Poverty

by **Mayavi Morpheus** » Sun Oct 26, 2003 11:57 pm

OK guys, gear up for some serious discussions - and trolls please keep out.
 
I have seen that every time the government takes up some development project or infrastructure work and spends money, people make a big issue of it and say that the money is better spent on poor people. Now I have a few queries.
 

 
1. Where is the government getting all the money from?
 
2. What is the percentage of poor people in AP? It\'s 27% in India and is much less in AP, because nearly 33% of the poor live in the BiMaRu states (Bihar, Maharashtra, Rajasthan and UP). So the middle class in AP is definitely big compared to BIMARU. What facilities is the government providing to these middle class people?
 
3. Why are the poor still poor, even after 50 years of independence?
 
4. What is the government doing to eradicate poverty? And what steps do all those people opposed to infrastructure projects suggest to the govt. to eradicate poverty?
 
In short, what in your view is the best way to spend money to eradicate poverty?
 
a. Distribute wealth to the poor? Like 10,000 crores to the 1 crore poor?
 
b. Save the money in RBI and earn interest and support the poor (kinda social security)?
 
c. Create industries so that the poor can be employed and make money?
 
Any other \'intelligent\' ideas?
 
5. Last but not the least, what is the government doing for the TAX PAYER (the rich and the middle class)?
 

 
Thoughtful responses are welcome.

by ZC » Mon Oct 27, 2003 12:58 pm

Remove reservation based on caste and introduce reservation based on economic status (it can be free education, if u cant pay fees, no one will be turned away coz he/she cant pay).

by **fren** » Mon Oct 27, 2003 3:02 pm

m impressed...u sound intelligent....its gud to discuss on a topic wich we hardly think of!!!keep it up...mayavi

by **JustaLittleUnwell** » Mon Oct 27, 2003 3:28 pm

I opened the thread with interest but was dissappointed by the tone with which the thread has been initiated. It looks like you only wanted to ask question no.5 (last, but the first and foremost?), and the remaining ones are just props. Since poverty or its eradication doesn\'t seem to be the concern here, i\'ll just let this pass.

by **Ali** » Mon Oct 27, 2003 5:10 pm

I agree with ZC that the resevations based on cast should be removed,after all Ambedkar asked us to keep reservation only for 20 years after the independence,but political parties for their benefit do not want to touch this topic they just keep on extending it,so Members of parliments are hardly 500,who gain but rest of the crores of the people who suffer.

by **Mayavi Morpheus** » Tue Oct 28, 2003 3:30 am

Justa...U re both right and wrong. My emphasis is not on question 5. But everything is intricately linked to 5. Think abt it. Everyone has their own views and ideas on how to eradicate poverty. In my view it can be eradicated by catering to the needs of Middleclass

. Will ldetail later.
 
 Anyway I am still looking for answers for my questions. Mainly from the nay sayers and criticizers of mega infra projects and champions of the poor on this board.

by ZC » Tue Oct 28, 2003 11:50 am

MM: how is poverty eradicated by catering to the needs of Middleclass ? u mean \"they will become poor if u dont do this, adding to poverty?\"

by **Ramesh** » Thu Oct 30, 2003 9:17 am

I secon Ali and ZC

by **Mayavi Morpheus** » Fri Oct 31, 2003 4:08 am

My answer will not be direct, u have to infer it from the post: 1.If the government is getting any money, its due to taxes paid by the middle class (not the rich, not the poor). Middle class contributes more than rich. So they expect that their life is improved by government spending, which is not unnatural. What incentive do I have to pay tax if there are no roads leading to my house and no transport facilities? 2.The government should not feed the poor, no subsidies, no grants. Nothing is free in this world, we have to earn it. If you continue feeding the poor, they remain poor. Instead it should make an effort to provide an oppurtunity to them to earn money and live a decent life. Like someone said in other board, give a man a fish he will feed his family for a day, give him a line, he will feed forever. 3.All the goods u see in the market are aimed at middle class. The TV\\\'s , the Fridges, the scooters, the cars, apartments almost everythin is aimed at middle class. Who\\\'s making them? Who are the employees? Industrialization leads to increase in production, employment and standard of life of the citzens. Govt. should create favourable conditions for individuals to set companies to create wealth and also to create employment. 4.Indian economy opened up in 1990, end of socialism (not total end) and end of license raj, whats the result? The middle class is 300 million strong! and the poverty reduced by 10%. That means 90 million people (10% of 1990 pop) graduated from poor to Middle class. All this is due to liberalization of economy. What did we achieve by liberalization? Supply meets demand. There was always the demand for scooters, tv\\\'s etc from middle class, the govt didnt allow companies to produce enough to meet the demand, means no expansion of production lines and no increase in employment. With License raj gone, the manufacturing sector (which caters the middle class) picked up and so did the employment. PS: Serving the middle class doesnt mean working in the households of middleclass people.

by ZC » Fri Oct 31, 2003 12:11 pm

as i said in another board. eliminate Article 370 and distribute free land in J and K to the poor. and implement one child policy, infact no need. middleclass are slowly understanding themselves that raising two kids is becoming increasingly difficult and slowly are themselves following one child policy.govt jobs shouls be like, if one person in a family (family means 2 generations, my parents and sib,lings) has a govt job, then another person wont be given a givt job. this should be applied for public sector. Also, private sector should follow this(some companies dont take spouse in the same company, this should be applied to family as well). this idea is from Vysya Bank. it has a similar policy.

by ZC » Fri Oct 31, 2003 12:20 pm

in Germany education is free. can it be implemented in India. Something like, all companies govt and private should have their own school. They have to give free education to their employee\'s children and on top this number, 20% should be available as seats for poor people. Businessmen/entrepreneur children can be given free education in the extra 20% coz they are actually creating employment for others, which is good.

by ZC » Fri Oct 31, 2003 12:24 pm

the thought of adopting/starting schools came from the recent govt discussions that each company will adopt 50 sq-km around its location for starting hospitals, may not be free, but it helps people in remote areas.

by **JustaLittleUnwell** » Fri Oct 31, 2003 12:48 pm

Thx MM, for your post:
 
 \"1.If the government is getting any money, its due to taxes paid by the middle class (not the rich, not the poor). Middle class contributes more than rich. So they expect that their life is improved by government spending, which is not unnatural. What incentive do I have to pay tax if there are no roads leading to my house and no transport facilities?\"
 
 I agree the rich are paying less taxes than the middle-class, which has to be addressed by making suitable corrections (taxing rich farmers, having higher income tax slabs etc.). However, the trend has been to make the rich richer, by giving tax benefits to them, exempting them from taxes etc. While this happens, the \'indirect\' taxes are also being increased, which the poor have to bear because of the essential goods and services they purchase. So, in effect, the governments reduce the tax on the rich, and increase the tax on the poor.
 
 \">2.The government should not feed the poor, no subsidies, no grants. Nothing is free in this world, we have to earn it. If you continue feeding the poor, they remain poor. Instead it should make an effort to provide an oppurtunity to them to earn money and live a decent life. Like someone said in other board, give a man a fish he will feed his family for a day, give him a line, he will feed forever.\"
 
 This is a very true statement that people like you use conveniently in such discussions to deny the fish as well as the fishing line. If you look at \'fishing line\' initiatives for the poor like education, healthcare, job creation (for the poor - not for IT / BPO professionals), justice, law and order, communal harmony etc. you will observe that the track record of the governments have been zilch.
 
 \"3.All the goods u see in the market are aimed at middle class. The TV\\\'s , the Fridges, the scooters, the cars, apartments almost everythin is aimed at middle class. Who\\\'s making them? Who are the employees? Industrialization leads to increase in production, employment and standard of life of the citzens. Govt. should create favourable conditions for individuals to set companies to create wealth and also to create employment.\"
 
 Frankly, who are the employees? The middle class again. Which industry is going to hire unskilled labour (constituting the poor of this country)? So, industrialization has become a framework whereby middle-class employees produce goods for the middle-class consumer, and the rich banias walks away with the profits. Can you pls let me know how are the 500 million rural & urban poor of this country figure in this framework?
 
 \"4.Indian economy opened up in 1990, end of socialism (not total end) and end of license raj, whats the result? The middle class is 300 million strong! and the poverty reduced by 10%. That means 90 million people (10% of 1990 pop) graduated from poor to Middle class. All this is due to liberalization of economy.\"
 
 Hey, aren\'t you being cleverly vague here?

Assuming the size of the middle class \'grew\' from 210 million to 300 million based on what you claim, are you sure it is not because of the population growth? Are you sure the number of poor \'reduced\' by 90 million? Instead of talking absolute numbers, why dont you give me the percentage of population that was poor vs. that was in the middle-class, for years 1990 and 2000 (to track the \'decade of growth\')?
 
 \"What did we achieve by liberalization? Supply meets demand. There was always the demand for scooters, tv\\\'s etc from middle class, the govt didnt allow companies to produce enough to meet the demand, means no expansion of production lines and no increase in employment. With License raj gone, the manufacturing sector (which caters the middle class) picked up and so did the employment. PS: Serving the middle class doesnt mean working in the households of middleclass people.\"
 
 I have no disagreement about liberalization being fantastic for the middle-class, which why the likes of you are singing paeans in support. The question is, has it addressed the issue of poverty? Maybe poverty eradication is not in its scope - which is fair, but to misrepresent that liberalization eradicates poverty, and to push it citing it as a means for poverty eradication is gross and unfair.

by **Mayavi Morpheus** » Sat Nov 01, 2003 2:17 am

Justa...
 
 In reply to the second point, I never said that the goverment is taking measure to improve the poor. I always blame the government for not implementing development policies. Whatever it has implemented are wrong . Policies like Free current, subsidized ration, subsidized fertilizers for farmers are all wrong policies which only provide the poor with amenities but dont make them rich. It only increases the debt of governent (subsidies).
 I only mentioned this beacuse many people think that the poor should be fed by government money instead of wasting on infra projects. The government cannot feed 233 million chronoically hungry with the tax money. The government in not just fot the poor, there are 250 million Indians who are not poor and can feed for themselves.
 
 2. About middle class:
 I dont understand ur problem here. There were less than 200 million middle class people. The population in 1990 was 900 million, and 1 billion in 2000. In 2000 there are mroe than 300 million middle class and not to count the Rich people who increased by 1% (not sure, estimate based on an article). So the increase in population is accounted by Middle class, does taht mean the poor are nto reproducing? Its a known fact that the middleclass population growth (due to reproduction) is less compared to the poor. So all the statistics indicate that more poor people graduated to Middle class. Poverty dropped from 37% to below 25% (pop growth accounted for). I dunno why you think that 500 million Indians are poor. Are u fascinated by the poor or proud to be attached with the poor country tag?
 Just take a look around ,u can see the prosperity in India, where is all the money coming form? how come people are spending so much money? Why are the car sales picking up and two wheeler sales soaring? Why is the consumer electronics market booming? Certainly people are buying, they have money. They are not poor.
 
 All these years India was ruled by commies (should I say people like you?) with their socialist policies and gharibi hatao slogans only managed to ruin Indians economic growth seen in 1950\'s and 60\'s. What did they achieve? 37% of pop was poor in 1990, which was 54% in 1947. Jsut a meagre 17% reduction in 40 years. In the last 10 years the poverty dropped by 10%. Its only because the goverment created favourable environment for wealth creation. Wealth creation which was always looked upon as a sin by commies like u.
 If hyderabad today is a favourable place for FDI in IT and BPO its only because of change in govt policies. Thousands of young men are being employed by these IT/BPO firms who otherwise would have remained jobless and hence poor.
 
 To end on a happy note....
 The raddi waala at my street corner when first came to city didnt have money to feed his family. His wife was a maid in our house. He didnt wait for the government to help him and to subsidize his food. He started his own business, raddi dukaan (thats what I call serving the middle class to make money) now he zooms around town on a Bajaj Boxer. He now employs 3 people (unskilled employees) who otherwise would have been begging on the streets. Apart from that there are scores of rag pickers who make money thru him. Now he is considered middle class, bike and cell what else do u need?

by **Mayavi Morpheus** » Sat Nov 01, 2003 2:27 am

Continuing the above....
 
 Justa, if u still didnt understand why I cite liberalization as a tool to eradicate poverty, then picture this.
 Poverty eradication means that people should have enough money to afford food, clothing and shelter on their own. If the government is providing food and shelter then poor are not considered to be above poverty level. They are still poor living on social service (US Jargon, Bheek in India).
 Its all about Money. Money which India and Indians have aplenty, (but enough to be called a developing nation, rather than third world). The idea here is to get the people spending money, which was strongly condemned before liberalization. If people are willing to spend money then oppurtunities are created by themselves. The government doesnt have to do anything but facilitate the young enterpreneurs to with favaourable conditions to set up shops.
 This will reduce poverty in a big way, but not completely. Thats where govt has to take special measures.
 Show me one country where there is communism and prosperity.

by **Arch** » Sat Nov 01, 2003 7:23 am

very facinating discussion .. feel wow that somebody does believe in other than communism !!

and is not sorry about it ! good going MM

by **JustaLittleUnwell** » Sat Nov 01, 2003 9:32 am

MM, to briefly address the various things you mentioned:
 
 - I guess we are in agreement about the government initiatives being inadequate to address poverty eradication (in terms of giving the \'fishing line\'). Isn\'t that a cause for concern? So, while a segment of the population is chronically deprived, another segment is busy buying cars and electronic goods. Do you think it augurs well for the future?
 
 - Regarding growth in middle class numbers, can we pls rely on authentic sources? Pls cite a link which gives in percentage the population break-up of poor, middle-class & rich for the years 1990 and 2000, and let\'s see if the figures validate what you are claiming.
 
 - The number 500 million may not be accurate, but was quoted by one of the former Presidents of the country. I presume he had more authentic information before him to make such a statement in public. In any case, it is immaterial whether the number is 500 million or 300 million. The fact remains that we have the largest number of poor people in the world, despite every attempt to portray ourselves as an economic powerhouse.
 
 - I\'m moved by your story of a raddi dukaan giving employment to 3 unskilled labourers. How many such raddi dukaans will be required to provide employment to the millions of unskilled labourers who are dying of starvation / committing suicide?
 
 - I\'m glad you called me a socialist / commie even though I have never been associated with active politics. As a beneficiary of industrialization / liberalization myself, I have never advocated reversing or stopping these things, in whatever I have posted here or elsewhere. But the insensitivity to the misery surrounding us is what gets me, and I will countinue to voice my opposition to this insensitivity.
 
 - I reiterate that industrialization / liberalization is not a tool to eradicate poverty but to serve the purpose of betterment of the already well-off segments. There is nothing philosophically wrong about this betterment, but there are costs which the poor pay in terms of degradation of environment, physical displacement etc. and they dont get anything in return. It is the already well-off who stand to reap the benefits from exploiting the environment and natural resources (which in fact belong to everybody in the planet, not just the rich).

by **JustaLittleUnwell** » Sat Nov 01, 2003 10:17 am

MM, i thought of posting this link for you and your middle-class fans: http://www.infochangeindia.org/PovertyIbp.jsp
 
 The author of this article is some one who is actively involved in poverty mitigation in tribal regions, and hence can be expected to be more informed.
 
 To quote her:
 
 \"Trying to make sense of the varying figures on poverty is a difficult business. Official estimates themselves differ. The Planning Commission, pro-liberalisation and eager to bring down the number of poor in India, claims that just 19 per cent of our poor are below the poverty line. Not so, says the NSS (National Sample Survey): it\'s 36 per cent based on consumer expenditure. In February 1997, the Government of India rejected the Planning Commission figures and settled on 35 per cent as the official estimate of India\'s population below the poverty line. However, if we are to consider the Indian Council of Medical Research (ICMR) 1981 prescription that 2,400 calories are needed for light work, 2,800 for moderate work and 3,900 calories for heavy work, then it is possible that the poverty ratios are much higher.\"

by **Mayavi Morpheus** » Mon Nov 03, 2003 3:19 am

Justa...I am yet to go through the site.
 But the figures I quoted (27% below poverty) are according to UN benchmark for poverty.
 According to the UN if a person earns above a $1 a day, then he is above poverty level. That means a family of two bread winners - wife and husband - should earn around 90 rupees a day. This is the benchmark used for poverty statistics.
 This definition differs from country to country and developed countries use different standards. In the United states 12% of its population is below poverty line. Their percapita is around $35000. India uses the UN standard.
 According to a recent survey by GOI, there are 233 million hungry people in India (seasonal, they dont find food in summer) and around 30 million chronic hungry (beggars I guess).
 If nutrition is the measure of poverty or rosperity, then more than 50% of India is below poverty line. That includes me and most of my friends. I am not below poverty line, but malnourished just because my food habits changed durig my college days.

by **Mayavi Morpheus** » Mon Nov 03, 2003 3:25 am

To add to the above, India produces more food than it consumes. India is even an exported of food grains, yet there are millions of chronic hungry.
 This is not due to poverty, but due to lack of efficient food distribution methods. If feeding the poor means finding a way to bring the grains from producer to the user, then govt has miserably failed. The Ration shops are a big example.

by **JustaLittleUnwell** » Mon Nov 03, 2003 12:30 pm

MM, we are not talking of people who are under-nourished out of choice or habit, like you and your friends. We are talking of people who do not have a choice - who do not have the option to obtain the required nourishment, and who can ill-afford to meet the minumum calorific requirements of their bodies.
 
 You are making it sound as though there are not enough trucks and wagons to transport food from where it is produced to where it is consumed. That is not the problem. The problem is there are many people in our country (as indicated by the various percentages) who can\'t afford to buy enough food.
 
 I strongly suggest you to read that website to get a better insight of the problem being discussed.

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