AS I SEE THINGS: The fight against poverty
LAST WEEK, Bill O’Reilly, host of The O’Reilly Factor on the Fox News Channel in the United States, alluded to the fact that despite the vast amount of financial resources poured into Baltimore by the Federal government, poverty in that city has increased.
Specifically, according to O’Reilly, in the past five years alone, the city received $1.8 billion in the form of stimulus funds to help combat poverty and other emerging problems. Yet, there has been little progress in terms of the plight of ordinary citizens.
What seems clear from this inference is that money alone will not, and cannot solve poverty in any society. Furthermore, government intervention by itself is incapable of resolving poverty given the very nature of this problem. Hence, the fight against poverty has to be a collective action involving government, the private sector, the churches, trade unions, other important stakeholders in society, and individuals.
But above all, the fight against poverty has to involve well-targeted and specific interventions that are coordinated by a central agency. In short, a piecemeal approach to fighting poverty is more likely than not to led to vast amount of wastage of resources as is apparent in the case of Baltimore.
Against that backdrop, and given the fact that poverty continues to remain a major area of concern for many countries in the Caribbean, how should we as a people wage war against poverty with the goal of winning in the long run? The economics literature offers some assistance that can guide us in answering this crucial question. The first approach centres on interventions that are general in scope. For example, measures to control the prices of such essentials as food, health care, and education.
Clearly, this strategy would benefit all sections of society, but it is unlikely to be sufficient. By the very nature of this intervention, the government logically has to take the lead in terms of implementation. To some extent, we have seen this kind of strategy in play in many Caribbean countries with the value added tax, for example, being reduced or eliminated on several food items and medical supplies.
The second type of intervention is to develop a set of measures that would reach different sections of the poor. This form of intervention seeks to ensure that sufficient income or entitlement is afforded to the poor so that they would be able to secure basic necessities.
This is surely essential to counteract the deeply-rooted structural processes at work. As part of this strategy, issues such as access to funds at reasonable rates of interest, the creation of employment opportunities at sensible wages, and redistributive land reform become essential. And it is within this context that the private sector, trade unions and other stakeholders can make their greatest contribution in the fight against poverty.
Going forward, therefore, even though poverty reduction is a rather challenging goal to accomplish, we in the Caribbean can certainly succeed in our fight against poverty by being creative in our approaches and by combining the efforts of everyone in society.
Money alone will not resolve the problems we face in relation to poverty. The sooner we recognise and accept that fact, the better for all now and in the future.
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