Dambisa Moyo: Is China the new idol for emerging economies?

587,769 views ・ 2013-11-11

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00:12
"Give me liberty or give me death."
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When Patrick Henry, the governor of Virginia,
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said these words in 1775,
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he could never have imagined
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just how much they would come to resonate
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with American generations to come.
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At the time, these words were earmarked
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and targeted against the British,
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but over the last 200 years, they've come to embody
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what many Westerners believe,
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that freedom is the most cherished value,
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and that the best systems of politics and economics
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have freedom embedded in them.
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Who could blame them?
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Over the past hundred years, the combination
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of liberal democracy and private capitalism
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has helped to catapult the United States
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and Western countries
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to new levels of economic development.
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In the United States over the past hundred years,
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incomes have increased 30 times,
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and hundreds of thousands of people
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have been moved out of poverty.
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Meanwhile, American ingenuity and innovation
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has helped to spur industrialization
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and also helped in the creation and the building
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of things like household appliances
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such as refrigerators and televisions,
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motor vehicles and even the mobile phones in your pockets.
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It's no surprise, then, that even at the depths
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of the private capitalism crisis,
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President Obama said,
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"The question before us is not whether the market
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is a force for good or ill.
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Its power to generate wealth and to expand freedom
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is unmatched."
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Thus, there's understandably
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a deep-seated presumption among Westerners
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that the whole world will decide to adopt
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private capitalism as the model of economic growth,
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liberal democracy, and will continue
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to prioritize political rights over economic rights.
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However, to many who live in the emerging markets,
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this is an illusion, and even though
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the Universal Declaration of Human Rights,
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which was signed in 1948,
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was unanimously adopted,
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what it did was to mask a schism
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that has emerged between developed and developing countries,
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and the ideological beliefs
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between political and economic rights.
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This schism has only grown wider.
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Today, many people who live in the emerging markets,
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where 90 percent of the world's population lives,
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believe that the Western obsession
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with political rights is beside the point,
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and what is actually important
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is delivering on food, shelter,
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education and healthcare.
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"Give me liberty or give me death"
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is all well and good if you can afford it,
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but if you're living on less than one dollar a day,
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you're far too busy trying to survive
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and to provide for your family
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than to spend your time going around
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trying to proclaim and defend democracy.
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Now, I know many people in this room
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and around the world will think,
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"Well actually, this is hard to grasp,"
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because private capitalism and liberal democracy
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are held sacrosanct.
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But I ask you today, what would you do
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if you had to choose?
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What if you had to choose
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between a roof over your head
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and the right to vote?
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Over the last 10 years,
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I've had the privilege to travel to over 60 countries,
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many of them in the emerging markets,
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in Latin America, Asia,
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and my own continent of Africa.
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I've met with presidents, dissidents,
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policymakers, lawyers, teachers,
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doctors and the man on the street,
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and through these conversations,
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it's become clear to me
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that many people in the emerging markets
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believe that there's actually a split occurring
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between what people believe ideologically
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in terms of politics and economics in the West
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and that which people believe in the rest of the world.
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Now, don't get me wrong.
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I'm not saying people in the emerging markets
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don't understand democracy,
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nor am I saying that they wouldn't ideally
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like to pick their presidents or their leaders.
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Of course they would.
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However, I am saying that on balance,
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they worry more about
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where their living standard improvements are going to come from,
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and how it is their governments can deliver for them,
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than whether or not the government
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was elected by democracy.
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The fact of the matter
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is that this has become a very poignant question
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because there is for the first time in a long time
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a real challenge to the Western ideological systems
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of politics and economics,
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and this is a system that is embodied by China.
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And rather than have private capitalism, they have state capitalism.
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Instead of liberal democracy, they have de-prioritized the democratic system.
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And they have also decided to prioritize
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economic rights over political rights.
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I put it to you today that it is this system
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that is embodied by China
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that is gathering momentum amongst people
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in the emerging markets as the system to follow,
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because they believe increasingly
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that it is the system
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that will promise the best and fastest improvements
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in living standards in the shortest period of time.
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If you will indulge me, I will spend a few moments
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explaining to you first
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why economically they've come to this belief.
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First of all, it's China's economic performance
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over the past 30 years.
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She's been able to produce record economic growth
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and meaningfully move many people out of poverty,
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specifically putting a meaningful dent in poverty
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by moving over 300 million people
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out of indigence.
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It's not just in economics,
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but it's also in terms of living standards.
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We see that in China, 28 percent of people
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had secondary school access.
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Today, it's closer to 82 percent.
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So in its totality, economic improvement
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has been quite significant.
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Second, China has been able
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to meaningfully improve its income inequality
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without changing the political construct.
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Today, the United States and China
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are the two leading economies in the world.
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They have vastly different political systems
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and different economic systems,
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one with private capitalism,
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another one broadly with state capitalism.
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However, these two countries
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have the identical GINI Coefficient,
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which is a measure of income equality.
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Perhaps what is more disturbing
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is that China's income equality
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has been improving in recent times,
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whereas that of the United States
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has been declining.
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Thirdly, people in the emerging markets
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look at China's amazing and legendary
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infrastructure rollout.
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This is not just about China
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building roads and ports and railways
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in her own country --
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she's been able to build 85,000 kilometers
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of road network in China
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and surpass that of the United States --
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but even if you look to places like Africa,
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China has been able to help tar the distance
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of Cape Town to Cairo,
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which is 9,000 miles,
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or three times the distance of New York to California.
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Now this is something that people can see and point to.
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Perhaps it's no surprise
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that in a 2007 Pew survey, when surveyed,
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Africans in 10 countries said
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they thought that the Chinese were doing
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amazing things to improve their livelihoods
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by wide margins, by as much as 98 percent.
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Finally, China is also providing innovative solutions
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to age-old social problems that the world faces.
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If you travel to Mogadishu, Mexico City or Mumbai,
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you find that dilapidated infrastructure and logistics
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continue to be a stumbling block
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to the delivery of medicine and healthcare
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in the rural areas.
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However, through a network of state-owned enterprises,
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the Chinese have been able to go into these rural areas,
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using their companies
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to help deliver on these healthcare solutions.
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Ladies and gentlemen, it's no surprise
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that around the world, people are pointing at what China is doing and saying,
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"I like that. I want that.
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I want to be able to do what China's doing.
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That is the system that seems to work."
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I'm here to also tell you
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that there are lots of shifts occurring
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around what China is doing
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in the democratic stance.
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In particular, there is growing doubt
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among people in the emerging markets,
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when people now believe that democracy
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is no longer to be viewed
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as a prerequisite for economic growth.
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In fact, countries like Taiwan, Singapore, Chile,
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not just China, have shown that actually,
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it's economic growth that is a prerequisite
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for democracy.
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In a recent study, the evidence has shown
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that income is the greatest determinant
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of how long a democracy can last.
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The study found that if your per capita income
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is about 1,000 dollars a year,
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your democracy will last about eight and a half years.
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If your per capita income is between
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2,000 and 4,000 dollars per year,
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then you're likely to only get 33 years of democracy.
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And only if your per capita income
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is above 6,000 dollars a year
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will you have democracy come hell or high water.
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What this is telling us
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is that we need to first establish a middle class
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that is able to hold the government accountable.
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But perhaps it's also telling us
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that we should be worried about going
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around the world and shoehorning democracy,
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because ultimately we run the risk
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of ending up with illiberal democracies,
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democracies that in some sense
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could be worse than the authoritarian governments
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that they seek to replace.
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The evidence around illiberal democracies
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is quite depressing.
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Freedom House finds that although 50 percent
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of the world's countries today are democratic,
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70 percent of those countries are illiberal
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in the sense that people don't have free speech
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or freedom of movement.
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But also, we're finding from Freedom House
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in a study that they published last year
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that freedom has been on the decline
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every year for the past seven years.
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What this says
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is that for people like me
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who care about liberal democracy,
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is we've got to find a more sustainable way
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of ensuring that we have a sustainable form
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of democracy in a liberal way,
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and that has its roots in economics.
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But it also says that as China moves
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toward being the largest economy in the world,
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something that is expected to happen
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by experts in 2016,
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that this schism between the political
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and economic ideologies of the West and the rest
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is likely to widen.
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What might that world look like?
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Well, the world could look like
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more state involvement and state capitalism;
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greater protectionisms of nation-states;
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but also, as I just pointed out a moment ago,
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ever-declining political rights
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and individual rights.
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The question that is left for us in general
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is, what then should the West be doing?
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And I suggest that they have two options.
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The West can either compete or cooperate.
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If the West chooses to compete with the Chinese model,
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and in effect go around the world
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and continue to try and push an agenda
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of private capitalism and liberal democracy,
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this is basically going against headwinds,
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but it also would be a natural stance
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for the West to take
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because in many ways it is the antithesis
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of the Chinese model
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of de-prioritizing democracy, and state capitalism.
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Now the fact of the matter is,
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if the West decides to compete,
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it will create a wider schism.
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The other option is for the West to cooperate,
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and by cooperating I mean
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giving the emerging market countries the flexibility
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to figure out in an organic way
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what political and economic system
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works best for them.
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Now I'm sure some of you in the room
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will be thinking, well, this is like ceding to China,
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and this is a way, in other words,
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for the West to take a back seat.
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But I put it to you
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that if the United States and European countries
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want to remain globally influential,
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they may have to consider cooperating
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in the short term in order to compete,
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and by that, they might have to focus
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more aggressively on economic outcomes
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to help create the middle class
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and therefore be able to hold government accountable
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and create the democracies that we really want.
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The fact of the matter is that
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instead of going around the world
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and haranguing countries for engaging with China,
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the West should be encouraging its own businesses
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to trade and invest in these regions.
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Instead of criticizing China for bad behavior,
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the West should be showing how it is
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that their own system of politics and economics
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is the superior one.
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And instead of shoehorning democracy
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around the world,
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perhaps the West should take a leaf
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out of its own history book
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and remember that it takes a lot of patience
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in order to develop the models
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and the systems that you have today.
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Indeed, the Supreme Court Justice Stephen Breyer
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reminds us that it took the United States
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nearly 170 years
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from the time that the Constitution was written
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for there to be equal rights in the United States.
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Some people would argue that today
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there is still no equal rights.
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In fact, there are groups who would argue
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that they still do not have equal rights under the law.
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At its very best,
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the Western model speaks for itself.
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It's the model that put food on the table.
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It's the refrigerators.
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It put a man on the moon.
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But the fact of the matter is,
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although people back in the day
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used to point at the Western countries and say,
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"I want that, I like that,"
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there's now a new person in town
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in the form of a country, China.
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Today, generations are looking at China
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and saying, "China can produce infrastructure,
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China can produce economic growth,
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and we like that."
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Because ultimately, the question before us,
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and the question before
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seven billion people on the planet
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is, how can we create prosperity?
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People who care and will pivot towards the model
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of politics and economics
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in a very rational way,
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to those models that will ensure
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that they can have better living standards
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14:34
in the shortest period of time.
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As you leave here today,
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I would like to leave you
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with a very personal message,
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which is what it is that I believe
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we should be doing as individuals,
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and this is really about being open-minded,
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open-minded to the fact that our hopes and dreams
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of creating prosperity for people around the world,
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creating and meaningfully putting a dent in poverty
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for hundreds of millions of people,
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has to be based in being open-minded,
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because these systems have good things
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and they have bad things.
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Just to illustrate,
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I went into my annals of myself.
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15:12
That's a picture of me.
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Awww. (Laughter)
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I was born and raised in Zambia in 1969.
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15:20
At the time of my birth,
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15:22
blacks were not issued birth certificates,
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15:24
and that law only changed in 1973.
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15:27
This is an affidavit from the Zambian government.
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I bring this to you to tell you that in 40 years,
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I've gone from not being recognized as a human being
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to standing in front of the illustrious TED crowd today
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to talk to you about my views.
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In this vein, we can increase economic growth.
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We can meaningfully put a dent in poverty.
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But also, it's going to require
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that we look at our assumptions,
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15:52
assumptions and strictures that we've grown up with
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around democracy, around private capitalism,
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15:56
around what creates economic growth
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15:58
and reduces poverty and creates freedoms.
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We might have to tear those books up
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and start to look at other options
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and be open-minded to seek the truth.
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Ultimately, it's about transforming the world
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and making it a better place.
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Thank you very much.
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(Applause)
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About this website

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