NY Times September 13, 1998 Worldwide, Most Are Consuming More, and the Rich Much More By BARBARA CROSSETTE Before the world slipped into a global financial crisis last year, consumption of goods and services was rising phenomenally in industrial and many developing nations, according to a U.N. report published last week. The costs of public and private consumption, still rising despite economic setbacks, will top $24 trillion this year, twice the 1975 level and six times that of 1950, the report said. But the gaps between the world's richest and poorest people have been steadily widening for years, an indicator that even if economies right themselves, there will be a huge backlog of unmet demands and needs, the kind that fuel popular unrest in an age of mass media. "Not everyone has been invited to the party," said James Gustave Speth, administrator of the U.N. Development Program, which released the Human Development Report 1998 last Wednesday. "Expectations have gone global but the affluence has not." In Africa, the report found, the average household consumes 20 percent less than it did 25 years ago. In many poor countries, in South Asia as well as Africa, fast-growing populations -- which are also living longer -- are depleting both natural resources and household purchasing power. In poor nations, where families tend to be much larger than in industrial societies, the average life span has risen from 46 to 62 in the last 36 years. Richer nations, on the other hand, are reducing population growth while increasing consumption. The 20 percent of people in high-income countries account for 86 percent of private consumption; the poorest 20 percent of the world's people consume only 1.3 percent of the pie, the report said. The richest fifth buy nine times as much meat, have access to nearly 50 times as many telephones and use more than 80 times the paper products and motorized vehicles than the poorest fifth. The report says that Americans spend more on cosmetics, $8 billion annually, and Europeans on ice cream, $11 billion, than it is estimated it would cost to provide basic education ($6 billion) or water and sanitation ($9 billion) to the more than 2 billion people worldwide who go without schools and toilets. The report only skirts the issue of what role the poorest nations themselves play in this predicament, some independent experts say. "The presumption there is that refraining from buying ice cream automatically finances immunizations in the third world," said Nicholas Eberstadt of the American Enterprise Institute in Washington. This is a fallacy, he said. Often, he added, there has been a "misuse of public resources in low income countries" and even if the money were available there is no guarantee that governments would spend it on the poor. In many developing countries, the gaps between rich and poor are far greater than in industrial countries. The rich avoid paying taxes, which could pay for basic services like schools and clinics. Conspicuous consumption is often glaring. "Even within the social sector," Eberstadt said, "the tendency is to spend disproportionately on the privileged." Military expenditures are often also disproportionately high, experts say. India, for example, now has a nuclear weapons program but not compulsory primary education. Worldwide, countries spend $780 billion on the military and people spend $400 billion on illicit drugs, the report says. The report recommends that to reduce inequalities within as well as among nations, consumption levels among the poor need to be raised to basic levels, while people with little experience in the international marketplace need more information and consumer protection laws and regulations. The reports also suggests that developing countries "leapfrog" over old technologies in developing more environmentally friendly sources of energy and other services. Otherwise, poor countries may relive some of the worst aspects of the Industrial Revolution. "Developing countries face a fundamental choice," the report says. "They can mimic the industrial countries, and go through a development phase that is dirty and wasteful and creates an enormous legacy of pollution. Or they can leapfrog over some of the steps followed by industrial countries and incorporate modern, efficient technologies." This would not restrain consumption, as some experts in the third world who are suspicious of advanced technology in labor-intensive countries argue, but could in fact increase consumption through efficiency with far less environmental damage, the report said. By 2050, 8 billion of the world's projected 9.5 billion people will be living in poor countries, the report said, and they will, if present trends continue, be destroying large areas of the earth. "The need is not so much for more consumption or less, but for a different pattern of consumption," Speth told reporters. "We will pay dearly later in migration, in the environment, in other problems." The Human Development Report 1998, like its predecessors, ranks nations according to the life they give their people rather than on the nation's traditional economic figures like per capita gross domestic product. The concept of a "human development index," which is at the heart of the report, was the idea of Mahbub ul Haq, a former finance minister of Pakistan and a World Bank official who died in July. This year Canada, France, Norway, the United States, Iceland, Finland, the Netherlands, Japan, New Zealand and Sweden rank as the top 10 of the 174 nations surveyed. At the other end of the scale, the 10 least developed countries in human terms are, from the bottom up, Sierra Leone, Niger, Burkino Faso, Mali, Burundi, Ethiopia, Eritrea, Guinea, Mozambique and Gambia. The report also tries to measure the relative positions of women in nations around the world. By standards of economic activity and political representation of women, some developing countries rise above industrial countries, and the United States ranks below the Nordic countries, Iceland, Austria, the Netherlands and Canada. The idea of measuring women's roles in vastly different cultures without reference to influences such as ethnicity and religion has been criticized. At the American Enterprise Institute, Eberstadt, a statistical expert, was dismissive. "Think of North Korea," he said. "North Korea has long boasted that over 48 percent of its work force is female. Is that a sign of liberation? Not exactly. In North Korea's Peoples Assembly, usually a quarter of its members are women, a higher proportion of women than in the United States Congress. What inferences does one draw from that? That women have more political opportunities in North Korea than in the United States?" The Human Development Report 1998 is published by Oxford University Press, 2001 Evans Road, Cary, NC 27513, and is available for $19.95.