The Causes of Poverty

Half the world – nearly three billion people – live on less than two dollars a day. The GDP (Gross Domestic Product) of the poorest 48 nations (i.e. a quarter of the world’s countries) is less than the wealth of the world’s three richest people combined. Nearly a billion people entered the 21st century unable to read a book or sign their names. Less than one per cent of what the world spends every year on weapons could put every child in school.

All over the world, the disparity between rich and poor, even in the wealthiest of nations, is rising sharply. Fewer people are becoming increasingly successful and wealthy while a disproportionately larger population is also becoming even poorer.

There are many issues involved when looking at global poverty and inequality. It is not simply enough (or correct) to say that the poor are poor due to their own (or their government’s) bad governance and management. In fact, you could quite easily conclude that the poor countries are poor because the rich countries are rich and have the power to enforce unequal trade agreements that favor their interests more than the poorer nations.

The International Monetary Fund and World Bank prescribed structural adjustment policies mean that nations that are lent money get it on condition that they cut social expenditure (which is vital for economic growth and development) in order to repay the loans. Many are tied to opening up their economies and being primarily commodity exporters, which, for poorer nations leads to a spiraling race to the bottom as each nation must compete against others to provide lower standards, reduced wages, and cheaper resources to corporations and richer nations. This further increases poverty and dependency for most people.

People are hungry not because of lack of availability of food, or overpopulation, but because they are too poor to afford the food. Politics and economic conditions that have led to poverty and dependency around the world would not be alleviated if food production is further increased and provided to more people. Even non-emergency food aid, which seems a noble cause, is destructive, as it undersells local farmers and can ultimately affect the entire economy of a poor nation. If the poorer nations are not given the means to produce their own food, if they are not allowed to use the tools of production for themselves, then poverty and dependency will continue.

The United Nations is one of the largest bodies involved in development issues around the world. However, it has many political issues and problems to contend with. But, despite this, it is also performing some much-needed tasks around the world, through its many satellite organizations and entities, providing a means to realize the Declaration of Human Rights. Unfortunately though, it is not perfect and is negatively affected by the politics of powerful nations that wish to further their own interests. What does an ever-increasing number of non-governmental organizations (NGOs) mean? NGOs are non-profit organizations which fill the gap where governments will not or cannot function. In the past, however, some NGOs from the wealthy nations have received a bad reputation in some developing nations because of things like arrogance, imposition of their views, being a foreign policy arm or tool of the original country, and so on. Even in recent years, some of these criticisms still hold. However, recently some new and old NGOs alike have started to become more participatory and grassroots-oriented to help empower the people they are trying to help to support themselves. This is in general a positive turn. Yet, the fact that there are so many NGOs popping up everywhere perhaps points to failures of international systems of politics, economics, market rights.

While the world is globalizing and the mainstream media in the developed nations point out that the world economy is booming (or, in periods of downturns, that the current forms of development and economic policies are the only ways for people to prosper), there are an increasing number of poor people who are missing out on this 1 1 apparent boom, while increasingly fewer people are becoming far more wealthy.