Question: What are the biggest challenges facing the developing world?
Lawrence Summers: How are we going to manage the rise of countries that will see their standards of living increase by factor of a hundred in a single human lifespan? What about the share of the income going to the top 1%, nearly doubling $600,000 a person at the expense of $7,000 a person for everyone in the bottom 80% of the income distribution?
How are we going to manage and keep stable a global financial system where the flow isn’t as it always was in the past with the Roman Empire or the British Empire, from the center to the periphery, but it’s from the periphery to the center with the world’s greatest borrower being the world’s greatest power?
So my job now is to think, to provoke, to have ideas, to prove the intellectual framework within which we all operate; to spur through argument, through entrepreneurship, through teaching others to think about the most important questions; and to lead us to be a more thoughtful, smarter and wiser society in dealing with its major challenges.
And if I’m able to do that by myself, by encouraging the work of others, I think that will be a source of great satisfaction to me, and hopefully some contribution.
When somebody writes the history of our time 250 years from now, the two largest stories in it will be the rise of Asia and the developing world, where living standards are increasing so spectacularly rapidly. That in a matter of a few decades, countries enjoy more growth than the United States has since the American Revolution. How that impacts the billions of people in these countries and how that impacts the world system.
And I think the second defining feature of our time will be the developments in the life sciences that are going to profoundly change our conceptions of human nature; that are going to free people from pain and suffering at a rate and on a scale that has never been seen before.
We are increasingly developing the capacity to change the way people think, to change the way people behave. How we’re going to manage all of that; how we’re going to manage the life science side of all that; how we’re going to manage the remarkable things that are happening in information technology.
And as those things come together, these two things, I think, will be the central stories of our time when history is written 250 years from now.
With respect to the developing of the rising world, are they going to be gradually welcomed members of a widening circle of opportunity? Or are they going to be angry outsiders crashing a restricted party? And if we can make it be the first, which would be great as anything that has happened in human history – if people feel it is the second, the consequences can be cataclysmic.
I think it’s hard, with respect to the developments in life science, to even begin to think about what all the issues are going to be. Suppose there’s a pill created that can increase your IQ by 30 points, but it’s enormously expensive. What’s that going to mean for equality of opportunity? Suppose there are ways of knowing in advance the likelihood that people will develop their diseases? What’s that going to mean for decisions about couples getting married, or employers hiring people, not to mention insurance? What’s it going to mean if there are medicines that curb your temper and in the same process reduce your passion? How are we going to feel about those things, and how are we going to think about managing them as a society? What is going to happen when there are computer programs or pieces of software that are able to have creative scientific ideas in certain spheres? Who’s going to have access to those? Who’s going to get the credit?
These are just a few of the kinds of questions that could come. What I hope is that we will deal as a society with these things in a way that is thoughtful and rational. I worry that the teaching of more anti-evolution and intelligent design in the public schools than at any time since the Scopes trial, and the attitude in many non-scientific intellectual circles that denies that relevance of biology to almost any aspect of behavior, is leaving us in a problematic place with respect to the making of these decisions.
Recorded On: June 13, 2007
Discuss
Melinda Elliott on January 20, 2008, 5:12 AM
Mr. Summers asked how are WE going to manage developing countries? I'm more worried about how THEY'RE going to manage US?
Melinda Elliott on January 20, 2008, 10:12 AM
Mr. Summers asked how are WE going to manage developing countries? I’m more worried about how THEY’RE going to manage US?
Samuel DeArmon on November 18, 2008, 12:27 AM
One word. Civility. That’s it!
We can all agree to disagree all we want to, and so live peaceably with each other. We can do this.
It’s shocking to know that a member of one party in the House of Representatives can’t check out the new born baby of another party in in the House of Representatives because of partisan disagreements. That is absolutely and totally wrong!
Cory Sweetin on November 18, 2008, 8:07 PM
Adam Smith warned that capitalism in paractice would require a certain common moral sentitment. I think your suggestion of civility gets to the heart of Western Society’s greatest problems. But change through an organic cultivation of civility seems impossible. Human nature is at tension with civility because it’s at tension with civilization.
Juro Jordan on November 27, 2008, 6:18 PM
Reagan was transformational figure, transformed america to what it is now, full of fear and divisions. Democrats finally stud up to his transformations. McCarthy started a war not only on communisam but more importantly a war on Unions but Reagan enabled it to full extent. Unions are there to protect hard working labor foce.
Demise of consumer’s buying power is what caused forclosures forced upon us by cash availability, caused by too much investments, caused by huge tax cuts to wealthy who make most of the investments. Greed is just natural uncontrolable part of our lives.
When Reagan allowed outsourcing it was the beggining of the end of unions. It was outsourcing out of the corporations that made more damage then outsourcing out of the country. Led by greed for more profits, executives looked for outside supplyers who are not burdened by union protection. Supllyers are usually small businesses who do not provide health insuranse and 401K, so they can cut costs. Thats why today, Big Three employ only 250,000 but produce 8 million cars not counting millitary orders. That is a total change from 50 years ago, when parts were made and cars out the door at the same place. Today car makers only put parts together, test and sell them while executives taking all profits. If you wonder why small business in painting, construction and etc employ mostly immigrants, it is because immigrants, with their child rate, qualify for Medicaid. Small business represent most of the new jobs this year and they do not provide health care. On the other hand medicaide is having more recepients due to corporate outsourcing not only too expensive drugs. On one end we save just to pay more on the other end trough higher taxes.
There was a union contract that required unionized corporations to use only unionised supllyers, but Reagan got rid of that.
Only solution to the problem of diminished buying power is to transfer wealth from those that have it to those that contribute to demand side: consumers. The best way is to have a temproary tax of 80% on wealthy 1% for 3 years and start public works by selling infrastructure bonds. RAISE MINIMUM WAGE to $10 imidiately. Unemployment is allready affected so minimum wage will do it only in short run.
James C on December 3, 2008, 1:19 AM
A much narrower comment than the ones above.
If it becomes clear enough that the trade talks are collapsing, try adding a Tobin tax (0.5% on foreign exchange transactions; proceeds to be used for development), which would be something for the developing world to support, and would also reduce the amount of speculation in money and possibly prevent another Asian Financial Meltdown.
Ryan Smith on December 18, 2008, 3:40 AM
I’m socially liberal, and I therefore tend to lean towards to the Democrat Party.
That being said, in my opinion this video seems to barely disguise a pointed finger at the Republican party as the single source of the fierce partisanship afflicting America.
I love this website.
But being partisan in trying to solve the issue of partisanship is new level of stupidity.
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