Redistributing Wealth: A Global Imperative for Peace

The objective of efficient anti-poverty policies has been restricted by a lack of credible information regarding the degree, depth, and persistence of poverty on the continent.

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Per capita consumption is not the only way to measure poverty and so there have been attempts to develop other methods, but data deficiency and excessive subjectivity have been problems [ Photo: Mint, India]

POVERTY AND ENCYCLOPEDIA BRITANNICA

Poverty, as defined by Encyclopedia Britannica, refers to the state of lacking a usual or socially acceptable amount of money or material possessions. It is said to exist when individuals lack the means to satisfy their basic needs. These needs can be narrowly defined as those necessary for survival or more broadly as those reflecting the prevailing standard of living in a community. The concept of poverty is further complicated by non-economic factors such as poor health, low education levels, and other attributes that may coexist with poverty. In simpler terms, poverty means not having enough resources to meet essential requirements like food, clothing, and shelter. It’s a condition that affects people’s well-being and quality of life. Whether we consider the bare minimum for survival or a more comprehensive standard of living, poverty remains a significant challenge that societies strive to address.

SOUTH AFRICAN PRESIDENT’S LENGTHY ARTICLE ON POVERTY

The current South African President, Cyril Ramaphosa, in a lengthy article, has highlighted the causes, effects, and characteristics of poverty. The aim of this article, President Ramaphosa says, is to examine the concept of poverty in terms of definition, types, causes, determinants, and indicators. The relationship between inequality and poverty is also visited. The absolute and relative approaches to the definition of poverty are examined. Poverty is defined as the inability of individuals or households to attain sufficient resources to satisfy a socially acceptable minimum standard of living. Characteristics that determine poverty include individual, community, household, and regional characteristics. Lack of access to basic services such as dwelling, electricity, water, and sanitation was found to aggravate poverty. Socio-economic factors such as unemployment, education level, gender, income, and household size also affect poverty. Causes, determinants, and types of poverty must first be understood before poverty can be alleviated. Poverty remains a problem in South Africa twenty years after the transition to democracy. This article is thus intended to provide the public, politicians, and policymakers with a better understanding of the word “poverty” and, therefore, help in the alleviation of poverty.

INTRODUCTION

The concept of poverty has been a subject of debate for many centuries. The conceptualization and definition of poverty have led to the formation of strategies to alleviate poverty. It is, therefore, important that concepts, definitions, and measurements of poverty are applicable to the society in which they are applied. Poverty is a continuous problem that has presented political and ethical challenges to societies. It is a familiar word that everyone thinks they understand. Specifically, however, the meaning attached to the word poverty depends upon the basic concept people have of it. Poverty is experienced in different ways, leading to different meanings and their impact on an accurate definition. Alleviation of poverty in Sub-Saharan Africa has been debated for a number of years. The intricate challenge of developing and implementing poverty alleviation policies is evidenced through discussions and resources earmarked for this purpose. The objective of efficient anti-poverty policies has been restricted by a lack of credible information regarding the degree, depth, and persistence of poverty on the continent. The unavailability of accessible methods for the evaluation of the effects of poverty alleviation policies also restrains efficient anti-poverty policies.

The problem of poverty and inequality continues to trouble South Africa twenty years after the transition to democracy. It can be said that poverty in South Africa is an outcome of the now-defunct Apartheid policy which discriminated against the majority of citizens. One of the key elements of the Apartheid policy was large-scale land dispossession. The Black population was grouped according to ethnicity and removed from their lands to poorly-resourced homelands. Black labor, however, was also required in the mining and industrial sectors, and this caused the development of a large-scale migratory labor system, a system which worsened the problem of poverty. The end of Apartheid in South Africa left the population with enormous inequalities across racial groups. Using a poverty line of South African currency R322 (at prices in 2000), at least 58% of all South Africans and 68% of Blacks were found to be living in poverty in 1995 – in the same year, none of the White population was living in poverty. The end of Apartheid brought high hopes of a future characterized by shared economic growth and employment creation, and thereby alleviation of poverty and its associated scourges. According to an analyst after more than a decade of democracy, South Africa is still a country with high levels of poverty and income inequality. In its quest to address the problems of poverty and inequality, the South African government has sought to provide a policy framework, regulations, policies, and laws for integrated and coherent socio-economic development in urban areas. This raises the question of what the socio-economic constraints to employment creation and poverty alleviation have been. In order to alleviate poverty, a thorough understanding of poverty is needed. The purpose of this paper is to aid policymakers in drafting policies which will lead towards the alleviation of poverty. The article will, therefore, concentrate on definition, indicators, causes, and poverty and inequality.

DEFINITION OF POVERTY

People interpret and understand poverty differently. There are, therefore, different meanings attached to poverty and its impact on society. What is important about these different meanings of poverty is that they all involve a common element of material insufficiency – especially the lack of resources needed for survival. Poverty studies and definitions thus lead to an identification of goods needed by human beings in order to keep on living. An important factor regarding the definition of poverty is the ability to function as a full and active member of society and have individual dignity.

The consideration of poverty from a broader perspective is derived from a global acknowledgment that poverty is more than just having enough income to live by. It is now widely acknowledged that poverty is a multi-dimensional phenomenon which includes other essential dimensions of living standards. In addition to income and consumption, health and education are now part of the definition of poverty. Another analyst points out that defining poverty is a difficult task. Public and private initiatives, as well as the direction of policy regarding poverty alleviation, will all determine how poverty is defined – to answer the question, “Who is poor?” There are varying perspectives on what poverty is. There is a need to consider the factors discussed below when defining poverty.

DEPRIVATION OF BASIC NEEDS

According to the International Labour Office (ILO), definitions of poverty are based on the idea of a state of deprivation. What are regarded as basic needs or necessities by one researcher might not be regarded as such by another. More personal needs, basic needs, and wants vary from place to place and time to time. If basic needs are divided into two categories, what is regarded as a need in one area may simply be regarded as a want in another area. The first category includes minimum requirements of a family for private consumption, such as adequate food, shelter, clothing, and household equipment and furniture. The second category includes essential services provided by and for the community, such as clean drinking water, sanitation, public transport, and health and education facilities.

POLITICAL AND CULTURAL INFLUENCES

In South Africa, the proposition that poverty is a political issue is clear, since many definitions of poverty are attached to income, inequalities, and disparities resulting from past policies. It has been stated that the Poverty and Inequality Report of 1998 does not separate the notion of poverty from inequality. There seems to be an unquestioned assumption regarding the existence of a cause and effect relationship between the two, according to PIR. A prevailing political climate can, therefore, underpin the definition of poverty. The population of South Africa consists of different cultural groups; therefore, people may be viewed as poor or better off, depending on the cultural group to which they belong.

ABSOLUTE AND RELATIVE APPROACH TO POVERTY

The definition of poverty is based on cash income, from all public and private sources, other than capital gains. This definition neglects public or private non-cash benefits, such as food stamps, medical benefits, and employer-provided health insurance, and does not subtract taxes. It must be taken into consideration that both non-cash benefits and taxes affect a family’s standard of living. Others recognize two main approaches to the definition of poverty. The first is the absolute approach which regards poverty lines as the absolute subsistence level; that is the level of living necessary to maintain health and the ability to work. The absolute approach views poverty as the failure of needs fulfilment, which impairs the ability of the individual or the family to function adequately in society.

There are also certain minimum needs necessary for engaging in social life and maintaining a family which must be met, other than simply maintaining health and the ability to work. The second approach, the relative approach, regards poverty as a relative concept. The relative approach maintains that poverty can be understood only as part of a given society, and that the situation of the poor is determined by its distance from the other strata of society. According to the relative approach, those belonging to the lowest fraction of the economy are the poor. Envisaging poverty as an absolute condition is usually based on the opinion of subsistence. Subsistence is defined as having the minimum basic needs to sustain life, and being below the subsistence level is to be experiencing absolute poverty because one does not have enough for survival.

The concept of absolute poverty refers to poverty that exists independently of any reference group. It does not depend on the general living standards of the society in which it is conceived, nor does it vary over time. In this instance, poverty refers to a state of deprivation defined in relation to a supposedly objective, invariant, and value-free external definition of basic human needs. The standard of absolute poverty supposedly does not change according to prevailing living standards of a society, or over time, or according to the needs of different groups in society. According to a scholar, the poor are those who have regular, though minimal, income, while the very poor are those whose income, for whatever reason, falls far below the subsistence level. The functional word in this approach is income. Income which consistently falls short of providing the basic necessities of life is regarded as the major cause of poverty. Absolute poverty, therefore, can be defined as having no access to the resources which meet absolute needs.

The common approach in measuring absolute poverty is to estimate the cost of a bundle of goods which is deemed to be basic. There are two flaws in the absolute poverty definition. Firstly, its determination is a matter of judgment, and levels of subsistence change over time, as do people’s expectations. Secondly, it takes no account of socio-cultural needs – namely, that an item can be seen as a luxury in one context but as a necessity in another, provided the poverty line is not constructed using the demographics of the context in question.

The absolute poverty definition goes beyond subsistence and defining poverty in relation to the accepted standard of living in a society, or the custom of the country. The relative approach is a more subjective measure than the absolute approach. The relative definition of poverty is based upon a comparison between the standard of living of those who are worse-off and those who are generally better off. An analyst proposes that people are poor if their resources fall significantly below those of the rest of the community. This means that their income is consistently below the level that would allow them to attain a specific average standard of living. Some scholars define relative poverty from three perspectives.

Firstly, the relative approach is defined in relation to living standards of a reference group. Secondly, it is defined in terms of resources required to participate fully in society and thirdly, in a narrower way, by reference to the national income and/or expenditure distribution. Those who are poor, therefore, command amenities and resources that are far below those that are attained by society. A measure of poverty is not only socially determined but must also be acceptable to the community involved, if it is to be socially acceptable. This shows that acceptability within a certain culture or community has an important role to play in the definition of relative poverty. This implies an existence of inequality in wealth and income distribution that leads to an unbalanced societal classification and social classes.

TYPES OF POVERTY

The community would identify those who are visibly starving and unable to meet their basic nutritional requirements as being poor. However, there would likely be disagreement over whether a person who wished to own or have access to an automobile like the rest of his neighbors, and was subsequently marginalized from the benefits that its use might directly or indirectly bring, could be labelled as being in poverty. There is a tradition of work on the culture of poverty that attributes the persistence of poverty to the cultural attributes of the poor groups. Poverty can be identified as follows:

  • Situational poverty exists because of a crisis or loss that has occurred and is often temporary. Events that can cause situational poverty include environmental disasters, divorce, or severe health problems.
  • Generational poverty occurs when there are at least two generations which have been born into poverty. Children who are born into poverty are likely to suffer from poverty. Families living in this type of poverty find it difficult to move out of their situation.
  • Urban poverty occurs in metropolitan areas with a population size of at least fifty thousand people. The urban poor deal with a complex aggregate of chronic and acute stressors and are dependent on often inadequate large city services.
  • Rural poverty occurs in areas with populations below fifty thousand people. In rural areas, there are more single guardian households, and families often have less access to services, support for disabilities, and quality education opportunities. Programs to encourage the transition from welfare to work are problematic in remote rural areas, where job opportunities are few.

CAUSES OF POVERTY

Poverty is increased not only by the incidence of depth but by a more unequal distribution of private consumption among the poor. Lack of food and nutritional security, income security, social security, and human security build up the ingredients of poverty. When people have physical and economic access to sufficient safe and nutritional food to meet daily needs, and food preferences for an active and healthy life at all times, then this is referred to as food security. Income security refers to income brought home through regular employment. Social security means access to education, health services, and opportunity for the acquisition of skills, and human security. The causes of poverty in Africa are multi-faceted and include economic, social, and political, international and national (macro and micro) factors. The failings of the political systems and the social forces are identified as the key primary causal factors underlying the poverty problem in most Black countries. Some have explained that poverty rate increases during recessions and that it is directly proportional to average income.

The weak rule of law and poor governance can discourage investment and perpetuate poverty. Poor access to affordable education increases poverty and high levels of corruption undermine efforts to make a suitable impact on poverty. Healthcare services can also cause poverty. Poor access to affordable healthcare makes individuals less resilient to economic hardship and more vulnerable to poverty. Children are vulnerable to poverty if they receive inadequate nutrition, which undermines their ability to develop full human capabilities. Geographic factors such as access to fertile lands, fresh water, minerals and natural factors such as climate change can also lead to increased poverty. According to some scholars there are three basic explanations to the causes of poverty: namely, residual, pathological, and structural. These are discussed in detail below.

  • According to the residuals explanation, poverty happens as a result of being “left out”. This approach assumes that “the rising tide lifts all boats”. As the economy grows, almost all people are empowered; however, a few people are left out. Residualists assume that economic growth and participation counteract poverty and, as such, are often linked to explanations of the persistence of poverty which plagues the poor.
  • The pathological explanations of poverty regard people as being responsible for their own poverty. Simply stated, those who advocate for such an analysis of the causes of poverty would argue that each individual contributes to his being poor and should be responsible for moving himself out of poverty. The pathological explanations view jobless people as being responsible for being unemployed. The pathological explanations do not take into consideration labor surplus, shortage of opportunities, and cost of finding and maintaining a low paying job.
  • The structural explanation identifies the system (growth and development) as producing poverty and inequality. To remedy this situation would be to change the system. This is very evident in the South African economy where it is believed that unemployment causes poverty. This is influenced by global and national production strategies. According to the World Bank poverty may be due to national, sector, community, household, or individual characteristics.

CONCLUSION

President Cyril Ramaphosa has further explained that economic growth and participation counteract poverty and, as such, are often linked to explanations of the persistence of poverty which plagues the poor. The pathological explanations of poverty regard people as being responsible for their own poverty. Simply stated, those who advocate for such an analysis of the causes of poverty would argue that each individual contributes to his being poor and should be responsible for moving himself out of poverty. The pathological explanations view jobless people as being responsible for being unemployed. The pathological explanations do not take into consideration labor surplus, shortage of opportunities, and cost of finding and maintaining a low paying job. The structural explanation identifies the system (growth and development) as producing poverty and inequality. To remedy this situation would be to change the system. This is very evident in the South African economy where it is believed that unemployment causes poverty. This is influenced by global and national production strategies.

According to the World Bank poverty may be due to national, sector, community, household, or individual characteristics. Besides President Ramaphosa’s detailed explanation of poverty, South Africa is entitled to the gratitude of the Islamic World for its stand against Israel’s on the question of Palestine and her insistence that there can be no peace in Palestine unless Israeli Prime Minister Benjamin Netanyahu is driven out of Israeli politics. The complex world of today cannot afford a repetition of Holocaust which the Jews themselves had been victims too.

Kazi Anwarul Masud

Kazi Anwarul Masud is a retired Bangladeshi diplomat. During his tenure, he worked in several countries as the ambassador of Bangladesh including Thailand, Vietnam, South Korea and Germany

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