses low income cut-off (LICO) to determine those living across the country • LICO is defined as a household that spends more than 70% of its income on food, clothing and shelter

The Poverty Trap • 1 billion people in developing countries go hungry everyday • The world produces enough food to feed 6.79 billion people • Farmers who do not own their land and migrant laborers are the first to feel the effects of droughts, crop failures or economic downturns

Loans to Developing Countries • The International Monetary Fund (IMF) and World Bank were set up to provide financial services to developing countries • These organization provided loans to improve the standards of living through economic growth • Western Banks lent billions of dollars for developing countries to engage in megaprojects to spur economic growth • Exportation of minerals agricultural products • A world economic slowdown led to a collapse in prices, making it difficult for them to repay debts

The Cycle of Debt • Western Banks and governments encouraged the IMF and World Bank to lend countries money to pay of debt • IMF told countries to restructure their economies to help repay their debts • Structural adjustment programs (SAPs) • Pursue foreign investment, cash crops for export, and private companies to run government services

The Burden of Debt • Many countries that are in debt have few natural resources or prices for goods are too low • Resources are also controlled by Multinational Corporations • control the production of a product throughout various countries • headquarters in one country and production in several countries • make profit, by producing products in other countries • Makes it very hard for countries to repay debt and to improve their standards of living

Debt Relief • The Heavily Indebted Poor Countries (HIPC) initiative was launched in 1996 by the International Development (IDA) to ensure poor countries are not crippled by debt • Provides debts relief to poor countries • Canada’s has spent $312 million on HIPC programs through the form of bilateral aid • Assistance from one country

Foreign Aid • Programs chosen to foster development in developing countries • Multilateral aid funded through government agencies to create large-scale programs to encourage economic growth • Tied aid, aid given to a foreign country with conditions attached • Canadian International Development Agency (CIDA) Canada’s governmental service that administers foreign aid

Standards of Living: Comparing Development Throughout the World