Rethinking Poverty

[This post is part of the Presbyterian Bloggers Unite effort.]

What is poverty? On the surface, it sounds like such a simple question. But is it? The Encarta Dictionary says:

"Poverty: The state of not having enough money to take care of basic needs such as food, clothing, and housing."

Two types of poverty are spoken of in the social sciences. First, there is absolute poverty, which matches Encarta definition. Second, there is relative poverty. Here the measure is someone's economic status relative to everyone else. There will always be relative poverty unless a community has a perfectly even economic distribution. Some folks will always be in the bottom ten percent of the wealth distribution. In a community of millionaires, those with "only" one million dollars will be in relative poverty.

To further complicate issues, how do we measure economic status? Most government entities use annual income. Yet some very wealthy people may have only a few thousand dollars of income in a given year, while a relatively poor person may have a one-year windfall (ex. selling a home or receiving an inheritance). Household income is frequently used, but household size increases with income. The bottom 20% of households account for only 14.8% of the population, while the top 20% account for 24.3%.

Then there is the question of temporary versus chronic poverty. A study of households from 1996-2005 determined that 58% of bottom-quintile earners moved up one quintile or more in that decade, while 57.4% of the top 1% of earners dropped by one quintile or more. Another study from the late 1990s, covering forty-eight months, showed that 51.1% of people in poverty for any given month were in poverty for 2 to 4 months, and only 5.7% were in poverty for thirty-six months or more. The common perception of "the poor" as a sizeable economically stagnate community is inaccurate. When we talk about poverty in emerging nations, we are dealing with a different set of issues, but we need to be very clear about what we mean when we talk about "poverty" and "the poor."

Absolute poverty is still very much with us. Yet, while relieving absolute poverty for the bottom billion or so of the world's population is paramount, we recognize that people are not cattle to be merely clothed, fed, and sheltered. God's image bearers were meant for more than mere animalistic survival. Yet this bare subsistence existence has been the norm for the great masses of humanity until the past century or two … and this raises a critical point.

It is common to frame global economic issues as though the relative comfort and ease of Western living is the historical norm and then conclude that something has been done to cause the poverty of the planet's poorest inhabitants. On the contrary, the plight of the world's poorest inhabitants is the historical norm, and the widely shared and spreading prosperity is the departure. So, one of the first issues that must be addressed is creating prosperous societies. (Note: For those inclined to doubt my claim about prosperity's spread, please see the first section of posts in my World Social Indicators series.)

In addition to the tendency to view even modest prosperity as the norm, is a widespread tendency to view economic questions in purely distributional terms. It is almost as if some believe that goods simply spring into being. All we will have to do is equitably distribute them. While distribution is a central economic concern, it is not the only one. Each day, any given society has limited time, labor, energy, and resources. Social and economic structures must exist that adequately coordinate the needs of multitudes with the efforts of economic entities to supply wants and needs. Each society must determine how many things will be produced today.

Markets circumscribed by a strong juridical framework have by far been the most successful means of achieving the real-time economic dynamism that creates widespread prosperity. Yet a reality of market economies is that they reward people according to generated economic value. That means unequal distribution of wealth. Winston Churchill quipped, "The inherent vice of Capitalism is the unequal sharing of blessings; the inherent virtue of Socialism is the equal sharing of miseries."

Regrettably, the lens through which much of our Presbyterian Church, USA, tribe views poverty is through the lens of sin and retribution. First, we determine who sinned and then exact retribution upon the sinners. Since distribution is perceived as the only economic question, it becomes obvious that the rich "took" more than their fair portion and didn't share it with others. Poverty is an injustice that gets solved by redistributing wealth.

This frequently gets framed in platitudes of embracing a life of abundance and rejecting notions of scarcity (falsely foisted upon us as economic thinkers). We simply need to share more. No thought is given to grain not turning itself into bread, trees into lumber, ore into steel, and data into information. No thought is given to the countless other processes requiring transforming matter, energy, and data from less useful forms into more useful ones with a fixed (i.e., scarce) amount of productive resources available on any given day. Economies are not about the distribution of spontaneously appearing goods. Economies are living, breathing, organic systems. Distribution of goods cannot be separated from this dynamic reality. Questions of poverty cannot be divorced from understanding this process either.

So if the historical reality has been bare subsistence poverty for the masses for most of human history, is it beneficial to ask, "What causes poverty?" Poverty is the norm. The question is, "What causes widespread prosperity?" There are several lessons we've learned.

Societies that have experienced the transition to prosperity have developed several competencies in human and societal functioning, including decentralized power, rule of law, trust of strangers, internalized virtue, trade, and application of science and technology. Without these competencies, prosperity cannot emerge. Just as you can pour all the water you want on seeds planted in barren soil to no avail, you can also pour all the money you wish to into poverty-stricken communities to no avail.

Nobel Prize-winning economist Amartya Sen suggests that we abandon the narrow notion of poverty as "inadequate income" and realize that poverty is about "capability deprivation." We need to develop both social capital (i.e., institutions, values, and supportive relationships) and human capital (i.e., individual physical, mental, emotional, and spiritual resources) for prosperity to emerge. Human beings were meant for much more than survival. Central to the biblical ethic is image bearers as productive stewards participating in their provision and the provision of others.

There is a need for a prophetic witness against forces that thwart the development of these capabilities in both advanced and emerging nations. Yet all too often, this "prophetic witness" is part of a sophomoric "sin and retribution" mindset that strokes our ideological proclivities and absences us from wrestling with the massive complexities of fostering just and prosperous economies. We feel good about our justice efforts, but the poor we are called to serve are frequently not aided and are harmed too often by our actions. It's time to focus on how the church can create soil from which economic prosperity can grow for individuals, communities, and entire nations … and that will mean letting go of some of our liberationist ideological baggage in favor of a full-orbed engagement with economic issues.

Comments

[Wes Vander Lugt]

Michael, thanks for posting on this important question. I think it is crucial, however, to understand poverty as much more complex and comprehensive than economic need.

I believe that poverty is a culture that results from broken relationships with God, self, family, community, society, and environment, and therefore poverty as physical, economic, political, social, intellectual, emotional, spiritual, familial, and cultural elements.

I have written more on our blog, where we track our life and work with Armonía in Mexico. You might be interested in this post on a holistic response to the holistic problem of poverty:

http://wsvanderlugt.wordpress.com/2009/03/30/how-can-we-serve-and-walk-alongside-the-poor/

[Rick McGinniss]

I really think you are on to something with the observation that poverty is the norm and therefore the right question is "what causes prosperity?"

FYI, I'm currently doing a message series on shalom (right now I'm just focusing on the personal & internal). Posts like this one plus many others on your site are very helpful in clarifying my thinking.

[Michael W. Kruse]

Rick, you always are doing such interesting sermon series. Do you ever publish or podcast them? It seems like a I came across one of your sermons online awhile back.

[Chris Harrison]

In a living, breathing, dynamic economic system, long term thinking should help us immensely. When we do this black or white thing with poverty and distribution of goods, we're stuck in crisis management--always behind the curve, ten steps behind, etc. Like all economies, I think that we would be well served to begin to think ahead, beyond distribution, and imagine ways for forward looking sustainable transformation. You hit on this in the Amartya Sen paragraph. Good stuff!

Thanks for the post...solid and thought-provoking.

[Rick McGinniss]

Michael, all of our messages in the past two years are here:

www.northheartland.org/siteresources/apps/sermon/sermonlist.asp

Before that, they are here:

archive.northheartland.org/message/

I'm still planning to go into the economics of shalom/prosperity later this summer or early next fall. Should be fun!

[Rick McGinniss]

I'm not sure why that first link got crunched. It is ...

www.northheartland.org/
siteresources/apps/sermon/sermonlist.asp

I also put it so that you can click on my name to get there.

[Michael W. Kruse]

Chris

Thanks.

Rick

Thanks for the links.