Fighting poverty

Fighting poverty – the government can’t do it for you.

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I am not sure it is the role of the government to fight poverty. Demanding that the government instate measures and policies in order to combat poverty assumes that government actually has the ability to reduce poverty. I am not so sure about this. Whilst an abusive/corrupt government (e.g. India or Zimbabwe) can certainly cause its people to massively suffer poverty, the reverse is not necessarily true – even the most benevolent and competent government is not necessarily able to reduce poverty.

I am not saying that governments should not attempt to reduce poverty; of course they should! Rather, I am saying that any efforts by the government to tackle poverty are extremely limited in scope and effect.

This might seem counter-intuitive to some. For many people, the agent most responsible for tackling poverty should be the government. I do understand this line of thinking: If the government, being the most powerful agent in the country, cannot tackle poverty, who else is going to do it? However, this attitude appears to betray a fundamental misunderstanding of the role of government.

The role of the government is to represent the people, lay down the law, and enforce the law. That is the aims of the classical understanding of the three roles of government: executive, legislative, and judiciary. None of these roles or responsibilities have any real effect on increasing their citizens’ economic prosperity. The law may help alleviate the abuse and underpaying of staff, but it doesn’t actually give them a job. It may create a tax environment that’s conducive to enterprise and growth, but it won’t actually create those companies for you.

To be fair, government has also taken on the responsibility of establishing infrastructure for the public good. This includes things such as the building of roads, power grid, communications grid, and establishing emergency services. However, all of these are not strictly the remit of government. It is entirely possible for all of these services to be provided by private enterprise. Furthermore, all of these services do not reduce poverty.

When the government builds public infrastructure and enforce laws that protect civil society and individual human rights, they do not prevent poverty, nor do they create prosperity. They only lay the foundations for the growth of economic prosperity. Economic growth occurs organically, when enterprising individuals or groups of people decide to take risks to do something people are willing to pay you good money for.

Even the welfare state, for which Western Europe is so (rightly) proud of herself for, does not actually combat poverty. It only alleviates the symptoms of poverty. The provision of welfare protections is not going to eliminate the true problem, the cause of poverty. It may provide you with the means to survive and even lead a comfortable life, but it will never increase the economic value of your contributions to society. Contributing economic value means making a product that is good value for money, or providing a service for less money and effort than if someone was to do the same thing for themselves. Earning money in and of itself is not necessarily contributing economic value.

The only antidote to poverty is prosperity. Prosperity is achieved when people are able to increase the economic value of their participation in society. When you have a skill/ability to provide a service or product that people are willing to pay for, you will prosper, and the value you contribute to society will improve other people’s lives.

If you want to prosper, you have to provide a skill that people are willing to pay good money for the services you provide, such as plastering on programming. Or, you could produce a product that people are unwilling to make for themselves, such as baking a cake or manufacturing a car.

I would even argue that the belief in governments’ ability to fight poverty actually increases poverty. This is because faith in the government to rescue us actually give us less motivation to rescue ourselves. Ironically, the more you argue for the government to help you, the more faith you are required to have in the government’s ability to help you. The less faith you have in the government’s ability to help you, the more you are willing to do something about it yourself.

My point? Don’t count on the government, whether nationalist or socialist, to resolve your economic woes. The only agent responsible for your economic prosperity is yourself. Granted, not everyone necessarily has the ability to become rich. Not even everyone has the motivation to become rich. However, should you desire financial prosperity, the onus is on you to take the steps necessary to increase the economic value you contribute to society. Nobody else can make you rich. It is true that you can blame the government for causing poverty, but you cannot blame the government for not helping you prosper. 

Author: Hoong-Wai

I'm a sinner. I have an interest in economics, philosophy, politics, science, sociology, technology, theology (in alphabetical order). I care about truth and justice. I can be a contrarian.

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