"Die soziale Ungleichheit in Deutschland nimmt zu, auch der Mittelstand befürchtet den Abstieg. Doch in den verschiedenen Einkommensschichten hat sich die Wahrscheinlichkeit zu verarmen über die letzten 25 Jahre sehr unterschiedlich entwickelt. Die Verarmungsquote stieg in den unteren Einkommensschichten von ca. 10 auf ca. 15 Prozent, während sie für die mittlere und die obere Einkommensschicht gleichmäßig niedrig geblieben ist." (Autorenreferat)
I will argue that the view of the poor as "resilient and creative entrepreneurs and value-conscious consumers" has no empirical support. Romanticizing the poor not only does not help them, it actually harms them. First, it results in too little emphasis on legal, regulatory, and social mechanisms to protect the poor who are vulnerable consumers. Second, it results in overemphasis on micro-credit and under-emphasis on fostering modern enterprises that would provide employment opportunities for the poor. More importantly, the BOP proposition grossly under-emphasizes the critical role and responsibility of the state for poverty reduction. This is not to advocate a return to statist policies that stifled economic growth for decades in countries such as India and China. Contemporary economic history clearly demonstrates that the free market system is the best way to achieve overall growth and development, but that does not mean that there is no role for the state. Rajan and Zingales persuasively argue that "markets cannot flourish without the very visible hand of the governments."4 There is a need to impose some limits on free markets to prevent exploitation of the poor.5 Another vital role of the state is to provide basic services such as infrastructure, public health and education, responsibilities that are even more critical in the context of poverty reduction. Adapted from the source document.
Opens with a historical overview of welfare policy, identifying four stages, the last centered on Temporary Assistance for Needy Families (TANF). TANF is described, & its inadequacies noted, asserting that it must be assessed in the context of the vast income inequality in the US & in particular, in terms of the poorest poor. In this light, elements of an improved TANF as well as other measures are considered, focusing on those in extreme poverty & the notion of an income floor for the most destitute. D. Edelman. Adapted from the source document.