Phatscotty wrote:okay, I want to ask something else.
How much food can you get for $1.25 in China? Laos? Somalia? Guatemala?
I used to make the assumption you did, PS: when people quoted numbers about how many people were living on less than $1/day, I knew that one US dollar would purchase a lot more in those nations than it would in the US. When I learned that this assumption was incorrect, and that the estimate of > 1 billion was based on purchasing power parity, I was stunned. It is quite seriously true that for 1.3 billion people around the world, their daily subsistence is based on what you could buy for $1.25 in an American supermarket. You can't buy a lot for that amount of money in such a supermarket. As I pointed out, a two liter bottle of soda costs more than that. Another way to think about it is to take what $1.25 would buy in the US, and convert that to whatever amount of local currency units would buy the same amount of food. The end result is the same. It's explicitly not based on exchange rates, which is what you are thinking of.
I'm such an American that I can hardly even imagine what it's like to live that way, and I've never visited an undeveloped nation that could help me see for myself. It's honestly hard for me to process, given how much relative wealth exists around me. I just know it's bad.