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This blog is based on an article in the Journal of International and Comparative Social Policy by Ilari Ilmakunnas. Click here to access the article. Despite the shared understanding that it is useful to analyse poverty by means of different measures, one measure is more commonly used than others. In the EU, the at-risk-of-poverty threshold… Continue reading Enhancing Clarity in Poverty Analysis →

Charles Dickens wrote what has become one of the iconic stories of Christmas day and Christmas spirit in A Christmas Carol. But of course, the experiences of Ebenezer Scrooge are a story, not a piece of reporting. Here’s a piece by Dickens written for the weekly journal Household Words that he edited from 1850 to 1859. It’s from the … Continue reading Charles Dickens on Seeing Poverty
The post Charles Dickens on Seeing Poverty first appeared on Conversable Economist.

Housing deregulation isn't just one sort of poverty policy. It is the best sort of poverty policy. Instead of letting government tax the rest of society and hoping that the benefits exceed the costs, housing deregulation shows government a mirror. "You're not the hero of this story. At best, you can become a repentant villain. Want to help the poor? Then stop hurting them."

The relationship between health and poverty is reasonably well known; one can exacerbate and contribute to the other in a vicious cycle.

This update, as well as including a few health stats updates, provides further information on noncommunicable diseases (which cause some two-thirds of all deaths each year) and more details on the relationship with poverty.

Read full article: Global Health Overview

If you have ever used a smartwatch or other wearable tech to track your steps, heart rate, or sleep, you are part of the "quantified self" movement. You are voluntarily submitting millions of intimate data points for collection and analysis. The Economist highlighted the benefits of good quality personal health and wellness data—increased physical activity,…

This blog is based on an article in Social Policy and Society by Jerry Buckland, Wendy Nur and Jodi Dueck-Read. Click here to access the article. The value placed on caring in the contemporary social-economic milieu in Canada is very low. People engaged in paid care work are often women and generally poorly paid. People… Continue reading Does Poverty and Caring Generate Debt? →

 There are many different answers to the question of what Marx and Spinoza have in common, theories of ideology, materialism, naturalism, and so on, to name a few that have been discussed on this blog. To this list Margherita Pascucci adds that perhaps what Spinoza and Marx have in common is the common itself. This is is claim put forward in Potentia of Poverty: Marx Reads Spinoza (part of the Historical Materialism series, currently it is only out as a hardcover, but it will be out from Haymarket in the Spring). In making such a claim Pascucci focuses on the intersection of not just Marx and Spinoza, but the way in which they both assert in different ways, the primacy of the epistemology and ontology of relation. As Pascucci writes, "The commodity in Marx and the common notion in Spinoza are both defined through an other. This 'other' which defines them is the common among two or more things. In the case of the commodity, this common has a character of abstraction--it disappears at a certain point; in the case of common notions, this common is something material, that which, common to a body and other bodies, brings the trace of relation and allows for knowledge."As they used to say in graduate school, lets unpack this claim. First, we have the common notion in Spinoza, the second kind of knowledge, beyond the imagination. As Spinoza writes in Proposition 37 and 38 of Part Two of the Ethics:P37. What is common to all things, and is equally in the part and in the whole, does not constitute he essence of any singular thing.P38 Those things which are common to all, and which are equally in the part and the whole, can only be conceived adequately. Common notions are understood in terms of both their genesis and their logic. In terms of their genesis let us begin with the simple and most basic encounter, walking around in the house in the dark I bang my shin against something, I do not know what. This is an encounter marked by pain and confusion, by the affects of sadness and hate. Those affects give shape to what could be called the inadequate ideas in which how something affects me and what something is are confusedly muddled in my scream of "ow, shit! what the fuck?" In that encounter there is still something in common, something that can be conceived adequately, I know something about my body, its materiality, and about whatever I ran into in the dark. I know that it is matter too, it has density and hardness. This commonality is incredibly general, but it is the basis for the construction of other common notions. Later, in Proposition 40, Spinoza contrasts common notions, which do not define the essence of any singular things, with the universal. The universal is attempt to define the essence of a singular thing, to understand what quality defines humanity, as rational or political animal, or even featherless biped. However, the problem with this particular essence is precisely the variability of particulars. As Spinoza writes, "But it should be noted that these notions are not formed by all in same way, but very from one to another, in accordance with what the body has been more often affected by, and what the mind imagines or recollects more easily. For example, those who have more often regarded men's stature with wonder will understand by the word man an animal of erect stature. But those who been accustomed to consider something else will form another common image of men--for example that man is an animal capable of laughter, or a featherless biped, or a rational animal."In contrast with a universal burdened with an often unstated particularity we have the common as that which is common to all and particular to none.Okay, what does this has to do with the commodity? Here one only has to think of Part One of Capital.  Value can only be expressed in relation. This is the point of all those formulations about linen and coats. As Marx writes, "The value of linen as a congealed mass of human labour can be expressed only as an 'objectivity' [Geganständlichkeit], a thing which is materially different from linen itself and yet common to the linen and other commodities." There are a lot of jokes, and memes, about the laborious process Marx goes through to show two things: first, that the value of a commodity cannot be shown through itself, a coat is worth a coat is tautology, and that the value any commodity can be expressed through any other commodity. As much as this section seems to go on a bit too long, and with unnecessary precision, its fundamental point, a point that comes out in relation to Spinoza, is worth stressing, and that is that the common, the relational is there even at the heart of capitalism. In capitalism commodities relate even if we remain isolated as subjects of freedom, equality, and Bentham.This brings us back to Pascucci's point, that the difference between the commodity and the common notion is that while the common notion is common to all and in the part and the whole, both my shin and the end table (or whatever I ran into) have extension and mass, value of the commodity is not common to all materially, but is abstracted from it. This abstraction underscores the brief, all too brief discussion of money that takes place in Capital between the general form of value and the famous section of commodity fetishism. Money is of course the general equivalent, it is why we do not go around expressing the value coats, tea, and corn, in the form of linen. Money is the materialization of the abstract idea. As Balibar writes in his little book on Marx, "Money is then constantly reproduced and preserved by its different economic uses (unit of account, means of payment, being hoarded or held in 'reserve' etc.) The other side of this materialization is, then, a process of constant idealization of the monetary material, since it serves immediately to express a universal form or an 'idea."Here is the difference this difference makes. I often think of the opening section of Capital as Marx asking a question that we do not ask in daily life: how are two disparate and different commodities equivalent? We do not ask this question because it presents itself as already answered. Money is the answer. Money is the condition of the equivalence of the disparate and distinct. This is another reason as to why I think that Marx's commodity fetishism section covers the same problem as the Appendix to Part One of the Ethics. In other words, the common, the commonality of labor is obscured in the fetish of the money form. This is not a consideration, much less a review, of the entirety of Pascucci's book. I have not even gotten into the discussion of poverty and subjectivity, parts that I have some serious questions about, but her reflections on the common in Spinoza and Marx not only sheds light on a different commonality between the two, one that ultimately sheds light on the common itself. 

Media have today covered a report by the International Development Committee on the effectiveness of UK aid spending.

The Bureau of the Census has just released numbers for Official Poverty Rate, as well as the Supplemental (the latter takes into account taxes and transfers, and is more relevant for thinking about the actual welfare of individuals). Source: Census. Source: Census. NY Times article. CEA post.

Well, how do nations escape poverty? Those of us familiar with the prominent US economic historian Deirdre McClosky know the answer to that. Liberal values (what she calls 'bourgeois values'). Things like respect for individuals and their freedom of action, toleration, limited government, the rule of law, minimising the use of force, property and honouring contracts. All those things provide the compost in which the seeds of prosperity can grow.But it's a long and difficult process. And unfortunately, says the prolific German author and economist Rainer Zitelmann in his new book, we don't often help poor countries to do what it takes to acquire these values. On the contrary, we try to help them with foreign aid, which messes up what markets there are and is too often badly managed or even abused. And when the funding runs out, projects become unaffordable and are terminated, so whatever good was created by them is lost, as William Easterly and Dambisa Moyo point out. So what can poor countries do, and do better, to pull themselves out of poverty?Zitelmann takes two very different countries, Vietnam and Poland, who took very different paths to reform. Vietnam, of course, was not helped by years of destructive war, then communism sweeping down from the north. Like everywhere else, it found that collective agriculture systems, borne of communist ideology, simply didn't work. So, like China and so many others, they were eventually forced to modify it, still claiming it was collectivised, of course, but actually transferring responsibility to individual families, who had an incentive to produce more rather than work less. The limited markets for agricultural products gradually expanded, then individuals were allowed to employ up to ten other people. Internal customs barriers were eroded, and international trade opened up. Then price controls and subsidies faded, banking was reformed. The trappings of socialism remained, but it declined in economic significance.By contrast to this slow and piecemeal approach, says Zitelmann, Poland change rapidly and radically after the fall of communism. Its new finance minister, Leszek Balcerowicz realised that only 'shock therapy' would reverse decades of soviet mentality. A new law allowed people to engage in any economic activity they liked, and to employ as many others as they chose. Inflation was reined in by sound money policies. Debt was cut. Banks and other businesses were privatised. Industries were deregulated. Taxes were simpliefied, along the lines of a flat tas. That all led to a big rise in entrepreneurship. And the opening up of trade with the West brought people more and better products, and a rise in prosperity.The lesson, really, is that there is no 'right' way to make a country rich — 'to carry a state to the highest degree of opulence from the lowest barbarism,' as Adam Smith put it. But 'peace, easy taxes and a tolerable administration of justice' seem to be the essentials that you cannot do without.  Zitelmann, Rainer (2024). How Nations Escape Poverty: Vietnam, Poland, and the Origins of Prosperity. Forward by George Gilder. New York: Encounter Books.

As the European elections loom, legislation addressing the root causes of poverty must move to the top of the agenda.

Much whingeing about the absolute poverty numbers. The Joseph Rowntree folk seem to be taking over the The Guardian about it - situation normal in fact. Absolute poverty, in this sense, is who is below the relative poverty level of 2010/11. The relative poverty level, as we know, is less than 60% of median household income adjusted for household size (and etc, etc). Absolute poverty, in this sense, is using the 2010/11 measure of relative poverty and comparing to that. There's a trick used here. We're old enough to recall when it was relative poverty in 2000/01 that was used. Given that poverty by that measure seemed to be disappearing real fast the rebasing was done. After all, calls for ever more stringent taxation to beat poverty cannot be maintained if poverty is disappearing before our very eyes now, can they? As Chris Snowdon points out, properly measured absolute poverty has fallen from 85% of the population in 1961 to the 14 to 18% of today.From which we can gain one useful lesson. Economic growth is important - it kills poverty. This means that we can reject all that degrowth nonsense because as we keep being told beating poverty is our prime economic directive.Cool.But there's also one more thing here. This rise in absolute poverty is more an artefact than a reality. Because this: Inflation-linked benefits and tax credits will rise by 6.7% from April 2024, in line with the Consumer Prices Index (CPI) rate of inflation in September 2023. For example, in 2024/25 Universal Credit standard allowances will increase: From £292.11 to £311.68 per month for single people aged under 25.Significant portions of - if not all - income of those in absolute poverty will be coming from the benefits system. Benefits are uprated for inflation after the inflation has happened. The measures of absolute poverty are before those benefits upratings. The problem will be - largely - solved when the benefits are uprated. We're just in that interregnum before they are. But we can also take another lesson from this. Which is that Modern Monetary Theory does not work. The inflation was indeed caused by that vast money print and spending into the real economy. Which is MMT of course. But if MMT increases poverty in this manner - which it does, the inflation is compensated for later - then we cannot achieve our prime directive of reducing poverty if we use MMT.So, two useful lessons from these absolute poverty numbers. Both degrowth and MMT are bad ideas not to be used. Well, sure, we know that anyway but nice to have another string to the bow - they increase poverty, see?

Policymakers and the public are in dire need of a poverty measure that remedies the well-known flaws of both the Official Poverty Measure and the Supplemental Poverty Measure. It should not be this complicated to assess how poverty changes year to year and why.
The post Putting This Year's Poverty Numbers in Context, Part II appeared first on American Enterprise Institute - AEI.

For folks who have concerns about the American economy yet also have an open mind about new information, here's a new study on LBJ's War on Poverty that they may find interesting—perhaps even perspective-altering.
The post A Valuable New Perspective on America's War on Poverty appeared first on American Enterprise Institute - AEI.