Poverty is becoming a political problem
The growing inequality between rich and poor in Western societies became a key issue for the first time at the latest Davos meeting. The reason is obvious: Social unrest caused by unjust income distribution in the Western world stands to become a serious political problem, which could be very difficult to tackle. The core of the difficulty is the impossibility of finding a way to help the poor in a reasonable amount of time.
In the old days, the unfair distribution of income was viewed as an almost mechanical problem which could stop economic growth whenever a shift occurred against the interests of either the investors or the working class. The logic was simple: A sharp decline in profits or a serious drop-off in total demand with accompanying profit loss would discourage new investments and halt economic activity.
During the last century, governments, especially in Western countries, began to approach unfair income distribution as a social problem. Naturally it was accepted that poverty could also create some political problems, but these were not seen to be as serious as the social problems. Governments with different ideologies implemented different policies to fight poverty, but even in some rich countries the percentage of total population composed of poor families did not change considerably. The situation in poor and emerging countries is obviously even worse.
A short time ago, the Turkish Statistical Institute (TurkStat) revealed the results of its recent survey on income distribution. According to this survey, income distribution in Turkey has improved slightly in recent years. However, 18 percent of the population is still living below the poverty line. This means that nearly 13 million people can be defined as poor. This can partly be explained by the recent worldwide crisis, but there are also more deeply rooted reasons for this situation.
When we examine figures on poverty in other countries, even in rich ones, we can see that poverty is a common problem. This is no consolation of course, but it is surprising to learn that the percentage of Americans living below the poverty line is almost the same as that in Turkey. The situation is supposed to be better in some parts of Europe, especially in the Scandinavian countries, Germany, the Netherlands, and France, despite the European economic crisis, but in fact even in those countries a large number of families (between 10 and 15 percent) are living below the poverty line.
Poverty is a serious economic and social problem which also has some important political repercussions. In the United States, these began first as street protests, but escalated to attacks on private property, especially in wealthy areas of major cities.
The austerity measures currently being taken in some European countries will probably result in similar upheaval. Many countries, even the richest ones, which did not or could not deal with poverty properly in prosperous economic times, are of course even more helpless to do so in the midst of a worldwide crisis. As a result, they may face unexpected political problems.
There is no shortcut to solving the problem of poverty. Past experiences in some Western countries have shown that some simple macroeconomic remedies, such as increasing wages or imposing higher taxes on the rich proved not to be effective tools for balancing income distribution. But this must not prevent governments from seeking proper ways to fight poverty.
This is necessary not only from a humanitarian perspective, but also to maintain worldwide social harmony and prevent political turmoil which could harm the democratic structure of Western countries. For poor and hopeless people, any kind of irrational promise might seem rational. There is wisdom in remembering that history generally repeats itself. It is no surprise that the extreme right is gaining ground even in the most democratic countries.
