The Economist: In 20 years, the global poverty rate has fallen by half

posted at 8:41 pm on June 3, 2013 by Erika Johnsen

Over the weekend, President Obama focused his weekly address on — you guessed it — the economy, and the many rehashed policy prescriptions the Obama administration has for “continuing” to foster economic growth and create good middle-class jobs (neither of which the president has proved at all adept at so far, and I must say, I find the moments in which Democrats conveniently discover a renewed and vigorous interest in the economy rather fascinating). Just the usual trite fare: First, all of the supposed “good news” and the ongoing “recovery” we’re experiencing, but we (i.e., those darn obstructionist Republicans blocking my brilliant agenda!) still “need to do more”:

Except that nothing much the president mentions is really part of the recipe for a robust and long-lasting economic growth rate. As much as progressives will claim more bureaucracy, more spending, more entitlement programs, more regulations, more taxes, more market interferences, and more big government are the only direct ways to help people lift themselves out of poverty and into a solid middle-class life, we’ve long since bypassed the point at which all of those things have become so metastasized as to be antithetical to economic growth — and economic growth is the truest, most efficient, most pervasive way to really lift people out of poverty in the long run.

As The Economist pointed out in a helpful blurb today, the cumulative impact of the many worldwide, bureaucratic variations of declaring a “war on poverty” over the decades has been marginal at best. The declining poverty rate averaged around the world is overwhelmingly due to the creation of new wealth, which is precisely why it needs to be our ceaseless Priority Numero Uno — not a useful smokescreen to which we “pivot” when our administration is suddenly plagued by scandals, hem hem:

POVERTY is easy to spot but hard to define. America sets its poverty line at $11,490 of income per year for a one-person household, or just over $30 a day. Any income below that amount is judged inadequate for the provision of fundamental wants. Other rich countries set their poverty lines in relative terms, so an increase in the incomes of top earners results in more poverty if everything else is held constant. The threshold for dire poverty in developing countries is set much lower, at $1.25 a day of consumption (rather than income). This figure is arrived at by averaging the poverty lines in the 15 poorest countries, not because $1.26 spells comfort. This is the yardstick by which poverty reduction in poor countries is measured. Remarkably, this poverty rate has halved worldwide, from 43% in 1990 to 21% in 2010. …

Almost all of the fall in the poverty rate should be attributed to economic growth. Fast-growing economies in the developing world have done most of the work.


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“Poverty” is a bullcrap term used to extort money from, also known as STEAL money from, those that produce something in this world.

TX-96 on June 3, 2013 at 8:45 PM

But, ‘income inequality’!

Resist We Much on June 3, 2013 at 8:47 PM

Smug protectionists and unions will not like this one bit!

can_con on June 3, 2013 at 8:50 PM

And if the One World Government crowd would get out of the way that number would be halved again.

Rio Linda Refugee on June 3, 2013 at 8:52 PM

The Iron Curtain falling and China & India starting to embrace freeish markets helped.

rbj on June 3, 2013 at 8:53 PM

And if the One World Government crowd would get out of the way that number would be halved again.

Rio Linda Refugee on June 3, 2013 at 8:52 PM

Not going to happen (even if they stopped). Africa (North) will keep Islamists in power, thus poverty never ends. The rest of Africa will never let colonialism go, thus they never advance (see Zimbabwe).

nobar on June 3, 2013 at 8:58 PM

…soon we’ll all be equal…

KOOLAID2 on June 3, 2013 at 8:58 PM

Democrats have held the White House for 12 of the last 20 years….

(Better me than some troll, right?)

Republicans have held the House for 13 of the last 20 years, also….

notropis on June 3, 2013 at 9:03 PM

Poverty………..just another tool of guilt used happily by Big gov lovers that want our money.

The poor in our country would be wealthy in most of the world, but we are told we must MORE programs.

Welcome in Insania (N-Say-Née-yah).

Where “the Onion” headlines of today are the news stories of next year.

PappyD61 on June 3, 2013 at 9:04 PM

Africa (North) will keep Islamists in power, thus poverty never ends. The rest of Africa will never let colonialism go, thus they never advance (see Zimbabwe).

nobar on June 3, 2013 at 8:58 PM

The rest of Africa will be a barbaric cesspit full of Starvin Marvins until either a Western colonial power reforms or the Chinese get around to that continent. They’d better pray the first one happens.

MelonCollie on June 3, 2013 at 9:07 PM

Actually, the Republicans have held the House for more like 15 of the last 20 years….

notropis on June 3, 2013 at 9:08 PM

America…the only country where the majority of people who live in poverty are obese and carry a MasterCard.

BobMbx on June 3, 2013 at 9:08 PM

The rest of Africa will be a barbaric cesspit full of Starvin Marvins until either a Western colonial power reforms or the Chinese get around to that continent. They’d better pray the first one happens.

MelonCollie on June 3, 2013 at 9:07 PM

China is already there in a big way, buying up significant amounts of land and setting up agricultural hubs.

http://china-africa.blogspot.ca/2011/03/chinas-engagement-in-african.html

can_con on June 3, 2013 at 9:10 PM

MelonCollie on June 3, 2013 at 9:07 PM

Sub-Saharan Africa has the highest GDP growth rates in the world, right now. If you’re looking to invest, look at Ghana, Kenya, Tanzania, Rwanda, Malawi, Liberia. All growing at double-digits. Better than gold….

notropis on June 3, 2013 at 9:11 PM

And just how fast is the U.S. middle class shrinking?! Income going down just thank bo.

tim c on June 3, 2013 at 9:17 PM

Sub-Saharan Africa has the highest GDP growth rates in the world, right now. If you’re looking to invest, look at Ghana, Kenya, Tanzania, Rwanda, Malawi, Liberia. All growing at double-digits. Better than gold….

notropis on June 3, 2013 at 9:11 PM

I predict they go the way of Zimbabwe. Just give it enough time.

nobar on June 3, 2013 at 9:19 PM

Don’t worry, guys: liberals have already buried poverty in a ditch as a statistic.

The real question is: what’s the “inequality” rate?

The answer is: whatever they want it to be.

HitNRun on June 3, 2013 at 9:20 PM

POVERTY is easy to spot but hard to define.

No kidding the “poor” live far better than I do what with all the benefits they get and not having to contribute to society through taxes or whatever. I’m poorer for being a working member of society. The gal that shows up and uses WIC to pay for her groceries considers me a chump for working even though I’m paying for her bastard’s food. I’ve pretty much had it with these greedy stupid parasites.

Happy Nomad on June 3, 2013 at 9:25 PM

But racism and stuff. I wish all meanie wingnuts would get on the trains and go jump in ovens or something. Then the rest of us can live in utopia or h3ll or whatever.
/ (I hope I didn’t need that:)

Fett on June 3, 2013 at 10:10 PM

Where “the Onion” headlines of today are the news stories of next year week.

PappyD61 on June 3, 2013 at 9:04 PM

fixed

Fett on June 3, 2013 at 10:14 PM

I predict they go the way of Zimbabwe. Just give it enough time.

nobar on June 3, 2013 at 9:19 PM

I guess you’re free to speculate based on your own ignorance or biases. Mugabe is not president of Ghana, or Tanzania, or….

I’ve spent most of my adult life in Africa. I don’t tend to stereotype.

notropis on June 3, 2013 at 10:27 PM

From the article:

By 2030 two-thirds of the poorest will be in fragile states like Congo and Somalia, where they will be hard for domestic governments or foreign agencies to help. Still, shifting people above the threshold that marks dire poverty has begun to look achievable within a generation.

Poverty can only be addressed effectively if we keep focused on the absolute threshold.
The Left likes to define “being poor” as being in the lower x-percentage of the population; hence, “the poor ye have always with you.”

AesopFan on June 3, 2013 at 10:29 PM

China & India starting to embrace freeish markets helped.

rbj on June 3, 2013 at 8:53 PM

This is the biggest factor, especially growth in China. Strange that Erika doesn’t highlight that.

DarkCurrent on June 3, 2013 at 10:33 PM

I predict they go the way of Zimbabwe. Just give it enough time.

nobar on June 3, 2013 at 9:19 PM

Based on what?

DarkCurrent on June 3, 2013 at 10:34 PM

If you’re looking to invest, look at Ghana, Kenya, Tanzania, Rwanda, Malawi, Liberia. All growing at double-digits. Better than gold….

notropis on June 3, 2013 at 9:11 PM

BWAHAHAHA! Investing in a third-world nation better than buying gold? I’ve heard some craaazy stuff on HA but this takes the cake, runs to Alaska, and hits a Democrat in the face with it!

MelonCollie on June 3, 2013 at 10:58 PM

Based on what?

DarkCurrent on June 3, 2013 at 10:34 PM

Anti-colonial sentiment. Despite what others may think, they still hate it. Let it boil under the surface for long enough, and it bursts.

nobar on June 3, 2013 at 11:00 PM

China is already there in a big way, buying up significant amounts of land and setting up agricultural hubs.

http://china-africa.blogspot.ca/2011/03/chinas-engagement-in-african.html

can_con on June 3, 2013 at 9:10 PM

I’m not surprised in the slightest. China is neither hobbled internally by a parasite class or a burden of false guilt…nor will they give a bat’s behind about rights or the Useless Nations since they have America’s economy by the short and curlies.

MelonCollie on June 3, 2013 at 11:00 PM

No kidding the “poor” live far better than I do what with all the benefits they get and not having to contribute to society through taxes or whatever. I’m poorer for being a working member of society. The gal that shows up and uses WIC to pay for her groceries considers me a chump for working even though I’m paying for her bastard’s food. I’ve pretty much had it with these greedy stupid parasites.

Happy Nomad on June 3, 2013 at 9:25 PM

Agreed. I’ve known many people who have 0 income, don’t work, or work very little/inconsistently. I noted decades ago that I was not that much better off than them.

The system has indeed been designed over the last century to take away from the working middle class (“chumps”) and give it to the underclass and bail out well-connected concerns (as in TARP). The money the welfare recipients get goes into the coffers of various companies (Blockbuster, fuel companies, Wal-Mart, McDonalds, alcoholic beverage companies, and so on).

If you want to be really cynical, you can also say they get a lot of this money back through drug dealing. Too many police and politicians have been caught with dirty hands for me to buy this “war on drugs” BS any longer.

From the perspective of the PTB it’s a win-win situation for them. And don’t forget, if they come up a little short they can always print more money. So we get taxed through inflation and welfare folks get COLAs.

Now with Obamacare the next major industries to profit off of all of this Socialistic organized crime are the insurance companies and for-profit health systems.

Dr. ZhivBlago on June 3, 2013 at 11:17 PM

Anti-colonial sentiment. Despite what others may think, they still hate it. Let it boil under the surface for long enough, and it bursts.

nobar on June 3, 2013 at 11:00 PM

Are you familiar enough with the specific countries notropis mentioned to know if that is indeed likely to be a significant factor impeding their future growth?

DarkCurrent on June 3, 2013 at 11:27 PM

DarkCurrent on June 3, 2013 at 11:27 PM

The book was called “Dreams from My Father” for a reason…Geez. That kind of sentiment doesn’t form in a vacuum.

nobar on June 3, 2013 at 11:30 PM

The book was called “Dreams from My Father” for a reason…Geez. That kind of sentiment doesn’t form in a vacuum.

nobar on June 3, 2013 at 11:30 PM

Doesn’t answer the question.

DarkCurrent on June 3, 2013 at 11:38 PM

No kidding the “poor” live far better than I do what with all the benefits they get and not having to contribute to society through taxes or whatever. I’m poorer for being a working member of society. The gal that shows up and uses WIC to pay for her groceries considers me a chump for working even though I’m paying for her bastard’s food. I’ve pretty much had it with these greedy stupid parasites.

Happy Nomad on June 3, 2013 at 9:25 PM

If this is true…who’s the “stupid” one?

L . I . B .

SwabJockey on June 4, 2013 at 5:59 AM

America…the only country where the majority of people who live in poverty are obese and carry a MasterCard.

BobMbx on June 3, 2013 at 9:08 PM

and watch the NBA on a big screen while talking on their cell phone munching Cheetos bought with an EBT card all courtesy of the dwindling number of actual productive carbon units in this country.

Oldnuke on June 4, 2013 at 8:15 AM

The gal that shows up and uses WIC to pay for her groceries considers me a chump for working even though I’m paying for her bastard’s food. I’ve pretty much had it with these greedy stupid parasites.

Happy Nomad on June 3, 2013 at 9:25 PM

Was in the grocery a few days ago. In front of me at the checkout was a woman. Grocery cart full of junk food and about 6 kids ranging in age from toddler to teen. I didn’t see one thing in that cart that had real food value. She did have about six items on the counter related to baby care but that was it. She had a cell phone stuck to her ear the whole time she was in the line. She paid for her purchases with about three different forms of welfare. As I was leaving the store I noticed her and two of the larger kids shoving her stuff into the back of a very large fairly new expensive SUV. Now granted it’s all unconfirmed, the kids may not have been hers, the SUV may not have been hers but it sure painted a sad picture for me and it really hacked me off.

Oldnuke on June 4, 2013 at 8:28 AM

I attended a seminar once by Tom Deweese, a strong proponent of property rights, who made an important observation regarding poverty in third world countries…

Poverty rates rose or fell over the decades in inverse proportion to the status of property rights in the country. In exceedingly poor countries, if people couldn’t own land, they had no way out of poverty. But if you owned property, you could put it up as collateral for loans to fund a startup business. Entrepreneurs in a capitalist society are what creates jobs and wealth even in a poor countries. That is the formula for reducing poverty… by encouraging entrepreneurial endeavors through strong property rights protection.

My church has had a hand in this itself, by partnering with a very poor village in Nicaragua. We built some initial buildings, but then supplied micro-loans to farmers (to purchase additional seeds/livestock). Over the last decade, we’ve seen them go from barefoot and illiterate, to having clothes/shoes, being able to read/write, and being much happier.

In the example above, our churches generosity with the micro-loans substituted for the property rights and land collateral. With strong property rights and the ability to use land as collateral for loans, they wouldn’t have needed our funding for the loans.

dominigan on June 4, 2013 at 10:07 AM

VPN still working…

DarkCurrent on June 4, 2013 at 3:54 PM