I have been thinking for a while about the exchange between a CEO and Rutger Bregman at Davos last month- the video is dynamite and can be seen here.
The CEO sort of made the point that people like Bregman should stop banging on about tax and inequality because, after all, world poverty is rapidly decreasing. The implication then is that global capitalism is working to advance the cause of the global poor. Give people a factory to work at, or a hotel room to clean, and they will no longer starve.
The World Bank agrees, even though the reduction in poverty seems to be slowing.
The evidence is strong. Take this report from Politifact for example. They were fact checking this claim by U.S. Agency for International Development administrator Gayle Smith.
“I think everyone in the room knows that this is a moment of extraordinary progress. Over the last 30 years, extreme poverty has been cut in half. Boys and girls are enrolling in primary school at nearly equal rates, and there are half as many children out of school today as there were 15 years ago,” Smith said in a speech on Capitol Hill.
They concluded that
Smith said, “Over the last 30 years, extreme poverty has been cut in half.”
By World Bank figures, Smith actually understated the reduction. We’ve cut extreme poverty by 58 percent using the 2008 definition of extreme poverty, and 74.1 percent by the 2015 definition.
While we don’t quibble with Smith using that metric, our research shows that there are other ways of determining poverty, and those different ways show different declines. Moreover, defining poverty is not an exact science, experts say.
Because of those caveats, we rate Smith’s claim Mostly True.
The message emerging from the world’s major economic foundations ( the World Bank, the IMF etc) appears to be this;
Things are getting better. Climate change will be a challenge (See below), and there are a few areas where poverty stubbornly remains and is difficult to deal with (mainly in Africa) but on the whole, global capitalism has reduced poverty to a level unknown in human history.
It’s all good news then? Bill Gates certainly thinks so- he tweeted this graphic at Davos;
Just in case you were starting to feel warm and comforted, I am afraid it takes but a second of examination of these stats for a whole raft of questions to emerge.
The first problem is the tool used to measure extreme, or absolute, poverty, which was set back in 1990 by the World Bank at a figure of $1 a day (now rising to $1.90 a day, adjusted for inflation.) There are all sorts of problems with this figure. What does it mean, when the costs of living vary so much from place to place? National poverty lines vary even within countries after all, let alone globally.
Secondly, this analysis ignores inequality and the brutalising, alienating nature of relative poverty- being measured by society as ‘wanting’ and ‘worth-less’. It has been strongly argued that inequality creates vast sickness in both those who have and those who have not. (Check out The Spirit Level book for a full analysis.)
Thirdly, even if you use the $1.90 figure, what about those just above the line?
Fourthly, the improvements described are rarely broken down into where in the world the improvements have been made. If you take China out of the figures, then measure again over the last four decades there seems to have been very little change- 60% of people remain in poverty.
The next problem is that the World Bank analysis is based on one solution to world poverty- economic growth. This solution gives it a major problem- how to keep the economy growing without killing the planet;
There is another question about how this all works for the global economic system…
Who benefits most from lifting people above $1.90? Could it be Global capitalism? Think about the debate in the UK right now about low paid, insecure jobs. Working people are undeniably poorer than they were, but levels of employment have gone UP.
This is starkly highlighted in the infographic that Bill Gates tweeted- it suggests that in 1820, global absolute poverty was at 94%. Think about that. What on earth does that mean? Jason Hickel, writing in the Guardian, said this in response;
What Roser’s numbers actually reveal is that the world went from a situation where most of humanity had no need of money at all to one where today most of humanity struggles to survive on extremely small amounts of money. The graph casts this as a decline in poverty, but in reality what was going on was a process of dispossession that bulldozed people into the capitalist labour system, during the enclosure movements in Europe and the colonisation of the global south.
Prior to colonisation, most people lived in subsistence economies where they enjoyed access to abundant commons – land, water, forests, livestock and robust systems of sharing and reciprocity. They had little if any money, but then they didn’t need it in order to live well – so it makes little sense to claim that they were poor. This way of life was violently destroyed by colonisers who forced people off the land and into European-owned mines, factories and plantations, where they were paid paltry wages for work they never wanted to do in the first place.
In other words, Roser’s graph illustrates a story of coerced proletarianisation. It is not at all clear that this represents an improvement in people’s lives, as in most cases we know that the new income people earned from wages didn’t come anywhere close to compensating for their loss of land and resources, which were of course gobbled up by colonisers. Gates’s favourite infographic takes the violence of colonisation and repackages it as a happy story of progress.
Finally, I think again of my own situation. I am poor by any measure of income within the UK- not at the dollar-a-day level, but in terms of relative poverty. If we use a financial measure, that is. The fact is, I have a house, I have land. I have skills and assets. I can grow food, keep chickens. I am largely unmolested by government or oppressive regimes. I have time to think and create and write.
The World Bank can keep it’s dollars.