Socialist Standard July 2008 World Poverty page 11

Socialist Standard The Socialist Party Of Great Britain is a companion party of The World Socialist Movement

July 2008

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World Poverty

Why it will never be eliminated from the capitalist system

Everyone has a notion of what global poverty is. Many tut-tut and wish someone would do something about it. Some give funds, a little or a great deal, in the hope of relieving some of the worst effects here or there. Governments and global institutions spend vast sums of money on getting together regularly in luxury hotels to discuss, repeatedly, what could/should be done, where and how it should be done and how much in money terms each of them will pledge for the current initiative. The bottom line – how much of these pledges the donors actually divest themselves of compared with the self-seeking public pronouncements they make about their grand schemes – reveals huge discrepancies.

Apart from concerns of absolute poverty of billions living on less than one or two dollars a day there are also plenty living in relative poverty who know only too well the feeling of sinking deeper and deeper in the last two or three decades into unmanageable debt through falling incomes (in real terms), through job-loss and no hope of replacement, through long-term illness or injury, through losing their homes from natural disaster, conflict or falling house prices and foreclosures, through unfavourable global tendencies, through simply always having more months than money. Awareness of global poverty, whether relative or absolute, has probably never had as high a profile as currently but much of the data compiled by such institutions as the World Bank and available in publications geared to promoting an unquestioning belief in the continuation of the economic norms of the capitalist system convey information slanted to support particular agenda. That schemes are afoot to tackle and abolish the worst ravages of poverty is an illusion manufactured to veil the truth.

In an article in Dissent winter 2008, “Growth and Inequality” Thomas Pogge (of the Centre for Applied Philosophy and Public Ethics at the Australian National University and soon to be in the Philosophy Department of Yale University) debunks the myth, promulgated by the Economist, the World Bank and others who subscribe to this unfounded belief, that “growth is good” for all across the spectrum. Statistics can be and are manipulated and displayed to back up a pre-chosen outcome. Pogge shows example after example of how this is done. The cherry-picking that follows is designed to present a part of what he reveals about growing inequality without misrepresenting his main thrust. An early example compares figures from the World Bank tabulating the Gross National Income of the high-income countries alongside the rest of the world, with his own figures extrapolated from the World Bank’s data placing the Gross National Income of the richest countries alongside the GNI only of the poorest countries (each group constituting 10 percent of the world’s population). The difference between the two comparisons is striking. Over a 25 year period, 1980-2005, in the World Bank’s table, the high income countries had between 15.8 and 23.2 (fluctuating up and down slightly in different years) times more than the rest of the world; however, in the same period in Pogge’s figures derived from the World Bank’s World Development Reports, he shows the difference between richest and poorest increasing from 60:1 to 122:1. In an example from the Economist whose author sets out to prove that faster growth is more beneficial for the more populous poor countries (e.g. China and India) than the less populous ones Pogge explains that the Economist’s author is erroneously comparing Gross Domestic Product rather than Gross National Product/Gross National Income, thus inflating the figures and grossly misleading the readers about the true state of income of the world’s poorest. (Gross Domestic Product includes the earnings made by foreigners which is leaving the country and also includes earnings that residents derive from abroad – hardly relevant in an assessment of the wealth of the poor).

Continued on following page 12

11	Socialist Standard July 2008