For the promise of “Billions to Trillions” to materialize, we must take more risky bets.
Imagine an informed gambler, who understands that casino games have negative expected value—play long enough and you’ll certainly lose. But she plays anyway as she enjoys the game and maybe there will be a win along the way. She sets herself a nightly limit—when her money is gone, she quits.
One day, she sees a new game and starts playing. After playing awhile she realizes that her winnings are mounting, and, looking around the table, she realizes that it’s true of all the other players too. She increases the size of her bets—and her wins. She bets more, and more, and….
The SDGs are asking the world to take a big bet. Move from billions—which is small change in the world economy—to trillions: not enormous, but hefty. The trouble is that the billions bet on development in the past haven’t paid off terribly well. So, there’s a hesitancy to bet more on the same game we’ve played in the past.
There’s some attempt at innovation, but it’s slow, as the “powers that be” are risk averse. Development banks are exploring innovative projects and financing techniques, but on the margin, to protect their AAA balance sheets. Financial markets look for investments that can be bought and sold in under five years rather than longer-term, bigger-payoff (and riskier) projects. Aid disbursed from traditional donors goes to known good performers or international agencies to ward off criticism from skeptical constituents. Developing country officials need to increase their tax base for SDG investment, but fear political retribution if taxes go up.
Instead, we need to bet more on new ways of doing business, new kinds of projects, new tax regimes. We need to ramp up these small experiments both in terms of size and scope. To do this, leaders must be willing to break old rules, understand that many bets won’t pay off, and risk that the “magic bullets” will never be found. And we need to draw more players to the table, to raise the pot and the returns. But if we continue to play the same old development games, billions will never become trillions. We’re running out of time if we want to make the SDGs a reality in 2030.