2020s >> 2020 >> no-1393-september-2020

Cooking the Books: What is poverty?

‘Huge rise in destitution for the poorest’ ran the headline in the Times (27 July) reporting on research by the National Institute of Economic and Social Research. According to this think-tank:

‘Destitution is defined as income that is so low that a household is likely to lack essential provision of shelter, food, heating, lighting, clothing/footwear and basic toiletries in the immediate future’.

Destitution is a word socialists have tended to prefer to describe the situation of ‘the poor’ as the word poverty has a wider meaning.

In fact capitalism can be said to be based on poverty in that the vast majority of the population does not have enough of their own resources to live; as a result they are obliged by economic necessity to sell their mental and physical energies to an employer in exchange for money to buy what they need. In this sense all those in the working class are poor; it is part of the definition of the working class.

Other definitions of poverty don’t take the analysis as far back as this, but assume that most workers do have a more or less steady job and so do have resources to satisfy their basic needs. This is not entirely unreasonable as most workers do have a job and the regular income it provides and so are not deprived of some or all of the basic necessities of life. They are not destitute.

Academic, legal and popular definitions of poverty start from this point and define the poor as those who, for one reason or another, do not have enough money to satisfy all their basic necessities. In this sense most workers aren’t poor. Only those on very low wages or who are unable to find an employer or who are unable to work are poor. In other words, essentially what the NIESR mean by destitution.

Ever since the sixteenth century the state has had to make some provision for people in this position. For centuries it was called the Poor Law; today it’s Income Support as the minimum level to which the state will bring up a person’s income. When Marx was writing and right up until the 1920s such people were officially called ‘paupers’. Marx regarded one section of paupers as part of what he called capitalism’s ‘industrial reserve army’, i.e., that section of the working class that could be called on to serve as wage-workers in periods of capitalist expansion but which had to be maintained by the state in times of contraction. The NIESR report confirms that the number of the destitute does rise in a period of contraction (even though the present one is government-induced rather than a part of the boom/slump cycle).

It is not just socialists who feel the need to distinguish between poverty and destitution. Reformists have come up with the concept of ‘relative poverty’: ‘those who can scrape by on the basics but who cannot afford the normal activities and opportunities that average earners have access to’ (Big Issue, 21 February 2019). In Britain you are considered to be in this position if you are in a household whose income is less than 60 percent of the median average (i.e., of the mid-point of the range of incomes).

This concept has a number of drawbacks. First, it assumes that those with incomes above this level don’t have restricted opportunities. Second, it’s a moving poverty line as a household can find itself reclassified as not being (or being) in poverty without their income changing simply because the average income has. It is probably better called ‘relative low income’. Still, according to the government’s own statistics some 14 million people, or over 20 percent of the population, are in this position. Which is quite an admission and a condemnation of capitalism by its own standards.


Socialist Standard September 2020


Leave a Reply