ROBERT LEKACH MAN
71
daily proving to be, Nixon's 1972 visit
to
Moscow sharply devalued
the credibility of the Russian threat
to
the political independence of
Western Europe and drastically increased Congressional resistance
to
Pentagon budgetary escalation.
No doubt Western prosperity could have survived detente,
particularly
if
trade with Russia dramatically increased. OPEC's five–
fold increase in petroleum charges proved to be another matter. In
1975 the probable balance of payments surplus of the cartel countries
will approximate $50 billion.
It
is likely that North America., Japan,
and the Common Market will be in rough balance of payments
equilibrium and substantial merchandise surplus with OPEC,
although it is worth emphasizing that the balance is attained by
shipping directly or indirectly
to
the OPEC bloc merchandise
which otherwise would be available to maintain or raise living
standards in oil importing countries.
The condition of the Fourth World, poor societies unblessed
by oil, is far more desperate. Their 1975 balance of payments
deficit of $35 billion substantially exceeds foreign aid and loans
from all sources. Thus it is that OPEC's spectacular triumphs have
aggravated (though not caused) a global crisis of development.
"It
is now clear," recently observed Hollis Chenery of the World
Bank, "that more than a decade of rapid growth in underdeveloped
countries has been of little or no benefit
to
perhaps a third of the
population," for, continued Chenery, "Although the average per
capita income of the Third World has increased by fifty percent since
1960, this growth has been very unequally distributed among coun–
tries, regions within countries, and socio-economic groups."
It
IS
worth quoting this impeccably respectable expert a trifle further:
Recent evidence confirms earlier speculations that in the early
stages of development the distribution of income tends to
become more concentrated. Increases in output come dis–
proportionately from relatively small modern sectors of primary
production and industry, which absorb a high proportion of total
investment and have relatively high rates of productivity growth.
This pattern of concentrated growth is perpetuated by limited
access to land, credit, education, and modern-sector employ–
ment, and is often reinforced, unintentionally or otherwise, by
the government's fiscal and trade policies as well as the distribu–
tion of public expenditures.
