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Ending poverty by rethinking thinking

This writing is by Howard Richards, and is a DIALOGUE INVITATION_in the discussion groups of the Unbounded Academy 

6 March 2022

[Unbounded Academy coordinator for discussion groups is Gert van der Westhuizen, D.Ed. –]

First Premise:  “. “There is nothing new about poverty. What is new is that we now have the techniques and the resources to get rid of poverty. The real question is whether we have the will.”   –Martin Luther King Jr.

Second Premise:  “I regard any considerable increase in human happiness, unaccompanied by changes in the state of desires, as hopeless.”   –John Stuart Mill

         My general idea is simple:  We should all be working together to make sure everyone´s needs are met, if not one way then some other way.  Nonetheless, this unbounded realistic ethical approach is so different from orthodoxy that when you try to fit any of the proposals below into the framework of now standard rationality  (the common sense of an economic society, Pareto optimality, maximizing the bottom line, the requirements of sustained growth etc.)   you will find that my proposals require rethinking thinking.  We are in a civilizational crisis because we  are dominated by irrational rationalities that paralyze our ability  to use existing and in-the-pipeline techniques and resources to welcome every sister and every brother into what Dr. King called the Human Family living in a World House.

        I  will sketch an unbounded critical realist ethical open-ended and always -subject- to- revision plan to end poverty.   Be warned, however, that it does not fit the bogus economic logic that currently defines what is accepted as making sense in policy-making circles.  Unbounded ethics calls for a long critical process  separating the wheat from the chaff  in currently dominant thinking.  And in currently widespread emotions.  As Mill intimates in the quote above, without changes of heart, without healthy desires curing the current epidemics of rage, fear, and sick desires, no improvements in logic or in science will save us.   

            A beginning point for my plan is to focus on converting free riders.  I refer to people who possess surpluses they could share with the poor, who  are happy to benefit from the social peace, the lower rates of crime and disease, and all the other benefits the non-poor derive from the absence of poverty. (See the studies by Wilkinson and Pickett  that document the benefits the non-poor derive from living in more equal societies),   But the free riders do not contribute to paying for ending poverty.   Free riders  often stash money they do not really need   in secret trusts in tax havens, instead of using the same money to  buy food  and subsidize child care for the single mom across town struggling to survive balancing caring for her kids with working twenty hours a week at McDonalds.

         Karl Marx and Milton Friedman, speaking from different perspectives, argue that  the free riders will inevitably dominate the prosperous people who care and share.  The essence of their  arguments is that businesses like Google and donors like Bill and Melinda Gates, who donate large sums to poverty-alleviation  will inevitably be driven to the wall by free riding competitors like Apple. Some free riders  accumulate enormous stashes of cash skillfully protected from taxation.  They are positioned to drive their nice guy competitors  out of business.  As Marx puts it, whatever higher ethical level individual capitalists may subjectively achieve, they are prisoners of objective social relations beyond their control.    

           Given today´s huge surge in philanthropic giving, and given that a substantial portion of the corporate shares traded on stock exchanges is held by non-profits whose income flows serve  one or another aspect of the common good, there must be  something wrong, or something inapplicable to today´s realities, in  the abstract  reasoning of Marx and Friedman.

        The free riders  intimidate the givers.   Prudent  givers  are trying to follow Cicero´s advice to be generous, although  not so generous that they impoverish themselves to the point where they are no longer are able to  generate surplus to share.   They are naturally intimidated by the fear of being gobbled up by less idealistic competitors.    A plan to  help the free riders to see the light and to cooperate for the common good  is a giant step toward encouraging more sharing by prudent givers who are already motivated to share.

         The point Marx and Friedman make is while not the whole truth, not to be dismissed.  As Friedman put it, anybody in business who does not concentrate single-mindedly on maximizing profit and accumulating reserves to fight off future challenges from future competitors “will not be in business for long.”   Friedman  is  not entirely wrong.  Savage capitalism, to a large extent in the form of the British Empire later followed by the American Empire, came to dominate the earth largely by accumulating wealth  far beyond the money cost of enabling the owners of wealth to  climb the lower rungs of Maslow´s hierarchy of needs and graduate to pursuing higher needs for  meaningful self-realization.   Accumulated wealth made it possible to accumulate military power. Military power made it possible to accumulate more wealth.  And so on.   One might draw from history the conclusion that savage capitalism –or savage any ism—has an inherent tendency to win, while peace and love have an inherent tendency to lose.   

         Ending poverty would remove a major obstacle to ending crime, racism, sexism, massive drug addiction and drug gang turf wars. It would  deflate  bogus anti-ecological arguments alleging that the human population must continue to multiply beyond the carrying capacity of the earth in order to  stimulate economic growth and to have enough young people working to pay the pensions of retired old people.

Despite the historical tendency of accumulators to win and sharers to lose, today ending poverty is not hard to achieve.  Today is not yesterday.  Being aware of the inherent historical advantage of the free riding accumulators,  we can take steps to neutralize their advantage, as advocated above.    We are at a point in history where the accumulators have won the class struggle, not because they are so smart or so strong, but because the dominant social structures require regimes of accumulation that make investment profitable.  Having “won¨ through no merit of their own, Warren Buffet´s class finds itself in a world nobody wants to live in.  It is a world nobody can live in much longer because it is unsustainable.  

       Ending poverty would benefit everyone.   It would be relatively inexpensive.  It would open paths to sustainability.   Rethinking thinking is needed to see why ending poverty  is feasible. 

            Funding is feasible. The amount of  funds required,  counting both enhanced private sector and substantial public sector contributions, and adding crowdfunding among the many millions who are already not-poor; and then adding approaches like ABCD (mentioned below) that mobilize resources the poor already have,  adds up to:  Doable.  

           Given funding, meaningful work that leads to dignity and self-discipline is not hard to find.  Dr. King suggested that any number of people could be employed caring for the young, the old, and the sick.  Any number of people could also be employed greening the planet.  The ocean will not pay you for cleaning up the plastic that is poisoning it, but work with dignity can be organized to clean the ocean.  The same can be said for reforestation and any number of essential tasks that are now neglected.  We should also include funding the arts and sciences and any activity that develops intrinsically valuable human talents.

             Meeting  human needs is not expensive.  Admittedly the magic word “need” is just a good place to start conversations about how to allocate time, talents, and treasure.   An appeal to “needs”  is not a cookie-cutter shortcut to specifying objectives and drafting budgets.  

          Without oversimplifying, we can rely on the general principle  that meeting  human material needs  so people can move on to satisfying  emotional and spiritual needs is comparatively inexpensive compared to other ways to spend the same money.  Wars are expensive.  Persuading big  investors to invest in markets already well supplied with quality goods at affordable prices, produced by firms that got there first and already occupy all known profitable niches is expensive.  Creating good jobs by enticing big investors  typically requires government subsidies; tax breaks;  public spending on security,  infrastructure, and skills training; public-private partnerships where the public takes most of the risk and the private investors get most of the profits (as in the case of the Santiago metro)  and so on. 

           Paying interest on astronomical unpayable debts is expensive.  Creating employment at good wages to be paid from funds generated by projected future sales is expensive.  (See the World Bank statistics on how much money must be invested up front to create a good traditional  job.)   

         Ending  poverty intelligently at an affordable cost  often  begins by mobilizing the resources poor people already have, as in the ABCD (Asset Based Community Development) approach that Barack and Michelle Obama were trained to apply.   Community development  is mainly about dignity.  It is mainly about building positive human relationships amid the massive trauma-induced emotional wreckage that is mass-produced by today´s dysfunctional societies.  However, it requires money too.  It requires steady flows of money from property income, from haves to have-nots. 

            It is a great illusion to think all the poor can  become mini entrepreneurs using  subsidies to get started, and thereafter be self-supporting  selling merchandise to willing buyers.   

             An ethical shift is required,  a shift to caring and sharing, a shift to  mission-driven vocations of service.   The resources already exist: the free time, the expertise  (for example Doctors Without Borders) and the  material resources.   It is a simple matter  of working together to make sure everyone´s needs are met, if not one way then some other way.

             The money required to end poverty  is dwarfed by the trillions traded every day in the global casino of speculative investments.   It is dwarfed by  the trillions devoted to FIRE.   FIRE refers to Finance, Insurance, and Real Estate.  The RE parts, speculative real estate investments, are normally counter-productive.   They drive up the cost of buying a house.  They drive up  the cost of renting.   Many people end up sleeping on the sidewalk or in the back seats of their cars; while others work overtime at low-paying jobs just to pay the rent.

          Ending poverty is not expensive, but it requires curbing speculation that drives up prices without serving any ethically valid  purpose.

          Big ticket items like hernia operations and cancer treatments are best handled by single-payer health care funded  by nation-states that do not have to depend exclusively on taxes for income.  A nation-state dependent on taxes for income is  what Joseph Schumpeter called a tax-state, ein Steuerstaat.  Schumpeter correctly predicted  in 1918 that tax-states attempting to be welfare states would be unsustainable.  An example of a nation-state that is a sustainable welfare state and not a tax state is Norway.   Its government can count on the backstop of publicly owned North Sea oil that makes possible  an enormous diversified sovereign wealth fund.   The Norwegians are aware that while their model solves the problem of the high cost of hernia operations and cancer treatments, it does not solve the problem of ending dependence on fossil fuels.

         The rethinking of thinking that can end poverty welcomes what Shiv Visvanathan calls the defeated epistemologies.  They are the epistemologies  that were demoted to being “cultures” as opposed to “civilization” when the weapons possessed by the indigenous peoples of America, Africa and Asia proved to be no match for European fire power.  Rethinking thinking  must forget the “civilized” European doctrine of John Locke that a person is entitled to all and only  the value of what the person produces.   Locke´s notion of entitlement was the starting point for Adam Smith´s theory of the natural level of wages.  And for David Ricardo´s more mathematical doctrine  that the supply of  labour (a commodity whose supply is determined by birth and by how many of those born  survive) is regulated, like anything that is bought and sold, by the law of supply and demand.  (See the chapter on wages in Ricardo´s Principles).   King got ethics right; Locke and Ricardo got ethics  wrong.