Nonsense on poverty


The Joseph Rowntree Trust released its report on the state of poverty in the UK and brought forth the usual howls of outrage about, well, pretty much everything really. I was actually rather enjoying the howls of how we now have Dickensian, Victorian, levels of poverty for I always do enjoy hysterical hyperbole. But it set me thinking, do we actually have such levels?

Of course, we simply do not have, absent a very few families blighted by mental illness, drugs or drink, anything like the physical poverty of those days. Absent those entirely non-financial problems all are clothed, housed and fed. Perhaps not as much as some would like, but we simply do not have cholera sticken children starving to death in the gutters. So "real" poverty is no where near such levels. But of course this isn't the detailed claim, although the language used attempts to equate the two. The real claim today is that we have similar levels of inequality: and inequality these days is referred to as relative poverty....although that "relative" gets dropped pretty quickly so as to underline the similarity between the two concepts of poverty.

But thinking through it all a little more we don't in fact have Victorian levels of inequality either. The measure used is market income plus or minus taxes and benefits. But we only use money, we don't in fact include benefits offered in kind.

Think through what the modern state offers to its poorer citizens, over and above any money they get. Council or housing association places are markedly cheaper than the market rents. That difference should be added to the incomes of the poor if we are trying to measure inequality or their incomes. Education is provided free at the point of use yet it costs taxpyers what, £6,000 per child? £7,000? That again should be added to the incomes of the poor (and we can of course add all these sums to everyone's incomes if we wish, but they will raise the incomes of the poor much more than those of the rich thus closing any inequality gap to some extent)....The NHS is around £2,000 for every man woman and child in the country: that would add £8,000 to the income of the mythical Mum, Dad and two kids.

None of these things existed in 1860: so to claim that we have the same levels of inequality with them as we had without them is nonsense: it's simply not counting properly.

So no, we don't have Victorian poverty: and we don't have Victorian levels of inequality either.