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Why does poverty exist? How can poverty be alleviated?

Why poverty still exists?

Poverty is inextricably linked to access to employment, food and shelter, health services, and education. I became acutely aware of this during the seven years in the 1980s when we lived in the Congo and again upon our return to Canada when I spent more time with First Nations and Inuit both in urban and remote communities.

We acknowledge the impressive progress that has been made globally lifting so many out of absolute poverty. My more recent concern, however, is focused more on the complex and contradictory situation in the United States, the wealthiest country in the industrialized that leads the world in poverty. To understand why I have been reading a number of books and articles by economists, social scientists and journalists. My contributions to the conversation will be informed by several ideas gleaned from my reading. Robert Rank’s work on poverty and inequality, particularly Chasing the American Dream: Understanding What Shapes Our Fortunes (2014), and One Nation, Underprivileged: Why American Poverty Affects Us All (2005), Thomas Pikkety’s Capital in the Twenty-First Century, Thomas Friedman’s Thank You for Being Late, and by Jonathan Haidt’s The Righteous Mind.’

As Baha’is we are asked to be anxiously concerned with the age in which we live. While we are encouraged to be compassionate and caring and to reduce the suffering of the poor, we are all called upon to earn a living through a trade or a profession for example. Dave has compiled some related readings on poverty from the Baha’i writings.

Almost 80 percent of [Americans] “experience significant economic insecurity at some point between ages 25 and 60” this includes families where both parents have graduate degrees and had been gainfully employed. Their findings reveal “a rising economic risk of acute poverty for individuals, one that is consistent with recent observations and research suggesting that a growing number of Americans will eventually find themselves in an economically precarious position”.

Rank, Hirschl and Daniel A. Sandoval demonstrated “for the first time that the risk of American poverty had become “exceedingly high” and had “increased substantially during the 1990s in comparison with the 1970s and 1980s”. “[P]overty has become a routine and unfortunate part of the American life course”.[15]

Rank, Hirschl and Daniel A. Sandoval as well as other analysts who have revealed “indicators and patterns over since the 1980s. They cite weakened “job security”, more Americans who were “without health care”, increased “income volatility and downward mobility”, a “seriously eroded” “social safety net”, stagnation in men’s earnings, the widening gap in income and wealth inequality, and a record high level of consumer debt.

By 2016, ordinary citizens, academics and policy makers were preoccupied with two economic issues in particular: “widespread economic insecurity and soaring levels of income inequality.

Robert Rank, author of Chasing the American Dream: Understanding What Shapes Our Fortunes (2014), and One Nation, Underprivileged: Why American Poverty Affects Us All (2005)
c Rank’s research based on “44 years of longitudinal data regarding individuals from ages 25 to 60 According to Rank, between the early 1970s and 2014, “those in the top 20 percent… experienced real economic gains” and the “gap between the top and bottom of the income distribution” in the United States “expanded significantly”. Gains were “heavily concentrated in the top 10, 5 and — most famously — 1 percent”. The “risk of acute poverty increased substantially, particularly in the 1990s” particularly “for individuals in their 20s, 30s, and 40s; for all age groups with respect to extreme poverty; and for white males”.

Thomas Pikkety’s most recent book, Capital in the Twenty-First Century, focuses on wealth and income inequality in Europe and the US since the 18th century. Pikkety relies on economic data going back 250 years to show that an ever-rising concentration of wealth is not self-correcting. To address this problem, he proposes redistribution through a progressive global tax on wealth. Following the Second World War, after initially undergoing a decrease in economic inequality similar to that in continental Europe, English-speaking countries have, over the past thirty years, experienced increasing inequalities. The book’s central thesis is that inequality is not an accident but rather a feature of capitalism that can be reversed only through state intervention.[43] The book thus argues that unless capitalism is reformed, the very democratic order will be threatened.[43] Piketty offered a “possible remedy: a global tax on wealth.”[45]

Thomas Friedman’s Thank You for Being Late. Human capacity to adapt is being outpaced by a “supernova,” built from three ever faster things: technology, the market (globalization) and climate change.

In his book, The Righteous Mind Jonathan Haidt describes how polarization has made countries almost ungovernable. Liberals, conservatives and libertarians each claim the moral high ground and no longer listen to those whose views differ from their own. Each has a different explanation and solution for poverty. He uses terms such as compassion, caring and proportionality.

Poverty has multiple causes – linked and compounding
Personal individual level
• unexpected crisis
o a serious health problem, job loss, or divorce
 worsened when compounded with other risk factors
• low education
• limited skills training
• lack of savings
• lack of family supports
• personal struggle – physical, mental, or emotional

Structural level
• changing market demand for skills or labour (manufacturing to service industry)
• gaps in social safety nets
• lack of access to quality education, housing, health, food (high cost, etc)
• systemic discrimination (gender, race, ageism, etc)

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