The World Bank (WB) deals in statistics; people it would seem are a function of the stats. Judgements will be made, decisions will be taken and resources allocated on the basis of the figures. World poverty is but a number and numbers make for understanding, or do they? By its own admission the WB accepts that the poverty threshold of $1.25 a-day is “very frugal”. Nonetheless the WB holds fast on the figure; meanwhile the South Asian Bank promotes a $1.35 a-day threshold as more realistic.
I don’t know how the calculation is done to arrive at either figure but what is abundantly clear is that the higher the threshold the more people that come under its umbrella and thus more are considered to be living in ‘extreme’ poverty. The $1.25 a-day relates to what can be purchased in the USA for that amount. Of course it has no bearing on what can be purchased in Kenya, Chad or in Honduras, for the same daily allowance, unless all prices are the same.
There is a very powerful political agenda being advanced by the WB, one that suits Conglomerates rather than promoting local business. The celebration of the huge drop in ‘extreme’ poverty mainly due to the industrial surge by China seems to have been taken as a panacea to rid the earth of all poverty. Consequently, the WB has sought to impose the China model elsewhere. As we have noted, China is booming and the WB applauds the results but what are the consequences of such rapid growth?
A look at recent film footage from China shows an environmental and human downside to the industrial expansion. Quite visible is the smog that hangs in the atmosphere; whilst behind the closed doors are the poor working conditions that the people are forced to endure. Such is the celebration of the growth that few listen or take heed of the warnings:
“The same is true of other developing countries, for growth in these lands is not environmentally neutral and raw materials are not elastic.” The Hungry Spirit, P54. Charles Handy,
One light shines and the WB leads us walking blind into a well of human misery and potential environmental catastrophe. One is reminded of the ‘Dark Satanic mills’ of 19th century UK. Are the millions of child labourers, who earn a pittance working in the most hideous, squalid conditions; are they and their families removed from below the poverty line if they earn a cent above the $1.25 a-day threshold? How can poverty be understood on purely monetary terms?
Nonetheless, pleased with its catchpenny statistical endeavours so far, the WB has set its next goal, to reduce ‘extreme’ poverty throughout the globe to 3% or less by 2030. However, it does recognise that more than 1billion people still live in destitution and that inequality is rising in developing countries. The WB offers a caveat by admitting it has, “established ambitious but achievable goals.” They also accept that the target is, “highly optimistic” and requires, “rapid economic growth,” as well as, “long term structural changes.” This is quite an array of caveats and while I wish them well, I cannot muster the same belief that they obviously possess.
My attention was particularly drawn to:
“It will require sustaining high rates of economic growth across the developing world…” and “ social policy changes not seen yet in many poor countries,…” now that is what I call ambitious!
I am intrigued by the “long-term structural changes”
mentioned and by just how long these changes will take and crucially, how they will be implemented? Surely changes of a major kind such as envisaged will require local support and wherewithal to impose them? The time factor is also critical here; the WB has given themselves, 20 years or so; does that constitute long-term? Or is it satisfactory for the reforms to be in the pipeline? Can the WB guarantee the support locally to implement the changes or do they have an alternative method in mind?
What of the “social policy changes not seen yet…”? Is this just wishful thinking on the part of the WB or a necessary prerequisite? Are we to see a health service and an education system manifest themselves overnight? When will they start and do the governments involved fully endorse these mammoth undertakings? Where will the staff for the numerous jobs come from? My advice to the WB is to get their skates on!
The task becomes even more daunting when the foundation from which they start is so unstable.
“In 12 countries in sub-Sahara Africa, the extreme poverty rate is above 60%; in four cases it is above 80%.” A great deal of credit is due for the basic honesty that is displayed. However, when India is added to the picture, with 33% of people globally living below the poverty line then we must start to think in terms of miracles. Their realistic assessment, I believe, condemns the ambitious target set before the engine is started.
Another major criticism of the plan is the one to retain the threshold at $1.25. Introduced in 2005, the threshold is now unrealistic because it does not take into account inflation from then to the present day. To maintain the rate set as a global rate is a false position as price rises are not universal, they differ depending on the economic stability of the individual nations. This, therefore, appears as a game played with numbers and gives credence to the notion that the WB’s main concern is looking good; a policy of self-promotion. It reminds me of a little book I came across in a second-hand bookshop, titled, How to Lie with Statistics, by Darrell Huff, 1954.
An indictment of the $1.25 a-day threshold is exemplified if we consider a threshold of $2 a-day, which raises the number trapped in poverty from 1.4 billion to 2.6bn. Is that why the WB is sticking to the prescribed threshold? If these figures are reliable then we have 1.2bn people living in a shadow place between darkness and light, fighting a constant battle with hunger and hades, yet daring to hope. Therein lies the true miracle of the human spirit. www.prb.org/Articles/
We can all use statistics to promote or defend our argument, and it is very difficult to ascertain the truth or otherwise of facts and figures, as bias is a constant intruder into our thoughts. However, to begin on a false premise would seem to lack moral certitude. Nonetheless, a number of points can be raised here; Oxfam (2008) warned that 100million more people may face poverty due to price increases as the $1.25 a-day does not take into consideration increases in fuel and food. (bbc.co.uk) “In addition in developing countries the informal economy predominates for all income brackets except for the richer, urban upper income bracket population.”
In effect money does not play a large part in the lives of these poor people. To add to the downcast mood we have another opinion from Oxfam (2008) when they point out that in sub-Sahara Africa, 50% live in ‘extreme’ poverty and have done for the past 25 years. Elizabeth Stuart. (bbc.co.uk). The point here, surely, is that poverty in sub-Sahara Africa is endemic and the sheer scale of the task to eradicate it will take more than the 15/20 years allotted to it by the WB. A similar case can be made about India.
A total rethink in terms of approach is vital and it does not help when those who can affect change fail to deliver. In 2005 the G8, (the eight most economically powerful
countries) set a target to double aid to Africa by 2010; that target was never met. Since the mid-1950s donor nations have poured over $1 trillion into the Horn of Africa and yet today these countries are still in a state of perpetual misery. The sadness continues for several of these nations as famine has reared its ugly head (2013) in Somalia, Sudan and South Sudan. Unfortunately the good news that the WB would like us to believe is overwhelmed by the bad.