Most UN reports take an optimistic view of poverty eradication
According to the Millennium Development Goals Report 2012, “for the first time both the number of people living in extreme poverty and the poverty rates fell in every developing region—including in sub-Saharan Africa, where rates are highest.”
In 2008, says the report, about 110 million fewer people than in 2005 lived in conditions of extreme poverty.
The World Bank confirms that the proportion of people living on less than US$1.25 a day (the agreed figure defining extreme poverty) fell from 43.1 percent in 1990 to 22.2 percent in 2008.
Therefore, the first Goal, which aims to halve the number of people living on less than a dollar a day by 2015, might not be that unachievable.
However, the World Bank cannot hide the fact that the food, fuel, and financial crises over the past four years have worsened the situation of vulnerable populations and prevented poverty reduction in many countries.
Even worse, the current crisis has increased the number of the so-called ‘working poor’, those workers whose incomes fall below a given poverty line. And this happens especially in industrialised countries hit by the downturn.
In the United States, for example, after decades of success in the fight against hunger, more and more families cannot afford to feed themselves.
There are about 46 million Americans – of all colors, ethnicities and backgrounds, who are living at or below the poverty line. Many subsist on ‘food stamps’, a federal programme that helps low-income households to buy food.
The number has increased by more than 14 million since 2008, the Nation reports.
The latest statistics by the European Commission show that one in four Europeans was threatened with poverty or social deprivation in 2010.
According to the report “115 million people, or 23 percent of the EU population, were designated as poor or socially deprived.”
“The main causes are unemployment, old age and low wages, with more than 8 percent of all employees in Europe now belonging to the working poor.”
There is no need to add that the most vulnerable, in these cases, are single parents, immigrants, young precarious workers – since the vast majority of new contracts are temporary – and the young unemployed.
Poverty-inducing policies
In spite of this situation, under the pretext of austerity, governments keep slashing social spending, increasing the retirement age, eliminating public-sector jobs and expanding low-wage sector—all measures that inevitably deepen poverty.
“Worldwide unemployment and poverty have grown enormously since the beginning of the economic and financial crisis in 2008. Again, we need to remind the world that powerful financial and business elites are still dictating policy and that ordinary people continue to suffer,” said Sharan Burrow, ITUC General Secretary on the occasion of the International Day for the Eradication of Poverty, held on Wednesday.
It is worth noting that the theme of the UN Plan of Action on the second decade for the Eradication of Poverty, from 2008 to 2017, is “Full employment and Decent Work for all”.
The formal aim is to raise awareness of the critical role of full employment and decent work, including social protection mechanisms, in poverty eradication.
Decent work means, above all, the defence and the promotion of some core labour standards, like freedom of association and the right to collective bargaining.
The latter is particularly important for wage determination and as an ‘economic stabilser’ to secure minimum incomes for poor households, especially where there are no minimum wages, social protection tools and other in-work benefits.
However, the traditional policy measures aimed at securing decent wages and working conditions are often weak in developing countries.
Unsustainable inequality
As a result, even if the poverty rate seems to decrease globally, the level of inequality is still high, especially within countries.
“The concentration of wealth at the very top is part of a much broader rise in disparities all along the income distribution,” comments Zanny Minton Beddoes, the economics editor of the Economist.
“The majority of the people on the planet live in countries where income disparities are bigger than they were a generation ago.”
This is particularly true in the world’s most unequal countries, such as South Africa, or continents, like Latin America.
Not surprisingly, the world’s richest man in the world is a Mexican, Carlos Slim, with a fortune of about US$ 69 billion. In Mexico, 51.3 per cent of the population lives below the poverty line of US$ 2 a day.
The US has 421 billionaires, Russia has 96, China 95 and India 48.
Minton Beddoes underlines the unsustainability of such income gaps. She argues that, inequality is economically inefficient, above all, since it prevents social mobility, weakens demand, slows down growth and contributes to financial crisis.
Other studies show that even in advanced economies increasing inequalities cannot but contribute to illnesses, such as obesity and suicide. Let alone conflict and social unrest.
