Causes of Poverty

• Half the world — nearly three billion people — live on less than two dollars a day.
• The GDP (Gross Domestic Product) of the 41 Heavily Indebted Poor Countries (567 million people) is less than the wealth of the world’s 7 richest people combined.
• Nearly a billion people entered the 21st century unable to read a book or sign their names.
• Less than one per cent of what the world spent every year on weapons was needed to put every child into school by the year 2000 and yet it didn’t happen.
• 1 billion children live in poverty (1 in 2 children in the world). 640 million live without adequate shelter, 400 million have no access to safe water, 270 million have no access to health services. 10.6 million died in 2003 before they reached the age of 5 (or roughly 29,000 children per day).

More Facts (and Sources) »

Poverty is the state for the majority of the world’s people and nations. Why is this? Is it enough to blame poor people for their own predicament? Have they been lazy, made poor decisions, and been solely responsible for their plight? What about their governments? Have they pursued policies that actually harm successful development? Such causes of poverty and inequality are no doubt real. But deeper and more global causes of poverty are often less discussed.

Behind the increasing interconnectedness promised by globalization are global decisions, policies, and practices. These are typically influenced, driven, or formulated by the rich and powerful. These can be leaders of rich countries or other global actors such as multinational corporations, institutions, and influential people.

In the face of such enormous external influence, the governments of poor nations and their people are often powerless. As a result, in the global context, a few get wealthy while the majority struggle.

These next few articles and sections explore various poverty issues in more depth:

Structural Adjustment—a Major Cause of Poverty

Cutbacks in health, education and other vital social services around the world have resulted from structural adjustment policies prescribed by the International Monetary Fund (IMF) and the World Bank as conditions for loans and repayment. In addition, developing nation governments are required to open their economies to compete with each other and with more powerful and established industrialized nations. To attract investment, poor countries enter a spiraling race to the bottom to see who can provide lower standards, reduced wages and cheaper resources. This has increased poverty and inequality for most people. It also forms a backbone to what we today call globalization. As a result, it maintains the historic unequal rules of trade. Last updated Monday, July 02, 2007.

Read article: Structural Adjustment—a Major Cause of Poverty

Poverty Around The World

Inequality is increasing around the world while the world appears to globalize. Even the wealthiest nation has the largest gap between rich and poor compared to other developed nations. In many cases, international politics and various interests have led to a diversion of available resources from domestic needs to western markets. Historically, politics and power play by the elite leaders and rulers have increased poverty and dependency. These have often manifested themselves in wars, hot and cold, which have often been trade- and resource-related. Mercantilist practices, while presented as free trade, still happen today. Poverty is therefore not just an economic issue, it is also an issue of political economics. Last updated Thursday, February 15, 2007.

Read article: Poverty Around The World

Today, over 26,500 children died around the world

Around the world, 27–30,000 children die every day. That is equivalent to 1 child dying every 3 seconds, 20 children dying every minute, a 2004 Asian Tsunami occurring almost every week, or 10–11 million children dying every year. Over 50 million children died between 2000 and 2005. The silent killers are poverty, easily preventable diseases and illnesses, and other related causes. In spite of the scale of this daily/ongoing catastrophe, it rarely manages to achieve, much less sustain, prime-time, headline coverage. Last updated Thursday, January 31, 2008.

Read article: Today, over 26,500 children died around the world

Economic Democracy

This next page is a reposting of a flyer about a new book from J.W. Smith and the Institute for Economic Democracy, whom I thank for their kind permission. The book is called Economic Democracy: The Political Struggle Of The 21st Century. Typically on this site, I do not advertise books etc, (although I will cite from and link to some, where relevant). However, in this case, I found that the text in the flyer provides an excellent summary of poverty’s historic roots, as well as of the multitude of issues that cause poverty. (Please also note that I do not make any proceeds from the sale of this book in any way.) Posted Sunday, November 26, 2000.

Read article: Economic Democracy

World Hunger and Poverty

People are hungry not because of lack of availability of food, or “over” population, but because they are too poor to afford the food. Politics and economic conditions have led to poverty and dependency around the world. Addressing world hunger therefore implies addressing world poverty as well. If food production is further increased and provided to more people while the underlying causes of poverty are not addressed, hunger will still continue because people will not be able to purchase food. Last updated Thursday, February 15, 2007.

Read article: World Hunger and Poverty

Food Dumping [Aid] Maintains Poverty

Even non-emergency food aid, which seems a noble cause, is destructive, as it under-sells local farmers and can ultimately affect the entire economy of a poor nation. If the poorer nations are not given the sufficient means to produce their own food and other items then poverty and dependency may continue. In this section you will also find a chapter from the book World Hunger: 12 Myths, by Lappé et al., which describes the situation in detail and looks at the myth that food aid helps the hungry. A must read! Last updated Monday, December 10, 2007.

Read article: Food Dumping [Aid] Maintains Poverty

Corruption

We often hear leaders from rich countries telling poor countries that aid and loans will only be given when they show they are stamping out corruption. While that definitely needs to happen, the rich countries themselves are often active in the largest forms of corruption in those poor countries, and many economic policies they prescribe have exacerbated the problem. Corruption in developing countries definitely must be high on the priority lists, but so too must it be on the priority lists of rich countries. Last updated Sunday, September 23, 2007.

Read article: Corruption

United Nations World Summit 2005

The UN World Summit for September 2005 is supposed to review progress since the Millennium Declaration, adopted by all Member States in 2000. However, the US has proposed enormous changes to an outcome document that is to be signed by all members. There are changes on almost all accounts, including striking any mention of the Millennium Development Goals, that aim for example, to halve poverty and world hunger by 2015. This has led to concerns that the outcome document will be weakened. Developing countries are also worried about stronger text on human rights and about giving the UN Security Council more powers. Last updated Sunday, September 18, 2005.

Read article: United Nations World Summit 2005

IMF & World Bank Protests, Washington D.C.

To complement the public protests in Seattle, the week leading up to April 16th/17th 2000 saw the other two global institutions, the International Monetary Fund (IMF) and World Bank, as the focus of renewed protests and criticisms in Washington, D.C. The purpose of the mass demonstrations was to protest against the current form of globalization, which is seen as unaccountable, corporate-led, and non-democratic, and to show the link between poverty and the various policies of the IMF and the World Bank. Last updated Friday, July 13, 2001.

Read article: IMF & World Bank Protests, Washington D.C.

Poverty Facts and Stats

While the world is globalizing and the mainstream media in many developed nations point out that economies are booming (or, in periods of downturns, that the current forms of “development” and economic policies are the only ways for people to prosper), there is an increasing number of poor people who are missing out on this apparent boom, while increasingly fewer people are becoming far wealthier. Some of these facts and figures are an eye-opener, to say the least. Last updated Tuesday, March 04, 2008.