Rocking the world

from the Sydney Morning Herald

Jonathan Pearlman spoke to the "rock star economist" Jeffrey Sachs on the eve of his Australian visit.

In a career that has spanned three decades and more than 100 countries, Jeffrey Sachs, perhaps the world's most famous macroeconomist (and certainly the economist with the most famous friends), has never come across a problem he thought could not be solved.

Known for his boundless energy and furious work-rate, his non-stop quests have included boosting Mongolian trade, cutting Polish inflation and ending world poverty. Along the way, he has been likened to the British economist John Maynard Keynes, urged to run for the US presidency by the Sachs For President group, and described by Angelina Jolie as "one of the smartest people in the world".

On his first foreign assignment in Bolivia in the mid-1980s, Sachs, a prodigy who had been made a tenured professor at Harvard at the age of 28 (he is now 53), gained international recognition after helping to reverse the country's soaring inflation.

He was given this task after attending a campus meeting with a small group of Bolivian students, who believed the country's 24,000 per cent inflation rate could not be fixed without a recession. Sachs disagreed. "If you think you can do it," said one member of the group, "come to Bolivia and prove it."

And so he did, eventually working as an adviser to the Bolivian president, Victor Páz, and recommending a series of tightly disciplined measures - including privatisation, debt cancellation, huge cuts to government spending - that later became known as shock therapy. This work earned him the nickname "Dr Shock" - a title he kept for 20 years until Bono described him as "my professor, my teacher, my rock star", prompting a flurry of new nicknames that included "Bono's guru" and "rock star economist".

After Bolivia, Sachs spent the early 1990s advising Eastern bloc countries on their switch from communism to capitalism. This included a controversial attempt by Sachs and his Harvard colleagues to apply shock therapy to Russia - which some critics say led to the country's social and economic collapse. Sachs describes the charge as absurd and has blamed the then US government for failing to assist with Russia's transition.

But Sachs's most enduring and ambitious campaign - to end world poverty - did not begin until 1995 with his first visit to sub-Saharan Africa, where he saw children dying of malnutrition and disease. Typically, his contact with extreme poverty sparked a quest for a solution. But he had discovered a different sort of problem, which stretched beyond questions of market economics and could not be solved on a whiteboard or a computer.

"The things that work best in this world are markets, but markets do not solve problems of the extreme poor," Sachs told the Herald before his arrival in Australia today.

"If I were dealing with market forces alone, it would be simple. The wonderful thing about markets is they self-organise. You don't really have to do very much. You turn a couple of dials and the whole national economy changes … You can sit in a finance ministry or a central bank and make tremendous progress for a whole economy. But these kinds of issues - children dying of malaria or mothers dying in childbirth or impoverished peasants not being able to grow enough food - are actually not solvable at the first instance by markets."

For more than a decade, Sachs has been travelling the world, marshalling support for efforts to fight the spread of disease and poverty in the world's poorest countries. He has written books, made countless speeches, advised the United Nations, the World Health Organisation and governments across Africa. He has travelled to Kenya with Jolie - their trip was made into a show for MTV - and with Madonna to Malawi - their work featured in her documentary about Malawi's children orphaned by AIDS. He worked with Bono on a six-year campaign to promote debt relief for the world's poorest countries, which led to billions of dollars of debt being written off by the International Monetary Fund and the World Bank. Bono later wrote an introduction to Sachs's best-selling book, The End of Poverty, predicting: "In time his autograph will be worth a lot more than mine."

For Sachs, who has been accused of being a "celebrity sycophant", his work with celebrities, governments, international bodies, social workers, activists and academics is all part of his job of being "a pest".

"The biggest obstacle to action is simply the lack of awareness of the things that can be done," he says. "When the world wakes up to these issues you find that a lot more action can occur than anyone was dreaming of because we have quite powerful technologies and simple packages of things that can be done with big effect. Trying to help people see the linkages of why they should invest a small amount in these solutions - a small amount is enough - is the biggest challenge of all of this … The resources needed to address these problems are not vast, which has been my whole point for 25 years. It does not take a lot to solve these problems."

When I spoke to Sachs by phone, he was at Charles de Gaulle airport in Paris on a stopover between Mali - where he had been working with the Mali Government on its food and malaria crises - and Cairo, where he was part of a UN delegation to a meeting of African leaders. His Australian visit will include speeches to the Australian National University's annual conference on China, and Sydney University's newly formed Institute for Sustainable Solutions, an institute partly based on Columbia University's Earth Institute, which he directs.

He is also due to meet the Prime Minister, Kevin Rudd, and will press the Government to stand by its commitments to international aid and tackling climate change. "I am very happy to be coming at a time of political change that I find very good for Australia and very beneficial for the world," he says.

"The Rudd Government has taken on two of the challenges that I think are most important in the world - climate change and the fight against poverty. Australia under the Howard government really fell away from both these issues. It was sad to see.

"The drought and the Murray Darling Basin are suffering under the pressures of climate change. Australia has a big stake in this and a big role to play given its [position] as a major energy producer and leading technology country."

Sachs, a special adviser to the UN Secretary-General, Ban Ki-moon, was head of the UN's project to advise governments on reaching a set of targets on health, education, poverty and the environment by 2015, known as the Millennium Development Goals. He has set up and runs the Millennium Villages project, which is trying to help about 80 villages across Africa lift themselves out of poverty, a concept that has been floated for parts of the Asia-Pacific and indigenous Australia.

Sachs believes that global poverty can be eradicated, as long as the developed world abides by its commitment to increase aid levels to 0.7 per cent of gross national income. In its first budget this year, the Rudd Government lifted aid levels slightly to .32 per cent; it aims to reach .5 per cent by 2015 - though these levels remain behind most developed countries.

"Australia needs to ramp up its development assistance," says Sachs.

"If Australia does this, it can really play a very major role in its own neighbourhood - in countries like Papua New Guinea and poorer parts of South Asia … If we drop those commitments, the world will become considerably more dangerous. The biggest disappointment for me has been that after the debates and arguments, commitments have been taken, but then the commitments for increased financing for practical solutions have not yet been forthcoming. You don't give up on this."

Sachs never gives up. His belief in "practical solutions" seems a peculiarly American conviction that stems back to the can-do commitment to human endeavour of the country's 19th century Transcendentalists such as Ralph Waldo Emerson and Henry Thoreau. Jet-lagged on a Saturday morning and speaking into his mobile phone, Sachs does not see the tarmac and terminal at Charles de Gaulle as signs of modern decay, but of hope and unfulfilled promise.

"The amazing thing is that our world has the mix of this stupendous wealth and 10 million children dying every year of poverty," he says.

"That is the paradox of our world … I am sitting in an airport, looking out at aircraft landing, at sparkling buildings, at technology all around me, at all of the appliances and computers that people are using.

"Humanity has created an extraordinarily sophisticated society with unbelievable ingenuity. So how can one not believe that we could get a bed-net to each sleeping site in Africa, or we could help people infected with HIV to get the pills they need? Of course we can do these things. It does not take irrational optimism or blinding insights to see that."

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