Eliminating Poverty

by Don Boudreaux on January 28, 2005

in Standard of Living

Former Senator John Edwards "is planning to set up a center to study ways to alleviate poverty" – so reports the Washington Post’s E.J. Dionne.

My first reaction is: Don’t need it. We already know how to alleviate poverty: achieve economic freedom.

My second reaction is: At least in the United States, we have not only alleviated poverty – Would even Edwards insist that America’s poor are today no better off than they were 100 or even 50 years ago? – we have eliminated poverty.

I stand by both of my reactions. But I know that the second one is especially controversial. We have indeed eliminated poverty in the United States. By historical standards, no one – not a single person in our civilization – lives in poverty. (I suspect there are a handful of people who voluntarily live like hermits in the wilderness of places such as Montana or North Carolina’s mountains. These people might well live in deep material poverty, but they live this way by choice – by choosing to remove themselves from our commercial civilization.)

The typical reaction I get when I insist that poverty is eliminated in the U.S. is this: "How can you say that?! Many Americans are homeless, having to bed-down in shelters. Many Americans have no health insurance. Many Americans go to bed hungry? Many Americans are without jobs."

I respond by pointing out that, unlike people living in absolute poverty, no American starves to death; almost all Americans without homes of their own have ready access to homeless shelters and to soup kitchens; lack of health insurance is not the same thing as lack of health care – and much health care is readily affordable even without a shred of insurance; and losing a job in America doesn’t mean starvation and death.

"Of course," comes the retort, "but surely you, Boudreaux, don’t mean to say that people who eat in soup kitchens and sleep in homeless shelters aren’t living in poverty?!"

I reply that, yes, such people do live in poverty by the standards of our astonishingly wealthy society. And I agree that these standards are appropriate. What was middle-class comfort in 1905 might well be poverty by the standards of 2005.

But (I continue) it’s important to recognize that in the U.S., Canada, western Europe, and many other countries that are well-integrated into the global market economy, absolute poverty is eliminated. And more to the point, if we agree that the relevant standard for poverty is a relative one, then barring complete equality of material standards of living, some people living below the median will be classifiable as living in poverty. This classification will arise no matter how materially affluent these ‘poor’ people are in any absolute sense.

So any center for the study of ways to alleviate poverty in the United States, if it does its job seriously, will either push for as much income equality as possible, or attempt that which is impossible by definition — the elimination of relative poverty.

Again, if poverty is defined as a relative concept – as it must be defined in America today by those who wish to do battle against domestic poverty – then there is no solution, no alleviation or elimination of poverty, short of bringing about total income equality.

Put differently, if we define the poor as those who live, say, in the bottom quintile of the income distribution, then the poor will indeed always be with us – and centers such as the one planned by John Edwards will always have a ‘problem’ to ‘solve’ even as the real curse that such institutions appear to address – material deprivation – shrinks into an ever-more-distant memory.

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