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What is Poverty?

Updated on November 21, 2009

From Bibical to modern times the great majority of people were poor. They were poor, however, in things rather than in food. Except in times of regional crop failures or plague or disastrous wars, there was generally enough food to go around. But even the few who enjoyed great riches - the barons, the great landowners, the aristocracy - might be considered "poor" by today's standards. None of them enjoyed free education through college, expert medical care, or the chance for worldwide travel. None of them knew such conveniences as central heating, hot running water, electricity, or the automobile- all of which are now available to families with modest incomes throughout the United States.

Photo by Leroy Skalstad
Photo by Leroy Skalstad


Poverty as a social problem first came to be recognized in Europe and the United States during the Industrial Revolution at the end of the 1700's. A slow, stately agricultural economy gave way to the hustle and bustle of factories. Soot and smoke blackened the skies. Working people abandoned the spaciousness of farms for the day wages and distempers of factories and slums. The Industrial Revolution transformed the Western world, created great private fortunes, and permitted giant steps in man's material progress. But it accomplished all this at a considerable price in human misery.

Under feudalism, in theory at least, the landowner had been responsible for the welfare of his tenants. Often rural landowners had little more education than their inferiors and shared with them a crudity of manners and a love of blood sports. Henry Fielding's novel Tom Jones, written in the 1700's, gives an excellent, rollicking picture of the rough justice and paternalism of the rural squire.

The landowner's sense of personal responsibility for his workers did not carry over to the factory owner in England, the coal operator in Wales, or, later, the steel magnate in the United States. Their behavior was consistent with the laissez-faire theory of economics as expounded by Adam Smith.

This may seem paradoxical, for in his time Adam Smith was a reformer, a fact that many people now overlook. He wanted to take away the special privileges that had been granted to favored subjects by British kings. When such privileges and restraints are abolished, he wrote, "the obvious and simple system of natural liberty establishes itself of its own accord."

The system he believed in was based on the "free market." It was a market of self-interest and competition. The factory owner would buy as cheaply as he could and sell as profitably as he could. Adam Smith believed in a free market for labor as well as for materials. He wrote that competition also existed for labor: if the factory owner would not pay enough, workingmen would move on for higher wages.

But the supply of cheap labor seemed endless. The population expanded at an unprecedented rate during the Industrial Revolution. Workers migrated to the cities from farms that would no longer feed their large families.

For the most part, these transplanted country people were ignorant and untutored. Whatever country skills they possessed no longer availed them in the slums in which they settled. Whole families worked 14 hours a day in dark, airless mills. They did not move on for higher wages because they were too many to command higher wages. Jobs were scarcer than people.

Both in England and in the United States, there was concern for these transplanted people. But it was moral concern rather than concern for their material needs. In their villages, they had been subject to the spiritual authority of a church. In the cities, many of them were without anchor or direction. Drunkenness and depravity became more common in the streets as distilled liquors became cheaper. Scenes of such debauchery were dramatically documented by William Hogarth, the English artist.

Educated people were slow to connect the sins of the slum poor with the misery of their lot. Richard Cobden, for example, was a reformer and a friend of the laboring classes. Yet, as Stuart Chase pointed out, as late as 1847 Cobden voted in Parliament against the 10-hour working day because he believed workers needed "the discipline of the factory."

Caste-conscious society seemed to be afflicted with double vision when it looked at poverty. On the one hand, poverty was regarded as a spiritually elevating condition. Jesus Christ had said: "Sell all thou hast and follow me." St. Francis of Assisi and the founders of many Christian orders took vows of poverty so that they might be concerned with things of the spirit rather than with worldly things. On the other hand, poverty was regarded as something disgraceful. In some way, it was thought, the poor man must be responsible himself for the wretchedness of his condition.

George Bernard Shaw attacked the callousness of the governing classes in the introduction to his play Major Barbara in 1905. He wrote:

"We tolerate poverty as if it were either a wholesome tonic for lazy people or else a virtue to be embraced as St. Francis embraced it. If a man is indolent, let him be poor. If he is addicted to the fine arts or to pure science instead of to trade and finance, let him be poor. If he chooses to spend his urban eighteen shillings a week or his agricultural thirteen shillings a week on beer and his family instead of saving it up for his old age, let him be poor. Let nothing be done for 'the undeserving': Let him be poor ....

"Now what does this Let Him Be Poor mean? It means let him be weak. Let him be ignorant. Let him become a nucleus of disease. Let him be a standing exhibition and example of ugliness and dirt. Let him have rickety children .... Let his habitations turn our cities into poisonous congeries of slums .... Let the undeserving become still less deserving."

Photo by Leroy Skalstad
Photo by Leroy Skalstad

Kinds of Poverty

Economists differ in their definition and classification of poverty. In his book The Affluent Society, John Kenneth Galbraith described three types of poverty in the United States: generalized poverty, island poverty, and case poverty. Other economists, viewing the problem in worldwide terms, have spoken of collective poverty, cyclical poverty, and individual poverty.

Collective poverty exists in nations or regions where economic resources do not meet the needs of the population. India, where millions live on a diet just above starvation level, is a prime example. China, which turned to Communist leaders in vain hope of relief, is another. The peasants of some South American countries have existed on an almost permanent level of privation. Ignorance and exploitation have contributed to their poor condition.

Cyclical poverty is widespread but periodic. In an industrial economy, it is usually caused by lack of purchasing power. A memorable example is the Great Depression of the 1930's, with its mass unemployment. In an agricultural economy, it usually occurs with failure of crops. Pearl Buck in her novel The Good Earth presented a moving account of hordes of starving peasants migrating from a land stricken by famine.

Individual poverty is harder to define. It can be loosely classified as poverty that is not caused by general economic trends.

Every culture has wrestled with the problem of individual poverty. There have always been widows and orphans, the sick and the aged, the dull, the incapable, and the intemperate. In the past, their care usually fell upon the local community, the church, or private charity. Almost forgotten today is the almshouse or poor farm where towns and countries sheltered their paupers. To many of the needy, it represented the last personal defeat.

Central governments began to assume at least some responsibility for the relief of the poor in the late 1800's. This movement began in Germany under the authoritarian Chancellor Otto von Bismarck. Systems of social insurance were formulated. The poor began to be treated more like people and less like convicts. This, however, did not solve the problem of individual poverty in the midst of general prosperity.

In the United States and elsewhere, a strong back and a willingness to work cheap were once ample qualifications for employment. Manual laborers dug the ditches and constructed the transcontinental railroads. They picked cotton and fired the steel furnaces. But now the automation of industry and the mechanization of agriculture have made employment scarcer for the unskilled and the poorly educated.

Problems of Poverty

Between the depression years of the 1930's and the war on poverty of the 1960's, there was relatively little investigation into the causes of poverty in the United States. Because of a lack of information, a number of misconceptions about this complex problem became widespread. Some persons denied the problem on the ground that even those at the bottom of an affluent society were better off than members of most other societies, past or present. Others acknowledged the problem but dismissed it as one that would automatically disappear as national wealth increased. A few called for drastic revisions in the economy to achieve a redistribution of wealth. Still others continued to see poverty as a sign of lack of initiative by the poor.

Photo by Leroy Skalstad
Photo by Leroy Skalstad

Problems of Wealth Distribution

How much real purchasing power does an average family have? In terms of dollars, the median family income in the United States in 1966 was $7,436. But did this amount represent more or less purchasing power than that of families in other major nations?

Although such comparisons are difficult, one study did shed some light on the subject. Economists calculated the cost at retail prices of an adequate meal for a family of four in several countries. Then they translated the cost into the number of hours an industrial employee in each of the countries would have to work to pay for it. In the United States he had to work one hour, in Denmark an hour and a half, in West Germany and Britain two hours, and in Italy five hours. Such comparisons, of course, could not be made in the Orient, the Middle East, and other underdeveloped areas. There a day's work often provided the peasant with only enough sustenance to prevent hunger pains.

Do the rich get a larger share of the total income in the United States than in other countries? Many Europeans believe they do, perhaps remembering sensational stories about the luxurious living of American multimillionaires. But this is not true, according to data collected by Professor Simon Kuznets of Harvard University, an authority on income distribution. Income distribution is about the same in the United States as it is in Denmark, Sweden, and Britain. And it is much more nearly equal in the United States than in most other countries for which such information is available.

Why then is there poverty in the United States? It seems clear that the nation has enormous wealth in terms of real purchasing power, and that its wealth is comparatively evenly divided. But poverty still does exist. It exists because the prosperity that raised the living standards of most of the people has not reached the really poor.

Photo by Leroy Skalstad
Photo by Leroy Skalstad

Who Are The Poor?

Opinions vary about the income necessary to maintain an "adequate standard of living." In 1959, Professor Robert Lampman of the University of Wisconsin put it at $2,500 for an urban family of four. A few years later, this amount was probably no longer adequate. But in 1966, 3.8 million families had incomes below $2,000. More than a half a million children were being reared in families of six or more children each, on family incomes of less than $2,000 a year.

For those poor in 1965, other statistics showed that 37% of the heads of poor families and poor persons living among poor relatives had not completed the eigthth grade. Only 21% were high school graduates. In the general population the corresponding figures were 15% and 50%.

The poor also included many who lived alone or, without family ties, in boarding houses and drab hotels. The Council of Economic Advisers reported that 5 million of these "unrelated individuals" had incomes below $1,500. Of these, 3 million had incomes below $1,000.

In the main, the unrelated individuals were aged or aging people who subsisted on small pensions, small savings, or public relief. In their working years, some had not been eligible for Social Security. Others had always worked for low pay. They received none of the benefits of the increasing strength of labor unions because they worked in nonunionized fields. And many were employed in service industries, where the federal minimum wage law did not apply.

Photo by Leroy Skalstad
Photo by Leroy Skalstad

Problems of the Poor

"Poverty breeds poverty" in the words of the Council of Economic Advisers' report. "A poor individual or family has a high probability of staying poor. Low incomes carry with them high risks of illness; limitations on mobility; and limited access to education, information, and training. Poor parents cannot give their children the opportunities for better health and education needed to improve their lot. Lack of motivation, hope, and incentive is a more subtle but no less powerful barrier than lack of financial means. Thus the cruel legacy of poverty is passed from parents to children."

A sample study of recipients of aid to families with dependent children showed that more than 40% of the parents had been reared in families receiving public assistance. And other statistics showed that 61% of poor families were headed by persons who had completed no more than elementary school. By contrast, less than 7% of poor families were headed by persons with some college education.

The rise in juvenile delinquency has justifiably excited newspaper editorial writers. But few of them associate die rise with the scarcity of jobs available to teenagers. In 1964, national unemployment had been reduced to 5%. But among youngsters between the ages of 16 and 21 who were not in school, the unemployment rate was 15%. Among Negro teen-age boys and girls, the rate was 25%, and this would be even larger if the Census Bureau could locate all of these people.

This was the kind of discouraging evidence uncovered when the national problem of poverty was examined in the middle 1960's.

The United States in the 1960's was the richest and most powerful nation in the world. Thanks to ample natural resources and a highly developed technology, most of its citizens lived lives of comfort and affluence unimaginable a century before. It was also a nation with a record of generosity to other nations. It had lent and given billions of dollars to western Europe and to newly born and have-not countries around the globe.

Yet in the midst of unprecedented American prosperity there existed - although often invisible to visitors from foreign lands - the paradox of poverty. It was estimated that in 1965, 32 million persons, or one sixth the population, existed in conditions of want or near want. Of these, 13 million were children under 16 years of age. Although statisticians disagreed on definitions of poverty, there was ample evidence that 6 million families were attempting to feed, shelter, and educate their youngsters on grossly inadequate incomes.

Older Americans remembered the Great Depression of the 1930's when, in President Franklin D. Roosevelt's words, one third of the nation was "ill-housed, ill-clad, ill-nourished." There was nothing invisible about poverty then. There were long lines outside employment offices. There were apple sellers on Wall Street. It was during this period that the government introduced federal programs for health and welfare, social insurance, and unemployment compensation.

The tremendous industrial effort that began with World War II expanded production to peaks previously unknown. And, despite minor recessions, production continued to expand. By the mid-1960's, for example, there were estimated to be 71 million automobiles in the United States.

But in its 1964 annual report to the President, the Council of Economic Advisers said:

"There will always be some Americans who are better off than others... In the United States today we can see on the horizon a society of abundance, free of much of the misery and degradation that have been the old fate of man. Steadily rising productivity, together with an improving network of private and social insurance and assistance, has been eroding mass poverty in America. But the process is far too slow. It is high time to redouble and to concentrate our efforts to eliminate poverty."

Shortly after the report was issued, President Lyndon B. Johnson called for an "all-out war on poverty." In August, 1964, Congress passed legislation setting up the Office of Economic Opportunity - with the authority of the White House behind it - to direct and coordinate the efforts of many government and private agencies toward this end. On October 8, 1964, Congress provided the money, $800 million, to start the attack.

It was a bold and imaginative program that commanded worldwide attention. Sponsors of the legislation knew that it would not end poverty overnight. But it was a beginning.


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    • JON EWALL profile image

      JON EWALL 

      8 years ago from usa


      ''President Lyndon B. Johnson called for an "all-out war on poverty." In August, 1964, Congress passed legislation setting up the Office of Economic Opportunity - with the authority of the White House''

      TODAY there are close to 50,000 citizens on food stamps. Where is our country headed in the war on poverty. In some cities over 50% of our young people don't graduate from high school. Poverty breathes crime and young folks can end up in prison. What a waste of young people’s lifes.Who will reach out a hand and help them?

    • profile image


      9 years ago

      you are correct


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