Causing Poverty

This political season has made for some great entertainment watching Othello duke it out with Lady Macbeth. As pretty much everyone who knows me is aware of, I'm rooting for Othello¹, but certainly not because I think that he has a clue economically. Very good he is at getting votes and, given his academic credentials, I assume that he's damn good at citing chapter and verse from legal texts. But this is a far cry from understanding how our nation actually works, or how economies work in general. Both of them have been guilty, at some point or other in this campaign of seeking to "identify and root out the causes of poverty in our nation". What a knuckle-brained idea.

At this point, I'd like to advance a small thesis, one that I would hope to be self-evident:

What we call "poverty" has been an aspect of the state of humanity since the dawn of history, remains the state of most of humanity, and has always been the state of most of the natural world. As such, "poverty" on its grand scale is not the result of causation, but is the result of lack of causation.²

I think the big sticking point is the definitions that people casually use for the opposite of poverty, "wealth". If you have as your operative definition of wealth "ill-gotten gains resulting from exploiting the masses of commodity-laborers"³, then you're nearly guaranteed to have a captive constituency of commodity-laborers who, depending on the individual, either cannot or will not elevate themselves from their commodity status. This certainly works for the philosophical socialists and their more numerous brethren, the socialists-of-convenience, among us, but does nothing for arriving at an understanding that can be used for anything. Show me one med-student or overworked lawyer who has actually "raised the jackboot of oppression over the supine body of the proletariat"⁴ -- not the way things work. I've seen more than one instance of someone being a jackass or worse to further him or her self personally, but this's different from claiming that the systemic actions of individuals going about their business "cause poverty". More often than not, the "causes" of poverty cited turn out to be a lack of voluntary charitable donations of time or money on the part of people busy supporting themselves and their own.

All this rhetoric, as well as a whole bunch of other societal ills, goes away in an instant when one actually regards the true meaning of the word wealth: "surplus". Regarding a lack of surplus to be caused, in general, would be as silly as regarding darkness to be caused by someone hoarding light. The great genius of several species⁵, including our own, is to work to create a surplus, then to dispose of that surplus at need. We've gotten so good over the centuries at creating and retaining surpluses that we've not only figured out how to exchange surpluses with other people, we've invented vast systems for disposing of excess surpluses. In fact, for a long period of time centers of power competed with each other for how artfully they could squander surpluses⁶.

The baseline determination of who's wealthy encoded in the sentiment "having more than you need" is wrong not only due to the implication that one becomes wealthy by taking more than one's share, but also because it ignores the fact that not all surpluses are equal. We've all seen examples of people with lifestyles that are way beyond our own means who complain incessantly of how they wish they were better off. These people have fallen into the common trap of exchanging too much of their liquid surplus for illiquid surpluses. Whether it's upgrading the kitchen to the very latest granite counter-tops, buying the Bentley one's always wanted, or simply moving into a higher-end neighborhood⁷. It's one thing to have an item, but it's quite another to be able to consume it, and for all the moral talk against "consumer consumption", the fact of the matter is that we all have a baseline consumption that we must meet, plus an extra level that we entitle our "lifestyle", to which we're sufficiently accustomed that we maintain it as if it were part of the baseline. While we retain property rights over non-consumable items, it's only those items that we can either consume, or which we can exchange for consumables, that really define our surpluses. Surely, if we get in financial trouble, we can sell our thousand-inch plasma-TV on Craigslist, but we can only do so at a significant discount from what we paid for it, and at a price that is difficult to determine ahead of time -- not the stuff monthly budgets are made of.

The "cause", so to speak, of poverty is, simply put, failure to create or retain consumable surplus. If we're avid gardeners and have access to land, we can grow and set aside stores of food for later use. We can also sell our labor for more than our lifestyle costs and pocket the difference. Then of course, one also has to dodge Uncle Sam, who'll come through and grab our surplus for the "public good"⁸; lately Congress & the Fed's theft of our surpluses via currency devaluation has become quite a matter for concern too⁹. But however it goes, what we have to do to stay out of poverty is to amass surpluses.

So all that having been said, what I'd really like to see from politicians who claim to care about the poor is a debate not on the causes of poverty, but on how we can identify and remove obstacles to an individual's ability to generate wealth¹⁰, and what can be done to ameliorate these obstacles without simply stealing, as the great sage Izzard said, "from people who are comfortable and giv[ing] to the moderately impoverished". Rolling up our sleeves and creating wealth was what made this country great, not the current situation where our governments are the largest block-employer¹¹. We don't have to be the world's biggest debtor-nation -- we can get the ship aright again. But we'll never do it while supposing that wealth is the natural norm and poverty the aberration.

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¹ I'm rooting for Obama not because I think he'd made the best president of the three, but as a strategic play. Obama's "towards a more perfect union" rhetoric is working so well because independents and those Dems who don't happen to be shrill zealots are sick to death of the Gramsci-esque "I'm a Righteous Anger Studies major planning a divisive career in Identity Politics". Clinton, OTOH, is a confirmed Gramsci follower. If we can muddle through four years of incompetent socialism to remind the Republicans of what (fiscal) conservatism is all about and get them back on the wagon, while simultaneously removing one of the fangs from the Marxists on the left, I call it a good deal: may the best conservative win in 2012. Now that the macro-economic sins of the past two decades are coming back to haunt us, the disaster that we risk during the '08-'12 time-frame might even help to dissuade the public of the curious left-wing notion that if only a few of us can afford something, then somehow, collectively, we all can. Wishful thinking, perhaps, but the combination of a non-Gramsci-esque political approach plus a discrediting of idiot-socialism seems worth the risk.
² Clearly genocides, murders and crippling diseases all can be regarded as individual causes of instances of poverty. Anyone who argues otherwise is an idiot; but I'm talking about the larger picture here.
³ Under the sanctifying label of "workers", as if 60-hour weeks at a desk fail to constitute "work".
⁴ Not original to me: my socialist friend used the term humorously to describe her time purchasing labor from her employees.
⁵ Ants and squirrels, for example.
⁶ The palace at Versailles, Beethoven's symphonies and the only English gift to cuisine, ice-cream, might be good examples. Dubai is perhaps our finest disposer of surpluses at the moment, but I suspect the Chinese will catch up one day.
⁷ Michelle Obama has famously complained that things are so financially tight for them, in spite of enjoying a high-six-figure income and living in a mansion.
⁸ Which I generally define as enriching politicians at the public's expense, but that could be Lazarus Long's influence.
⁹ This is not a total loss -- since fiat currencies are inherently inflationary, the theft of ordinary people's savings by the legislature is somewhat offset by the fact that the super-rich cannot simply save their money or it will likewise erode. When you have seven figures in your savings account, these kinds of inflationary losses are huge, so this inflationary tendency forces the super-rich to purchase labor via the equity markets (public or private). It's hard to overstate how important these capital flows are to the rest of us, albeit indirectly: if you want to see what a country without (re)investment looks like, North Korea and Somalia are very good examples.
¹⁰ Vouchers to get inner-city students out of the drop-out factories euphemistically referred to as "schools" would be a good start....
¹¹ Our governments, taken as a sector, employ almost a million more people than the next largest sector, wholesale & retail trade: roughtly twenty-three-ish million people.