Reflections Dr Mike Meegan Founder

" How we deal with pain, loss, problems depends on how clearly we know our own centre . We need to absorb the anger of another to be wounded by it."


Michael Meegan
Changing the World
www.michaelmeegan.com
http://www.michaelmeegan.net/
www.eye-books.com


"We need to accept the energy to be scarred by unkindness . In each moment we have a critical choice, to allow events and external forces determine our joy , How we feel . "

Michael Meegan
Changing the World
www.michaelmeegan.com
http://www.michaelmeegan.net/
www.eye-books.com


" If we allow others to manipulate our emotions or change our inner thoughts, we allow them to alter our experience. This can shift our nature taking away personal happiness."


Michael Meegan
Changing the World
www.michaelmeegan.com
http://www.michaelmeegan.net/
www.eye-books.com


" The more we understand that we alone decide to be happy , not those around us. "


Michael Meegan
Changing the World
www.michaelmeegan.com
http://www.michaelmeegan.net/
www.eye-books.com


"We so often hear "you must feel terrible...". "poor you...." , " you Must be shattered.." it is a language of anxiety , it implies how you should be feeling within the narrow limits of how people manage situations in their own movie . They want you to be in their map of expected reaction and effect . We can break free of this trap by learning to reject patterns that build negative language and negative reactions"


Michael Meegan
Changing the World
www.michaelmeegan.com
http://www.michaelmeegan.net/
www.eye-books.com



"We are already eternal, the same spark as the dawn of creation. We are of the same power that is light , the same force that is love . We are of the same spirit that is our inevitable destiny , beginning.already eternal "


Michael Meegan
Changing the World
www.michaelmeegan.com
http://www.michaelmeegan.net/
www.eye-books.com

ICROSS women's groups wlll increase by 20% in 2011 as we extend maternal child health Dr Mke Meegan announced today

ICROSS women's groups will increase by 20% in 2011 as we extend maternal child health Dr Mike Meegan announced today

http://news.bbc.co.uk/1/hi/programmes/hardtalk/4675531.stm

" With so little we can change the lives of so many. For 30 years ICROSS has made a measurable difference in the lives of the poor. Our work continues to touch suffering among the most vulnerable , the destitute and the hungry . In 2011 we are launching three new initiatives to fight extreme poverty. Building on decades of work we are developing ,

1. Malaria prevention
2. Holistic diarrhea control
3. Expansion of maternal child health programmes

Dr Michael Meegan
Founder ICROSS
International director
Feb19 2011
Sent from my iPhone




--
Michael Elmore-Meegan MSc Community Health TCD
D Med HC NUI FRAMI
Founder International Director
www.icrossinternational.org
www.icrosskenya.org
www.michaelmeegan.com
http://www.michaelmeegan.net/
http://icrossprojects.blogspot.com/
http://twitter.com/#!/ICROSSprojects

ICROSS exhibitions www.afrca-awakes.com 2011

Awakening ICROSS

IL PROGETTO
2011: anno della cultura africana in Italia
Dopo 5 anni di esperienza a contatto con la cultura africana, per la realizzazione di reportage a fini
umanitari, torno a vivere stabilmente in Italia, pieno di interrogativi.
La civiltà africana e quella occidentale appartengono allo stesso mondo: negli ultimi anni ho
mostrato in gallerie e musei europei la bellezza primigenia africana. Parallelismi: gli istinti
rimangono gli stessi, le esigenze sono le stesse.
Ora, partendo dall’abissale scarto economico-tecnologico tra la civiltà primitiva sub-sahariana e la
realtà metropolitana occidentale, il mio percorso fotografico indaga nei tratti basilari delle esigenze
umane, contrapponendo e avvicinando dinamiche e gestualità. E' uno spunto di riflessione sulla
condizione del benessere (e sulla sua esasperazione).
Manuel Scrima

LA MOSTRA
La mostra sarà formata da circa 30 dittici fotografici, ossia coppie di fotografie, di cui una è scattata
in Africa, l’altra in Europa.
La realtà africana rappresentata è quella originaria delle tribù primitive, che ormai stanno
scomparendo. La realtà europea è la quella a cui siamo abituati tutti i giorni nelle grandi città.
Nelle immagini africane la natura è un tutto enigmatico, integro, profondo ed immenso ma
immobile e altro. La natura occidentale è alla nostra portata: interrogata, segmentata e scomposta
nell’infinitamente piccolo, oppure valorizzata con enfasi e trasformata fino all’irriconoscibile per
diventare nostra alleata e complice.
IL TEMA DELLA MOSTRA
Cosa ti viene in mente quando pensi all’Africa?
L’idea di questo progetto nasce da una constatazione: l’immagine che l’opinione pubblica
occidentale ha dell’Africa è spesso l’effetto delle sole campagne di sensibilizzazione. Queste
campagne, pur con lo scopo nobile di raccogliere fondi di beneficenza, tendono a rappresentare un
continente appestato, interamente e uniformemente, da una doppia miseria: l’indigenza e l’infelicità.
Tutto ciò che abbiamo per vivere felicemente (e che possiamo anche offrire, data l’abbondanza) a
loro è negato. Questo atteggiamento unilaterale si rivela scorretto, se pensiamo che nelle classifiche
sul livello di felicità soggettiva, ai vertici si trovano diversi paesi africani.
Dove lo stile di vita occidentale non è arrivato a dettare nuove regole, le tribù cosiddette primitive
conducono un’esistenza semplice e dignitosa, ma soprattutto articolata ed autonoma. Chi si trova in
quei luoghi, sempre più rari, s’imbatte in un nuovo universo di senso. Non si tratta semplicemente
dell’elemento, per noi invitante, dei paesaggi mozzafiato, dei riti misteriosi o dell’artigianato
esotico: quest’Africa è il risultato della sua propria storia.
La mostra è finalmente l’occasione di pensare l’Africa come soggetto di pensiero: al di fuori di ogni
desiderio di integrazione al nostro modello di felicità. Quell’Africa così lontana si propone di nuovo
suggestiva. Le azioni quotidiane di queste donne e di questi uomini, poste a fianco alle nostre,
illuminano le nostre pratiche di vita, spesso – apparentemente – sprovviste di un significato:
l’intensità del loro vissuto e la bellezza equilibrata e radiosa che esso sprigiona sembrano possibili
solo grazie all’essenzialità e al rifiuto di ogni piano evolutivo o velleità progressista.
Paradossalmente, la nostra ricerca di bellezza, in continuo stato di perfezionamento, si rivela meno
equilibrata e più fragile: così l’idea del continuo aggiornamento è l’unica possibilità di aspirazione
al successo. Il mondo della tribù sembra immunizzato al canto delle sirene pubblicitarie. I colori
colmano gli occhi, l’orizzonte si apre all’infinito, il buio ci parla, i gesti infondono consapevolezza,
la passione torna a esprimersi assieme allo stupore: un mondo “chiuso”, a dispetto delle promesse
della competitività, spalanca i sensi e libera la vitalità. L’uomo e la sua misura: questa condizione di
sintesi e di armonia è l’oggetto degli scatti africani.
Le fotografie europee non vogliono contrapporsi come esempio di avidità, decadimento o apatia. Al
contrario, il modello europeo ha accettato la sfida del progresso. Si lavora per migliorare le nostre
condizioni e lavorando s’invecchia: chi dovrà pienamente godere dei nostri sforzi sarà l’umanità del
futuro. E’ un atto, inconsapevole, di altruismo spregiudicato quanto inconsapevole. Di qui
l’immagine sarà mobile, sincopata, tesa. La nostra civiltà è ribelle (alla misura) e ottimista. Grazie a
questo ottimismo, decisamente intellettualistico per una civiltà appagata, sopporta il disequilibrio e
fa dell’insoddisfazione la sorgente della virtù cardine, la virtù dell’ambizione, il nostro vanto
segreto.

http://news.bbc.co.uk/1/hi/programmes/hardtalk/4675531.stm

http://news.bbc.co.uk/1/hi/programmes/hardtalk/4675531.stm


The recent G8 Summit at Gleneagles ended with an agreement to boost aid for developing countries by $50 billion.

The debt of some of Africa's poorest countries is also being cancelled. Michael Meegan runs a small charity trying to help some of Africa's poorest.

He doesn't think debt relief and more aid are the answer to the complex issue of lifting people out of poverty.

He talks to Stephen Sackur near one of his clinics in the Rift Valley - the home of the Masaai people.

HARDtalk can be seen on BBC World at 03:30 GMT, 0830 GMT, 1530 GMT, 1830 GMT, 2330 GMT

It can also be seen on BBC News 24 at 04:30 and 23:30

ICROSS on twitter

You can now follow us on Twitter at

http://twitter.com/#!/ICROSSprojects

You can find out more about our work at

www.icrossinternational.org
www.icrosskenya.org
http://icrossprojects.blogspot.com/
http://twitter.com/#!/ICROSSprojects

Lectures on Global health

Dr Michael Meegan is in Europe this week meeting with ICROSS Ireland Directors. ICROSS Ireland was created by Michael Meegan and Joe Barnes in 1979. The team is developing strategies to implement the new five year plan for ICROSS Rural health programmes in Africa. The ambitous expension of our health programmes builds on three decades of experience in African health care

causes of hunger and poverty

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4. Causes of Hunger are related to Poverty

Causes of Hunger are related to Poverty
Author and Page information

* by Anup Shah
* This Page Last Updated Sunday, October 03, 2010

* This page: http://www.globalissues.org/article/7/causes-of-hunger-are-related-to-poverty.
* To print all information e.g. expanded side notes, shows alternative links, use the print version:
o http://www.globalissues.org/print/article/7

Consider the following:

* Over 9 million people die worldwide each year because of hunger and malnutrition. 5 million are children.
* Approximately 1.2 billion people suffer from hunger (deficiency of calories and protein);
* Some 2 to 3.5 billion people have micronutrient deficiency (deficiency of vitamins and minerals);
* Yet, some 1.2 billion suffer from obesity (excess of fats and salt, often accompanied by deficiency of vitamins and minerals);
* Food wastage is also high:
o In the United Kingdom, “a shocking 30-40% of all food is never eaten;”
+ In the last decade the amount of food British people threw into the bin went up by 15%;
+ Overall, £20 billion (approximately $38 billion US dollars) worth of food is thrown away, every year.
o In the US 40-50% of all food ready for harvest never gets eaten
+ Of the food that does eventually reach households, some 14% is wasted, resulting in something like $43 billion of wastage
+ If food reaching supermarkets, restaurants and cafeterias is added to the household figure, that wastage goes up to 27%.
o In Sweden, families with small children throw out about a quarter of the food they buy
o In some parts of Africa a quarter or more of the crops go bad before they can be eaten. More generally, high losses in developing nations are mainly due to a lack of technology and infrastructure as well as insect infestations, microbial growth, damage and high temperatures and humidity.
o The impacts of this waste is not just financial. Environmentally this leads to:
+ Wasteful use of chemicals such as fertilizers and pesticides;
+ More fuel used for transportation;
+ More rotting food, creating more methane — one of the most harmful greenhouse gases that contributes to climate change.
+ Reducing wastage in the US by half could reduce adverse environmental impacts by 25 percent through reduced landfill use, soil depletion and applications of fertilizers, pesticides and herbicides.
* The direct medical cost of hunger and malnutrition is estimated at $30 billion each year.
*
Sources»

The first three stats come from a report by UK-based Centre for Food Policy, Thames Valley University and UK Public Health Association, titled Why health is the key for the future of farming and food, January 24, 2002. See page 10, Table 1 for the data.

The stats on food wastage come from
o The best meal you'll never have!, Costing the Earth, BBC Radio 4, April 14, 2005.
o Wasted Food blog also notes that more than 40% of food is wasted in the US
o U.S. Throws Away Half Its Food by Kate Melville, ScienceAGoGo, November 24, 2004. This article also notes that “households waste 14 percent of their food purchases” and is also the source for the bit about reducing environmental impacts by 25%.
o One Country’s Table Scraps, Another Country’s Meal, by Andrew Martin, New York Times, May 18, 2008 makes the note about 27% of wastage in American supermarkets, restaurants, cafeterias and homes, and is also the source for the Sweden, Africa and developing nations figures.

See also, for example, this site’s section on consumption effects for more issues.

Stats on annual deaths and medical costs from from the United Nations Food and Agriculture Organization’s State of Food Insecurity in the World 2004 report.

Notes from SellingPower.com points out that:
o “Numerous studies suggest that every dollar invested in well-targeted interventions to reduce undernourishment and micronutrient deficiencies can yield $5 to $20 in benefits.”
o The number of children that die every day due to hunger is the “technical equivalent of 45 jumbo jets crashing every single day”

In a world of plenty, a huge number go hungry. Hunger is more than just the result of food production and meeting demands. The causes of hunger are related to the causes of poverty. One of the major causes of hunger is poverty itself. The various issues discussed throughout this site about poverty lead to people being unable to afford food and hence people go hungry.

There are other related causes (also often related to the causes of poverty in various ways), including the following:

* Land rights and ownership
* Diversion of land use to non-productive use
* Increasing emphasis on export-oriented agriculture
* Inefficient agricultural practices
* War
* Famine
* Drought
* Over-fishing
* Poor crop yield
* Lack of democracy and rights
* etc.

Some of the above are introduced here. (Over time, this will grow, and more will be added so do check back for updates.)

This web page has the following sub-sections:

1. Land rights and ownership
2. Diversion of land use to non-productive use
1. The tobacco industry
2. Environmental and Economic damage from coffee production
3. Growing flowers can have a high cost to growers
4. The effects of dam projects on the poor
5. Beef and fast food industries using other people’s resources
6. Sugar cane growing for sugar exports
7. Environment and health problems from pineapple farming
8. Increasing use of biofuels
3. Increasing emphasis on liberalized, export-oriented and industrial agriculture
1. Food as a Commodity

Land rights and ownership

Two inter-related factors which influence hunger that are often ignored are land ownership and who controls land.

The following passage summarizes it very well, asking “Is It Overpopulation or Who Controls the Land?”

The often heard comment (one I once accepted as fact) that “there are too many people in the world, and overpopulation is the cause of hunger”, can be compared to the same myth that expounded sixteenth-century England and revived continuously since.

Through repeated acts of enclosure the peasants were pushed off the land so that the gentry could make money raising wool for the new and highly productive power looms. They could not do this if the peasants were to retain their historic entitlement [emphasis is original] to a share of production from the land. Massive starvation was the inevitable result of this expropriation.

There were serious discussions in learned circles about overpopulation as the cause of this poverty. This was the accepted reason because a social and intellectual elite were doing the rationalizing. It was they who controlled the educational institutions which studied the problem. Naturally the final conclusions (at least those published) absolved the wealthy of any responsibility for the plight of the poor. The absurdity of suggesting that England was then overpopulated is clear when we realize that “the total population of England in the sixteenth century was less than in any one of several present-day English cities.”

The hunger in underdeveloped countries today is equally tragic and absurd. Their European colonizers understood well that ownership of land gave the owner control over what society produced. The most powerful simply redistributed the valuable land titles to themselves, eradicating millennia-old traditions of common use. Since custom is a form of ownership, the shared use of land could not be permitted. If ever reestablished, this ancient practice would reduce the rights of these new owners. For this reason, much of the land went unused or underused until the owners could do so profitably. This is the pattern of land use that characterizes most Third World countries today, and it is this that generates hunger in the world.

These conquered people are kept in a state of relative impoverishment. Permitting them any substantial share of the wealth would negate the historic reason for conquest — namely plunder. The ongoing role of Third World countries is to be the supplier of cheap and plentiful raw materials and agricultural products to the developed world. Nature’s wealth was, and is, being controlled to fulfill the needs of the world’s affluent people. The U.S. is one of the prime beneficiaries of this well-established system. Our great universities search diligently for “the answer” to the problem of poverty and hunger. They invariably find it in “lack of motivation, inadequate or no education,” or some other self-serving excuse. They look at everything except the cause — the powerful own the world’s social wealth. As a major beneficiary, we have much to gain by perpetuating the myths of overpopulations, cultural and racial inferiority, and so forth. The real causes must be kept from ourselves, as how else can this systematic damaging of others be squared with what we are taught about democracy, rights, freedom, and justice?

— J.W. Smith, The World’s Wasted Wealth: the political economy of waste, (New World’s Press, 1989), pp. 44, 45.

Some have pointed out over the years that even the US Founding Fathers understood this very well, to the effect that some elites were able to affect the Constitution in this manner:

Despite the egalitarian rhetoric of the American Revolution and an attempt to place a proclamation in the Constitution for a “common right of the whole nation to the whole of the land,” the powerful looked out for their own interests by changing Locke’s insightful phrase: “all men are entitled to life, liberty and land.” This powerful statement that all could understand coming from a well-read and respected philosopher was a threat to the monopolizers of land, so they restructured those words to “life, liberty and [the meaningless phrase] pursuit of happiness.” Knowledge of the substitution for phrases in America’s Constitution which would protect every person’s rights with phrases that protect only the rights of a few should alert one to check the meaning and purpose of all laws of all societies carefully.

— J.W. Smith, Regaining Rights to a Modern Commons through Eliminating the Subtle-Monopolization of Land, Chapter 24, Economic Democracy; The Political Struggle for the 21st Century, (1st Books, 2002, Second Edition) [Bracketed text is original]

In addition to local elites and governments changing the rules in the past, globalization in the modern era is seeing another assault on local communities’ lands. A number of countries are buying up or securing deals with poorer countries to use their land. But this use is not for helping the poor country with their food security issues. Instead it is to ensure food security for the investor country, or it is for the investor’s own commercial benefit.

The Financial Times revealed that “Investors in farmland are targeting countries with weak laws, buying arable land on the cheap and failing to deliver on promises of jobs and investments, according to the draft of a report by the World Bank.” But despite those promises, “investors failed to follow through on their investments plans, in some cases after inflicting serious damage on the local resource base” according to the report.

Furthermore,

The overall picture it gave was one of exploitation, warning that investors either lacked the necessary expertise to cultivate land or were more interested in speculative gains than in using land productively.

It stated that “rarely if ever” were efforts made to link land investments to “countries’ broader development strategy”.

“Consultations with local communities were often weak,” it added. “Conflicts were common, usually over land rights.”

The report said some countries allocated land to investors that was within the boundaries of local communities’ farmland.

— Javier Blas, World Bank warns on “farmland grab”, Financial Times, July 27, 2010

Countries involved in this land grab range from developing countries such as China to industrialized nations such as the United Kingdom.

This continues decades-long policies of inefficient or inappropriate use of land which often benefits local and remote elites, but often leaves locals in rural and poorer communities left out.

Back to top
Diversion of land use to non-productive use

When precious arable land use is diverted to non-productive, or even destructive use, the overall costs to society can be considerable. Examples of such land use include, but is not limited to the following:

* The tobacco industry
* Tea and Coffee plantations the world over to be sold to the wealthier countries, primarily
* Floriculture to sell flowers in the wealthier countries comes at a high cost to the growers
* Certain dam projects
* Beef and fast food industries using other people’s resources
* Sugar cane growing for sugar exports
* Pineapple growing can come with health and environmental consequences for workers and local communities
* Increasing use of biofuels

The tobacco industry

Smoking kills, reduces economic productivity and exacerbates poverty, charges the world’s premier health body, the World Health Organization (WHO).

Smoking also contributes to world hunger, as the tobacco industry diverts huge amounts of land from producing food to producing tobacco:

Dr Judith MacKay, Director of the Asian Consultancy on Tobacco Control in Hong Kong, claims that tobacco’s “minor” use of land denies 10 to 20 million people of food. “Where food has to be imported because rich farmland is being diverted to tobacco production, the government will have to bear the cost of food imports,” she points out.

… The bottom line for governments of developing countries is that the net economic costs of tobacco are profoundly negative — the cost of treatment, disability and death exceeds the economic benefits to producers by at least US$200 billion annually “with one third of this loss being incurred by developing countries”.

— John Madeley, Big Business Poor Peoples; The Impact of Transnational Corporations on the World’s Poor, (Zed Books, 1999) pp. 53, 57

Madeley also describes in detail other impacts on land from tobacco use:

* The land that has been destroyed or degraded to grow tobacco has affects on nearby farms. As forests, for example, are cleared to make way for tobacco plantations, then the soil protection it provides is lost and is more likely to be washed away in heavy rains. This can lead to soil degradation and failing yields.
* A lot of wood is also needed to cure tobacco leaves.
* Tobacco uses up more water, and has more pesticides applied to it, further affecting water supplies. These water supplies are further depleted by the tobacco industry recommending the planting of quick growing, but water-thirsty eucalyptus trees.
* Child labor is often needed in tobacco farms.
* For more detail, refer to Big Business Poor Peoples; The Impact of Transnational Corporations on the World’s Poor, by John Madeley, (Zed Books, 1999) ch. 4.

Madeley continues on to point out that heavy advertising of tobacco by TNCs can “convince the poor to smoke more, and to use money they might have spent on food or health care, to buy cigarettes instead.”

A report by the Campaign for Tobacco-Free Kids says that from a socioeconomic and environmental perspective, there is little benefit in tobacco growing, and that “While a few large-scale tobacco growers have prospered, the vast majority of tobacco growers in the Global South barely eke out a living toiling for the companies.” Furthermore, “the cigarette companies continue to downplay or ignore the many serious economic and environmental costs associated with tobacco cultivation, such as chronic indebtedness among tobacco farmers (usually to the companies themselves), serious environmental destruction caused by tobacco farming, and pesticide-related health problems for farmers and their families.”

In fact, it is interesting to note that the tobacco industry has gone to extraordinary level to discredit the World Health Organisation (WHO) and others that are fighting tobacco issues , as a report from the WHO describes. A Committee of Experts had been set up in October 1999 to “enquire into the nature and extent of undue influence which the tobacco industry had exercised over UN organisations.” This Committee produced the report that “found that the tobacco industry regarded the World Health Organization as one of their leading enemies, and that the industry had a planned strategy to ‘contain, neutralise, reorient’ WHO’s tobacco control initiatives.” They added that the tobacco industry documents show that they carried out their plan by:

* staging events to divert attention from the public health issues raised by tobacco use;
* attempting to reduce budgets for the scientific and policy activities carried out by WHO;
* pitting other UN agencies against WHO;
* seeking to convince developing countries that WHO’s tobacco control program was a “First World” agenda carried out at the expense of the developing world;
* distorting the results of important scientific studies on tobacco;
* discrediting WHO as an institution.

While some countries, such as the US have had the resources and political will to tackle the large tobacco corporations, these multinationals have intensified their efforts in other regions of world such as Asia, to continue growing and selling cigarettes, as well as expanding advertising (to create demand, not meet).

Reports from the WHO show that there is a lot of political maneuvering by large tobacco companies to lower prices, to increase sales, etc. In addition, the poor and small farmers are the ones most affected by the impacts of tobacco companies. The hard cash earned from this “foreign investment” is offset by the costs in social and public health. In effect, profits are privatized; costs are socialized.

If one doesn’t wish to give up smoking because it is considered their free choice, how about giving up smoking so others may have a choice?

More issues around tobacco and its impacts, the actions of the tobacco industry, attempts at global regulation, and more are provided on this site’s tobacco section.
Environmental and Economic damage from coffee production

“Coffee drinkers will be astonished to learn that they hold in their hands the fate of farm families, farming communities, and entire ecosystems in coffee-growing regions like Costa Rica,” as Old Dog Documentaries notes. Furthermore:

25 million coffee growers worldwide are paid a mere pittance in the corporate marketplace while bearing the full brunt of global price fluctuations. When prices crash, farmers go hungry and their children are forced to drop out of school. Families are separated, communities disintegrate, and the land is cleared for other crops or other means of livelihood. That clearing of the land disrupts the ecosystem in ways that have deadly consequences for migratory birds in particular and for global ecological balance in general.

— Birdsong & Coffee: A Wake Up Call, Old Dog Documentaries, Inc., March 2006

The ID21 research organization summarizes some the impacts of coffee production:

“Coffee production provides a livelihood for 25 million people in developing countries and globally, 10.6 million hectares of land are used for growing coffee beans.” Coffee is therefore “one of the most legally-traded agricultural commodities in the world and one of the most important income crops for small farmers in developing countries.”

Despite its importance,

Growing coffee is not always a reliable source of income, however. While coffee production increased by 61 percent between 1960 and 2000, prices fell by 57 percent during the same period.

…Growing coffee has significant environmental impacts:

* Establishing coffee plantations results in the clearance of natural forest areas. This trend is made worse by the increasing demand for high-grade speciality coffee, which requires more land.
* Chemical use contributes to soil degradation. A shift to new production methods (such as full-sun production) has increased pesticide use enormously, resulting in lower insect populations and reduced nutrient recycling by soil.
* As coffee processing has moved away from the farms and fields, waste pulp is dumped in rivers, thus reducing levels of oxygen in the water and degrading freshwater ecosystems. It could instead be used as a soil amendment for coffee crops.

— Counting the cost of a cup of coffee, ID21, 28 February 2005

Fair Trade Coffee is often highlighted as a better option than normally produced coffee, for it at least pays the producer a fairer wage. Yet, in a wider context, is such mass coffee consumption healthy for the producing country?

Coffee consumption, in the amounts typically done today, may also be unnecessary. Many consume it in vast quantities believing the caffeine intake will help them get through the day, especially if working long, stressful hours. A recent program by the BBC called the Truth about Food compared coffee with a decaffeinated substitute and concluded the following:

Does caffeine give us the edge over decaf users? No. Once we’ve recovered from caffeine we can do just as well without it.

— Caffeine and the Brain, BBC, accessed February 15, 2007

Some may choose to consume coffee for its taste, but if so many are consuming it to get through work, then it may not be necessary. This may implied “wasted labour” and resources (the details and implications of which are discussed further on this site’s section on Behind Consumption and Consumerism).
Growing flowers can have a high cost to growers

Floriculture too is a growing field in some developing countries. However, as Madeley explains, it too has some negative effects, such as:

* Divert land use away from growing needed food. (In Colombia for example, floriculture was seen as a way to avoid cocaine growing. Food growth could have been more directly positive for the growers and local communities.)
* Very low wages
* Child labor
* Pesticide poisoning and other severe health problems. (Some of these pesticides are banned in the West.)
* Women suffer high miscarriage rates
* For more detail, refer to Big Business Poor Peoples; The Impact of Transnational Corporations on the World’s Poor, by John Madeley, (Zed Books, 1999) ch. 4, pp 64 - 70 (Non-traditional export crops).

Anuradha Mittal also describes the effects in some parts of India:

In 1999, a UN Population Fund report predicted that India would soon become one of the world’s largest recipients of food aid. The report went on to blame the increasing population for the problem. What it did not mention is that the state of Punjab, also known as “the granary of India,” grows abundant food even today, but most of it is being converted into dog and cat food for Europe. Nor did the report mention that the neighboring state of Haryana, also traditionally a fertile agricultural state, is today one of the world leaders in growing tulips for export. Increasingly, countries like India are polluting their air, earth, and water to grow products for the Western market instead of growing food to feed their own people. Prime agricultural lands are being poisoned to meet the needs of the consumers in the West, and the money the consumers spend does not reach the majority of the working poor in the Third World.

— Anuradha Mittal, True Cause of World Hunger, February 2002

And in Ecuador, Mother Jones magazine adds that

Insecticides, herbicides, fungicides, and soil fumigants used in the greenhouses are causing serious health problems for Ecuador’s 60,000 rose workers — especially the women and children who sort and package the flowers prior to shipping. In recent years, studies by the International Labor Organization and Ecuador’s Catholic University have found that as many as 60 percent of postharvest workers complain of pesticide-poisoning symptoms, including headaches, blurred vision, and muscular twitching. Women in the industry, who represent 70 percent of all rose workers, experience significantly elevated rates of miscarriages. Children under 18, who make up more than a fifth of the workforce, display signs of neurological damage at 22 percent above average.

— Ross Wehner, Deflowering Ecuador, Mother Jones, January/February 2003 Issue
The effects of dam projects on the poor

While not necessarily a non-productive use as such, dam projects have long been criticized for displacing millions of people and not providing them the benefits promised, while also degrading the environment and even flooding arable land.

Every year, from the mid-1980s to the mid-1990s, around four million people were displaced from their homes because of hydro-electric dam schemes. These schemes usually created huge resevoirs which flooded homes, forests and fertile land.… Since the electricity generated by the dams was intended to power factories and houses in urban areas, few of the rural poor benefitted from such schemes.

… These [multinational construction] corporations are a vital link in the “big dam” chain. Their experience of such projects means they can provide an expertise that national companies usually lack. Without the TNCs, the big aid-funded dam schemes of the last 40 years could not have gone ahead with such confidence. The schemes give the TNCs security of payment, as the money is coming mostly from foreign aid, and the opportunity to make good profits at low risk — if costs soar they can usually be passed on. Dams often cost more than the original estimates, leaving governments of developing countries to pick up an extra bill.

… The construction of the [Sri Lankan] Mahaweli River scheme effectively witnessed an enormous transfer of wealth from people in one of the poorest developing countries to some of the world’s largest TNCs. “We are a poor country”, said a critic of the scheme, “we cannot afford this kind of aid”.

… The UK had agreed to give aid for Pergau in 1989 as a sweetener for securing a £1.3 billion arms deal with Malaysia. In 1991, Sir Timothy Lankester, a former permanent secretary at the Overseas Development Administration, the British government department which then administered the aid budget, opposed aid for the dam, saying he believed it was neither economic or efficient. He was over-ruled.

— John Madeley, Big Business Poor Peoples; The Impact of Transnational Corporations on the World’s Poor, (Zed Books, 1999) pp. 115 - 117

After reactions to a pertinent report by the World Bank, a World Commission on Dams (WCD) was established in 1998 with a mandate to review the development effectiveness of large dams and develop internationally acceptable criteria, guidelines and standards for large dams.

The World Commission on Dams (WCD), released a report at the end of 2000 criticizing dam projects for failing to deliver promised benefits while affecting millions of poor people’s lives in developing countries and degrading the environment.

They also pointed out that “dams have made an important and significant contribution to human development, and the benefits derived from them have been considerable.” However, “in too many cases an unacceptable and often unnecessary price has been paid to secure those benefits, especially in social and environmental terms, by people displaced, by communities downstream, by taxpayers and by the natural environment. Lack of equity in the distribution of benefits has called into question the value of many dams in meeting water and energy development needs when compared with the alternatives.”

The full report from the World Commission on Dams is on their web site.

The World Bank, involved in many dam projects, received criticism for choosing to only reference the WCD report rather than adopt them as rules governing its operations.
Beef and fast food industries using other people’s resources

Consider the following cited from this web site’s section on consumption and beef:

* More than one third of the world’s grain harvest is used to feed livestock.
* Breaking that down a little bit
o Almost all rice is consumed by people
o While corn is a staple food in many Latin American and Sub-Saharan countries, “worldwide, it is used largely as feed.”
o Wheat is more evenly divided between food and feed and is a staple food in many regions such as the West, China and India.
* The total cattle population for the world is approximately 1.3 billion occupying some 24% of the land of the planet
* Some 70 to 80% of grain produced in the United States is fed to livestock
* Half the water consumed in the U.S. is used to grow grain for cattle feed
* A gallon of gasoline is required to produce a pound of grain-fed beef

— Anup Shah, Beef

The beef industry consumes a considerable number of resources, and for a product that is not a “need” as such, but more of a “luxury”. Excessive promotion of its consumption has led to many health issues as well as environmental problems. Furthermore, the resources used could be put to more productive uses. In addition, as an example of the vast first world subsidies which the third world often complains about as hypocritical, consider the following:

If water used by the meat industry [in the United States] were not subsidized by taxpayers, common hamburger meat would cost $35 a pound. You need 25 gallons of water to produce a pound of wheat — 2,500 gallons to generate a pound of meat.

— Simone Spearman, Eating More Veggies Can Help Save Energy, San Francisco Chronicle, June 29, 2001. (Emphasis Added) [Previous link is to a reposted version at Commondreams.org]

The issue of beef and fast food industry is discussed further on this site’s section on beef.
Sugar cane growing for sugar exports

Like beef, sugar too contributes to problems. From the obvious things like health, there are also other concerns such as the environment, and using vast resources to produce an unhealthy product for export when similar resources could be spent in other, more productive ways.

This too is further discussed on this site’s section on sugar.

Like beef, sugar exemplifies issues related to some of the negative aspects of liberalized, industrial agriculture.
Environment and health problems from pineapple farming

As this site’s section on pineapples shows, industrialized, mono-culture farming of pineapples requires intensive use of chemicals which has had noticeable effects on the local environment and health for people in Costa Rica. In addition, pay for workers are often below living wages and has been further exacerbated by European supermarkets’ drive for lower prices, because it is ultimately the workers that get squeezed.
Increasing use of biofuels

The food crisis of 2008 that has driven some additional 100 million people into poverty has been due to many of the concerns raised above. An additional cause has also been the increasing use of biofuels, which diverts land away from food production to growing crops for fuels such as ethanol.

For a long time, various people have believed that biofuels would have an impact on agriculture and hunger. However, rich countries, the main backers behind biofuels, have played down their impact. Wrongly, it turns out.

The US and some European countries have often insisted that the impact of biofuels on the food crisis has been small. It seems that this claim has been self-serving, because of interests in the biofuel industry. Yet, based on the most detailed analysis of the crisis so far,

Biofuels have forced global food prices up by 75%—far more than previously estimated—according to a confidential World Bank report obtained by the Guardian.

The figure emphatically contradicts the US government's claims that plant-derived fuels contribute less than 3% to food-price rises. It will add to pressure on governments in Washington and across Europe, which have turned to plant-derived fuels to reduce emissions of greenhouse gases and reduce their dependence on imported oil.

Senior development sources believe the report, completed in April, has not been published to avoid embarrassing President George Bush.

— Aditya Chakrabortty, Secret report: biofuel caused food crisis; Internal World Bank study delivers blow to plant energy drive, The Guardian, July 4, 2008

Rich countries have attempted instead to blame demand from rising poorer countries as a bigger cause.

President Bush has linked higher food prices to higher demand from India and China, but the leaked World Bank study disputes that: “Rapid income growth in developing countries has not led to large increases in global grain consumption and was not a major factor responsible for the large price increases.”

— Aditya Chakrabortty, Secret report: biofuel caused food crisis; Internal World Bank study delivers blow to plant energy drive, The Guardian, July 4, 2008

The report mentions the following ways in which biofuels have distorted food markets which had led to the 2008 food crisis:

* Grain has been diverted away from food, to fuel; (Over a third of US corn is now used to produce ethanol; about half of vegetable oils in the EU goes towards the production of biodiesel);
* Farmers have been encouraged to set land aside for biofuel production;
* The rise in biofuels has sparked financial speculation in grains, driving prices up higher.

The World Bank has also estimated that an additional 100 million more people have been driven into hunger because of the rising food prices. Another institute, the International Food Policy Research Institute (IFPRI) estimates that 30% of the increase in the prices of the major grains is due to biofuels. In other words, biofuels may be responsible for some 30-75 million additional people being driven into hunger.

With such large numbers of destruction, it is understandable why politically the US and EU may wish to publicly minimize the impact of biofuels.

Back to top
Increasing emphasis on liberalized, export-oriented and industrial agriculture

In Less Developed Countries the problem of land use is even more acute. Whilst the majority of food produce tends to be grown on small, subsistence farms, the bulk of the best agricultural land is used for the growing of cash crops. Partly a legacy of colonial policies, partly a result of the debt problem and IMF and World Bank solutions to this problem, we find that people in the LDCs, particularly the rural poor, are going hungry whilst the bulk of these countries' agricultural output is exported to Europe and the USA.

— Ross Copeland, The Politics of Hunger, University of Kassel, September 2000

In many cases where food is grown, it is often for exports. In some cases, while local people may be going hungry, they are growing food to export for the hard cash that would be earned. The increasingly export-oriented economies are being promoted by the wealthier Northern countries and the international institutions that they have strong influence over, the IMF and World Bank, as detailed in the Structural Adjustment section on this site. The result of this is that the wealthier nations tend to benefit while poorer countries generally lose out.

[Farmers] producing [fruit and vegetables] for export markets has recently become more common. TNCs are increasingly involved in the production of crops that have traditionally not been exported. But export crops are replacing staple foods in some areas, resulting in food scarcities and rising food prices that hit hard at the poorest.

… Yet [the market success seen by this exporting policy] “has frequently come at a cost in workers' health, inequitable distribution of economic benefits, and environmental degradation in many of the exporting countries.”

… Small-scale farmers and consumers in Latin America are paying the price of this drastic shift to export agriculture. In towns and cities across the continent, beans are now frequently scarce as land which once grew beans now grows vegetables for export. Beans contribute around 30 per cent of the protein consumption by the continent’s 200 million low-income families. Most bean farmers are now trying to grow vegetables for export and devoting less of their land (often already small) to beans for their own use.

— John Madeley, Big Business Poor Peoples; The Impact of Transnational Corporations on the World’s Poor, (Zed Books, 1999) pp. 64 - 66

Sometimes, the cost of the food produced can be more than what the local people can afford and has to be exported to earn cash. Land and labor is therefore diverted away from immediate needs. Additionally, the local food growers are then subject to the fashions and preferences of external communities and market demands. If they no longer like the range of products as much, the entire local economy could be affected. The banana trade in the Caribbean is an example of this.

Joseph Stiglitz explains the effects of liberalization & subsidized agriculture on poor farmers(see link for transcript)

Free trade and other economic agreements that reduce subsidies on local farms etc, has a worse impact on developing countries. We hear of these subsidies being “barriers” for foreign investment and more open trade. Yet, as Structural Adjustment Policies (SAPs) have tried to do, it results in opening up economies that may not be ready to do so. This therefore results in unequal trade, as poorer countries and their industries often cannot compete with multinationals — especially if they end up competing with subsidized industries as Joseph Stiglitz explains earlier.

In addition, SAPs have opened up these economies in such a way that focus on “export” means base foods, commodities and resources are exported, while finished items are typically made from these in first world economies, which are more costly for poor nations to purchase. As J. W. Smith has described, this results in the Third World producing for the First World (which was the pattern during imperial and colonial times):

World hunger exists because: (1) colonialism, and later subtle monopoly capitalism, dispossessed hundreds of millions of people from their land; the current owners are the new plantation managers producing for the mother countries; (2) the low-paid undeveloped countries sell to the highly paid developed countries because there is no local market [because the low-paid people do not have enough to pay] … and (3) the current Third World land owners, producing for the First World, are appendages to the industrialized world, stripping all natural wealth from the land to produce food, lumber, and other products for wealthy nations.

This system is largely kept in place by underpaying the defeated colonial societies for the real value of their labor and resources, leaving them no choice but to continue to sell their natural wealth to the over-paid industrial societies that overwhelmed them. To eliminate hunger: (1) the dispossessed, weak, individualized people must be protected from the organized and legally protected multinational corporations; (2) there must be managed trade to protect both the Third World and the developed world, so the dispossessed can reclaim use of their land; (3) the currently defeated people can then produce the more labor-intensive, high-protein/high-calorie crops that contain all eight (or nine) essential amino acids; and (4) those societies must adapt dietary patterns so that vegetables, grains, and fruits are consumed in the proper amino acid combinations, with small amounts of meat or fish for flavor. With similar dietary adjustments among the wealthy, there would be enough food for everyone.

— J.W. Smith, The World’s Wasted Wealth 2, Institute for Economic Democracy, 1994), pp. 63, 64.

Yet, the wealthier nations realize the importance of food security and heavily subsidize their own farming infrastructures:

While subsidies are viewed as barriers by companies outside the region, they are critical incentives for the smallholder farmers especially those in southern Africa, most of whom are still using traditional methods and are only just beginning to acquire vital modern technology. Large-scale commercial farmers in Europe and the US have been modernized for decades and have benefited from similar subsidies from their own governments for many years.

Paradoxically, the European Union, one of the leading proponents of trade liberalization has one of the most protected agricultural sectors in the world through its Common Agricultural Policy. Such is the double standard of the EU that it forces developing countries, through the western-dominated World Trade Organization (WTO), to open up their economies when Europe’s agriculture sector is the most highly subsidized in the world.

— Munetsi Madakufamba, Unequal 'freetrade' threatens food security, The Mail & Guardian (a South African national newspaper), August 13, 2001

Additionally, some of the political dynamics that result in the poverty that most food growers are in, also leads to continued misery:

* Historically, the poor have often been marginalized by forcing them off their lands on to land less suitable for agriculture. This has been achieved through (sometimes violent) change and control of legal land ownership and related laws, especially during the colonial times.
* When much of the colonialized countries broke free from their imperial rulers, this pattern didn’t go away.
o There was a continued concentration by the newer elites of poor countries (who, as discussed in some of the geopolitics sections of this site, were often placed in power by former colonial and imperial rulers).
o In some cases the new elites were dictators and despots. In other cases, the economic relations of the society had been transformed so much, that systems like mass plantation systems continued as those in charge were in favor with former colonial masters, and now had more power.
o Combined with the expansion in global trading today, and the promotion of export-oriented economies as a solution to poverty, this has led to local and national elites in poor countries exporting to wealthier nations where the only real “market” for their food and other products can be effectively sold.
o For some emerging economies, the growing middle class is able to add to this consumption so that at least adds to the local economy. However, that still hides how the poor still lose out as the market rarely caters for their needs (which are many, but with little purchasing power).
* A continuing circle like this produces a downward spiral of deeper poverty and further marginalization.
* The less suitable land also leads to further environmental degradation of those and other areas as well such as forests.

Peter Rosset describes the above very clearly as part of a look at some of the causes of poverty and hunger in his essay “Genetic Engineering of Food Crops for the Third World: An Appropriate Response to Poverty, Hunger and Lagging Productivity?” He goes on to show how this has led to the current downward spiral, quoted in summarized form below:

* The marginalization of the majority leads to narrow and shallow domestic markets
* So landowning elites orient their production to export markets where consumers do have purchasing power
* By doing so, elites have ever less interest in the well-being or purchasing power of the poor at home, as the poor are not a market for them, but rather a cost in terms of wages to be kept as low as possible.
* By keeping wages and living standards low, elites guarantee that healthy domestic markets will never emerge, reinforcing export orientation.
* The result is a downward spiral into deeper poverty and marginalization, even as national exports become more “competitive” in the global economy.
* One irony of our world, then, is that food and other farm products flow from areas of hunger and need to areas were money is concentrated, in Northern countries. (Bold emphasis added; italics emphasis is original)

Food as a Commodity

And when food is treated as a commodity, those who can get food are the ones who can afford to pay for it. To illustrate this further, the following is worth quoting at length (bulleting and spacing formatting is mine, text is original):

To understand why people go hungry you must stop thinking about food as something farmers grow for others to eat, and begin thinking about it as something companies produce for other people to buy.

* Food is a commodity.…
* Much of the best agricultural land in the world is used to grow commodities such as cotton, sisal, tea, tobacco, sugar cane, and cocoa, items which are non-food products or are marginally nutritious, but for which there is a large market.
* Millions of acres of potentially productive farmland is used to pasture cattle, an extremely inefficient use of land, water and energy, but one for which there is a market in wealthy countries.
* More than half the grain grown in the United States (requiring half the water used in the U.S.) is fed to livestock, grain that would feed far more people than would the livestock to which it is fed.…

The problem, of course, is that people who don’t have enough money to buy food (and more than one billion people earn less than $1.00 a day), simply don’t count in the food equation.

* In other words, if you don’t have the money to buy food, no one is going to grow it for you.
* Put yet another way, you would not expect The Gap to manufacture clothes, Adidas to manufacture sneakers, or IBM to provide computers for those people earning $1.00 a day or less; likewise, you would not expect ADM (“Supermarket to the World”) to produce food for them.

What this means is that ending hunger requires doing away with poverty, or, at the very least, ensuring that people have enough money or the means to acquire it, to buy, and hence create a market demand for food.

— Richard H. Robbins, Readings on Poverty, Hunger, and Economic Development

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Thinking about solutions to world hunger then, requires the recognition that there are political and economic causes related to poverty.
Where next?

Related articles

1. Poverty Facts and Stats
2. Structural Adjustment—a Major Cause of Poverty
3. Poverty Around The World
4. Today, over 22,000 children died around the world
5. Corruption
6. Foreign Aid for Development Assistance
7. Causes of Hunger are related to Poverty
8. United Nations World Summit 2005
9. IMF & World Bank Protests, Washington D.C.
10. Economic Democracy

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* by Anup Shah
* Created: Sunday, February 25, 2001
* Last Updated: Sunday, October 03, 2010

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Inequality in the World

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Poverty Around The World
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* by Anup Shah
* This Page Last Updated Sunday, January 02, 2011

* This page: http://www.globalissues.org/article/4/poverty-around-the-world.
* To print all information e.g. expanded side notes, shows alternative links, use the print version:
o http://www.globalissues.org/print/article/4

This web page has the following sub-sections:

1. Introduction
2. World Bank’s Poverty Estimates Revised
3. Inequality
1. Inequality in Industrialized Nations
2. Inequality in Cities Around the World
3. Inequality in Rural Areas
4. Inequality Between Genders
5. Inequality and Health
6. Inequality fueled by many factors
7. Inequality increases social tensions
8. Fragile Democracies, Inequality "turn good people to evil"
4. The Wealthy and the Poor
5. The World Bank and Poverty
6. Poverty in Industrialized Countries
7. Corruption

Introduction

What does it mean to be poor? How is poverty measured? Third World countries are often described as “developing” while the First World, industrialized nations are often “developed”. What does it mean to describe a nation as “developing”? A lack of material wealth does not necessarily mean that one is deprived. A strong economy in a developed nation doesn’t mean much when a significant percentage (even a majority) of the population is struggling to survive.

Successful development can imply many things, such as (though not limited to):

* An improvement in living standards and access to all basic needs such that a person has enough food, water, shelter, clothing, health, education, etc;
* A stable political, social and economic environment, with associated political, social and economic freedoms, such as (though not limited to) equitable ownership of land and property;
* The ability to make free and informed choices that are not coerced;
* Be able to participate in a democratic environment with the ability to have a say in one’s own future;
* To have the full potential for what the United Nations calls Human Development:

Human development is about much more than the rise or fall of national incomes. It is about creating an environment in which people can develop their full potential and lead productive, creative lives in accord with their needs and interests. People are the real wealth of nations. Development is thus about expanding the choices people have to lead lives that they value. And it is thus about much more than economic growth, which is only a means—if a very important one—of enlarging people’s choices.

— What is Human Development?, Human Development Reports, United Nations Development Program

At household, community, societal, national and international levels, various aspects of the above need to be provided, as well as commitment to various democratic institutions that do not become corrupted by special interests and agendas.

Yet, for a variety of reasons, these “full rights” are not available in many segments of various societies from the richest to the poorest. When political agendas deprive these possibilities in some nations, how can a nation develop? Is this progress?

Politics have led to dire conditions in many poorer nations. In many cases, international political interests have led to a diversion of available resources from domestic needs to western markets. (See the structural adjustment section to find out more about this.) This has resulted in a lack of basic access to food, water, health, education and other important social services. This is a major obstacle to equitable development.

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World Bank’s Poverty Estimates Revised

In August 2008, the World Bank presented a major overhaul to their estimates of global poverty, incorporating what they described as better and new data.

The World Bank’s long-held estimate of the number of people living on the equivalent of $1 a day has now been changed to $1.25 a day.

The World Bank also adds that the previous $1 a day estimate for the international poverty line would have been $1.45 a day at 2005 prices if only inflation was accounted for.

The revised estimates include a lot more recalculations and the $1 a day measure used in some of the charts below are therefore not to be confused with the old $1 a day measure, and where available, a $1.45 measure is also provided as well as a more current $1 a day measure. (Because some developing countries also have poverty lines at $2 and $2.50 a day, those are also shown, where available.)

At a poverty line of $1.25 a day, the revised estimates find

* 1.4 billion people live at this poverty line or below
* This is more than the previous estimate of 984 million with the older measure of a $1 a day in 2004
* In 1981, the estimated number of poor was also revised upward, from 1.5 billion to 1.9 billion

The World Bank notes that “the incidence of poverty in the world is higher than past estimates have suggested. The main reason is that [previous data] had implicitly underestimated the cost of living in most developing countries.”

The data also does not reflect the recent global food crisis and rising cost of energy, which is feared will bring another 100 million into poverty.

Accounting for the increased population between 1981 and 2005, the poverty rate has, however, fallen by about 25%.

While this at least sounds encouraging, it masks regional variations, and perhaps most glaringly the impact of China:

* China’s poverty rate fell from 85% to 15.9%, or by over 600 million people
* China accounts for nearly all the world’s reduction in poverty
* Excluding China, poverty fell only by around 10%

As a result, the World Bank feels that while China is on target to reach the Millennium Development Goals to reduce poverty and tackle various other issues, most other countries are not.

Here are the World Bank’s new estimates of poverty at different poverty levels:

* Different poverty levels
* Data in other graph formats
* Raw data

Different poverty levels

Poverty lines shown here include $1 a day, $1.25 a day, $1.45 a day, $2 a day (typical for many developing countries), $2.50 a day (which includes a poverty level for some additional countries), and $10 a day, which a World Bank report referred to if looking at poverty from the level of a wealthy country, such as the US.

Data in other graph formats

As a pie chart showing how many people fall into each poverty level:

As a stacked bar chart:

Raw data
Proportion of the world’s population at different poverty levels in 2005Poverty line ($ a day) Population in poverty (in billions) Population above that level (in billions) Percent in poverty

Sources:

* Shaohua Chen and Martin Ravallion, The developing world is poorer than we thought, but no less successful in the fight against poverty, World Bank, August 2008
* For the numbers on $10 a day, see Martin Ravallion, Shaohua Chen and Prem Sangraula, Dollar a day revisited, World Bank, May 2008. They note that 95% of developing country population lived on less than $10 a day. Using 2005 population numbers, this is equivalent to just under 79.7% of world population, and does not include populations living on less than $10 a day from industrialized nations.

$1.00 0.88 5.58 13.6%
$1.25 1.40 5.06 21.7%
$1.45 1.72 4.74 26.6%
$2.00 2.60 3.86 40.2%
$2.50 3.14 3.32 48.6%
$10.00 5.15 1.31 79.7%

But even with some poverty reduction, inequality is quite high in many regions around the world:

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Inequality

Inequality is not just bad for social justice, it is also bad for economic efficiency

— Growth with equity is good for the poor, Oxfam, June 2000

While poverty alleviation is important, so too is tackling inequality. Inequality is often discussed in the context of relative poverty, as opposed to absolute poverty.

That is, even in the wealthiest countries, the poor may not be in absolute poverty (the most basic of provisions may be obtainable for many) or their level of poverty may be a lot higher than those in developing countries, but in terms of their standing in society, their relative poverty can also have serious consequences such as deteriorating social cohesion, increasing crime and violence, and poorer health.

Some of these things are hard to measure, such as social cohesion and the level of trust and comfort people will have in interacting with one another in the society. Nonetheless, over the years, numerous studies have shown that sometimes the poor in wealthy countries can be unhappier or finding it harder to cope than poor people in poorer countries.

In the context of tackling poverty then, the Overseas Development Institute (ODI) for example sees poverty reduction as a twin function of

1. The rate of growth, and
2. Changes in income distribution.

The ODI also adds that as well as increased growth, additional key factors to reducing poverty will be:

* The reduction in inequality
* The reduction in income differences

A few places around the world do see increasing rates of growth in a positive sense. But globally, there is also a negative change in income distribution. The reality unfortunately is that the gap between the rich and poor is quite wide in most places. For example:

* About 0.13% of the world’s population controlled 25% of the world’s assets in 2004.
* The wealthiest 20% of the world’s population consumes 76.6% of the world’s goods while 80% of humanity gets the remainder.

(See poverty facts and stats on this site for more examples.)
Inequality in Industrialized Nations

Professors Richard Wilkinson and Kate Pickett, from the Equality Trust, produced an informative lecture video titled Inequality: The enemy between us? based on their recently released book, The Spirit Level; Why More Equal Societies Almost Always Do Better (Penguin, March 2009).

In the lecture, compelling evidence is presented by the two professors that once nations are industrialized, more equal societies almost always do better in terms of health, well-being and social cohesion and that large income inequalities within societies destroys the social fabric and quality of life for everyone:

Inequality: The enemy between us?, Equality Trust, 2009

As they studied the data for industrialized nations, they noticed a clear tendency for countries which do badly (or well) on one outcome to do badly (or well) on others.

They looked at a wide range of health and social problems and found that,

* Outcomes are substantially worse in more unequal societies
* The problems tend to move together, implying that they share an underlying cause
* Whether their findings are tested internationally among the rich countries, or among the 50 states of the USA, there is almost always the same tendency for outcomes to be much worse in more unequal societies.

As they note in a presentation of their findings:

* Health is related to income differences within rich societies, not between them
* Health and social problems are worse in more unequal countries
* Health and social problems are not related to average income in rich countries
* Child well-being is better in more equal rich countries
* Child well-being is unrelated to average incomes in rich countries
* Levels of trust are higher in more equal rich countries
* The prevalence of mental illness is higher in more unequal rich countries
* Drug use is more common in more unequal countries
* Life expectancy is longer in more equal rich countries
* Infant mortality rates are higher in more unequal countries
* More adults are obese in more unequal rich countries
* Educational scores are higher in more equal rich countries
* Teenage birth rates are higher in more unequal rich countries
* Homicide rates are higher in more unequal rich countries
* Children experience more conflict in more unequal societies
* Rates of imprisonment are higher in more unequal societies
* Social mobility is higher in more equal rich countries
* More equal societies are more innovative
* More equal countries rank better on recycling

An interesting point they make is that economic growth alone — which is supposed to raise the income of all — is not necessarily a good determinant of life-expectancy and well-being: individuals in some developing countries can attain a level of life-expectancy comparable to industrialized nations even when their income may be far lower:

Income per head and life-expectancy: rich & poor countries, The Spirit Level Slides, The Equality Trust, 2009 (previous link has larger image)

In other words, economic growth is important when developing, but after that equality may be more important.

The following graphs (reproduced with kind permission) are just examples of the problems they looked at, but the trends are always the same: the more unequal the society, the worse the problem generally:

Violence is more common in more unequal societies, Evidence: Violence, The Equality Trust, 2009.

From the source for the above graph, the Equality Trust notes that, “The link between inequality and homicide rates has been shown in as many as 40 studies, and the differences are large: there are five-fold differences in murder rates between different countries related to inequality. The most important reason why violence is more common in more unequal societies is that it is often triggered by people feeling looked down, disrespected and loss of face.”

The next example compares social mobility (the ability for someone to move up the social ladder, escape poverty etc) with inequality:

Social mobility is higher in more equal rich countries, Evidence: Social Mobility, The Equality Trust, 2009.

It may be surprising to see the US at the low end of social mobility when it is touted as the land of dreams and possibilities for anyone, no matter who they are. The UK is also surprisingly at the low end.

Interestingly, the US and UK are the biggest proponents of neoliberal economic ideology, which has often played down concerns about inequality and instead focused more on raising the lot for everyone (as the interview with Tony Blair noted further below reveals). Yet, the Equality Trust finds that,

It looks as if the American Dream is far more likely to remain a dream for Americans than it is for people living in Scandinavian countries. Greater inequalities of outcome seem to make it easier for rich parents to pass on their advantages. While income differences have widened in Britain and the USA, social mobility has slowed. Bigger income differences may make it harder to achieve equality of opportunity because they increase social class differentiation and perhaps prejudice.

— Evidence: Social Mobility, The Equality Trust, accessed December 7, 2009

The implications of all these findings are important in many ways. For example, it is often said that to develop and industrialize, developing nations’ carbon emissions must increase, as industrialization implies a more energy-intensive economy. However, what is less discussed is whether that means carbon emissions of poorer countries must be similar to today’s industrialized nations.

Many of today’s industrialized nations are often seen as over consuming with respect to the planet’s health (climate change being something largely a result of greenhouse emissions from wealthier nations, for example).

As the next graph shows, a number of developing nations have achieved average life expectancies that are close to industrialized nations, but with far less carbon emissions in the process:

High life expectancy can be achieved with low CO2 emissions, The Spirit Level Slides, The Equality Trust, 2009 (previous link has larger image)

Addressing inequality implies tackling many, many social, political, economic and environmental issues, for they are all inter-related in many ways.

(Interestingly, the data they used for the study came from the early 2000s, so are not distorted by the global financial crisis that started around 2008.)

Further below there is more about poverty in industrialized nations, but first, some more on inequality.
Inequality in Cities Around the World

Inequality is usually associated with poorer, developing nations. But for many years, studies have shown that many wealthier nations also suffer from inequality, sometimes at levels similar to those of some developing countries.

For example, the UN Habitat’s State of the World’s Cities 2008/2009 report has found that disparities within cities and between cities and regions within the same country are growing as some areas benefit more than others from public services, infrastructure and other investments.

In addition, and almost counter to conventional wisdom, the report finds that in cities that have high levels of inequality increases the chance of more disparities increases, not reduces, with economic growth. This is because high levels of urban inequality have a dampening effect on economic growth and contribute to a less favorable environment for investment.

The report also added that in such cities, the lack of social mobility tends to reduce people’s participation in the formal sector of the economy and their integration in society. This exacerbates insecurity and social unrest which, in turn, diverts public and private resources from social services and productive investments to expenditures for safety and security.

In another UN Habitat report, the issue of equality was noted:

As a municipal official, one has to decide whether to spend taxpayers’ money on road infrastructure, which in developing cities mostly serves higher income citizens with cars, or to spend it on public utilities and amenities, thus providing for a majority of the population, particularly benefiting the poor. This is why the major issues for today’s cities have to do with equality and politics, rather than engineering alone.

— Enrique Peñalosa, former mayor of Bogotá, Colombia, Urban World: Bridging the urban divide, Why cities must build equality, UN Habitat, December 2009-January 2010, p. 8

Factoring in democratic principles also makes things harder: “Government has many roles but a fundamental one, in democracy, is to build equality. For legitimacy to exist in society, citizens must perceive that inclusion and equality are fundamental objectives of public authorities.” (p.9)

Yet different priorities and interests easily result. For example, the report adds that in many developing cities, wealthier citizens live in private spaces and may even avoid visiting or walking around in city centers. As a result, “they do not care much about city’s parks or public schools” but may be more interested in better roads, for example.

There is therefore a dilemma that the public sector faces compared to the private sector: for the private sector, deciding where to invest usually boils down to where the best returns will be. By contrast, “in the public sector every project is ‘good’, a police station, a road, a school or a park all provide a benefit which is difficult to measure.”

In parallel with growing cities are growing “informal settlements” or slums. Numerous factors create this rise, from poverty in the countryside, changes towards neoliberal economic ideology, corruption, globalization factors and so on. The problem is so immense that, according to UN Habitat, approximately 1 billion people live in slums in the cities of the world — approximately 1 in every 6 people on the planet.

While there have been some successes in reducing the number of people living in such areas in recent years by about a tenth (mostly in China and India), numerous problems persist.

World Habitat Day — Stop forced evictions in Africa, Amnesty International, October 2009

Without the ability to make their voices heard, people in informal settlements often find that in addition to less services, the threat of forced eviction is commonplace as private developers often want prime land for development. Amnesty International provides numerous examples of this from around the world. A short video summarizes a number of other videos they have compiled on this.

Some settlements don’t have official recognition. As a result, “residents have been denied a range of essential services provided by the government to other residents … [such as] water, sanitation, electricity, garbage collection, health, education, access roads and transport” (from Amnesty International’s report: Kenya: the unseen majority; Nairobi’s two million slum-dwellers PDF formatted document, June 2009, p.7).

Kibera, Nairobi, Sub-Saharan Africa’s largest slum, from Share The World’s Resources work on Megaslumming.

Kenya’s Kibera slum, Sub-Sharan Africa’s largest informal settlement, is an example of a massive settlement without official recognition which has been around for decades. The video clip shows that despite the hardships there is still a sense of vibrant humanity. Share The World’s Resources, an organization that produced the video, released the book Megaslumming which described this further, highlighting that despite the grinding reality of poverty, human nature can still prevail and people work together to help each other and are enterprising despite all the circumstances.

Image: Deep Sea slum in Kenya.(© Amnesty International)

In developing countries, where some 1 in 3 people living in cities are living in slum areas, the urgency to address this has never been more.

With increasing migration to cities (almost half of humanity lives in urban areas), there is increasing pressures on providing sufficient resources in a sustainable way.

Furthermore, as cities grow in this way, addressing greenhouse emissions from urban areas can go a long way to helping combat climate change.

Some of the other findings the 2008/2009 UN Habitat reported included that

* Some 3 million people per week were added to cities of developing world.
* Some American cities are as unequal as African and Latin American cities. For example, New York was found to be the 9th most unequal in the world while Atlanta, New Orleans, Washington, and Miami had similar inequality levels to those of Nairobi, Kenya Abidjan and Ivory Coast.
* Race is one of the most important factors determining levels of inequality in the US and Canada. For example, “The life expectancy of African-Americans in the US is about the same as that of people living in China and some states of India, despite the fact that the US is far richer than the other two countries.”
* India was becoming more unequal as a direct result of economic liberalization and globalization.
* The most unequal cities were in South Africa and Namibia and Latin America.
* Beijing was now the most egalitarian city in the world, just ahead of cities such as Jakarta in Indonesia and Dire Dawa in Ethiopia.
* Europe was found to be generally more egalitarian than other continents. Denmark, Finland, the Netherlands and Slovenia were classed as the most equal countries while Greece, the UK and Spain were among the most unequal.

Conventional thinking on development issues is often characterized by many assumptions, clichés and rationalizations about the residents of slums. Challenging some of these core myths about slums can help focus on the structural causes of urban poverty that result in the rapid growth of informal settlements, as Adam Parsons from Share the World’s Resources organization notes.

Although the above focuses on cities, more generally, rural areas exhibit more poverty than urban areas which is briefly looked at next. In addition, the section further below on poverty in industrialized areas also suggests that inequality is unfortunately widespread.
Inequality in Rural Areas

Poverty and inequality in rural areas is also high, particularly in the developing world.

The International Fund for Agricultural Development (IFAD), an international financial institution and a specialized UN agency, released a major report on the state of rural poverty in the developing world in December 2010.

Reuters summary of IFAD report, December 2010

The Rural Poverty Report 2011 contains updated estimates by IFAD of the number of rural poor people living in the developing world, poverty rates in rural areas, and the percentage of poor people residing in rural areas.

The report also includes new information on how many people move in and out of poverty over time. It points to what it describes as “emerging opportunities for rural growth and development” and suggests how to help rural women and men move out of poverty and become part of the solution for the global food security challenges of the next several decades.

The report adds that despite an historic shift towards urbanization, “poverty remains largely a rural problem, and a majority of the world’s poor will live in rural areas for many decades to come.” In addition, “of the 1.4 billion people living in extreme poverty [less than US$1.25/day] in 2005, approximately 1 billion — around 70 per cent — lived in rural areas.” (p.47)

Changes over time are not the same in all regions, however.
Rural share of total poverty (Rural people as percentage of those living on less than US$1.25/day), Rural Poverty Report 2011, p.47

As the IFAD chart shows,

* As a total average, yo% of those in extreme poverty live in rural areas
* East Asia has reduced the rural share of total poverty to just over 50 per cent
* Latin America and the Caribbean, and the Middle East and North Africa, the most urbanized regions, a majority of the poor now live in urban areas
* In South Asia, South East Asia and sub-Saharan Africa, by contrast, over three-quarters of the poor live in rural areas, and the proportion is barely declining, despite urbanization

But rural areas are not with poor only. In recent years, many have been lifted out of poverty:
Incidence of extreme rural poverty (Percentage of rural people living on less than US$1.25/day), Rural Poverty Report 2011, p.48

As the IFAD chart shows, as a total average across developing nations, just under 35% of the total rural population of developing countries is classified as extremely poor, down from around 54% in 1988. The various regions have fared differently, however. For example,

* Rural poverty has declined more slowly in South Asia, where the incidence is still more than 45 per cent for extreme poverty and over 80 per cent for US$2/day poverty
* Likewise, sub-Saharan Africa’s rural poverty decline is also slow, where more than 60% of the rural population lives on less than US$1.25 a day, and almost 90% lives on less than US$2/day.

Even within these regions, the IFAD reports that some countries and sub-regions fared better than others.

IFAD also noted that the number of those living on less than $2 a day is also down, from around 80% of all rural populations to around 60% (but mostly due to massive rural poverty reduction in East Asia (mostly China) where today the incidence of rural poverty is around 15% for the US$1.25/day line and 35% for the US$2/day line. (p.48)

Despite successes in areas like Latin America when using the internationally comparable $1.25/day poverty line, the report also warns that the numbers there that can be classified in poverty would be higher if using their own national poverty lines. In other words, inequality is high even while absolute poverty is slowly being reduced.

In addition, in terms of raw numbers of people, South Asia and sub-Saharan Africa are where most rural poor live:
Rural people living in extreme poverty (Millions of rural people living on less than US$1.25/day), Rural Poverty Report 2011, p.49

Although the graphs seem to show progress, the report warns of complacency as further efforts to reduce rural poverty will be complicated by

* Increasingly volatile food prices as seen in 2008
* The uncertainties and effects of climate change, and
* A range of natural resource constraints

Inequality Between Genders

IFAD also notes that women tend to do more work (for less pay) and are the primary care givers in virtually all rural societies, yet barely feature in recognition or policy.

IFAD also adds that “The general implication of these findings is that achieving gender equality requires challenging social institutions, and that doing so is crucial to address interlocking deprivations which result in poverty – not only for women, but poverty more broadly. … women’s access to better paid, more secure jobs is not only beneficial to them and their families, but also to the growth of the wider economy.” (p.63)

For more information, see this site’s section on women’s rights which goes into the above further.
Inequality and Health

A Canadian study in 1998 suggested that the wealthiest nations do not have the healthiest people; instead, it is countries with the smallest economic gap between the rich and poor.

For many years, poverty has also been described as the number one health problem for many poor nations as they do not have the resources to meet the growing needs. Yet, it is not beyond humanity:

At the end of August, 2008, the World Health Organization’s Commission on the Social Determinants of Health presented a 3-year investigation into the social detriments to health in a report titled the Closing the gap in a generation: Health equity through action on the social determinants of health.

The report noted that health inequalities were to be found all around the world, not just the poorest countries:

The poorest of the poor, around the world, have the worst health. Those at the bottom of the distribution of global and national wealth, those marginalized and excluded within countries, and countries themselves disadvantaged by historical exploitation and persistent inequity in global institutions of power and policy-making present an urgent moral and practical focus for action. But focusing on those with the least, on the ‘gap’ between the poorest and the rest, is only a partial response.

… In rich countries, low socioeconomic position means poor education, lack of amenities, unemployment and job insecurity, poor working conditions, and unsafe neighbourhoods, with their consequent impact on family life. These all apply to the socially disadvantaged in low-income countries in addition to the considerable burden of material deprivation and vulnerability to natural disasters. So these dimensions of social disadvantage – that the health of the worst off in high-income countries is, in a few dramatic cases, worse than average health in some lower-income countries … – are important for health.

— Closing the gap in a generation: Health equity through action on the social determinants of health PDF formatted document, Commission on Social Determinants of Health, World Health Organization, August 28, 2008, p.31

Sir Michael Marmot explains why social, political and economic policies affect health. Source: WHO. Higher quality video

Sir Michael Marmot, chair of the Commission, noted in an interview that most health problems are due to social, political and economic factors.

“The key determinants of health of individuals and populations are the circumstances in which people are born, grow, live, work and age,” he says. “And those circumstances are affected by the social and economic environment. They are the cause premature of disease and suffering; that’s unnecessary. And that’s why we say a toxic combination of poor social policies, bad politics and unfair economics are causing health and disease on a grand scale.” Marmot expands on this further in the video clip.

Even within a country such as the UK, then, the report finds that the average life-span can differ by some 28 years, depending on whether you are in the poorer or wealthier strata of society.

This is discussed in more detail on this web site on this page: Global Health Overview.
Inequality fueled by many factors

Various things can create inequality. Most common generalizations will be things like greed, power, money. But even in societies where governments are well-intentioned, policy choices and individual actions (or inactions) can all contribute to inequality.

In wealthier nations, the political left usually argue for addressing inequality as a matter of moral obligation or social justice, to help avoid worsening social cohesion and a weakening society.

The political right in the wealthier nations generally argue that in most cases, western nations have overcome the important challenge of inequality of opportunity, and so more emphasis and responsibility should be placed on the individual to help themselves get out of their predicament.

Both views have their merits; being “lazy” or trying to “live off the system” is as abhorrent as inequalities structured into the system by those with wealth, power and influence.

In poorer countries, those same dynamics may be present too, sometimes in much more extremes, but there are also additional factors that have a larger impact than they would on most wealthier countries, which is sometimes overlooked by political commentators in wealthy countries when talking about inequality in poorer countries.

For example, in some poorer countries, a combination of successive military governments (often supported or aided by the West) and/or corrupt leadership, as well as international economic policy have combined to create debt traps and wealth siphoning, affecting the poorer citizens the most (because the costs such as the debt gets “socialized”).

Nigeria is one often-mentioned example, as Jubilee 2000 highlights where Western backed dictatorships have siphoned off much of the nation’s wealth in the past leaving the country under immense debt for later generations to suffer under. Indonesia is another example as part of this Noam Chomsky interview by The Nation magazine reveals. Latin America on the whole is another.

Latin America has the highest disparity rate in the world between the rich and the poor: Internal, regional and external geopolitics, various international economic factors and more, have all contributed to problems. For example, the foreign policy of the US in that region has often been criticized for failing to help tackle the various issues and only being involved to enhance US national interests and even interfering, affecting the course and direction of the nations in the region through overt and covert destabilization. This, combined with factors such as corruption, foreign debt, concentrated wealth and so on, has contributed to poverty there.

Much of the above was written around early 1999. Unfortunately, well into 2003, the World Bank reported that the Latin American rich-poor gap is widening. There has been progress in closing the gender gap in income, and girls and young women had overtaken their male counterparts in education. However, inequality is very high. For example:

* Income inequality in the region had worsened with the richest one tenth of the population earning 48% of its total income, while the poorest tenth earns only 1.6%
* Race has also been a factor where “Indigenous and Afro-descended people are at considerable disadvantage with respect to whites, with the latter earning the highest wages in the region.”

Into 2010, Inter Press Service (IPS) reports that 10 of the 15 most unequal countries in the world are in Latin America: Bolivia, followed by Haiti, Brazil, Ecuador, and Chile, which is tied in fifth place with Colombia, Guatemala, Honduras, Panama and Paraguay.

The U.S. itself also has the largest gap and inequality between rich and poor compared to all the other industrialized nations. For example, the top 1% receives more money than the bottom 40% and the gap is the widest in 70 years. Furthermore, in the last 20 years while the share of income going to the top 1% has increased, it has decreased for the poorest 40%.

Inter Press Service also summarizes an updated report by the US Census Bureau that 1 in 7 people in the US are in poverty. In 2009, 43.6 million people — 14.6 percent of the population - were living in poverty in the U.S., up from 13.2 percent of the population in 2008. The United States currently has the highest number of people in poverty it has ever had since the government began counting in 1959, although the percentage of people this represents is lower than it was then (due to the increased population size since then).

IPS also notes factors such as the global financial crisis, stagnant wages and more contribute to this deepening poverty. But the article also adds that the poverty estimate may be understated because of assumptions made in calculations years ago and changes in costs of living since then as well as regional differences.

The UK and US are often two of the more dynamic nations, economically and opportunities to make a very successful life is well within the realms of possibility. Yet, these two tend to have the worst levels of inequality amongst industrialized nations. Such levels of inequality implies that it is overly simplistic to blame it all on each individual or solely on government policy and “white-collar” corruption.

While ideological debates will always continue on the causes of inequality, both the political left and right agree that social cohesion (social justice or family values, etc) is suffering, risking the very fabric of society if it gets too out of control.
Inequality increases social tensions

Andrew Simms, policy directory for the New Economics Foundation in U.K. (which spear-headed the Jubilee 2000 campaign to highlight the injustices of third world debt) makes an interesting suggestion in the British paper, The Guardian (August 6, 2003).

He suggests that as well as a minimum wage, for the sake of social cohesion there should perhaps be a maximum wage, too.

Amongst various things, Simms notes that tackling inequality from the other end is important because “the economic case for high executive pay in terms of company performance doesn’t hold up, and because highly unequal societies have a habit of falling apart.”

In addition:

Crime and unhappiness stalk unequal societies. In the UK the bottom 50% of the population now owns only 1% of the wealth: in 1976 they owned 12%. Our economic system’s incentive structure, instead of “trickle-down”, is causing a “flood-up” of resources from the poor to the rich. Inequality leads to instability, the last thing the country or world needs right now.

Even the former hardline conservative head of the International Monetary Fund, Michel Camdessus, has come to the conclusion that “the widening gaps between rich and poor within nations” is “morally outrageous, economically wasteful and potentially socially explosive”.

Above subsistence levels, what undermines our sense of well-being most is not our absolute income levels, but how big the gaps are between us and our peers. Allowing the super-rich to live apart from society is as damaging in its own way as the exclusion of the poorest.

— Andrew Simms, Now for a maximum wage, The Guardian, August 6, 2003

It seems, however, that neoliberal economic ideology may lead many to think inequality is not important. This partial transcript of an interview with Britain’s then-Prime Minister, Tony Blair, by the BBC prior to the June 2001 elections, reveals an example of that where Blair appeared to evade the question of the importance of reducing inequality, and kept suggesting that he wants to improve the lot of the poor, regardless of the levels of inequality between rich and poor.

Britain’s BBC aired a documentary on March 17, 2004, titled IF. It looked into a scenario of what would happen in a few years if the growing inequality in the United Kingdom continued to widen. While the predictions of what would happen are always tough to make, the documentary noted some important issues that are already present, and that also parallel many parts of the world today.

In summary, the documentary noted the increasing alienation and exclusion of people in society where inequality was high, but if government tried to do something about it, they would face a powerful obstacle: the rich. The remainder of this subsection provides more details:

“Gated communities”, while providing an opportunity to develop otherwise derelict areas, also represents a sign of growing inequality, whereby those who can afford to do so live in areas where security is paid for and managed to ensure undesirables are kept out.

While individuals are making understandable decisions regarding their security, there is the additional effect of cutting off from the rest of society, leading to consequences such as:

* Resentment, fragmentation, and exclusion;
* A divided society (described as an “apartheid” of society);
* Further inequality of
o Wealth;
o Opportunities;
o Space.

Side Note»

While this phenomenon is rarely discussed in the U.K. for example, it is a common thing in many parts of the world, including the U.S., Latin America and many other parts of the Third World that exhibit high inequality.

These are times when the “welfare state” is failing people because it gives people a false sense of security and uses an element of coercion (payment of taxes to pay for the services). Yet, at the same time, the documentary noted, what is making this situation more complicated is that the super rich are taking advantage of globalization and all the loop holes it provides, such as off-shore tax havens. As a result, there is less the state is able to do, leading to further frustrations.

In the U.K., it was noted that inequality has been increasing to levels not seen since around the Second World War.

At the same time, in U.K. (as elsewhere) private security services are increasing, providing a quasi-policing role. This is in response to the increase in crime, an effect of inequality. But this has important implications. For example:

* Such services are good at protecting everything that is a commodity and has a price. This typically implies possessions of individuals.
* The wealthy, the documentary also noted, can afford more private security than the poor. When a fear of crime exists then it is understandable that people will want security services that can protect their property. Furthermore, one would not expect an individual concerned with their own well-being to appear to sacrifice that for the sake of society. The concerns for their immediate family, children naturally take precedence.
* Regrettably though, a downward spiral potentially emerges that seems hard to get out of, because of the increasing fragmentation and exclusion that this results it.

However, policing is meant to be more than protecting things of material value; the police are supposed to have social and human concerns for society as well, something a private security firm neither is mandated to have, nor is usually created for. Due to the different roles, the costs, structures and accountability are also different.

If crime is perceived to be increasing and the police are not seen as trusted, people can, and do take actions into their own hands. Wealthier people of course can afford to take more measures.

In theory then, one of the many things that makes up a functioning, stable and democratic society is an uncorrupted judicial system and law enforcement.

Addressing the root causes of inequality would therefore seem to be where the challenge lies. The political costs of inequality are recognized and accepted as being too high. The economic costs of fighting effects are also high. Citing some research, the BBC also noted that for each dollar spent on poverty causes, seven dollars was saved on consequences.

Unfortunately, governments are in a difficult situation, because they “can try to address inequality, but they will anger the rich”.
Fragile Democracies, Inequality “turn good people to evil”

In May 2002, the BBC aired another documentary related to inequality, called The Experiment, where they showed in detail how inequality can “turn good people to evil”.

* The experiment involved a system of guards and prisoners.
* The prisoners eventually revolted against the initial inequality.
* However, some of the former prisoners themselves instituted what was becoming an almost fascist regime before the experiment was eventually stopped.
* The documentary concluded that on a more general sense,
o Our democracies are more fragile than we realize;
o In addition, any power vacuums, which inequality can create and exacerbate, can seriously threaten to undermine democracy.

Inequality is also characterized by a concentration of wealth, which means a concentration of political power. Historically, one of the main reasons for continued poverty has been in order to maintain this power.

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The Wealthy and the Poor

In the developing world, there is a pattern of inequality caused by the powerful subjugating the poor and keeping them dependent. Outside influence is often a large factor and access to trade and resources is the usual cause. It is often asked why the people of these countries do not stand up for themselves. In most cases when they do, they face incredible and often violent oppression from their ruling elites and from outsiders who see their national interests threatened.

Consider the following from the United Nations:

Everyone has the right to work, to just and favourable conditions of work and to protection for himself and his family [and] an existence worthy of human dignity … Everyone has the right to a standard of living adequate for the health and well being of himself and his family, including food, clothing, housing and medical care.

— Universal Declaration of Human Rights, 1948

And contrast that with the following around the same time, from a key superpower that helped create the United Nations. It is from George Kennan, head of the US State Department planning staff until 1950, and his comments on US relations with Far East:

we have about 50% of the world’s wealth, but only 6.3% of its population.…In this situation, we cannot fail to be the object of envy and resentment. Our real task in the coming period is to devise a pattern of relationships which will permit us to maintain this position of disparity.…To do so, we will have to dispense with all sentimentality and day-dreaming; and our attention will have to be concentrated everywhere on our immediate national objectives.…We should cease to talk about vague and… unreal objectives such as human rights, the raising of the living standards, and democratization. The day is not far off when we are going to have to deal in straight power concepts. The less we are then hampered by idealistic slogans, the better.

… We should recognize that our influence in the Far Eastern area in the coming period is going to be primarily military and economic. We should make a careful study to see what parts of the Pacific and Far Eastern world are absolutely vital to our security, and we should concentrate our policy on seeing to it that those areas remain in hands which we can control or rely on.

— George Kennan, U.S. State Department Policy Planning, Study #23, February 24, 1948. (See also Foreign Relations of the United States 1948, Vol. 1, No. 2, 1976 for the full text where this was first published; The text to the part on realism of US relations in the Far East; David McGowan, Derailing Democracy, (Common Courage Press, 2000), p.169; Noam Chomsky, What Uncle Sam Really Wants, (Odian Press, 1993), Chapter 2.

While it is recognized that strong institutions, a functioning and non-corrupt democracy, an impartial media, equitable distribution of land and a well structured judicial system (and other such factors), etc. all help in realizing a successful nation and society, a lack of any of these things can lead to a marginalization of a sector of people. Often, it can be a very large sector.

For example, those likely to lose out in such an equalizing effect are the rich, elite power holders.

As a result of their ability to own and/or influence one of these above-mentioned things, they affect the lives of millions. This is a pattern seen throughout history. Take for example the medieval days of Europe where the wealthy of the time controlled land via a feudal ruling system and hence impoverished the common people intentionally.

* The rulers (Kings etc), would proclaim their “Divine Right” to rule over their subjects.
* They had an army of Lords and Bishops to advise on policies that benefited these groups (religion was used—and still is—to control and influence people, while Lords and Knights were an extension to the ruling family that would carry out the wishes.)
* They would heavily tax the people of their land.
* Not allowing the peasants to own the land upon which they lived meant that they would be stuck in poverty and dependency.
* When the elite could no longer tax the poor, they started to tax the wealthy nobility.
o It was only at that point did the revolutions such as the French Revolution take hold (because now the nobility had their wealth affected and were able to influence the peasants to fight for their cause.)
o While this helped bring more rights, once the “people” won, there were concessions made that allowed the elite to retain their power, but to share it a bit more.

Trading superiority was maintained by raiding and plundering areas deemed as a threat. Summarizing from the works of the Institute for Economic Democracy:

* The old European city states, which were centers of wealth, would control their countryside as the source of their resources and production, and hence, the source of their wealth. If the countryside became more efficient and produced better, or threatened to trade with other neighboring cities, this would be seen as a threat to the wealth, power and influence of the city. These peripheries would therefore be raided and their means of production would be destroyed.
* The cities would fight over each other for similar reasons.
* For continual support, those rulers would proclaim various reasons to their people, of maintaining security and so on (not unlike what we hear today about national security). Even some laws were established that basically allow these practices.
* A strong military was therefore necessary (just as it is today) to ensure those trade advantages were unfairly maintained.
* Those European city states evolved into nation states and imperial powers, and the countryside expanded to include today’s “third world”, which was much of the rest of the world. The effects of colonialism and imperialism are still felt today.

The “discovery” of the Americas, expansion of trade routes etc brought much wealth to these “centers of empire” which helped fuel the industrial revolution, which required even more resources and wealth to be appropriated, to continue this growth. Mass “luxury” consumption in Europe expanded as well as a result of the increased production from the industrial revolution.

Eric Toussaint: globalization’s roots lie in colonialismSee link for transcript

But this had a further negative impact on the colonized nations, the “country side”, or the resource-providers. For example, to keep profits up and costs down, they used slavery where they could, sometimes transferring people across continents, introducing others when indigenous populations had either been wiped out, decimated, or proved too resistant in some way.

Europeans also carved out artificial borders to reflect their territorial acquisitions, sometimes bringing different groups of people into the same borders that had never been forced to live together in such short times. (Some poorer countries today still suffer the effects of this.)
Side Note»

This process has also had an effect on the West, some of which continues today.

Many Europeans and their descendants around the world have tried to look back at history and ask how it was that Europe and the West prospered and rose to such prominence. The late Professor J.M. Blaut accused many historians and others of employing self-congratulation and projecting eurocentric world views, whereby reasons for Europe’s rise were (and still are) attributed to things like favorable conditions for agriculture, for democracy to grow, and for economic superiority to take hold. Race and Christianity (in particular, Protestantism) were often claimed to be a factor, too.

Blaut was critical of these and other underlying assumptions and belief systems that guided this view, showing many assumptions to be false, and suggested instead that colonialism and the “discovery” and exploitation of the Americas, with the plunder of silver, gold and other resources helped fund a European rise.

Blaut’s work is presented in two books (though a third was never finished for he passed away), part of a volume called The Colonizer’s Model of the World. His two books are Geographical Diffusionism and Eurocentric History (Guilford Press, 1993), and Eight Eurocentric Historians, by J.M. Blaut (Guilford Press, 2000).

As with the previous wars throughout Europe’s rise, World War I and II were also battles amongst the various European empires who struggled over each other to control more of the world’s resources and who would “decide the rules of unequal trade”.

Except for religious conflicts and the petty wars of feudal lords, wars are primarily fought over resources and trade. President Woodrow Wilson recognized that this was the cause of World War I: “Is there any man, is there any woman, let me say any child here that does not know that the seed of war in the modern world is industrial and commercial rivalry?”

— J.W. Smith, Economic Democracy: The Political Struggle for the Twenty-First Century, (M.E. Sharpe, 2000, 1st Edition), p.58

Plundering the “countryside” to maintain dominance and control of the wealth-producing process has been an age-old process.

These mercantilist processes continue today. Those policies of “plunder by raid” have continued, but include a more sophisticated “plunder by trade”:

The powerful and cunning had learned to plunder by trade centuries ago and societies ever since have been caught in the trap of those unequal trades. Once unequal trades were in place, restructuring to equal trade would mean the severing of arteries of commerce which provide the higher standard of living for the dominant society and collapse of those living standards would almost certainly trigger open revolt. The world is trapped in that pattern of unequal trades yet today.

— J. W. Smith, Economic Democracy: The Political Struggle for the Twenty-First Century, (1st Books, 2002, 2nd Edition), Chapter 2

The geopolitical events of the post World War II era have been crucial for their impacts on poverty and most other issues. J.W. Smith summarizes this:

Virtually the entire colonial world was breaking free, its resources would be turned to the care of its own people, and those resources could no longer be siphoned to the old imperial-centers-of-capital for a fraction of their value.

… If India and the rest of the world’s former colonies continued to take the rhetoric of democracy seriously and form the nonaligned bloc as they were planning, over 80 percent of the world’s population would be independent or on the other side of the ideological battle. And, if Japan, Germany, Italy, and France could not be held (it was far from sure they could be), that would leave only the United States, Britain, Canada, and Australia, about 10 percent of the world’s population, still under the old belief system, and even there the ideological hold would be tenuous at best. After all, if there were no countryside under the firm control of an imperial center, the entire neo-liberal/neo-mercantilist belief system will have disappeared.

What Western nations were observing, of course, was the same potential loss of the resources and markets of their “countryside” as the cities of Europe had experienced centuries earlier. “National security” and “security interests,” which citizens were coached (propagandized) to believe meant fear of a military attack, really meant maintaining access to the weak, impoverished world’s valuable resources. The “domestic prosperity” worried about was only their own and the “constantly expanding trade” were unequal trades maintaining the prosperity of the developed world and the impoverishment of the undeveloped world as the imperial-centers-of-capital siphoned the natural wealth of their “countryside” to themselves.

… Those crucial natural resources are in the Third World and developed world capital could never compete if those people had their own industrial capital and processed their own resources into consumer products. With their own industrial capital, and assuming political and economic freedom as opposed to world neo-liberal/neo-mercantilist law dictated by military power, they could demand full value for their natural resources while simultaneously underselling the current developed world on manufactured product markets. The managers-of-state had to avert that crisis. The world’s break for freedom must be contained.

— J.W. Smith, The World Breaking Free Frightened the Security Councils of Every Western Nation, Economic Democracy; The Political Struggle for the 21st Century (1st Books, Second Edition, 2002), Chapter 7

While European nations are now more cooperative amongst themselves (in comparison to the horrors of World War II) and the U.S. had long taken the lead in the international arena, for the rest of the world, international trade arrangements and various economic policies still lead to the same result. Prosperity for a few has increased, as has poverty for the majority.

Today’s “corporate globalization”, is an example where the wealthier companies and nations are able to determine the rules, shape the international institutions and influence the communication mechanisms that disseminate information to people.

In this backdrop, how do developing nations contend with poverty?

* During the Post World War II period, during the Cold War, poorer country governments often found that if they tried to improve the situation for their people, they could have been perceived as a threat or worse still going communist. They may have faced external pressure, external meddling in internal affairs or even military intervention by the powerful nations.
* The powerful nations would of course claim this was necessary for something like world stability, national interest, or to save the other country from themselves, but it would often be to do with protecting “their” national interests, such as a secure and constant supply of cheap resources or some other reason related ultimately to maintaining influence and power.
* Dictators and other corrupt rulers have often been placed/supported in power by the wealthier nations to help fulfill those “national interests” in a similar way the old rulers of Europe used the Lords and Knights to control the peripheries and direct resources to the centers of capital. (Although, now, increasingly, “democracies” are supported, but ones where the economic choices are so limited, that the “democracy” provides a similar environment that a dictatorship did, for foreign investors, but without the overt violence and oppression.)
* This means that it is hard to break out from poverty, or to reduce dependency from the US/IMF/World Bank etc.

Structural Adjustment (SAP), as described in a previous section on this web site, is an example of that dependency. Neoliberal economic ideology has been almost blindly prescribed to poor countries to open up their economies.

The idea is that opening markets for foreign investment will also help improve exports and contribute to economic growth. Cutting back on social spending (e.g. health and education) which are seen as inefficient will also help pay back loans and debts.

But what ends up happening is the poorer nations lose their space to develop their own policies and local businesses end up competing with well-established multinationals, sometimes themselves subsidized (hinting a more mercantilist economic policy for the rich, even though free market capitalism is the claim and the prescription for others).

Joseph Stiglitz explains the effects of liberalization & subsidized agriculture on poor farmers(see link for transcript)

Hence, many back the economic neoliberal policies without realizing the background to it. It is another example that while international trade and globalization is what probably most would like to see, the reality of it is that it is not matching the rhetoric that is broadcast.

J.W. Smith has researched this in depth and the following offers a relevant summary:

The Third World remains poor because the powerful strive to dominate every choke-point of commerce. One key choke-point is political control through the “co-respective” support of local elites. Where loyalty is lacking, money will be spent to purchase it. If a government cannot be bought or otherwise controlled, corrupt groups will be financed and armed to overthrow that government and, in extreme cases, another country will be financed to attack and defeat it.… The pattern has been well established repeatedly throughout history and throughout the world, as noted by the well-known philosopher Bertrand Russell,

An enormous proportion of the income of nations and individuals, nowadays, is blood money: payment exacted by the threat of death. Therefore the most prudent nation is the nation which is in the best position to levy blackmail.…Modern nations are highwaymen, saying to each other “your money or your life,” and generally taking both.

— J.W. Smith, The World’s Wasted Wealth 2, (Institute for Economic Democracy, 1994), p. 134.

(To find out more about the political dimensions of the economy of the world and to see the detailed links between history (how it is both told and repeated), politics that are always at play and the effects on the economy the world over, visit the Institute for Economic Democracy web site. It provides much more in-depth research into these backgrounds and in far more detail than what I have summarized above.)

With this in mind, why would so many people not oppose such things? There are many reasons, including:

* Most people don’t know—this is not an accident. It is in the interest of power-holders to ensure as little is questioned by outsiders as possible. Whether it be via an aristocracy or by simple distortion of information, educational systems, or whatever, different nations have had various means to handle this.

The smart way to keep people passive and obedient is to strictly limit the spectrum of acceptable opinion, but allow very lively debate within that spectrum—even encourage the more critical and dissident views. That gives people the sense that there’s free thinking going on, while all the time the presuppositions of the system are being reinforced by the limits put on the range of the debate.

— Noam Chomsky, The Common Good, Odonian Press, 1998
* Those that have opposed such things in the past may have been persecuted in some way. In some societies those who try to say something may just face ridicule due to the embedded belief systems which are being questioned, while in other societies, people may even face violent oppositions.
* Some dare not entertain the thought that the work they may be doing could be at the expense and exploitation of someone else. The following summarizes this aspect quite well:

[W]e should be familiar with the sincerity with which people will protect the economic territory that provides them their livelihood and wealth. Besides the necessity of a job or other source of income for survival, people need to feel that they are good and useful to society. Few even admit, even to themselves, that their hard work may not be fully productive. This emotional shield requires most people to say with equal sincerity that those on welfare are “lazy, ignorant, and nonfunctional.”

Those above the poverty level vigorously insist that they are honest and productive and fulfill a social need. It is important to their emotional well-being that they believe this. They dare not acknowledge that their segment of the economy may have 30 to 70 percent more workers than necessary or that the displaced should have a relatively equal share of jobs and income. This would expose their redundancy and, under current social rules, undermine their moral claim to their share. Such an admission could lead to the loss of their economic niche in society. They would then have to find another territory within the economy or drop into poverty themselves.

— J.W. Smith, The World’s Wasted Wealth 2, (Institute for Economic Democracy, 1994), p. 90.

J.W. Smith, quoted above, also points out (and details in his work) how we have moved from “plunder by raid to plunder by trade” in recent centuries. The complexities of some of today’s economics and trading systems also make it harder to address root causes of poverty:

Although in [the] early years the power brokers knew they were destroying others' tools of production (industrial capital) in the ongoing battle for economic territory, trade has now become so complex that few of today’s powerful are aware of the waste and destruction created by the continuation of this neo-mercantilist struggle for markets. Instead, they feel that it is they who are responsible for the world’s improving standards of living and that they are defending not only their rights but everybody’s rights.

This illusion is possible because in the battle to monopolize society’s productive tools and the wealth they produce, industrial capital has become so productive that—even as capital, resources, and labor are indiscriminately consumed—living standards in the over-capitalized nations have continued to improve. And societies are so accustomed to long struggles for improved living standards that to think it could be done much faster seems irrational.

— J.W. Smith, The World’s Wasted Wealth 2, (Institute for Economic Democracy, 1994), p. 158.

And when considering how today’s global economic model promotes the liberalization of capital more and more, the effects of rapid flows of capital and other impacts of over-liberalization is borne largely by the poorer members of society:

A French humorist once wrote, “When it’s money you’re after, look for it where it is most abundant, among the poor.” Governments now do this more than ever because the poor are rooted, stationary, “slow”; whereas the big money is nomadic and travels at the speed of bytes. Stationary money (of local businesses, professionals, wage and salary earners) will be taxed to the limit for the simple reason that it can be got at.

— Susan George, The Lugano Report, (Pluto Press, 1999), p. 186

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The World Bank and Poverty

The World Bank is a major international institution involved in poverty and development. It has the capacity to lend a lot of money and expertise to developing countries and advise on development matters.

The World Bank produces an annual report, called the World Development Report. The Bank regards this as its flagship report. Most mainstream economists use this report in some way or form, and it is one of the few reports on development that the US mainstream media reports on (because it usually shows the US, and its policies that it prescribes to the rest of the world, in a favorable light.)

The way the 2000 report was released highlighted another problem with the World Bank, and how it doesn’t like to accept criticism on the current forms of globalization and neoliberalism. For the 2000 report, Ravi Kanbur, a professor from Cornell University had been asked to lead up the report team.

Kanbur won respect from NGO circles as he tried to be inclusive and take in a wide range of views, something the Bank has been criticized for not doing (which is a problem in itself!). However, as the report was to be published, he resigned because he was unreasonably pressured by the Bank to tone down sections on globalization, which, amongst other things called for developing nations to accept market neoliberalism cautiously.

The World Bank was apparently influenced itself by the US Treasury on this—this is not new though; critics have long pointed out that the Bank is very much influenced by the US, thus affecting the chance of real progress being made on poverty issues around the world.

The following quotes collected from the Bretton Woods Project, reveal some interesting insights:

The Washington Consensus has emerged from the Asia Crisis with its faith in free markets only slightly shaken. Poverty eradication is now the menu, but the main dish is still growth and market liberalisation, with social safety nets added as a side dish, and social capital scattered over it as a relish. The overall implication of the resignation is fairly clear. The US does not want the World Bank to stray too far from its agenda of economic growth and market liberalisation. Ravi Kanbur’s draft has raised a few too many doubts about this agenda, and strayed too much towards politics.

— The Nation, Bangkok, 5 July, 2000

To keep the Bank afloat Wolfensohn has to steer between two major constituencies. The first are the critics, the second is the US Treasury. You don’t need to be a World Bank economist to do the cost benefit analysis. To save the Bank, and his own reputation, it is essential that the Bank’s policies and public pronouncements do not err too far from its main shareholder and political protector, the US Treasury.

— Focus on Trade, Issue Number 51, Focus on the Global South, June 2000

The World Bank has often come under criticism for its development projects not actually helping the societies that they claimed they will. One such example is the numerous dam projects that have seen lives devastated, where millions have been displaced and people have not seen the benefits promised, while at the same time, the environment has degraded and crucial arable land has been flooded. This is discussed further on this site’s hunger and poverty causes section.

Another example is the devastating Structural Adjustment Policies pressured upon poor countries by the First World, The World Bank and the IMF. These have had devastating consequences for much of the third world, though benefiting the First World.

Another example involves a recent Chad-Cameroon oil pipeline project, which started construction in 2000. The World Bank had also stressed commitments to ensure policies were observed that would protect society and the environment, while helping millions of poor in Chad out of extreme poverty (Chad is the fifth poorest country in the world) and also providing land-locked Cameroon with much needed revenue.

The World Bank’s actual monetary investment amount was just four percent of the cost. However their participation and stated commitment to poverty-combating development gave political backing that allowed multinational oil companies (who were the main investors) to raise sufficient capital on the international capital markets, which they would not have been able to otherwise do.

The World Bank had therefore highlighted this project as a prototype for the extractive industry, designed to carry oil wealth not to a few but to the mass of the poor.

AfricaFiles is an organization about African issues from the perspective of human rights, economic justice, and African perspective and alternative analysis. Given the World Bank’s claims and presenting this project as a flagship of sorts, AfricaFiles issued a report looking to see how the World Bank’s claims held up.

They concluded that

1. “Oil corporations cannot be transformed into development agencies even with the best intentions and monitoring mechanisms” referring to the sidelining of time-intensive parts of the project such as capacity building and taking social and environmental issues into consideration.
2. As a result, “global levers of development outcomes like the World Bank cannot exercise sufficient clout on oil multinationals' penchant for profits”
3. “The World Bank is incapable of respecting its own weakening safeguard policies, which are premised on controlling damage rather than avoiding harm. This is particularly significant as Africa banks on the increasing trend in Foreign Direct Investments (FDIs).”
4. “The embryonic neo-liberal governance structures in Africa are incapable of forcing FDIs, which are principally attracted by ground mineral resources, to respect ecological and social principles. This cannot be over-stressed, especially as the World Bank prepares to engage in what it calls high risk/high reward projects in developing countries.”
5. “The flawed contention of the World Bank is ‘you cannot eat omelettes without breaking some eggs.’ As this paper has demonstrated, the eggs most often broken are those of the poor who are left with no alternative livelihood.” The paper has also noted the high level of corruption, implying that those who would “eat the omelette” so to speak, would be the wealthy elite and multinationals.
6. “Public Private Partnership [PPP], the buzz paradigm of sustainable development, is fundamentally incapable of addressing the unequal power relation between fattening multinationals, weakening states and the World Bank, in this era of globalisation.”

AfricaFiles also, interestingly, suggested the World Bank use its precious resources to support more renewable energy sources development rather than oil, which has had so much political, economic and environmental problems associated with it. This was also a recommendation from a report commissioned by the World Bank itself, which has not been followed.

In mid-2004, the committee set up to oversee transparency in the oil revenues in Chad has protested about the lack of resources from both the government and the oil company involved, and that people in Chad were becoming disillusioned at the project.

In September 2005, the human rights organization, Amnesty International criticized the project investment agreements for undermining human rights, noting that, “The investment agreements governing the project risk seriously undermining the ability and willingness of Chad and Cameroon to protect their citizens’ human rights, making the oil companies de facto unaccountable in the pipeline zone.” Nearby fisherman and farmers have also been denied access to water and land, and that “there is a prevailing climate of fear and intimidation around the pipeline, some of whose critics have already been arrested and intimidated.”

In mid-January, 2006, the BBC reports that the World Bank shut down the Chad oil account which was to keep 10% of the oil revenue for future generations of people in Chad. The Chad government argued it needed to fight against poverty now and had a right to that revenue and signed a law allowing access to that account early. Earlier, the World Bank had suspended some loans, too. Some will raise concern of possible intention for corrupt practices by the Chad government, while others will see the World Bank’s influence at play here, preventing another African country to determine its own policies and be accountable to its own people.

The World Bank also provides the main source of poverty figures, such as those presented further above. The $1 dollar a day poverty line (now upgraded to $1.25 dollars a day using newer data and updated techniques) has also fallen under criticism in the past.

For example, during the long period the $1 dollar a day measure was used the World Bank was criticized for almost arbitrarily coming up with a definition of a poverty line to mean one dollar per day.

In addition, as also stated in the previous link, in the United States for example, the poverty threshold for a family of four has been estimated to be around eleven dollars per day. The $1 a day (now $1.25) definition then misses out much of humanity. Indeed, as the chart earlier showed, the number of people living on under $10 dollars a day is estimated to be just under 80% of humanity (95% of developing countries).

To be fair, the World Bank did explain why they did not use a $10 dollar a day poverty line. They felt that “Learning that (possibly) 95% or more of the [developing country] population is poor by such a standard is unlikely to have much relevance, given that US standards of living are not within the foreseeable reach of most people in a typical developing country.”

It does seem sadly true that this level is sadly not attainable in the near future for so many people. However, it serves as a useful figure to remind us how divided the world may indeed be (although, as also mentioned earlier, numbers alone do not capture all the issues; as also mentioned earlier, a number of studies show that some of the poorest in rich countries can be regarded as worse off than some in developing countries, depending on what you measure such as well-being, health, social cohesion, etc.) This can be seen more vividly in that chart also shown earlier:

Another critique of the $1 a day figure came from Columbia University, called How not to count the poor PDF formatted document.

The report describes 3 main errors as being:

1. An ill-defined poverty line;
2. A misleading and inaccurate measure of purchasing power equivalence; and
3. Incorrect extrapolation of limited data giving the false impression of precision while masking the high probably error of the estimates.

These errors, they feared, would lead to “a large understatement of the extent of global income poverty and to an incorrect inference that it has declined.” (Emphasis added). At the same time, it allowed the World Bank to insist that the world is indeed “on the right track” in terms of poverty reduction strategy, attributing this “success” to the design and implementation of “good” or “better policies”.

Since that report, the World Bank has indeed revised the poverty line as explained earlier and they noted more people were in poverty than previously realized. The links provided earlier from the World Bank do provide a better explanation of why their poverty lines were chosen as they were. And while the data this time significantly includes China and India for the first times, they also acknowledge various challenges with collecting the data. However, while they have also given their reason for not using a $10 a day poverty line (because most poor people are unlikely to reach that level in the foreseeable future), we must still wonder if poverty, and its effects, are worse than the figures reveal.

As an aside, Morgan Spurlock, the Oscar nominee for his documentary Super Size Me where he went 30 days on a diet of burgers to see what the effects would be, produced another documentary where he tried to live on the minimum wage of $5.15 per hour for 30 days. At times he was earning $50 to $70 a day and yet the tremendous hardships he faced was incredible (including a ludicrous $40 for a bandage in a hospital, and some $500 for just being seen to).

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Poverty in Industrialized Countries

As mentioned earlier, poverty in industrialized nations is also an important issue. While many poor in wealthy countries may not be in absolute poverty as the many poor people in developing countries, the relative poverty and high inequality in many wealthy nations creates significant issues.

The gap between rich and poor has grown in more than three-quarters of rich countries since the mid-1980s, according to a study of income inequality and poverty by the Organization for Economic and Cooperative Development (OECD) released in October 2008.

In addition, the study finds that the economic growth of recent decades has benefited the rich more than the poor.

However, amongst those 30 countries, results are mixed. The study finds, for example, that the past five years saw growing poverty and inequality in two-thirds of OECD countries. Canada, Germany, Norway and the United States are the most affected. The remaining third—particularly Greece, Mexico and the United Kingdom—have seen a shrinking gap between rich and poor since 2000.

As summarized by an OECD briefing PDF formatted document, the income of the richest 10% of people is, on average across OECD countries, nearly nine times that of the poorest 10%.

The average hides large variations. For example the top 3 countries with the highest income gaps are:

1. Mexico, where the richest have incomes of more than 25 times those of the poorest
2. Turkey, where the ratio is 17 to 1
3. USA, where the ratio is 16 to 1.

Portugal and Poland also have large gaps, making it the top 5, but their gaps are not as large as those first three. (For many years, the US was regarded as having the largest gap between rich and poor of any industrialized nations, but the group of industrialized nations has slightly grown since to include Mexico and Turkey—also the two poorest OECD countries—amongst others.)

In Nordic countries, however, such as Denmark, Sweden and Finland, the gap is much smaller. The incomes of the richest 10% average around five times those of the poorest 10%.
from Are we growing unequal?, OECD Briefing, October 2008, p.2

Although the elderly are more likely to be poor, the risk of them falling into poverty has reduced over the last two decades such that “people aged 66-75 are now no more likely to be poor as the population as a whole.”

Worryingly, however, “children and young adults have poverty rates that are now around 25% higher than the population average, while they were below or close to that average 20 years ago.”
from Are we growing unequal?, OECD Briefing, October 2008, p.4

The OECD report noted for example UK’s shrinking gap between rich and poor. Back in 2000, the UK was the worst place in Europe to be growing up if you were poor, as more children were likely to be born in to poverty there, compared to elsewhere in the EU.

Despite a period of boom, in April 2000, the UK National Office of Statistics found that disparities between rich and poor continued to grow in UK.

In April 2008, the BBC noted that after 30 years of unprecedented economic growth, the British are richer and healthier — but no happier than in 1973.

As well as growing inequality and other issues, the BBC noted that the UK figures “follow trends from around the world that show that happiness and satisfaction do not correlate with average income once countries reach ‘middle-income’ levels.” In addition, “one in six UK adults reported that they suffered from a variety of mental health problems in the latest survey, of which the largest category was ‘mild anxiety and depression.’”

As Britain’s wealth generally increased, improvements in health were also accompanied by unhealthy luxury consumption including excessive alcohol consumption and excessive unhealthy eating creating a rise in alcohol related deaths and in obesity.

Andrew Simms, policy director of the New Economics Foundation in an article mentioned further above about inequality notes that

Crime and unhappiness stalk unequal societies. In the UK the bottom 50% of the population now owns only 1% of the wealth: in 1976 they owned 12%. Our economic system’s incentive structure, instead of “trickle-down”, is causing a “flood-up” of resources from the poor to the rich. Inequality leads to instability, the last thing the country or world needs right now.

Even the former hardline conservative head of the International Monetary Fund, Michel Camdessus, has come to the conclusion that “the widening gaps between rich and poor within nations” is “morally outrageous, economically wasteful and potentially socially explosive”.

— Andrew Simms, Now for a maximum wage, The Guardian, August 6, 2003

However, although there has been some improvement, there is a long way to go. A UNICEF report in February 2007 found that UK is failing its children PDF formatted document as it comes bottom of all industrialized nations in terms of child well being. UK child poverty has doubled since 1979, for example.

As another example, it may be surprising for some readers to learn that the United States, although the wealthiest nation on Earth, has often had one of the widest gaps between rich and poor of any industrialized nation.

United For a Fair Economy reported that for 1998 almost 70% of the wealth was in the hand of the top 10%. In another report, they mentioned that the gap had widened in recent decades. “In 1989, the United States had 66 billionaires and 31.5 million people living below the official poverty line. A decade later, the United States has 268 billionaires and 34.5 million people living below the poverty line-about $13,000 for a three-person family.”

In the United States, wealth is highly concentrated in a relatively few hands. As of 2007, the top 1% of households (the upper class) owned 34.6% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 50.5%, which means that just 20% of the people owned a remarkable 85%, leaving only 15% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth (total net worth minus the value of one’s home), the top 1% of households had an even greater share: 42.7%.

— Prof. G. William Domhoff, Wealth, Income, and Power, Who Rules America, University of California, Santa Cruz, last updated July 2010

Inter Press Service also summarizes an updated report by the US Census Bureau that 1 in 7 people in the US are in poverty. In 2009, 43.6 million people — 14.6 percent of the population - were living in poverty in the U.S., up from 13.2 percent of the population in 2008. The United States currently has the highest number of people in poverty it has ever had since the government began counting in 1959, although the percentage of people this represents is lower than it was then (due to the increased population size since then).

IPS also notes factors such as the global financial crisis, stagnant wages and more contribute to this deepening poverty. But the article also adds that the poverty estimate may be understated because of assumptions made in calculations years ago and changes in costs of living since then as well as regional differences.

As with Britain, even during the “booming economy” in the late 1990s and early 2000, there was an increasing gap between the rich and poor. Into 2002, fighting poverty did not appear to have been a major election campaign issue (nor was it in previous election campaigns).

Then chairman of the Federal Reserve, Allan Greenspan, revealed concerns in mid-2005 that the increasing and widening income gap might eventually threaten the stability of democratic capitalism itself in the US.

While health and education are key to any economy or nation to grow and be strong, both of these suffer issues of access, equality and pressure to cut back (including elsewhere around the world as discussed in the structural adjustment part of this site). For example,

* As a summary of a report titled Economic Apartheid in America mentions, “that the United States is the only industrialised nation that ‘views health care as a privilege, not a basic human right.’”. (Unfortunately the report itself not available on the Internet, but is produced by United for a Fair Economy where you can see many extracts and similar reports.)
* In addition, as good education is linked to a strong economy, Business Week reports (February 14, 2002) on a study that analyses OECD data from 1994 to 1998, and summarizes that “the literacy of American adults ranks 10th out of 17 industrialized countries.” In addition, the issue of inequality was highlighted: “More troubling, the U.S. has the largest gap between highly and poorly educated adults, with immigrants and minorities making up the largest chunk of those at the bottom.” While Business Week concentrates on the U.S. they also point out that “Despite the mediocre U.S. ranking, it still beat out most of its major trading partners except Germany, including France, Britain, and Italy. (Japan didn’t participate [in the study].)”

The above-mentioned UNICEF report on child health found that as well as the UK being ranked bottom of all rich countries, the US ranked second to last. The report suggests that absolute wealth isn’t necessarily a guarantor of poverty alleviation or a measure for indicators such as child well-being, and factors such as inequality are also important.

And it isn’t in just these two industrialized nations that these problems persist. A Guardian news report, for example, shows that certain types of poverty in various European cities can be regarded as worse than in some other parts of the world which one would not normally think would compare with Europe, such as India.

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1. Poverty Facts and Stats
2. Structural Adjustment—a Major Cause of Poverty
3. Poverty Around The World
4. Today, over 22,000 children died around the world
5. Corruption
6. Foreign Aid for Development Assistance
7. Causes of Hunger are related to Poverty
8. United Nations World Summit 2005
9. IMF & World Bank Protests, Washington D.C.
10. Economic Democracy

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* by Anup Shah
* Created: Monday, July 20, 1998
* Last Updated: Sunday, January 02, 2011

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* Causes of Poverty (13)
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Document Revision History
Date Reason
January 2, 2011 Added a small additional note and link about slums as well as a new section on rural poverty and gender inequality
September 20, 2010 Added a short note about inequality in Latin American and poverty in the US
March 1, 2010 Added some information and videos about slums
December 7, 2009 Added a section on inequality in industrialized nations and how that may be more important than economic growth, because most health and well-being indicators are related more to equality than growth, once a nation has industrialized. Also added a couple of videos on aspects of poverty.
November 22, 2008 Added information about inequality in cities around the world, rich and poor
November 3, 2008 Added information and charts on inequality in industrialized nations
September 3, 2008 Added charts and explanation of the revised poverty figures from the World Bank and added some more information about inequality and health
February 15, 2007 Small note added on child poverty/well-being in industrialized nations
January 29, 2006 Moved the corruption section into its own page
January 14, 2006 Small update added on the World Bank/Cameroon-Chad oil pipeline issue
June 11, 2005 Small addition on level of inequality
July 3, 2004 A World Bank and multinational company project for the Cameroon-Chad oil pipeline reveals that despite the World Bank assuring people that local people’s interests will not be sacrificed, the opposite indeed happened.
March 31, 2004 Added new and updated information on inequality
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* Shaohua Chen and Martin Ravallion, 'The developing world is poorer than we thought, but no less successful in the fight against poverty', World Bank, August 2008http://go.worldbank.org/5V41Z1WRL0

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* 'For richer, for fairer. Poverty reduction and income distribution', ID21 Insights Issue #31, September 1999http://www.id21.org/insights/insights31/index.html

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* 'Chad-Cameroon pipeline: New report accuses oil companies and governments of secretly contracting out of human rights', Amnesty International, September 7, 2005, News Service No: 239, AI Index: POL 30/028/2005http://web.amnesty.org/library/Index/ENGPOL300282005?open&o...

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