What's a rich country? It might seem an innocuously straightforward question. But it's not. Rich enough to do what? If you define rich as being able to afford long-range missiles and nuclear weapons, then even poverty-plagued North Korea qualifies (as long as you aren't too concerned about whether the missiles actually work). What about being rich enough to ensure a decent life for all your country's citizens? Many in the United States and Europe would argue that even their developed countries, with the world's highest standards of living, aren't rich by that measure. Or what about being rich enough to be a good global citizen, providing aid to those in more desperate need?
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The good news is that, by almost any definition, there are a lot more rich countries than there used to be. The number of countries classified by the World Bank as "low income" -- at or below a national average of $1,005 per person per year -- fell from 63 to 35 between 2000 and 2010. That means there are now more middle-income countries than ever, while still other countries have moved up from middle-income to high-income status. And because rich countries generally lead the charge when it comes to providing aid to other places that need it, a lot more countries could soon be contributing to the global general good. The rise of the nouveau riche could really help change the world.
The United Nations classification of "developed regions" currently comprises Australia, Canada, Japan, New Zealand, the United States, and Europe as far as Russia. It's a group that basically includes the countries on top of the global income rankings; in other words, it's all relative, indicating status in the world pecking order, not necessarily wealth itself. And it's a definition that comes with obligations. The U.N. encourages these countries to provide 0.7 percent of their gross national product to foreign development assistance; 16 countries have pledged to meet the target by 2015, and Denmark, Luxembourg, the Netherlands, Norway, and Sweden have already surpassed it.
This generous spirit is a longstanding tradition. Fifty-two years ago, in March 1960, the first meeting of the Development Assistance Group was called to order in Washington by Italian U.N. Ambassador Egidio Ortona. Officials from Belgium, Britain, Canada, France, Germany, Italy, Portugal, and the United States discussed their assistance programs to less-developed countries. Within months, Japan and the Netherlands had been asked to join. All were already giving money to poorer countries spread across Africa, Asia, and Latin America -- the idea was to encourage coordination and greater aid flows.
Yet, most strikingly, many of these donor countries were still reeling from World War II and were far from what we'd think of as rich today. Italy's annual income per capita in 1961, according to the late economic historian Angus Maddison, was $6,373. That's less than the average 2008 incomes in Brazil, China, Malaysia, Mexico, Russia, and Thailand (measured in constant dollars). And Italy, mind you, was twice as rich as Portugal was in 1961. By 2008, Egypt and South Africa were already considerably better off than Portugal was back then, while India was roughly on par -- and it's surely richer today.
According to Maddison's data, about 28 percent of the world's population in 1961 lived in countries richer than Portugal, the poorest of the Development Assistance Group members. By 2008, 61 percent of the world lived in countries richer than Portugal was in 1961. In 1961, 75 percent of the world's GDP was produced by countries richer than Portugal. By 2008, that proportion had climbed to 89 percent. Here's the point: Today, most people live in, and the vast majority of the world's output is produced by, countries that would have been considered rich in 1961.
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