Permanent Poverty

I'm glad that the Edwards' campaign has made the discussion of poverty a central element of his overall platform. I'm not sure it's engendering a nationwide discussion on poverty but, well, I'm not sure that will ever happen. Democracies are strange things. We pay attention to groups that get us elected. As a group shrinks to a small enough size to be irrelevant to an election it no longer is able to court attention or candidates. But kudos to Edwards all the same. The question that has been vexing me lately, though, is whether poverty can ever be eliminated.

A few years ago Ashis Nandy gave an interesting lecture titled 'The Beautiful Expanding Future of Poverty' where he argued that poverty as a concept was an ever expanding one; it constantly changed to mean and define something else, something more. It has evolved today into one that embraces both destitution and all 'low consuming' habits, to use Nandy's term. For Nandy, our notion of poverty is intimately tied to our notion of prosperity as material wealth and well-being. As such, low consumption or consumption of low grade goods counts as poverty. At the same time its conflation of destitution (or absolute poverty where basic needs cannot be met) and low consumption into one term, poverty, blinds us to what we truly ought to focus on: destitution. It is this that destroys life.

I wonder which form of poverty is vexing Edwards? Is it the poverty that keeps a family of four in low quality housing driving a beat-up old car or is it the poverty where parents work 60+ hours a week and still can barely manage to feed the family. I'm guessing it's the latter.

But can poverty, however conceived, be eliminated? If we pay attention to the historical-material evolution of changes of production and inter-state relations we can certainly see how penury or destitution has been manufactured and is not, as such, a natural condition. So that form of poverty, then, is capable of elimination. But can that poverty we more accurately think of as relative, that poverty whereby people hover near penury or close enough to it to smell its vile breath be eliminated? In short, can poverty as inequity be eliminated? I doubt it.

For reasons I've attempted to say are 'research related' I've recently been revisiting Lindblom's book, The Market System, and in reading it I began to wonder if inequity is a necessary condition of market systems. This point was not addressed by Lindblom, mind you. But in his cogent analysis and discussion of how efficiency is created by market systems via, in part, the interaction of buyers and sellers (the word 'consumer' is never mentioned) who, both seeking ideal and low prices, play a central role in the 'efficiency' of market systems, I began to wonder if inequity also played a role. Lindblom, of course, has much more to say about what leads to efficient outcomes, such as the role of laws and technology. But inequity seems to be an absolute necessity to the function of a market system.

What do I mean by this? Well, if efficiency is in part a result of the competition among and between buyers and sellers each seeking the best price, then there must be an assumption that producers and buyers can both offer lower prices and higher offers, respectively. What I mean is that a multiplicity of producers competes for the buyer's money by trying to lower production costs and, thus, price. By the same token the varying purchasing powers of buyers means that some will inevitably be able to pay more leading to a more ideal price for the producer (supply and demand, if you will). It's two sliding scales of ability defined as cost and wealth where some balance is achieved and a purchase is made ideally leaving both parties happy with the outcome. It also produces system wide 'efficiency.'

More than this, however, is the simple fact that if the inequality in earnings in a society is greatly minimised then the purchasing power of each individual is nearly equal, so to speak. This could lead to inefficiency via stasis: the producer and the buyer have no wiggle room. All buyers have equal power to purchase a good and no way to outbid the other. Producers, however, must rely on other means to lower their costs (presumably because labour is paid a higher wage to ensure less inequity) to achieve lower prices to produce a profit through greater numbers of buyers. The caveat being, perhaps, a monopoly or monopsony. Assuming more than one producer, though, we can also assume that some producers will manage to beat out others and, thus, gain more money thereby recreating inequity for as one producer loses buyers it cannot produce forever and will eventually shed labour who then have lowered purchasing power.

All of this is of course very abstract at the moment. Heady and dense, if you will. But it seems to me that that very function of a market system not only rests on some element of inequity, but that in its function it produces it as part of its 'efficiency'. The rise and fall of producers in pursuit of profit ensures a steady yet dynamic process that produces winners and losers while simultaneously being efficient.

So poverty in some form looks like it's here to stay unless we wish to upend the system. But that's 'radical' and we Americans hate all things radical...