Poverty and Inequality

Introduction
Poverty and inequality are a form of instability into the future. -Tavis Smiley.
Poverty and Inequality, exist around us. It is hard for one to determine whether
poverty causes inequality or is it the other way around because both these problems are
interrelated.
They both exist in every developed culture and often patched in order for
society to continue move upwardly.
Poverty and inequality have been recurrent challenges in the Philippines and
have again come to the fore in the wake of the current global financial crisis and
rising food, fuel, and commodity prices.
In many cases, people who have unequal opportunities in life often live in
poverty, and people who live in poverty may be treated unequally. Although a person
who experiences poverty may suffer from inequality, every person who faces
inequality is not impoverished. Inequality directly affects the amount and severity of
poverty within a nation. Countries that have greater inequality often have many
citizens living in poverty.
Among the major East Asian economics, the Philippines has had slowest rate
of poverty production during the last three decades and at the turn of present century,
had highest incidence of absolute poverty. Yet only three decades ago, by Asian
standards, the country had comparatively low levels of absolute poverty.
The growth of the economy has been characterized by boom and bust cycles
and current episodes of moderate economic expansion have had limited impact on
poverty reduction. Other reasons for the relatively moderate poverty decline include
the high rate of inequality across income brackets, regions, and sectors; and
unmanaged population growth.
Economic growth is a crucial factor in poverty reduction; however, other
factors such as inequality affect its impact on poverty. Consistent failure to reduce
poverty and inequality may also result in a lower economic growth trajectory (Lustig
et al. 2001).
Discussion
Poverty is the state of not having enough material possessions or income for a
person's basic needs. Poverty may include social, economic, and political elements.
Absolute poverty is the complete lack of the means necessary to meet basic personal
needs, such as food, clothing, and shelter. Poverty is often extended for generations
because children often experience the same blocks that their ancestors faced.
The floor at which absolute poverty is defined is always about the same,
independent of the person's permanent location or era. On the other hand, relative
poverty occurs when a person cannot meet a minimum level of living standards,
compared to others in the same time and place. Therefore, the floor at which relative
poverty is defined varies from one country to another, or from one society to another.
The main causes of poverty in the country are the following:
 low to moderate economic growth for the past 40 years
 low growth elasticity of poverty reduction
 weakness in employment generation and the quality of jobs
generated
 failure to fully develop the agriculture sector
 high inflation during crisis periods
 high levels of population growth
 high and persistent levels of inequality (incomes and assets), which
dampen the positive impacts of economic expansion
 recurrent shocks and exposure to risks such as economic crisis,
conflicts, natural disasters, and “environmental poverty.”
With all of these, the high population growth rate is particularly significant,
the population growth over the two decades has been such that even though the
official population incidence fell, the actual number of poor people increased by more
than 4 million from 1985-2000. Also the main reason why poverty reduction in the
country has been slow compared with other Asian countries is the failure of the
economy to grow rapidly and generate quality employment in sectors with large
numbers of the poor. This has constrained the poor in terms of opportunities to escape
deprivation and increased the probability of the non-poor to become poor.
Inequality, on the other hand, is a relative term and compares the financial
stability of a part of the society versus the financial situation of another part of the
society where one party is better off than the other. Inequality can be crippling to a
person who wants a better life for themselves and their families. Minorities
throughout the world are often victims of inequality, and inequality is an obstacle that
prevents them from securing wholesome opportunities. Unequal treatment can make it
difficult for a person to establish a meaningful career, find a job or buy properties.
We cannot also deny that Global Inequality exist, this refers to the unequal
distribution of resources among individuals and groups based on their position in the
social hierarchy (a series of ordered groupings of people or things within a system.
The following are some of the causes of Global Inequality: 
 Religion 
 Gender Inequality ( Gender inequality around the world)
 Inequality in the workplace 
 Inequality in wealth and income 
 Unemployment 
 Social inequalities 
 Education 
 Poverty
Inequality is where one part of the population has more financial resources,
more access to material goods, and better financial ability to acquire goods and
services to meet their needs in comparison to others. The other part of the population
may have comparatively lower financial resources and thereby lesser ability to meet
their needs and requirements. While those of the population having ample financial
and other resources are referred to as the rich, others that barely have enough funds to
meet their basic needs are known as poor, with many other classes of poverty in
between. It is what we call inequality in the economy.
One of the major difference between the two is that poverty maybe measured
in terms of vulnerability where a person suffers from poverty not because they are
unable to meet their obligations, but because they are barely making ends meet. For
example, a person who makes $300 a week has expenses for $298 is said to be living
in poverty because any additional expense could make them vulnerable. However,
inequality does not take vulnerability into consideration and only compares the
financial standing of different classes of society.
 The table below shows the differences of poverty and inequality.
Poverty Inequality
 Poverty is a pronounced  Inequality refers to disparities and
deprivation in well-being. discrepancies in areas such as
 Income or consumption poverty income, wealth, education, health,
refers to lack of monetary nutrition, space, politics and social
resources to meet needs. identity.
 Absolute poverty is poverty below  Intersecting inequalities occur
a set line of what is required to when people face inequality in
access minimum needs for multiple aspects of their lives.
survival.  Vertical inequalities occur
 Relative poverty is set in relation between individuals.
to others.  Horizontal inequalities occur
 Shelter poverty, food poverty, between groups.
asset poverty, time-poverty or  Inequality of outcomes refers to
health poverty refer to lack of that differences in what people achieve
specific good. in life (e.g. level of income).
 Multidimensional poverty  Inequality of opportunities refers
recognises the many different ways to differences in people’s
in which people can be deprived. background or circumstances that
 The transiently poor move in and condition what they are able to
out of poverty. achieve.
 The chronically poor are poor for  Global inequality refers to
years at a time or even their whole difference in income between all
lives. individuals in the world rather than
 Vulnerability to poverty is the inequalities between countries.
probability or risk of being in
poverty or falling into poverty in
the future.

Conclusion
As a student, and a future entrepreneur, I know that we can still take an action
for this matter. But we cannot deny the fact that even though there are a lot of people
trying to stop poverty, it is impossible to stop it without the support of rich countries,
this is because to fight poverty we have to fight it with the help of funds and we
cannot deny the fact that only a few countries could support us with this need. There
is also an urgent need to enhance government’s strategy and to involve key sectors of
society for a collective and coordinated response to persistent poverty,
There are following key points and strategies that might help to bring down
poverty.

 Encouraging people who have volunteered to provide facilities such as pure

water, foods filled with nutrients, living places to poor people and who’re
conducting charity services to develop the lives of them, by offering special
rewards and admiring them in various ways would be a good way to increase the
number of voluntary workers. .
 Revisiting the poverty framework to include a strategy to address vulnerability.
This should be formulated in a national social protection strategy which in turn,
would be a major component of the fight against poverty. The framework and
strategy should also tackle chronic poverty (and pathways out of a poverty trap)
and give serious attention to population management.
 Interventions and programs to fight poverty should incorporate both growth and
distribution factors to maximize impact.
 Allocating more funds from the budget and raising money from other sources
(civil society, religious, business, bilateral and multilateral agencies) for the fight
against poverty, vulnerability, and inequality; examining feasibility of setting up
a national poverty fund.
 Enhance population management as an important component of poverty reduction
strategy
 Local government resources and capacity for fighting poverty should be
enhanced, including improvements in national agency–local government
coordination.
 Increasing the number of organizations which are working to reduce poverty by
educating people of developed countries to be organized and to take actions
related to this matter is also another suggestion of mine.

Then again inequality has been further widened by three things. Technological
change favors high-skilled over low-skilled labour. Economic policies have lowered
tax contributions from the highest earners. And unionization has slumped (it is harder
to organize when service providers are diverse, geographically dispersed and each
individual unit involves few people)
In my view, even in a capitalist world, four benign forces could decrease
inequality.

 Reduction in how much corporations charge for their products over and above
what's needed to cover their costs. This happens as competitors catch up — as for
personal computers, for instance.
 Technological change that undermines the coveted positions enjoyed by the
highly skilled, guild-like workers in rich countries, such as doctors, lawyers and
teachers. For example, with advances in communication now often allowing
medical diagnoses to be made more cheaply in India, say, than in rich countries,
patients are travelling for treatment and reducing the demand for physicians'
services in rich countries.
 More equal access to good education, as well as the equalization of the quality of
state and private education. The last is political change that results in some of the
highest incomes being limited, minimum wages and tax on capital being
increased, and tax incentives being provided to make current plutocratic
capitalism more a 'people's capitalism'. (This proposal was floated by economists
and politicians in the early 1980s when the current neo-liberal wave began, but
was then quietly forgotten.)
 Governments can take steps to implement the last two: education and tax reforms
(including minimum-wage legislation). Governments could also crack down on
tax havens and use the proceeds to fund socially useful programmes. It is
estimated that up to 1% of global gross domestic product is hidden in off-shore
accounts8. Better collaboration between national authorities or the establishment
of a truly international income- and wealth-information gathering system could
help to curb such off-shoring. At the very least, members of the Organisation for
Economic Co-operation and Development should work together on this.

They have no control over capital, and it is the ability to control capital that
gives people the power to rise out of poverty. - Muhammad Yunus
References

Poverty in the Philippines: Income, Assets, and Access - Karin Schelzig - Google
Mga aklat

Income inequality is cyclical : Nature News & Comment

SELF-RATED POVERTY IN THE PHILIPPINES, 1981–1992 | International Journal

of Public Opinion Research | Oxford Academic (oup.com)
Difference Between Poverty and Inequality | Compare the Difference Between
Similar Terms
Defining poverty, extreme poverty and inequality - GSDRC

Poverty And Inequality Essay - 1971 Words | Internet Public Library (ipl.org)

What Is the Relationship Between Poverty and Inequality? (reference.com)

Poverty-Philippines-Causes-Constraints-Opportunities.pdf (adb.org)
Inequality in Life - 2313 Words | 123 Help Me

https://www.bing.com/search?
q=what+is+the+rate+of+unemployment+today5690edf178e84423a5ccd3ee829a0d1d
&cvid=&FORM=ANAB01&PC=U531

Poverty-Philippines-Causes-Constraints-Opportunities.pdf (adb.org)