GDP growth does not bring equality

May 10, 2013

The United Nations General Assembly met after World War II in 1948 and committed to 30 articles on human rights. The Universal Declaration of Human Rights (UDHR) has been signed by most nations and serves in many cases as a legally binding document on human rights.

Article 25 in the UDHR says: “Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing, and medical care.”

Article 28 says: “Everyone is entitled to a social and international order in which the rights and freedoms set forth in this Declaration can be fully realized.”

Recently, the World Bank and the International Monetary Fund (IMF) met and hailed 2030 — the year when global poverty will statistically be said to be eliminated. Previously, 2015 was set to be the year that the “millennium development goals” (MDGs) would have halved extreme poverty globally.

Proponents say eradicating poverty by 2030 is a reachable target because global poverty occurs unnecessarily, is preventable, foreseeable and the world has the resources and wealth to end it.

But even as leaders of the IMF and the World Bank meet to discuss tackling poverty, they also discuss “economic growth” and imply that Third World economies simply need to grow to end poverty.

This suggests poverty itself has no real cause. And it ignores a fundamental contributor to perpetual and abject poverty for millions of people — a vast and widening wealth divide.

When world leaders say poverty can be eradicated by 2030, they are presenting a reachable goal. But their policies do not clearly state unambiguous and straightforward steps to achieve this.

Not only does poor outlining of policies contribute to the underachievement of the MDG’s targets, extreme wealth in the hands of a few also adds to the causes of the global poverty problem.

Oxfam says about US$32 trillion is hidden from the world in tax havens, a problem greatly contributing to the world’s income inequalities. It has also estimated that one year of the combined wealth of the world’s 100 richest people could put an end to global poverty four times over.

Insofar as unequal distribution of wealth and resources are a staggering problem, and a feature of current global institutional practices, economic growth does not lift people out of poverty but merely makes the small number of rich people richer.

In light of the Oxfam reports, poverty clearly stands out as a human-made moral catastrophe, not an unfortunate state of nature. By looking not only at the bottom 18 million who live in poverty, but also shifting attention to the big gaps of income — to the top at the accumulators of wealth — a fuller and more practical picture is given.

Income inequality globally is a big factor causing poverty, undermining democracy and distorting social unity. Many world leaders find it easy to implement policies favouring the rich, yet it seems an impossible task to prioritise the needs of the many.

Critics of the World Bank’s optimistic poverty statistics, including the United Nations, say climate change will be a serious and disastrous hindrance to ending poverty.

As well as education, health and mitigating the effects of climate change, more attention is needed on income inequality and current tax havens worldwide, which are easily solvable ongoing structural issues.

That the world still produces income inequalities and allows for today’s unprecedented poverty rates can only be seen as a huge failing in the documents outlining procedures and policies to fight extreme poverty.

As long as a tiny minority of people continues to hold huge wealth while millions starve, the World Bank, the IMF or any capitalist country cannot come close to truly ending poverty.

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