Causes of Poverty
Causes of Poverty
Poverty is the state for the majority of the world’s people and nations. Why is this? Is it enough to blame poor people for their own predicament? Have they been lazy, made poor decisions, and been solely responsible for their plight? What about their governments? Have they pursued policies that actually harm successful development? Such causes of poverty and inequality are no doubt real. But deeper and more global causes of poverty are often less discussed.
Behind the increasing interconnectedness promised by globalization are global decisions, policies, and practices. These are typically influenced, driven, or formulated by the rich and powerful. These can be leaders of rich countries or other global actors such as multinational corporations, institutions, and influential people.
In the face of such enormous external influence, the governments of poor nations and their people are often powerless. As a result, in the global context, a few get wealthy while the majority struggle.
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Structural Adjustment—A Major Cause of Poverty
“Debt is an efficient tool. It ensures access to other peoples’ raw materials and infrastructure on the cheapest possible terms. Dozens of countries must compete for shrinking export markets and can export only a limited range of products because of Northern protectionism and their lack of cash to invest in diversification. Market saturation ensues, reducing exporters’ income to a bare minimum while the North enjoys huge savings. The IMF cannot seem to understand that investing in … [a] healthy, well-fed, literate population… is the most intelligent economic choice a country can make.”
— Susan George, A Fate Worse Than Debt
Many developing nations are in debt and poverty partly due to the policies of international institutions such as the International Monetary Fund (IMF) and the World Bank.
Their programs have been heavily criticized for many years for resulting in poverty. In addition, for developing or third world countries, there has been an increased dependency on the richer nations. This is despite the IMF and World Bank’s claim that they will reduce poverty.
Following an ideology known as neoliberalism, and spearheaded by these and other institutions known as the “Washington Consensus” (for being based in Washington D.C.), Structural Adjustment Policies (SAPs) have been imposed to ensure debt repayment and economic restructuring. But the way it has happened has required poor countries to reduce spending on things like health, education and development, while debt repayment and other economic policies have been made the priority. In effect, the IMF and World Bank have demanded that poor nations lower the standard of living of their people.
World Hunger
We often hear about people’s desire to solve world hunger, or to be able to feed the world and help alleviate the suffering associated with it.
However, meaningful long-term alleviation to hunger is rooted in the alleviation of poverty, as poverty leads to hunger. World hunger is a terrible symptom of world poverty. If efforts are only directed at providing food, or improving food production or distribution, then the structural root causes that create hunger, poverty and dependency would still remain. And so while continuous effort, resources and energies are deployed to relieve hunger through these technical measures, the political causes require political solutions as well.
Causes of Hunger:
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
Solving World Hunger:
Food subsidies have often been used by governments to help the poor, though many nations have either voluntarily, or under pressure from aid donating countries actually removed these subsidies.
Mozambique recently reintroduced food subsidies after deadly protests resulted from fuel and food price hikes.
However, on their own, food subsidies may not help in the longer term if additional policies to help the poor get out of poverty are not in place, as Save the Children in Mozambique says in this video.
Giving or donating food as aid or charity in non-emergency situations is also not always the long term answer, either. The section on food dumping, next, reveals additional details on how food aid has been used as a foreign policy tool by some wealthy nations to their advantage and interests. Rather than benefiting recipients, such “food aid” has amounted to economic dumping, helping destroy local farmers and their production, while supporting and bolstering large agribusiness. Hunger and poverty has increased as an effect.
Food Dumping [Aid] Maintains Poverty
In the industrialized northern countries, we instinctively believe that food aid is a very worthy cause and many do their utmost to genuinely help in this field. Web sites like the hungersite.com allow you to simply click a link and thereby donate food to someone in need in a developing country. However, there is more to it that selecting on a link.
In fact, if priority is not placed on the political root causes of hunger, sites like this may unwittingly contribute to the harm that has already been inflicted on the poor in developing countries because the poor countries will remain dependent. (Providing free food in emergency situations of course is usually welcome, but we are concerned with systemic root causes of hunger in non-emergency situations here as someone sixth of humanity goes hungry each day in non-emergency situations.)
Food and Agriculture Issues
Food and agriculture is at the heart of our civilizations. Many religions and cultures celebrate various aspects of food and agriculture due to the importance in our continuity. For an issue that goes to the heart of humanity, it also has its ugly side.
East Africa Food Crisis:
Into mid-2011, the world’s worst food crisis is being felt in East Africa, in Ethiopia, Somalia and Kenya.
Despite successive failed rains, the crisis has been criticized as avoidable and man-made. This is because the situation had been predicted many months before by an international early warning system. Both the international community and governments in the region have been accused of doing very little in the lead up to this crisis. In addition, high food prices have forced food out of the reach of many people, while local conflicts exacerbate the situation.
As the international organization Oxfam describes: 12 million people are in dire need of food, clean water, and basic sanitation. Loss of life on a massive scale is a very real risk, and the crisis is set to worsen over the coming months, particularly for pastoralist communities.
Global Food Crisis:
The global food crisis that has made headlines in 2008 has been simmering for a while. The rise in food prices, affecting the poorest the most, has a variety of causes, mostly man-made. It has resulted in riots, an overthrow of a Prime Minister and many deaths, around the world. It has been common to attribute causes to things like overpopulation but that seems to miss the real causes as food levels continue to outstrip demand even in a growing population. While media reports have been concentrating on some of the immediate causes, it seems that deeper issues and causes have not been discussed as much.
Corruption
Corruption is both a major cause and a result of poverty around the world. It occurs at all levels of society, from local and national governments, civil society, judiciary functions, large and small businesses, military and other services and so on.
Corruption affects the poorest the most, in rich or poor nations, though all elements of society are affected in some way as corruption undermines political development, democracy, economic development, the environment, people’s health and more.
The issue of corruption is very much inter-related with other issues. At a global level, the “international” (Washington Consensus-influenced) economic system that has shaped the current form of globalization in the past decades requires further scrutiny for it has also created conditions whereby corruption can flourish and exacerbate the conditions of people around the world who already have little say about their own destiny. At a national level, people’s effective participation and representation in society can be undermined by corruption, while at local levels, corruption can make day to day lives more painful for all affected.
A difficult thing to measure or compare, however, is the impact of corruption on poverty versus the effects of inequalities that are structured into law, such as unequal trade agreements, structural adjustment policies, so-called “free” trade agreements and so on. It is easier to see corruption. It is harder to see these other more formal, even legal forms of “corruption.” It is easy to assume that these are not even issues because they are part of the laws and institutions that govern national and international communities and many of us will be accustomed to it—it is how it works, so to speak.
Tax Avoidance and Tax Havens
We might not like the idea of paying taxes, but without it, democracies will struggle to
function, and will be unable to provide public services. This affects both rich and poor nations, alike.
Individuals and companies all have to pay taxes. But some of the world’s wealthiest individuals and multinational companies, able to afford ingenious lawyers and accountants, have figured out ways to avoid paying enormous amounts of taxes. While we can get into serious trouble for evading payment of taxes, even facing jail in some countries, some companies seem to be able to get away with it. In addition, if governments need to, they tax the population further to try and make up for the lost revenues from businesses that have evaded the tax man (or woman).
Why would companies do this, especially when some of them portray themselves as champions of the consumer? The reasons are many, as this article will explore. In summary, companies look for ways to maximize shareholder value. Multinational companies are in particular well-placed to exploit tax havens and hide true profits thereby avoiding tax. Poor countries barely have resources to address these — many have smaller budgets than the multinationals they are trying to deal with.
Yet, companies and influential individuals also pour lots of money into shaping a global system that they will hope to benefit from. If the right balance can’t be achieved, not only will attempts to avoid taxation and other measures undermine capitalism (which they claim they support) they will also undermine democracy (for even responsible governments may find it hard to meet the needs of their population).
How to Prevent Poverty
Understandinghow to prevent poverty has been an issueof great concern both in the United States and across the globe.Countrieslike the U.S., in a position to prevent poverty in less developed nations, are particularly interested indetermining the causes of poverty in order to effectively alleviate poverty at home and abroad. By understanding what it is that leads to impoverishment in specific communities and countries, poverty reduction efforts are more likely to prevent poverty all over the world.
Though poverty and extreme poverty, as terms, have been defined as living under a certain dollar amount per day, what causes poverty is often much more complicated. The World Bank defines global poverty as a pronounced and multidimensional deprivation in wellbeing. That is, what it is to be considered poor or impoverished depends on a number of different conditions and factors that vary from community to community. For example, one family may have the dollar amount sufficient to feed itself but lack adequate access to education or water.
Because poverty represents such a wide variety of conditions, how to prevent poverty is an issue that requires a complex understanding of the circumstances in which one is working. Not only that, effective poverty prevention and reduction strategies will necessarily include either a multidimensional approach or take place in a network of projects that strive to prevent or reduce poverty on various levels. For instance, Plan Canada, a Canadian-based charity organization founded in 1937, takes a five-step approach in itsstrategy to prevent poverty worldwide.
The United Nations Population Fund (UNFPA) reports that slower population growth and investments in reproductive health and HIV prevention, as well as women’s empowerment and gender equality are also important steps toward preventing poverty. In fact, the UNFPA considers universal access to reproductive health information and services to be an “essential” condition to achieve the U.N.Millennium Development Goalsby 2015.
How to end poverty is a complicated question, but significant research like that taken to synthesize the reports discussed above suggests that it is not an impossible question to answer. Quite the contrary, there are thousands of organizations across the globe working on just that question every day. Collaborative and coordinated efforts, in recognition of the diverse causes of poverty, will no doubt win the day. In the meantime, these strategies continue to develop in scope and sophistication.
5 / Ways to Stop Poverty / Quality Educationprovides children with the knowledge and life skills they need to realize their full potential, and is essential to creating change in a child’s life. Plan International helps by training teachers, building new schools and breaking down barriers that prevent many children – and girls in particular – from attending school.
Access to Health Care
is essential. Plan International helps communities build health clinics, train health care workers and invest in equipment and medicine, so children can grow up healthy and strong. / Water and Sanitation
are also essential for every child’s survival. Each year, Plan helps communities build school latrines, community water points and helps to establish organizations to ensure the continued management and maintenance of water points.
Child Participation
Plan helps children learn their rights and take active roles within their community. Child participation helps children engage in citizenship, express their views and make decisions that will shape their future and influence the people around them. / Economic Security
Plan works to overcome poverty by helping communities around the world gain the economic security they need to thrive. Plan International is training people living in poverty to acquire the skills and knowledge they need to secure a livelihood, and support their families.
Organizations Aiding Poverty
The Borgen ProjectAlmost 3 billion people lack access to toilets and almost 1 billion lack access to clean drinking water
“The poorest 20% of the world’s children are twice as likely as the richest 20% to be stunted by poor nutrition and to die before their 5th birthday.”
2.7 million newborns worldwide die within their first month of life
Almost 200 million children under the age of 5 in developing regions are underweight for their age
179 million infants in the least developed countries are not protected from diseases by routine immunization
3.2 million children under the age of 15 currently live with HIV
161 million children do not attend primary school /
“The Borgen Project is an incredible nonprofit organization that is addressing poverty and hunger and working towards ending them.”
– The Huffington Post
Mission Statement: The Borgen Project believes that leaders of the most powerful nation on earth should be doing more to address global poverty. We’re the innovative, national campaign that is working to make poverty a focus of U.S. foreign policy.HISTORY
In 1999, while working as a young volunteer in refugee camps during the Kosovo War and genocide, Clint Borgen recognized the need for an organization that could focus U.S. political attention on extreme poverty. In 2003, after graduating from Washington State University and interning at the United Nations, Borgen began developing the organization.
In need of startup funding, Borgen took a job living on a fishing vessel docked in Dutch Harbor, Alaska (the same location as “The Deadliest Catch”). From humble beginnings in one of the most remote regions of the world, The Borgen Project was born. One man with a laptop and a budget that came from his Alaska paychecks has evolved into a national campaign with volunteers operating in 220 U.S. cities.
Death by Birthplace: 7 countries are home to 58% of the world’s hungry: India, China, Pakistan, Ethiopia, Bangladesh, Indonesia, and Tanzania
Action Against Hunger
What Makes Us Unique
Action Against Hunger saves lives while building long-term strategies for self-sufficiency:
- Lifesaving impact in 45+ countries
- 6,500+ field staff assisting more than 14.9 million people in 2015
- 35+ years of expertise in contexts of conflict, disasters and food crises