Welcome to the TEP University lecture session. Every week, great thinkers from our nation of the east pacific shall hold talks about social, politicial, economic and security issues of the world. Today, we invited Professor John Pacs from the University of Centreford to talk about the Poverty Reduction.
*Applause as Dr.John enter the room and tookover the mic
Hi I am Dr. John Pacs, Professor of Economics and Social Science in the University of Centreford. I am a economist and I spent my years researching on poverty, wealth distribution, uneven development and inequality around the world.
Basically, this lecture will be about poverty and ways to alleviate those problem.
Let me define what is poverty. Poverty is the lack of basic human needs, such as clean water, nutrition, health care, education, clothing and shelter, because of the inability to afford them. Many believes that a high economic growth will eventually alleviate poverty because it provides job and income for the poors. That not really entirely true. Even if a nation had high GDP, it does not mean that the majority of the people are truely well off. This may due to huge income gaps where a ridiculous amount of wealth concentrated around only a minority of the population while the majority’s income had medium or low level income or live in poverty. A very factor that help to alleviate poverty is to improve the basic security of the people in term of economical, social and political. This will give them a secured access to opportunities which may prevent them from falling back to poverty.
So the question is to ask is what are some measures that can be taken to alleviate this problem?
Legal System. In a developing capitalist country, the poors usually lack of legal protection such as property rights and fair justice. Property rights are legal paper that recognise the individual ownership of the land, house and the property. By recognise the legitmacy and legality of the ownership, it creates asset for the poors and give them access to financial loans such as collateral to start business and protect them from unlawful or unfair land takeover. For example, the farmers can use their lands as collateral to get loan from the bank. The farmer can use the loan to start a business and raise his income level so that he can feed his family.
Subsidies and Incenitives. Subsidies are quite useful to make necessities affordable to the poors but it can be financial strain on the government budgets. It widely recommended to subsidise infrastructure costs, technology, education and healthcare instead of food. This increase poors’ access to technology that help improve their productivity when working or starting small businesses and make medical drug affordable to them. Poor farmers can buy better and affordable tools to grow more crop, thereby increasing productivity and personal income. Local village can buy cheap water filter and medical drug for reducing risk of diseases and health problem. Better and affordable education give them skills to find job with better income.
Another way was to introduce incentive for poors to work and learn. The old saying " Give a man fish and you will fed him for life, Teach him how to fish and he fed for himself " is very true. Incentive made people to do things. Rather than feed Government or charities can reward the poors if they managed to do some work like building local infrastructures for their communities and learning new skills. Reward can be in a form of cash, food, necessities or tools. It also part of the learning process and encourage them to be dependent on themselves.
Capital Access. People who are poor usually lack of opportunities access to wealth because of geographic, political and social reasons. One of the ways is to increase financial services to the poors such as microcredit, microfinances, insurance and saving accounts. Government can provide incentives to establish and invest in rural banks. The poors can use microloans to set up small business and local villages can borrow funds to build infrastructure for their communities. This increase number of job and economic growth in those poor areas. Some economist even suggested to allow farm animals such as pig and cow to use as collateral for loans.
Infrastructure. Infrastructure is considered fundamental for the growth and development of the economy. Infrastructure such as school, hospital, roads, railway, dam and irrigation sysytem can help to improve living standards of the locals. Government should enact policies to encourage investment in the undeveloped region which will generate large number of jobs and businesses. Well developed infrastructure also help to facilitate better trade and investment into the rural areas.
Technology. Another way to alleviate poverty is by introducing technology to the poors. It will enhanced their productivity of work and raised income levels. Also, it can overcome geographic factors such as the climate and the environment which prevented them from moving out of the poverty cycle. For example, irrigation system provides stable water supply for crops while chemical fertiliser increases crop output per land, thus both increase productivity and more crops, hence for income for the farmers. A famous example was the Green Revolution when new agricultural technology is introduced to third world country such as China and India in the 1940s, this increase food production of the world and mitigate problem of world hunger.
Technology also help the poors by connecting them to the market and capital. Introduction of mobile phones and internet allows the poors to better access to the market. The knowledge of the global commodity prices allow them to sell their product at a greater profits, thereby raising income level and standard of living. Fund transfer such as remitance and loan are safer for the poors.
Coming to the end of the lecture, I had some personal opinion which some might disagree. Sometimes, it is not to judge on how great nation is through its military mights, its vast wealth and political influence, but it is to judge how great nation treats its worst. Thank you.
- Applause
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