Sustainable Development: Are We Making Progress Or Just Chasing Rainbows?
I confess that I’m an “Annual Meeting” fanatic. I enjoy attending these once-a-year meetings of management and shareholders. It’s the recap of the past 12 months, the best opportunity I know of to get to know the people who run the organization: to catch a glimpse of their personalities and what they have planned for the future.
Just such a meeting occurred on Monday, although it needed more structure and detail provided at the Annual Meetings for public companies we have here in the US.
The occasion was the 15th anniversary of the United Nation’s Sustainable Development Goals, the halfway point of a program envisioned to be completed in 2030, just over six years from now. That’s just the precision investors look for specific goals with a set time to achieve them.
Unfortunately, in too many of the Sustainable Development Goals, there are at least two variables, meaning that the Goal may be achieved by either improvement in one factor OR a decline in the other factor. Gender Equality (SDG#5) is like that. In that case, more equality may be achieved either by an improvement in the economic outlook for Women or a decline in the economic outlook for men. The same can be said for SDG#10 Reduced Inequalities.
So, let’s look at three of the 17 Sustainable Development Goals, using data from the US Federal Reserve, to see how three of the most pivotal goals are working out so far.
Sustainable Development Goal #1 Poverty
The Goal here is to eliminate “Extreme Poverty.” Their measure is the World Bank’s “International Poverty Line.” The concept is that the poorest among us receive sufficient money to provide for one’s necessities: food, clothing, and shelter. In 2022, Extreme Poverty was defined as living on less than $1.90 per day or up to $5.50 per day in higher-income countries.
Here, the United Nations finds the same results as we observed in the United States: Poverty is increasing, not decreasing. While the United Nations reports that Poverty has increased by 7% in the last couple of years worldwide, Poverty in the US rose by less than 1%. With just seven years left to eliminate Poverty, this task is getting all the more difficult.
Sustainable Development Goal #2 Zero Hunger
The Goal here is to eliminate Global Hunger. There are several dimensions to how the UN looks at providing food for the World’s population, including sustainable farming practices and particular nutrition requirements. But we can use price to approximate the intersection between supply and demand reasonably. And with the World’s population steady, an increase or decrease in price should reflect an increase or decrease in supply. Again, using the Federal Reserve’s data, the global food price has increased by roughly 40%. (H1, 2015 to H1, 2023). Food supply has taken a giant reversal in the seven years of SDG. While exogenous factors may be involved (such as the COVID-19 pandemic), the UN is not meeting the challenge of Global Hunger.
Sustainable Development Goal #7 Energy
The United Nations estimates that 800K people live without electricity globally. The UN aims to provide electricity primarily using “clean,” i.e. renewable energy sources.
Again, price provides that intersect between supply and demand.
From 2015 until 2023, the Global energy cost has risen by 44%. Yet another Sustainable Development Goal that is drifting away, becoming less likely rather than more likely.
Speaking before the UN on Monday, Secretary-General Antonio Guterres indicated that 30% of the Sustainable Development Targets are below the levels needed to meet their 2030 goals. And many of these goals are lower than when the Project began. These declines reflect a project that is off the rails and increasingly appears that it will fail.
Sustainable Development Goal #17 Partnership
So, what’s the answer to this less-than-stellar track record? Why, money, of course.
Sustainable Development Goal #17 is Partnership. To the United Nations, it appears that the United States and the other UN member nations must become more of a “partner” in this plan, meaning providing more funding. Currently, the US provides $12.5 billion per year for UN operations, plus a few more billion here and there for any particular need that may come along.
But under Goal # 17, we need to be more of a partner, providing 7/10th% of our national economic output to Sustainable Development. Although it may not sound like much, that 7/10th of this year’s GDP would reach an astounding $178 Billion.
That’s a lot of money for a project that isn’t progressing.
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