The public and scientific treatment of the subject of poverty
It is well known that there is a lot of poverty in the rich countries of the world. Teams of sociologists are entrusted by their governments with the task of counting and classifying the poor, comparing their numbers to previous years and representing these results in bar charts and other graphic formats. These findings are widely reported and become part of the democratic debate. However, this research does not want to explain poverty, but to measure it. And knowledge of the existence of poverty is not an explanation of it.
The government defines poverty as something that exists apart from an existing prosperity – a prosperity that the members of the society can’t simply get hold of and make use of. If they have to earn their share of this wealth, they are obviously excluded from it in principle. Poverty in the market economy is not to be mistaken with scarcity or a lack of productivity. If there is poverty and short supply alongside existing wealth, it is because supplying the members of society is not a purpose of this society.
In addition, poverty researchers define poverty by income. This insane “indicator” doesn’t say anything else about whether and what one can afford, or what one must do in order to obtain an income. By defining poverty in terms of income, poverty measurements omit the differences and conflicts between the different sources of income. In this picture, there are only income recipients who earn more or less – instead of capitalists and wage laborers, or those who have their goals carried out and those who have to organize their lives on the basis of these goals. Instead of measuring poverty in relation to the existing social wealth – in the enormous productivity of factories that almost run themselves – they define poverty based on the earnings of the average wage earner. Wages and wage levels, which are not even guaranteed, are supposedly the purpose of capitalistic production and thereby the crucial yardstick for poverty or wealth. Those who earn more than the median income are counted as wealthy. Anyone who has more than that is not poor – completely apart from what he or she can actually afford. In addition, the authors of the poverty studies do not want those who fall beneath this arbitrarily established threshold to be considered simply as poor. They are not poor, but “at risk of poverty”!
For poverty researchers, the reason for poverty can never be wage labor. The “risk of poverty” only begins when one can’t find wage labor any longer, is unemployed, retires, has a physical handicap, or childcare prevents one from working. Why having children or becoming old should be occasions for poverty for some, when others make do quite well with children or getting old, is completely unclear.
Poverty researchers are concerned with the consequences of class society and intentionally refrain from finding that there are consequences to class society. Poverty researchers believe that a “normal wage” income is the opposite of poverty. The wages paid by capital are one great source of income! They make the normal, inevitable circumstances of a life as a wage laborer responsible for special forms of poverty (the “working poor,” “child poverty,” etc.) in order to deny the reason for their subject – class conflict.
Poverty is a necessary component of capitalism; it does not express a failure of this economy, but on the contrary is evidence of its success. Therefore, a brief explanation:
Poverty doesn’t just begin with misfortune – poverty is the basis of misfortune
Usually when poverty is talked about, everyone immediately thinks of homeless people, beggars and all the other manifestations of poverty that are so well known to the “modern urban landscape” of the 21st century.
These cases of a shortage of money that threaten a person’s whole existence are only part of a much more widespread and continuous struggle to live within a limited purchasing power. Homeless people in front of empty apartment buildings and beggars in front of full stores are nothing but personifications that witness a valid principle of capitalist societies – the principle that needs that can’t be paid for are not met.
If in this society everything that one needs to live – food, housing, means of production – is property, and one can access the objects of need only if one is willing and able to pay the price demanded by the seller, then the conclusion that this society is not concerned with supplying its members with what they need is correct. The gigantic wealth that is produced is not produced in order to satisfy the needs of the members of society, but only for the purpose of using the ability to pay that exists in the society in order to transform manufactured goods into money. For this reason, nothing is produced for needs that are not backed by the ability to pay.
How much can be earned from the available sources of incomes is invariably in inverse relation to the needs for which one works. Every new child, each case of illness, accident or divorce does not lead to an adjustment of income to the new circumstance. How much one earns on a job depends exclusively on the cost/benefit calculation of the entrepreneur who employs the worker.
Needs are not served but used in this society. The needs of individuals are the means to extort services from those who have no other property to call their own except their ability to work for a wealth from which they are excluded. This normal poverty, which already carries within itself the seeds of an endangered existence, is just more striking in a homeless person or a beggar – and then they are seen as victims of the unpredictable vicissitudes of life.
Poverty is not the result of an unjust distribution of wealth
Free market poverty, exclusion from the wealth that property establishes, presents itself in practical experience as a relation between incomes and prices. The entrepreneurs determine both – incomes and prices – according to their calculations.
The existing poverty has nothing at all to do with a bad distribution of wealth, as critics of poverty usually maintain. In a free-market economy, wealth is not distributed badly or unfairly; it is not distributed at all. Only by purchasing can one access real material wealth, the objects of need. And the money necessary for it is also not distributed, but must be earned. How the individual earns money is left up to him, within the framework of laws set by the market and the state.
There is only one market for earning incomes for the price levels; there is no other relationship between the produced wealth and people’s livelihoods. The existing poverty is therefore not the result of a bad distribution, but the economic result of the sources of income being more of a restriction than a source; that is what makes the prices for the existing wealth too expensive for those who need it.
A shortage of money for those dependent on wage labor is not the exception but the rule
A lack of money is the norm and not the exception for that large mass of the population who depends on wage-earning employment. It is not only when one loses one’s job that one is short of money, but one experiences it all the time in this source of income.
What is considered prosperity for a wage laborer – a car, a dishwasher, a microwave or whatever else is used to illustrate this alleged prosperity – is not evidence of luxuries in the employee’s budget, but in truth serves as absolutely necessary means for an economically- and time-limited life as a flexible, available-at-any-time cog of capitalistic business.
The ever-present shortage of money in proletarian households is shown by the wide-spread art of budgeting, although wage laborers pride themselves on this as a high virtue instead of being critical about the permanent necessity of making additional efforts to provide for their private lives after work. They do not consider their constant price comparing and bargain hunting as signs of poverty, but as opportunities to prove their talents and cleverness in dealing with the world. The retail trade also knows about this constant shortage of funds on the part of its customers when it screams about cheap prices in advertisements so that it can steer whatever solvency exists in wage earners’ budgets into their cash registers.
These connoisseurs in the arts of living are so busy organizing their private lives that they do not recognize their poverty. For them, poverty begins only when they lose their job. But this alleged exception just proves that a job is already ill-suited for anything if, even with a job, nothing more is left of their earnings than what they need to cover their current expenses, and they are never able to save enough to provide for those emergency situations which will in all certainty occur, despite all their budgeting efforts.
This shortage of money is the consequence of the fact that wages are not paid to make a livelihood possible on which one can get by, but are paid only to buy the labor performance that makes the employer richer. That’s because a wage is paid only for the ability to work; the purpose of increasing this money advance is better fulfilled the less the wages are; so they can never be too low. Wages always mean a shortage of money for the wage laborer because for the employer wages are always a cost to be reduced. The result is therefore certain, even before one begins working: work makes one poor! Or: the poor become ever poorer, the rich always richer! What else?
Poverty is more than a small income in relation to a higher one – poverty is a relation of production
Anyone who has to work for wages is most certainly not an owner of the production process and its yields. That’s why poverty is not simply a question of more or less income. It’s the other way around: the quantitative differences are the consequence of the qualitative conflict between wage labor and capital.
The basis of this production relation is private property guaranteed by the state. Those who do not call anything their own except their ability to work are separated from all the means needed to perform the work necessary for their own reproduction. Opposite them stand those who, in contrast to their poverty, own the productive power of the society. With private property, the state therefore establishes a relationship of extortion of its own kind; an extortion relationship that makes the propertyless useful to the property from which they are excluded.
The people who must work, and who want to work, can do this only if an entrepreneur might need their work for enlarging his wealth. In the words of Karl Marx: “The worker produces not for himself, but for capital. It is therefore no longer sufficient that he produces at all. He must produce surplus value. The worker is only productive if he produces surplus value for the capitalist or serves for the self-utilization of capital” (Capital Vol. 1). The wage earners can do the work necessary for themselves only if they create surplus value. They must compile more than their own living costs, their wages; they must compile a profit over their wages. If the work is not useful for gaining an entrepreneur a profit, then the necessary work for ensuring people’s livelihoods simply doesn't take place.
Poverty and its growth is the precondition and result of the capitalist economy
The poverty of the propertyless is the necessary precondition of capitalistic production. This destitution puts them in the situation of being extorted, so that they have to increase others’ wealth to be allowed to earn their own livelihood.
Capitalistic production does not eliminate this poverty, but reproduces it on an ever larger scale – their work does not make the workers richer, but only increases the capital from which they are excluded and which commands them.
Poverty is produced by capital and not by a lack of capital
With the success of capital, the size of its profit requirements grows. Employment and job security do not grow along with it. Rather, the contrary is true: with the success of capital, the insecurity of those who have to live on wages grows.
Capitalist firms grow in competition with each other. They mutually contend among themselves for business success. In addition, they lower the price of the goods they produce, undercut the competition, and so ensure that whatever exists in solvent demand becomes their profit and not that of the competition.
In order to lower prices, the entrepreneurs continually increase the productivity of the labor they buy. They constantly organize new machinery that makes work more productive, thus produces in less time the same amount of products or produces more products in the same time as before. They make the work cheaper for themselves by saving on paid work through increasing the productivity of work.
In capitalism, increases in productivity are not in order cut down on toil. Rather, productivity increases serve only to save on paid work for the entrepreneurs. Companies invest, lay people off, and have the reduced number of workers manufacture just as many products, or more, as the bigger staff did before.
Profit making – and not too little of it – is the reason for poverty; and yesterday’s growth – and not too little of it – is the reason for today’s unemployment. Unemployment, as it were, is the perverse reward the system gives workers for always increasing the productivity of their work. The enormous number of superfluous workers, the extent of their poverty, is almost an indicator of the productivity reached by work, the human source of material wealth.
Poverty is not a negligence of the state
Poverty does not exist despite but because of the state’s activities. Only the state’s protection of private property guarantees the crucial basis for capitalistic production, hence poverty – exclusion from the existing wealth. Or to quote The Democratic State:
Private property, the exclusive disposal over the wealth of society which other individuals require for their subsistence and must therefore utilize somehow, is the basis of individual advantage, and naturally also of disadvantage. It is the source of the modern form of poverty, whereby people must sustain themselves as instruments for other people’s property (whose growth is naturally of some concern to the state.)
Even if a welfare state still exists, this does not cancel out the state’s activities. It does not eliminate poverty, but ensures by redistributing poverty that the state and capital are not harmed.