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The causes of poverty are the subject of fierce debate among social scientists. Beyond obvious causes such as wars, famine, political corruption, and economic collapse, the presence of persistent poverty finds explanation in several theories. Some attribute poverty to macroeconomic structures and policy decisions beyond the influence of individuals. Marxists argue that poverty is endemic to the system of capitalism, because to function it needs a "reserve army of labor" to keep wages low and the working class disciplined. Public welfare programs, in this view, serve as a way to regulate labor by expanding in times of labor turmoil and contracting when it subsides. Poverty elimination, in the Marxist view, can only occur through eliminating capitalism and replacing it with socialism.

World system theorists attribute global unevenness in the incidence of poverty to political and economic decisions made by colonial and neocolonial powers that drained large parts of the world of its resources to benefit the elites and developing middle classes of the colonial powers. Thus, over the centuries the countries of sub-Saharan Africa, Southeast Asia, and Latin America were deliberately robbed of their natural resources and their populations reduced to cheap labor to feed the industrial machines in the metropolitan markets.

In contrast, U.S. neoconservatives argue that poverty is either the fault of some character flaw in the poor themselves (laziness, alcoholism, drug addiction, inability to defer gratification, loose morals, etc.), the fault of a "culture of poverty" that passes on such traits from one generation to another, or the fault of an overly generous social welfare system that acts as a disincentive to work. For conservatives and neoconservatives, inequality is beneficial because it feeds the competitive spirit needed for economic growth. Their remedy for poverty is "tough love"--cutting social welfare programs to force people into the labor market.

Economic liberals, following the British economist John Maynard Keynes, argue that the normal workings of capitalism produce periodic booms and busts that throw large numbers of people out of work. Government can and should mitigate the ups and downs in the business cycle by using its fiscal policies (taxing and spending) and monetary policy (manipulating the money supply) to even out the business cycle and provide a safety net under the most vulnerable. Keynesian remedies, however, failed during the economic crisis of the 1970s, so liberals turned to other explanations for persistent poverty, attributing it to macroeconomic trends like deindustrialization, outsourcing, the failure of government to provide the supportive services needed to "make work pay" for the unemployed, and gender and racial discrimination. Their answer to poverty is to increase support for human capital (e.g., improved education and training) to "make work pay" while outlawing discrimination and providing affirmative action for those left behind.

With the growth of neoliberal globalization from the 1980s on, still other explanations arose to explain persisting poverty. Some point to the spread of epidemic diseases, such as AIDS, affecting large sectors of the productive-age population in the developing world. Critics of neoliberal globalization (not only civil society groups, but also many developing country governments) point to the decisions of policymakers and their corporate allies in the rich countries of the North to write the rules of global trade and investment so as to benefit the rich nations--especially their elites--at the expense of the poorer nations. They cite onerous debt repayment schemes, structural adjustment programs, and rich country subsidization of key agricultural commodities as sources of the problem. What is needed, say these critics, is debt forgiveness, a fairer system of world trade and investment, and compensatory programs for less developed countries funded by the rich countries.

References:

1) Harrington, Michael. [1962] 1997. The Other America: Poverty in the United States. New York: Touchstone.

2) Katz, Michael B. 1996. In the Shadow of the Poorhouse: A Social History of Welfare in America. New York: Basic Books.

3) Murray, Charles. 1984. Losing Ground: American Social Policy, 1950-1980. New York: Basic Books.

4) Sachs, Jeffrey B. 2005. The End of Poverty: Economic Possibilities for Our Time. New York: Penguin.

5) Sen, Amartya. 2000. Social Exclusion: Concept, Application, and Scrutiny. Social Development Papers #1. Office of Environmental and Social Development, Asian Development Bank.

6) Smeeding, Timothy. 2006. Poor People in Rich Nations: The United States in Comparative Perspective. Luxembourg Income Study Working Paper no. 419.

7) U.S. Census Bureau. 2007. "Current Population Reports. Income, Poverty and Health Insurance Coverage in the United States: 2006." P60-233. Washington, DC: U.S. Census Bureau, Housing and Household Economics Statistics Division.

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