The common narrative of progress relies on an economic sleight of statistical hand and a selective historical analysis that sanitizes capitalism's brutal human toll
1) There's no need to quibble about the poverty line, which is fundamentally arbitrary. The neolib “line go up, world get gooder” applies to tangibles, line literacy rates, child mortality, life expectancy, etc. The material condition of the human species has massively improved since the industrial revolution and it's borderline insane to deny this.
2) A relative decline in poverty, even if not absolute is still Very Good regardless of whether one is a total or average utilitarian and reflects well on the economic order under which it occurs.
3) Arguing about whether capitalism began with colonialism, the industrial revolution, or something in between seems like a word game. People aren't posting the line go up graphs and saying “See? This is why we should do the Scramble for Africa 2.0.” People are advocating for the market economy as it has existed ~since the end of WW2.
4) Comparing wealth inequality to pre-captialist eras is extremely fraught because making 1:1 comparisons of asset values potentially flattens a lot of historical economic and social distinctions.
5) Yes, China and other developing countries that succeeded had industrial policies, tariffs, etc. But (a) a Marxist would still call these systems “capitalist” and (b) that's not necessarily *why* they succeeded. In pairwise comparisons of like counties, the more laissez-faire ones generally do better (South vs North Korea, Botswana vs Zimbabwe, West vs East Germany, etc. You can accuse me of cherry-picking, but I honestly am not aware of any plausible pairwise comparison where the results are the opposite)
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I say this as a liberal and a supporter of the market economy, but I'm not really trying to “dunk” on any socialist alternative. I think people who use “line go up” as a slam-dunk argument against any socialist alternative are being intellectually lazy. But it's annoying when socialists pretend, for ideological reasons, that the massive improvement in material conditions over the past century and a half has nothing to do with markets or just isn't real. There are plausible socialist alternatives to capitalism, and plausible arguments for their desirability, that aren't cancelled out by the above facts.
There are no plausible socialist alternatives to capitalism. This just amounts to saying "real socialism has never been tried". In regards to China, they are the poorest of the east asian countries (other than North Korea), and they are also the least capitalist. Coincidence?
I would also point out that Capitalism has lifted hundreds of millions of Europeans (and people living in former European colonies) out of poverty. It did so for about 100 million Japanese people and about 50 million Koreans, too. How many hundreds of millions living outside of poverty in a global capitalist economy would you have to see before you believed the claim, “Capitalism has lifted hundreds of millions out of poverty”?
This piece commands of its readers, “don’t believe your lying eyes.”
On China, the transformation in living standards as a result of Deng’s “Reform and Opening Up” was both widely celebrated and readily apparent when I visited in 2018 (when I say, “widely celebrated”, it was the 40th anniversary and there were huge block printed banners all over the place). Everyone that had lived through it could tell you just how fantastically things had changed, and their children could tell of it just as well. It could be seen in all the new buildings and infrastructure built, and those being built yet. Much of old China was still present, too—the nation’s development is still ongoing—and this ability to directly compare its past and present only made the change in economic fortune all the more apparent. China’s economic liberalization permeates everything over there, which is why I reacted as I did to your essay. To say that capitalism has _not_ lifted hundreds of millions out of poverty felt to me like a denial of China’s national experience, let alone the rest of the world’s.
I would just like to quickly note, you can easily enter no-true-Scotsman territory when describing both Capitalism and Communism, particularly with regard to China. Really, China is both and neither. “Socialism with Chinese Characteristics”, as they say. I personally question the fitness of a 19th century ideological binary to describe the immense complexity of human economic systems in the first place, but I digress…
In any case, it is my belief that the cause of China’s modern prosperity lies largely (though not wholly) with the liberal economic reforms initiated by Deng. In other words, to traditionally capitalist practices. I would wager the vast majority of Chinese citizens and party cadres share my opinion, too.
I guess my overarching point is you can theorize about these things all you want, but these are actual people’s lives we are talking about. Better to just ask them what they think or go and bear witness.
Agreed. Having also lived in China, I would imagine most Chinese now would say, “we’re just as “capitalist as America’s version - we just don’t have free speech. And thats not that much worse than the US.” And to my knowledge, China doesn’t have a huge welfare program like the US (although their economic policies is a form of indirect welfare). So it could be argued that China’s economy is more “capitalistic” than the US. Regardless, more freedom (capitalism) leads people out of poverty and minimizes the downsides, better than any other alternative.
Of all the world's societies, there's none more entrepreneurial and capitalist than the Chinese. Literally everywhere they go, even if they arrive with nothing, after a couple of generations they tend to end up wealthy themselves and enrich the society around them, unless thwarted by political interference.
The only reason we aren't writing this stack in Chinese is that, in the mid 1400s, while Europe was beginning to reorganize after the Middle Ages, a Chinese trading fleet had become so large and influential and its' admirals so wealthy that they threatened the power of the imperial court in Beijing. So the emperor ordered it burned.
At the time the fleet traded all over south and east Asia, as far as Southern Africa and some scholars theorize that Chinese explorers.may have reached the west Coast of the Americas. Some of their vessels were longer than a football field.
Thus, it is only a matter of imperial whim that enabled Europeans to invade so much of Asia rather than Asians colonizing Europe.
This is perhaps the most wrong anyone has ever been about anything - isn’t it an awfully great coincidence that the Industrial Revolution begins after the age of finance capital in Europe? Isn’t it a coincidence that as soon as free marketeer Deng Xiaoping takes control of China, it becomes middle income and abolished extreme poverty? Almost as if capitalism works or something
Yeah, the degree of motivated reasoning that Ryan Ward shows here is beyond comprehension. 30 million people died of famine during China's socialist experiment. I would like him to ask literaly any random Chinese person who was alive at the time if they think they are materially better off now or not.
Sorry, no. I'm frustrated to read this, but for the sake of those who came across this as I did in their feed and are not familiar with the debate:
This post is a rewritten version of Jason Hickel's article in the Guardian from 2019, which was shared extensively on social media at the time, in which he sought to debunk and discredit Max Roser's work at Our World in Data, which shows that global poverty has declined since 1820.
There has been a lot of debate on the methodology and arguments since then, and I'd recommend this https://www.noahpinion.blog/p/against-hickelism as a useful overview of why the points made by Jason Hickel and in this post are, mostly (but not at all) wrong.
To highlight the key points:
- The issue is not about the where you exactly draw the line for what constitutes global poverty, but about whether poverty overall is decreasing.
- It is bizarre to exclude China from an overall picture of global poverty reduction, and in any case, privatisation was a critical part of the Chinese economic policy.
- Reasonable to note that the data pre-1820 isn't shown here, but prior to this point, most of the world was living on subsistence farming. (Note that Jason Hickel has claimed elsewhere that pre-1820 data doesn't account for subsistence farming, and is incorrect). Colonisation shackled nations and extracted resources; the end of colonisation freed nations to grow. Since that time, poverty has reduced. This is not a 'bouncing back' to some mythical pre-colonisation/pre-industrial glory days: this is economic growth, with corresponding poverty reduction. Capitalism is not the preserve of colonialists and it is not the role of the moralistic west to supposedly try to 'free' the rest of the world from it.
Thanks for your comments. I think Hickel has done a great service in highlighting the suspect nature of the poverty line used by the World Bank to promote the general narrative. Based on going through some of Roser's posts and story, Hickel does seem like a bad actor in some ways. His recent work on China and pre-1820 poverty metrics seems much more robust to me and less polemical, but I can see that I could not have chosen a more controversial person to base a post on.
I think for me, the narrative that free market capitalism has lifted people out of poverty is so pervasive that anyone calling attention to historical and methodological flaws in that narrative is doing all of us a favor (and Hickel is far from the only person doing this, probably just the most famous). I had hoped to maintain a mostly objective tone in the post, but relying on Hickel probably will set a lot of people off right away.
I should have done more to differentiate what I mean by capitalism vs a market economy.
Thanks for the thoughtful response, I'm glad you are less obstinate than Hickel and various others in this space. I don't think he is watertight on the pre 1820 work either (see my points on subsistence farming) but perhaps that has less holes than the rest of his work which seems at best bad and at worst dangerous.
You have generated some interesting discussion. Perhaps you might consider an amended foreword updating on some of the facts and your reviewed position? You are at risk of encouraging more bad takes on this subject but you could actually move things forward in an interesting way.
Yes there seems be a lot of lazy conflation of capitalism and free market economy in a lot of the debate. I'd be interested to see what you had to write about it.
I have been considering writing a foreword this morning. My goal has never been to put forward a dogmatic and ideological opinion. I have been of the opinion for a long time that the facts speak well enough against capitalism without having to resort to polemics and exaggeration. But I am learning that, as with everything, the picture is much more nuanced.
Sure, it adds a lot of important context. I generally think it's more important to debunk arguments not people, and I'm not entirely sure from the foreword if you're saying the issue is about definitions of the global poverty line (you do talk about this) or about whether it was capitalism that led to the reduction of poverty (you don't really mention this but it is the title of the article). Either way, appreciate the engagement :)
Ryan Ward and Jason Hickel should move to China, Cuba, Lao or Vietnam for 10 years and then come back and try and convince us that life is better there
This ranks with vaccine denial and flat earthism. Capitalism has obviously substantially increased the share of people around the world who can easily afford food, healthcare and shelter. Arbitrary measures of "poverty" don't matter.
The frequency of peacetime famines in capitalist countries has collapsed. This is well documented. England hasn't had one since the enclosure movement brought widespread capitalism to agriculture in 1750,
You are clearly not open to data. You ignore any data that goes against your predetermined conclusion and cherry-pick "studies" that seemingly support your argument. This is what you sound like "I'm open to data that the world is round, but so far the studies I've seen are unconvincing".
Capitalism is two properties: property rights + freedom of association.
(Property rights is a fact of life due to scarcity, for example you cannot share the food you have consumed. Ergo, that’s your property. We abstract it out from there.)
Anything else is violence. To place the blame on capitalism is to say that the moral and voluntary is the bad, and the flip side, violent monopolistic government, is the good.
Violence does not lead to prosperity. It never has, it never will.
To place the blame on the idea of property, or on freedom, is morally retarded and is to argue for tyranny.
You do this sleight of hand where you try to swap the government and capitalism:
> “economic system that allows a minority of people to extract and hoard wealth from the majority.”
This exactly and precisely describes modern governments across the world.
There is no larger monopoly than government.
It steals and wastes societies life force relentlessly, and all of that energy gets sucked up by parasitic politicians and government enforced market monopolies.
(Free market monopoly is a myth, all monopolies are installed and maintained through government intervention in the market to prevent competition.)
Stop promoting a system of coercion and violence, and stop blaming the idea of property and freedom for its ills.
Do you have any evidence to back up your ideological screed? I'm open to evidence.
But to your point about property and scarcity. There are enough resources in the world for everyone, but they are not distributed equally according to everyone's needs, mostly because much has been appropriated as private property. The modern idea of private property was invented to justify the colonial and enclosure movements.
I can't be bothered to address your other inaccuracies.
This is basic philosophy, we’re mostly in the realm of logic, so you don’t need evidence for the meat of what I said.
The various assertions you can find evidence for if you want, but I’m not writing a cited essay as a simple reply. Attacking me on that is pointless, since you are interested in research and know how to look things up. To say that I haven’t cited anything here is just a distraction.
None of this is ideological that’s just low-brow adhom. I can simply retort that you are being ideological (ideologs cite facts all the time), and were left adrift nowhere. Adds nothing to the conversation.
Colonialism is the exact opposite of property rights and the free market; as violence and coercion are the opposite of property rights and freedom. This doesn’t need evidence, it’s philosophy.
Governments exist to violate property rights, not uphold them.
To the degree that empires have used “property” it hasn’t been truly property, but merely power disguised as something moral and benign. Governments do this all the time, to this day. They give money a bad name by force us to use their shitty fiat “money” that they debase to steal from us via inflation. Money isn’t bad, it’s essential, government is bad.
Property and price are invented like math is invented. That is, it’s a fundamental concept manifested in reality.
When there is scarcity we use property to portion it and we use the price mechanism to quantify how scarce it is.
By the way, the mycelial network (fungus in the ground) uses price to distribute resources between trees. Trees will pay more if they are desperate and the price is higher if that tree is far away. This ensures efficient resource distribution.
People like you have an ideology called “the only thing that is actually free and voluntary (property rights and markets) is the bad, and coercion violence and government redistribution is good”.
You are necessarily saying that, because if you strip away property rights, how will you have resources distributed? Well you’re more than likely going to suggest a system of coercion, eg some government structure like socialism or communism or maybe even AI like the zeitgeist movement.
My advice to you, if you truly aren’t ideological as you imply, think about property from first principles, rather than mired in what empires and coercive structures have done with “property”. Coercive structures corrupt everything they touch, that is the nature of violence.
This. A perfect example can be found in The Poverty of Slavery.
Slavery in the US did not enrich the South ante bellum, it kept the South poor (and high tariffs on industrial good, pushed by the North, also contributed.)
To be fair, the US government has grown (in wastefulness) with both Republicans and Democrats in charge.
Is DOGE going to cut welfare? Pensions? No, it’s political suicide. The system is incapable of truly removing waste because it’s fundamentally a corrupt system.
But it’s good to see that attitude shift in that direction. Well, unless you’re an accelerationist.
This is a straw man paper. “Capitalism” is a Marxian term and also one notably undefined by the author.
The real point is that objective living standards did not change from ancient agricultural societies until the early 1800s. An Englishman in 1790 had roughly the same amount of food, clothing and living space, and health and life expectancy, as Roman Briton 1700 years earlier.
The fact that Britain in 1790 was far more technologically advanced dis not change this equivalency, due to the “Iron Law of Wages”.
The miracle is that at a certain point, industrial production was able to reach a scale where production growth could exceed population growth.
Since no “socialist” economy existed until 1917, one can see this really has nothing to do with Socialism or Marxism. Socialist economies CAN also grow, but without any doubt their growth is much, much slower than non-Marxist/non-command/free-market economies, however one wishes to define that.
Very helpful, thanks. I guess the lingering question is: if capitalism was the solution to world hunger then why would we even need the UN pledges, world summits, and such like? If free markets automatically solve societies problems then funded initiatives to end world hunger or other forms of gross inequality would not be needed.
Access to capital is the biggest driver of growth in capitalism. Without it, growth is virtually impossible. If you can get a bank loan to buy livestock, the livestock will more than make enough money to pay off the loan. Access to global capital will massively reduce the time it takes to industrialize.
It could be said that food aid has caused much poverty and hunger and led to people fleeing the countryside for the shanty towns. Floods of cheap agribusiness surplus grain has impoverished what once were resilient rural societies . Who benefits in the end..the capitalists,and now all over the world good land is abandoned and villages deserted so that the industrial complex has a supply of cheap labour.
The 19th C. Corn Laws come to mind. Do you keep prices high in order to keep a rural population in place, or let cheap imports flood in so industrial workers can survive on a pitiful wage? The exodus from the countryside then gives capital an ever cheaper source of slave labour.
Perhaps the true effects of industrial scale food aid could be a subject worthy of investigation.
This is idiotic. Pre-capitalist agrarian societies suffered severe periodic famines on a regular basis. Why do you think the world population barely grew in pre-capitalist times?
Awesome post, thanks for sharing. How would you expand this argument to poverty in developed countries? I keep running into circular arguments where people say poverty in the US isn’t an issue because being poor in America still puts you in the top percentile of incomes globally. To borrow your wording, it’s a disingenuous and amoral line of reasoning, but I’d love to have some more context behind that top percentile stat and any associate statistical sleight of hand. Where should I go first to learn more?
No sensible person will ever say that capitalism is perfect and will “eliminate” poverty and guarantee shared levels of wealth. But it’s obvious that it has done more to improve the human global condition than anything else. There is no such thing as the perfect solution on a global scale. But denying its value to increasing the chance of prosperity to the masses is just made up.
The argument that poverty was not quite as high as some studies have suggested in the past is a reasonable position, including the PhD thesis written by Michalis Moatsos that used the BNPL poverty line on a global scale since 1820 .But the apparent stagnation or even increase in poverty suggested by Hickel and other researchers(Sullivan and Hickel). Is at odds with the best evidence at standard of living across countries since the emergence of a development towards a system of individual rights including economic freedom in parts of Europe, but later extending to western offshoots, east Asia and nowadays to various extents the entire world. https://www.tandfonline.com/doi/full/10.1080/03906701.2024.2380314#d1e755 Is a partial response to Hickel et al. of capitalism and global poverty, but especially the massive increase in poverty with liberalisation, acknowledged and supported by multiple Marxist and non-marxist scholars.
On the topic of poverty in china there's issues with the transition from price controls to market prices in the BNPL. This was acknowledged by Moatsos 2021, but only partially addressed(still finding a dramatic decrease in poverty). The work of Martin ravallion and shaohua Chen on china addresses the concerns of Hickel and Sullivan work, including a greater share(and thus potential negative impact) of food prices or the poor in china. They overall come to the conclusion that an unsteady but real poverty decline happened in china(supported by objective data on malnutrition, calories etc during 1980s up until today).
this is a very well-written article. I'd like to see the people who say capitalism is working explain how so many people are still in inescapable poverty.
I was not aware that Smith and Hickel had a public fight. I’m not too impressed with Smith as he dismisses Marx without reading or understanding him. Hickel is not the only person to criticise the World Bank’s poverty line. And it would be interesting to see how Smith replies to Hickel’s more recent work about the problems with using 1820 as a benchmark and his work showing poverty in China sharply increased with the implementation of free market reforms.
He does also seem to be criticising a fairly narrow aspect of Hickel’s work given how much ground his books and research cover. It seems to be a bit selective in the criticism which comes off as suspect.
I do admit to being sympathetic to Hickel’s overall view though so haven’t looked too much at his critics.
Hickel's a perennial lolcow over at Reddit's /r/BadEconomics. A comment that sums of the experience of a person with a background in economics reading a typical Hickel paper:
"I had to skim through a couple times thinking that it had to be more complicated than that and I was just missing it. But no, it's not. It really is that stupid."
There was one a couple of years ago where he claimed that rich countries were stealing from poor countries by trading with them. He arrived at this conclusion by multiplying the value of all goods imported to high-income countries from low-income countries by the difference in average price level between poor and rich countries. E.g. if the rich world imports goods sold for a trillion dollars, and prices are on average three times as high in high-income countries, then they've "stolen" 2/3 of a trillion dollars.
There are many problems with Hickel's reasoning here, but one of the most embarrassing is his failure to account for the fact that price differences between countries are concentrated in non-tradeable goods and services (real estate, personal services, perishable goods), whereas the prices of tradeable goods tend to be fairly uniform across countries after accounting for shipping, tariffs, and retail overhead.
This is fairly typical of Hickel's work: Making extremely strong claims that a) are facially ridiculous, and b) turn out on examination to be based on some elementary fallacy. The guy is just not very smart.
Thanks for that explanation. Do people have issues with his critiques of poverty lines? He’s not the only one that has those criticisms. And his data on proxy measures of poverty before 1820 in his 2022 paper and his China analysis in 2024 seemed sound. Seems a bit more in an anthropology wheelhouse.
A few points:
1) There's no need to quibble about the poverty line, which is fundamentally arbitrary. The neolib “line go up, world get gooder” applies to tangibles, line literacy rates, child mortality, life expectancy, etc. The material condition of the human species has massively improved since the industrial revolution and it's borderline insane to deny this.
2) A relative decline in poverty, even if not absolute is still Very Good regardless of whether one is a total or average utilitarian and reflects well on the economic order under which it occurs.
3) Arguing about whether capitalism began with colonialism, the industrial revolution, or something in between seems like a word game. People aren't posting the line go up graphs and saying “See? This is why we should do the Scramble for Africa 2.0.” People are advocating for the market economy as it has existed ~since the end of WW2.
4) Comparing wealth inequality to pre-captialist eras is extremely fraught because making 1:1 comparisons of asset values potentially flattens a lot of historical economic and social distinctions.
5) Yes, China and other developing countries that succeeded had industrial policies, tariffs, etc. But (a) a Marxist would still call these systems “capitalist” and (b) that's not necessarily *why* they succeeded. In pairwise comparisons of like counties, the more laissez-faire ones generally do better (South vs North Korea, Botswana vs Zimbabwe, West vs East Germany, etc. You can accuse me of cherry-picking, but I honestly am not aware of any plausible pairwise comparison where the results are the opposite)
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I say this as a liberal and a supporter of the market economy, but I'm not really trying to “dunk” on any socialist alternative. I think people who use “line go up” as a slam-dunk argument against any socialist alternative are being intellectually lazy. But it's annoying when socialists pretend, for ideological reasons, that the massive improvement in material conditions over the past century and a half has nothing to do with markets or just isn't real. There are plausible socialist alternatives to capitalism, and plausible arguments for their desirability, that aren't cancelled out by the above facts.
There are no plausible socialist alternatives to capitalism. This just amounts to saying "real socialism has never been tried". In regards to China, they are the poorest of the east asian countries (other than North Korea), and they are also the least capitalist. Coincidence?
The author has clearly never been to China.
I would also point out that Capitalism has lifted hundreds of millions of Europeans (and people living in former European colonies) out of poverty. It did so for about 100 million Japanese people and about 50 million Koreans, too. How many hundreds of millions living outside of poverty in a global capitalist economy would you have to see before you believed the claim, “Capitalism has lifted hundreds of millions out of poverty”?
This piece commands of its readers, “don’t believe your lying eyes.”
Care to elaborate?
On China, the transformation in living standards as a result of Deng’s “Reform and Opening Up” was both widely celebrated and readily apparent when I visited in 2018 (when I say, “widely celebrated”, it was the 40th anniversary and there were huge block printed banners all over the place). Everyone that had lived through it could tell you just how fantastically things had changed, and their children could tell of it just as well. It could be seen in all the new buildings and infrastructure built, and those being built yet. Much of old China was still present, too—the nation’s development is still ongoing—and this ability to directly compare its past and present only made the change in economic fortune all the more apparent. China’s economic liberalization permeates everything over there, which is why I reacted as I did to your essay. To say that capitalism has _not_ lifted hundreds of millions out of poverty felt to me like a denial of China’s national experience, let alone the rest of the world’s.
I would just like to quickly note, you can easily enter no-true-Scotsman territory when describing both Capitalism and Communism, particularly with regard to China. Really, China is both and neither. “Socialism with Chinese Characteristics”, as they say. I personally question the fitness of a 19th century ideological binary to describe the immense complexity of human economic systems in the first place, but I digress…
In any case, it is my belief that the cause of China’s modern prosperity lies largely (though not wholly) with the liberal economic reforms initiated by Deng. In other words, to traditionally capitalist practices. I would wager the vast majority of Chinese citizens and party cadres share my opinion, too.
I guess my overarching point is you can theorize about these things all you want, but these are actual people’s lives we are talking about. Better to just ask them what they think or go and bear witness.
I need to read up more on this. Thank you for your reply.
Agreed. Having also lived in China, I would imagine most Chinese now would say, “we’re just as “capitalist as America’s version - we just don’t have free speech. And thats not that much worse than the US.” And to my knowledge, China doesn’t have a huge welfare program like the US (although their economic policies is a form of indirect welfare). So it could be argued that China’s economy is more “capitalistic” than the US. Regardless, more freedom (capitalism) leads people out of poverty and minimizes the downsides, better than any other alternative.
Of all the world's societies, there's none more entrepreneurial and capitalist than the Chinese. Literally everywhere they go, even if they arrive with nothing, after a couple of generations they tend to end up wealthy themselves and enrich the society around them, unless thwarted by political interference.
The only reason we aren't writing this stack in Chinese is that, in the mid 1400s, while Europe was beginning to reorganize after the Middle Ages, a Chinese trading fleet had become so large and influential and its' admirals so wealthy that they threatened the power of the imperial court in Beijing. So the emperor ordered it burned.
At the time the fleet traded all over south and east Asia, as far as Southern Africa and some scholars theorize that Chinese explorers.may have reached the west Coast of the Americas. Some of their vessels were longer than a football field.
Thus, it is only a matter of imperial whim that enabled Europeans to invade so much of Asia rather than Asians colonizing Europe.
This is perhaps the most wrong anyone has ever been about anything - isn’t it an awfully great coincidence that the Industrial Revolution begins after the age of finance capital in Europe? Isn’t it a coincidence that as soon as free marketeer Deng Xiaoping takes control of China, it becomes middle income and abolished extreme poverty? Almost as if capitalism works or something
Yeah, the degree of motivated reasoning that Ryan Ward shows here is beyond comprehension. 30 million people died of famine during China's socialist experiment. I would like him to ask literaly any random Chinese person who was alive at the time if they think they are materially better off now or not.
Sorry, no. I'm frustrated to read this, but for the sake of those who came across this as I did in their feed and are not familiar with the debate:
This post is a rewritten version of Jason Hickel's article in the Guardian from 2019, which was shared extensively on social media at the time, in which he sought to debunk and discredit Max Roser's work at Our World in Data, which shows that global poverty has declined since 1820.
There has been a lot of debate on the methodology and arguments since then, and I'd recommend this https://www.noahpinion.blog/p/against-hickelism as a useful overview of why the points made by Jason Hickel and in this post are, mostly (but not at all) wrong.
To highlight the key points:
- The issue is not about the where you exactly draw the line for what constitutes global poverty, but about whether poverty overall is decreasing.
- It is bizarre to exclude China from an overall picture of global poverty reduction, and in any case, privatisation was a critical part of the Chinese economic policy.
- Reasonable to note that the data pre-1820 isn't shown here, but prior to this point, most of the world was living on subsistence farming. (Note that Jason Hickel has claimed elsewhere that pre-1820 data doesn't account for subsistence farming, and is incorrect). Colonisation shackled nations and extracted resources; the end of colonisation freed nations to grow. Since that time, poverty has reduced. This is not a 'bouncing back' to some mythical pre-colonisation/pre-industrial glory days: this is economic growth, with corresponding poverty reduction. Capitalism is not the preserve of colonialists and it is not the role of the moralistic west to supposedly try to 'free' the rest of the world from it.
Max Roser has also explained his position, both intellectual and personal, on the matter, here. https://x.com/MaxCRoser/status/1378735079481049100
Thanks for your comments. I think Hickel has done a great service in highlighting the suspect nature of the poverty line used by the World Bank to promote the general narrative. Based on going through some of Roser's posts and story, Hickel does seem like a bad actor in some ways. His recent work on China and pre-1820 poverty metrics seems much more robust to me and less polemical, but I can see that I could not have chosen a more controversial person to base a post on.
I think for me, the narrative that free market capitalism has lifted people out of poverty is so pervasive that anyone calling attention to historical and methodological flaws in that narrative is doing all of us a favor (and Hickel is far from the only person doing this, probably just the most famous). I had hoped to maintain a mostly objective tone in the post, but relying on Hickel probably will set a lot of people off right away.
I should have done more to differentiate what I mean by capitalism vs a market economy.
Thanks again.
Thanks for the thoughtful response, I'm glad you are less obstinate than Hickel and various others in this space. I don't think he is watertight on the pre 1820 work either (see my points on subsistence farming) but perhaps that has less holes than the rest of his work which seems at best bad and at worst dangerous.
You have generated some interesting discussion. Perhaps you might consider an amended foreword updating on some of the facts and your reviewed position? You are at risk of encouraging more bad takes on this subject but you could actually move things forward in an interesting way.
Yes there seems be a lot of lazy conflation of capitalism and free market economy in a lot of the debate. I'd be interested to see what you had to write about it.
I have been considering writing a foreword this morning. My goal has never been to put forward a dogmatic and ideological opinion. I have been of the opinion for a long time that the facts speak well enough against capitalism without having to resort to polemics and exaggeration. But I am learning that, as with everything, the picture is much more nuanced.
Thanks for engaging in good faith.
Sure, it adds a lot of important context. I generally think it's more important to debunk arguments not people, and I'm not entirely sure from the foreword if you're saying the issue is about definitions of the global poverty line (you do talk about this) or about whether it was capitalism that led to the reduction of poverty (you don't really mention this but it is the title of the article). Either way, appreciate the engagement :)
Check out the foreword. Is it clear enough and does it capture what it needs to?
Ryan Ward and Jason Hickel should move to China, Cuba, Lao or Vietnam for 10 years and then come back and try and convince us that life is better there
This ranks with vaccine denial and flat earthism. Capitalism has obviously substantially increased the share of people around the world who can easily afford food, healthcare and shelter. Arbitrary measures of "poverty" don't matter.
I’m open to data if you have them. The point I’m trying to make is that most data claiming this are suspect and far from straightforward.
The frequency of peacetime famines in capitalist countries has collapsed. This is well documented. England hasn't had one since the enclosure movement brought widespread capitalism to agriculture in 1750,
You are clearly not open to data. You ignore any data that goes against your predetermined conclusion and cherry-pick "studies" that seemingly support your argument. This is what you sound like "I'm open to data that the world is round, but so far the studies I've seen are unconvincing".
Bad fundamentals.
Capitalism is two properties: property rights + freedom of association.
(Property rights is a fact of life due to scarcity, for example you cannot share the food you have consumed. Ergo, that’s your property. We abstract it out from there.)
Anything else is violence. To place the blame on capitalism is to say that the moral and voluntary is the bad, and the flip side, violent monopolistic government, is the good.
Violence does not lead to prosperity. It never has, it never will.
To place the blame on the idea of property, or on freedom, is morally retarded and is to argue for tyranny.
You do this sleight of hand where you try to swap the government and capitalism:
> “economic system that allows a minority of people to extract and hoard wealth from the majority.”
This exactly and precisely describes modern governments across the world.
There is no larger monopoly than government.
It steals and wastes societies life force relentlessly, and all of that energy gets sucked up by parasitic politicians and government enforced market monopolies.
(Free market monopoly is a myth, all monopolies are installed and maintained through government intervention in the market to prevent competition.)
Stop promoting a system of coercion and violence, and stop blaming the idea of property and freedom for its ills.
Do you have any evidence to back up your ideological screed? I'm open to evidence.
But to your point about property and scarcity. There are enough resources in the world for everyone, but they are not distributed equally according to everyone's needs, mostly because much has been appropriated as private property. The modern idea of private property was invented to justify the colonial and enclosure movements.
I can't be bothered to address your other inaccuracies.
Also, it's 2025, enough with the "r" word.
This is basic philosophy, we’re mostly in the realm of logic, so you don’t need evidence for the meat of what I said.
The various assertions you can find evidence for if you want, but I’m not writing a cited essay as a simple reply. Attacking me on that is pointless, since you are interested in research and know how to look things up. To say that I haven’t cited anything here is just a distraction.
None of this is ideological that’s just low-brow adhom. I can simply retort that you are being ideological (ideologs cite facts all the time), and were left adrift nowhere. Adds nothing to the conversation.
Colonialism is the exact opposite of property rights and the free market; as violence and coercion are the opposite of property rights and freedom. This doesn’t need evidence, it’s philosophy.
Governments exist to violate property rights, not uphold them.
To the degree that empires have used “property” it hasn’t been truly property, but merely power disguised as something moral and benign. Governments do this all the time, to this day. They give money a bad name by force us to use their shitty fiat “money” that they debase to steal from us via inflation. Money isn’t bad, it’s essential, government is bad.
Property and price are invented like math is invented. That is, it’s a fundamental concept manifested in reality.
When there is scarcity we use property to portion it and we use the price mechanism to quantify how scarce it is.
By the way, the mycelial network (fungus in the ground) uses price to distribute resources between trees. Trees will pay more if they are desperate and the price is higher if that tree is far away. This ensures efficient resource distribution.
People like you have an ideology called “the only thing that is actually free and voluntary (property rights and markets) is the bad, and coercion violence and government redistribution is good”.
You are necessarily saying that, because if you strip away property rights, how will you have resources distributed? Well you’re more than likely going to suggest a system of coercion, eg some government structure like socialism or communism or maybe even AI like the zeitgeist movement.
My advice to you, if you truly aren’t ideological as you imply, think about property from first principles, rather than mired in what empires and coercive structures have done with “property”. Coercive structures corrupt everything they touch, that is the nature of violence.
This. A perfect example can be found in The Poverty of Slavery.
Slavery in the US did not enrich the South ante bellum, it kept the South poor (and high tariffs on industrial good, pushed by the North, also contributed.)
And the left wing governments are by far the biggest wasters and the biggest thieves. Just look at what DOGE has uncovered!
To be fair, the US government has grown (in wastefulness) with both Republicans and Democrats in charge.
Is DOGE going to cut welfare? Pensions? No, it’s political suicide. The system is incapable of truly removing waste because it’s fundamentally a corrupt system.
But it’s good to see that attitude shift in that direction. Well, unless you’re an accelerationist.
This is a straw man paper. “Capitalism” is a Marxian term and also one notably undefined by the author.
The real point is that objective living standards did not change from ancient agricultural societies until the early 1800s. An Englishman in 1790 had roughly the same amount of food, clothing and living space, and health and life expectancy, as Roman Briton 1700 years earlier.
The fact that Britain in 1790 was far more technologically advanced dis not change this equivalency, due to the “Iron Law of Wages”.
The miracle is that at a certain point, industrial production was able to reach a scale where production growth could exceed population growth.
Since no “socialist” economy existed until 1917, one can see this really has nothing to do with Socialism or Marxism. Socialist economies CAN also grow, but without any doubt their growth is much, much slower than non-Marxist/non-command/free-market economies, however one wishes to define that.
Can you recommend some sources for reading for me to follow up?
The most idiotic “sleigh of hand” article written by some one who has never really lived in a non capitalistic society
“Capitalism is the worst form of governance except for all other alternatives”
Very helpful, thanks. I guess the lingering question is: if capitalism was the solution to world hunger then why would we even need the UN pledges, world summits, and such like? If free markets automatically solve societies problems then funded initiatives to end world hunger or other forms of gross inequality would not be needed.
Access to capital is the biggest driver of growth in capitalism. Without it, growth is virtually impossible. If you can get a bank loan to buy livestock, the livestock will more than make enough money to pay off the loan. Access to global capital will massively reduce the time it takes to industrialize.
It could be said that food aid has caused much poverty and hunger and led to people fleeing the countryside for the shanty towns. Floods of cheap agribusiness surplus grain has impoverished what once were resilient rural societies . Who benefits in the end..the capitalists,and now all over the world good land is abandoned and villages deserted so that the industrial complex has a supply of cheap labour.
This is a great insight. I would love for you to elaborate on this. Thank you for engaging.
The 19th C. Corn Laws come to mind. Do you keep prices high in order to keep a rural population in place, or let cheap imports flood in so industrial workers can survive on a pitiful wage? The exodus from the countryside then gives capital an ever cheaper source of slave labour.
Perhaps the true effects of industrial scale food aid could be a subject worthy of investigation.
This is idiotic. Pre-capitalist agrarian societies suffered severe periodic famines on a regular basis. Why do you think the world population barely grew in pre-capitalist times?
Awesome post, thanks for sharing. How would you expand this argument to poverty in developed countries? I keep running into circular arguments where people say poverty in the US isn’t an issue because being poor in America still puts you in the top percentile of incomes globally. To borrow your wording, it’s a disingenuous and amoral line of reasoning, but I’d love to have some more context behind that top percentile stat and any associate statistical sleight of hand. Where should I go first to learn more?
No sensible person will ever say that capitalism is perfect and will “eliminate” poverty and guarantee shared levels of wealth. But it’s obvious that it has done more to improve the human global condition than anything else. There is no such thing as the perfect solution on a global scale. But denying its value to increasing the chance of prosperity to the masses is just made up.
I’d settle from a little more realism from the free market crowd
The argument that poverty was not quite as high as some studies have suggested in the past is a reasonable position, including the PhD thesis written by Michalis Moatsos that used the BNPL poverty line on a global scale since 1820 .But the apparent stagnation or even increase in poverty suggested by Hickel and other researchers(Sullivan and Hickel). Is at odds with the best evidence at standard of living across countries since the emergence of a development towards a system of individual rights including economic freedom in parts of Europe, but later extending to western offshoots, east Asia and nowadays to various extents the entire world. https://www.tandfonline.com/doi/full/10.1080/03906701.2024.2380314#d1e755 Is a partial response to Hickel et al. of capitalism and global poverty, but especially the massive increase in poverty with liberalisation, acknowledged and supported by multiple Marxist and non-marxist scholars.
Thanks for the reply and additional sources.
On the topic of poverty in china there's issues with the transition from price controls to market prices in the BNPL. This was acknowledged by Moatsos 2021, but only partially addressed(still finding a dramatic decrease in poverty). The work of Martin ravallion and shaohua Chen on china addresses the concerns of Hickel and Sullivan work, including a greater share(and thus potential negative impact) of food prices or the poor in china. They overall come to the conclusion that an unsteady but real poverty decline happened in china(supported by objective data on malnutrition, calories etc during 1980s up until today).
Thanks again. Will look up their work.
this is a very well-written article. I'd like to see the people who say capitalism is working explain how so many people are still in inescapable poverty.
Noah Smith responds to Hickel here: https://www.noahpinion.blog/p/against-hickelism
I was not aware that Smith and Hickel had a public fight. I’m not too impressed with Smith as he dismisses Marx without reading or understanding him. Hickel is not the only person to criticise the World Bank’s poverty line. And it would be interesting to see how Smith replies to Hickel’s more recent work about the problems with using 1820 as a benchmark and his work showing poverty in China sharply increased with the implementation of free market reforms.
He does also seem to be criticising a fairly narrow aspect of Hickel’s work given how much ground his books and research cover. It seems to be a bit selective in the criticism which comes off as suspect.
I do admit to being sympathetic to Hickel’s overall view though so haven’t looked too much at his critics.
Hickel's a perennial lolcow over at Reddit's /r/BadEconomics. A comment that sums of the experience of a person with a background in economics reading a typical Hickel paper:
"I had to skim through a couple times thinking that it had to be more complicated than that and I was just missing it. But no, it's not. It really is that stupid."
There was one a couple of years ago where he claimed that rich countries were stealing from poor countries by trading with them. He arrived at this conclusion by multiplying the value of all goods imported to high-income countries from low-income countries by the difference in average price level between poor and rich countries. E.g. if the rich world imports goods sold for a trillion dollars, and prices are on average three times as high in high-income countries, then they've "stolen" 2/3 of a trillion dollars.
There are many problems with Hickel's reasoning here, but one of the most embarrassing is his failure to account for the fact that price differences between countries are concentrated in non-tradeable goods and services (real estate, personal services, perishable goods), whereas the prices of tradeable goods tend to be fairly uniform across countries after accounting for shipping, tariffs, and retail overhead.
This is fairly typical of Hickel's work: Making extremely strong claims that a) are facially ridiculous, and b) turn out on examination to be based on some elementary fallacy. The guy is just not very smart.
Thanks for that explanation. Do people have issues with his critiques of poverty lines? He’s not the only one that has those criticisms. And his data on proxy measures of poverty before 1820 in his 2022 paper and his China analysis in 2024 seemed sound. Seems a bit more in an anthropology wheelhouse.
Brilliantly written. Lies, damned lies and statistics.