The Libertarian War on Poverty
Because liberty unleashes the most powerful force in the fight against poverty
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STATEMENT OF PURPOSE
- To inspire those who are concerned with the ravages of poverty to implement one of the most powerful forces in the world:
human liberty.
- To review the literature on poverty and to provide a forum for discussion. You will find book reviews at my blog:
POVERTY
STATISTICS
Only two point six percent of the population was persistently poor from 1969-1978. (1)
Twenty-four point four percent of the population was poor at least one year from 1969 - 1978. (1)
One-third of the those who were persistently poor are elderly. (1)
Sixty-five5 percent of the non-elderly persistently poor are single moms. (1)
Three-fifths of the persistently poor are black. (1)
Top income groups work 700 percent more hours than the bottom. (2)
The income of America's bottom
one-fifth has twice the income of India's top one-fifth.
Forty six percent of those classified as living in poverty own their own homes. (2)
Finish high school; wait until marriage to have a baby, and marry after the age of 20.
Seventy-nine percent of those who fail are poor.(2)
Ninety-five percent of minimum wage workers live in non-poor households. (2)
Sources:
(1) Years of Poverty, Years of Plenty, Greg J. Duncan
(2) Stealing From Each Other, Edgar K. Brown
Forthcoming book:LIBERTARIAN WAR ON POVERTYIt is my fervent hope that I will complete and publish my book: The Libertarian War on Poverty. From time to time I will provide links to some upcoming chapters. Your responses, comments and criticisms, both positive and negative, are always welcome. (That goes for agents, editors and publishers too). -- Dan K. Robin |
LEADERSHIP
It is time for the real champions of the little guy to retake the leadership role as protectors of the poor.
It is often said, and I agree, that we must DO something about poverty. The question really becomes: WHO is going to act? The real power, strength and energy to fight poverty comes from a free market, property rights and human freedom. For example, job training takes place every day for millions upon millions of people without a dime of government effort. Employers would love nothing more than to train someone new to expand their businesses. This isn't just job training with the hope of a job but on-the-job training. The minimum wage laws interfere with the natural process of hiring and training an employee. Libertarians do not favor sub-minimum wages, but we want to free employers to hire poor people and still be able to afford to provide the training they so desperately need.
Politicians, academics, and many others have written extensively on the subject of poverty. I hope that my review of some of this literature will lead others to be inspired to act and respond in a positive fashion. My purpose is to give both a fair review of these great efforts and to provide a libertarian perspective.
See poverty book reviews @ Champion of the Poor
Economic growth is the single most effective means to reduce the ravages of poverty. Would you rather be poor in America in 1800 or 2000? Even if life today can be threadbare for some, the opportunities to escape poverty are vastly better now and ever before.
"We got more done for the poor by pursuing the competition agenda for a few years than we got done by pursuing a poverty agenda for decades," the former Indian finance secretary Vijay Kelkar pointed out in a 2005 paper: The Elephant and the Dragon, The Rise of Indian and China and What It Means for All of Us, by Robyn Meredith.
"The progress in the earlier period [1939-1970] is easily explained: It was due to economic growth. Economic growth means increases in real income per capita and with a fixed real poverty standard more and more people realized incomes above the thresholds. Rising real wages were the tangible embodiment of this growth; people earned more and escaped poverty. It is notable that government welfare spending played little or no role in the reduction in poverty in this period.... The whole story for this period is economic grow." Stealing From Each Other, Edgar K. Browning.
"Two World Bank economists, David Dollar and Aart Kraay studied 40 years of income statistics from 80 countries....Their studies show that growth benefits the poor just as much as the rich. With 1% growth, the incomes of the poor rise by 1% on average...." In Defense of Global Capitalism, Johan Norberg.
No government run programs nor any government command economy has ever done anything close to the poverty reduction of economic growth.
See poverty book reviews @ Champion of the Poor
When you think of helping the poor, quite often you think about "job training programs." Give someone a fish and you feed him for a day; give someone a job and you feed him for life. Beyond a shadow of a doubt, private enterprise spends far more on job training than government ever will and it is free. Obviously businesses want to pay low wages during a training period. If we eliminate minimum wage laws, that opens up the greatest number of training positions to those poor people who need the training the most. Think of that: an entire job training program and all we have to do is get out of the way!!
"....Most programs [speaking about the costs and benefits of government run adult job training programs] do not appear to be a very worthwhile investment."
"The widely held consensus of this literature is that these programs [speaking about government run youth job development programs], particularly those that are not very intensive have failed to produce economically meaningful improvements in employment or earnings for program participants and so have not been very successful at moving youth out of poverty." The New Politics of Poverty, Lawrence M. Mead.
"More than one-third of white working men in their twenties or early thirties were still in their training periods compare to only about one-tenth of the corresponding black working men." Years of Poverty, Years of Plenty, Greg J. Duncan.
Government programs simply can't come close to the quality or quantity of job training that private industry supplies. Free employers to pay what they think proper and they will train anyone and everyone.
See poverty book reviews @ Champion of the Poor
PRICE - THE GREAT COMMUNICATOR
The price we pay for things is the great communicator of our values and our needs. It differentiates between what people say we should want and what we are really willing to buy. If you make a product or service free for the poor, you are taking away their voices. An open market allocates more resources proportionate to our payments. No government agency can possible know what millions of different people need or want from day to day and year to year.
No company will innovate in order to be paid zero. Don't take poor people's voice away. "As consumer-driven health care increases quality, more health care will be available at a better price. Further, suppliers are vitally interested in serving the large number of consumers who are not rich." Who Killed Health Care? America's $2 Trillion Medical Problem and the Consumer-Driven Cure, Regina Herzlinger.
"How do you move away from the temptation of providing a portfolio only for the affluent?" asks Phillips' India CEO, Ram Ramachandran. "You have to be part of the economy where you're working." Besides he argues, the real buying power in India comes from the poor.
"Imagine a billion people spending a little, little bit of money, which adds up to a helluva lot." The Elephant and the Dragon, The Rise of Indian and China and What It Means for All of Us, Robyn Meredith.
The obsessive problem solvers of the world are out there in small and large businesses trying to innovate a product or service. If given a chance, they will figure out a way to minimize the use of the world's resources and provide for everyone's needs at the lowest possible cost.
Don't let government take away the price of goods and services for the poor. Without price, the obsessive problem solvers can't hear their values.
See poverty book reviews @ Champion of the Poor
Improvements in the lowly hammer and nail have made carpenters more productive and have made houses more affordable. Disease resistant wheat and harvesting tools have multiplied farmer's output and helped feed the world. The freedom to innovate and the freedom to shift resources from old to new is what lifts up salaries and makes abundance possible. From the days of Galileo to the present, innovation and change have been met with fear and if coupled with the power of government can crush the hopes of millions of the poor. Look at Gandhi in India and his followers who idealized and institutionalized the spinning wheel size business. They did as much as anyone in history to impoverish an entire country. The acceptance of innovation must by definition mean the demise of older tools and methods. In order to move forward you must embrace the freedom to fail.
"In the name of helping the poor, the Indian Government passed laws granting lavish job guarantees to workers, back wages were owed even if their employers went bankrupt. Unfortunately, this made company leaders very reluctant to hire unless they could be sure a factory or office would be open for decades. (Today it still takes an average of 10 years to close a money-losing factory because of India's job guarantees.)" The Elephant and the Dragon, The Rise of Indian and China and What It Means for All of Us Robyn Meredith.
See poverty book reviews @ Champion of the Poor
OF INDIVIDUALS
People are amazingly innovative and hard working. If required to do so they find ways to overcome the many hardships and difficulties that life presents. Even those we call poor are almost always attempting to work their way to self sufficiency.
"About one quarter (24.4 percent of the population lived in families below the official poverty line in at least one of the ten years, 5.4 percent were poor at least five years, and less than one in a hundred (0.7 percent) were poor all ten years." Years of Poverty, Years of Plenty by Greg J. Duncan.
People say that the capitalist system is hard-hearted because it supposedly says if you don't work, you don't eat. Then comes Lawrence M. Mead in 1992 (just prior to President Clinton's welfare reform) who says that there is a hard core small group of people who simply do not show the "degree of competence" to sustain work effort. His conclusion is to modify welfare to require work or work related activities. He says: "I think obligation is essential to workfare's achievements." The New Politics of Poverty, Lawrence M. Mead.
The studies that he reviewed asserted that people were quite pleased to be forced to go to work in order to receive the government dole. But haven't we gone full circle? Government has finally reinvented the capitalist system: "Unless you do "X", you don't eat" and people are happy with it. Poverty is not a condition that you can examine under a microscope. All but the very smallest percentage of people are putting in the effort to move up and out. We should celebrate the great energy that individuals employ to provide for themselves and their families.
See poverty book reviews @ Champion of the Poor
Government can and should play a huge part in the success of a free economy. It must define and protect the ownership of property. This means everything from houses, to cars, to businesses, to inventions, to retirement funds. Government can give me the right and power to say this is mine to the exclusion of all others. With that right, I can take an idea, turn it into a successful business; hire thousands of people; offer share of stock to millions of potential investors and leave it all to my children and grandchildren. If you want more and better jobs for the poor, look to the power of ownership.
"As we saw in the previous chapter, these countries' principal problem is not the lack of entrepreneurship: The poor have accumulated trillions of dollars of real estate during the past forty years. What the poor lack is easy access to the property mechanisms that could legally fix the economic potential of their assets so that they could be used to produce, secure, or guarantee greater value in the expanded market. In the West, every asset - every piece of land, every house, every chattel - is formally fixed in updated records governed by rules contained in the property system. Every increment in production, every new building, product, or commercially valuable thing is someone's formal property." The Mystery of Capital, Why Capitalism Triumphs in the West and Fails Everywhere Else, Hernando De Soto.
Great wealth has been made through the wonders of ownership. Yet we don't trust the poor to own and manage their own retirement Social Security account. Maybe that's why they are poor.
See poverty book reviews @ Champion of the Poor
Join the discussion and send your comments to Dan K. Robin Danatlaw@aol.com