Opinion //
Is the world without poverty truly attainable?
We can’t end it. But we can mitigate its impacts.
Karl Marx wrote in his Communist Manifesto, well over a century ago, about the bigotry of the Bourgeoisie, the exploitation of human workers, and the relegation of humans to menial, machine-like beings in front of the assembly line. Marx’s biggest pull to workers, perhaps, was his suggestion that rampant poverty among workers was caused by their relentless exploitation, and that there was one system that could fix it all — called Communism.
Workers and intellectuals, displeased at their perceived exploitation at the hands of the very rich, brought Marx’s revolution to the world. Despite the best attempts of the Russians (Soviets), the Chinese, the Cubans and the North Koreans, Communism never achieved its main purpose of creating an equal and just utopia where all is shared, all are equal, and where poverty would be relegated to the annals of history books.
Economically, the idea of a world without poverty is perhaps unsound. The whole field of economics was formed to study the best and most efficient, and later, the most equal way of dividing wealth. Economists refer to this as equity — giving more benefits to those at the bottom to prop them up enough to compete on a level playing ground as those higher up. This is perhaps best explained in an illustration:
Now, why is it economically unsound? The problem in economics — the main one — is that resources are scarce and limited. And that we can only achieve some (not all) our aims with what we have. Economic and social growth, or helping those falling behind, is an everyday juggling task economists and policy-makers alike struggle with.
But that is not the biggest issue. The issue is that in cases of government intervention, economists fret over what can be called over-zealous intervention. Over-intervening can cause social allocative inefficiency in the form of deadweight loss — either resulting from a social cost that could have been avoided or a social benefit that could have been gained — had the government not intervened or intervened less.
The problem is that governments don’t have that piece of information. They know a bit more than us — that’s for sure — but they don’t know the name of every Tom, Dick and Harry living down the street with a less than socially acceptable income, nor how they are living and coping. Couple that with a limited budget scope and multiple priorities, and the government intervention almost always falls short of the optimum outcome.
Even in a well-developed city state like Singapore, where government budget is high compared to the number of citizens and land-space, and where monitoring and enforcement costs are relatively lower compared to larger countries, poverty has not been eradicated. Public rental flats, education, unemployment benefits and more have only served to mitigate the situation for Singapore’s underprivileged population.
Furthermore, every government policy that uses up something — be it time, or money — incurs an opportunity cost. That’s just economic jargon for the benefit foregone from the next best alternative by doing something. In the case of the government, the budget spent on navigating policies to improve equity incurs an opportunity cost of say, spending that money on R&D in technology to improve the economy, or loans to struggling banks. The idea here is that with our limited budget and time, we will always be giving up something (maybe) as valuable as achieving zero poverty.
Furthermore, our economy is always inflating. That is the natural state of our economy. What is “borderline out of poverty zone” now may be something else in the future. (Who else remembers the Zimbabwe cash crisis?) The ever inflating nature of our economy means that 2 USD today, the UN line for poverty, could mean not even able to survive a few years later. So even if we get a number of people out of poverty and into the realms of say, 3 USD a day, they could easily slide back into poverty in a few years, assuming that government benefits stay the same.
Poverty is also deeply intertwined with structural inequities embedded within societies. Discrimination based on factors such as race, gender, ethnicity, and social class exacerbates poverty rates. Historical disadvantages, systemic biases, and unequal access to education, healthcare, and employment opportunities limit social mobility and perpetuate cycles of poverty. Addressing these deep-rooted structural inequities requires comprehensive societal transformation, which is a complex and long-term endeavour.
Further geographical factors play a significant role in perpetuating poverty. Many impoverished regions, such as remote rural areas or conflict-ridden zones, face unique challenges in terms of limited infrastructure, inadequate healthcare, and insufficient access to education and markets. Unless we can solve problems like eternal war and deserts, it is almost impossible to prevent these places are their citizens from lagging behind the rest of the world. Factors like climate change, natural disasters, and geographical isolation further impede poverty eradication efforts. The complex interplay of these challenges makes it difficult to achieve zero poverty universally.
The Earth’s finite resources and the growing global population further pose significant challenges to poverty eradication. Limited resources strain efforts to provide basic necessities such as food, water, and shelter to all. Additionally, population growth outpaces economic development and the availability of job opportunities, exacerbating poverty rates. These factors make achieving zero poverty an immense and complex task.
Eventually, we would achieve what economists call equilibrium. The number of people we help out of poverty would be equal to the number of people sliding back into it. Poverty is not a class — it’s a state — and hence is mobile and ever-changing. We can do our best to reduce and minimise it, but ultimately, we will almost always be unable to end it. At least, not for long. Zero poverty is a noble aim, yet not one that we can achieve.
While we’re at it, though, let’s make the world a better place for us all.
