Poverty and power: some half-time analysis

It is now around four months to the iconic date of 07/07/07. In addition to the novelty of such a date, it also represents the half-way point of the program to halve global poverty by 2015. Members of the United Nations, including Australia, agreed to this target at the Millennium Summit in 2000.

The half time score is not looking too good. While some regions of the world are on track to achieve some of the targets, Sub-Saharan Africa is behind on all indicators.

One reason for the poor scoreline is lack of action by the developed world. For example, Australia’s foreign aid is still well short of the 0.5 per cent of GNI needed to achieve the goals set out in the Millennium Declaration. However, as half time draws near, it is useful to step back and take a look at the nature of poverty and see why the first half failed to deliver a better score.

The simplistic and perhaps common view of poverty is that poverty is simply a deficit: a deficit of food, of water, of income, of housing, of land, of services. Implicit in this view is that providing the things that are missing will solve the problem.

At the level of material deficits and lack of infrastructure, this means supplying food, wells, houses, roads, railways, bridges and other “things”. To the extent the deficit is in skills, then providing education is the answer. A deficit in law or governance means provision of police, legal officers or bureaucracy.

Now clearly, poverty does involve these deficits. Furthermore, alleviating poverty will involve addressing these material and social deficits. However, this purely materialistic view of poverty is inadequate. The notion of a rich, but benevolent, West providing goods, services and infrastructure to an impoverished developing world is not necessarily healthy. It can create the image of a messianic “developed world” delivering the poor from their poverty.

If it doesn’t work then the poor are obviously to blame. It is due to their inadequacy as human beings, their corruption, or their laziness. Donors can self-righteously point to their generous provision of funds and how it has been “wasted” by the recipients. Such failure of development due to this inadequate view of poverty can result in a reluctance to continue funding.

This is certainly not to decry aid. Aid and development funding is certainly necessary. Most donations come with sincere motives and much is given sacrificially. The questions remain though: is it being used effectively? Is it addressing the real problem? Are there other factors preventing it being more effective?

More recent development theory has begun to view poverty as more complex than simple lack. A key aspect of poverty that has come to the fore is that of disempowerment. According to Indian development practitioner Jayakumar Christian, the poor find themselves trapped inside a system of disempowerment made up of a complex framework of interacting systems. These systems are cultural, physical, personal (self image), religious and social. Thus combating poverty also involves a complex framework of interventions.

The social aspect of this complex framework is particularly relevant to us in the “rich world”. Christian sees the non-poor adopting a “god-complex” towards the poor. This involves an attitude of superiority and paternalism. Furthermore, the non-poor create narratives, structures and systems that justify and rationalise their privileged position.

What does this mean? The push for free trade is a good example. When the US was industrialising in the 19th century it protected its infant industries against European competition. However, now the US is in a position of power, the prevailing wisdom is free trade and anti-protectionism. This is justified by neo-classical economic theory and reinforces their dominant position. The structure of the World Trade Organisation and the conduct of its meetings also work to reinforce the current power structure even though it is justified by the façade of democracy.

A recent Sydney Morning Herald article (February 3-4, 2007) highlights a further example. It describes a situation in the Philippines where 16,000 babies die each year because of a decline in breastfeeding. The Department of Health along with civil society groups sought new regulations on the marketing and promotion of breast milk substitutes. However large western corporations marketing baby formula appealed through their industry association to the High Court claiming a restraint of trade. When that failed, some serious lobbying took place and the regulations are currently under a restraining order. Those with power continue to play god in the lives of those without, even to extent of risking lives. The narrative of the free market continues to justify this abuse of power.

Poverty as disempowerment exposes the myth of economic growth as its solution. Economic growth may increase a nation’s income without addressing the question of power. In the absence of specific action to redress inequality and power distribution, economic growth will tend to benefit those who already have the power.

The US, for example, has nearly doubled its real GDP per capita in the 30 years to 2005 while the proportion of people below 50 per cent of the poverty level (as defined by the US Census Bureau) has increased. Yet even if growth does increase income and reduce some aspects of material poverty of the poor, it may still fail to address the underlying powerlessness that constitutes the real poverty.

John Kenneth Galbraith said, “Power is the great black hole in economic theory”. To seriously tackle global poverty that black hole needs to be addressed. The elephant in the room, however, is that to empower some means disempowering others. That is, it involves a redistribution of power.

The problem of poverty will not be solved by the rich continuing to donate their excess while failing to give up their privilege. We in the wealthy world must accept that our position of power is unsustainable and seek to re-democratise the world. That would mean redressing the power imbalances in the WTO, IMF and World Bank. It would mean limiting the power of corporations and returning power to national governments. It would mean an end to corporations buying influence over politicians.

It would not just be about the big end of town though. It may also mean higher prices for our goods and services. It may mean lower returns on our superannuation as corporate profits are checked. It may mean a lower standard of living for those of us accustomed to being at the top of the world’s pyramid.

Such changes will not come easily. Power is usually not given away without a fight. It is much easier to continue to provide charity and wring our hands when the problem doesn’t go away.

However, in the words of the UN Millennium Declaration, signed by the Australian Government, “we have a collective responsibility to uphold the principles of human dignity, equality and equity at the global level … We will spare no effort to free our fellow men, women and children from the abject and dehumanising conditions of extreme poverty, to which more than a billion of them are currently subjected. We are committed to making the right to development a reality for everyone and to freeing the entire human race from want.”

The second half is about to begin. It may prove much more costly.