Not really Nick

It depends upon how you define poverty.

Although you only have to glance at the FTSE100 to know that child (and adult) poverty will soon explode,

I agree absolutely that poverty will increase, in the sense that more people will have less money. But that isn\’t the way that poverty is defined in our modern world. Now we define it in relative terms. It is as a percentage of the median income of the country.

I don\’t think it\’s all that much of a surprise that it\’s going to be the higher incomes that are hit hardest…..and the welfare state is going to underpin the incomes of the poorest, just as it does now.

It\’s possible that income inequality will shrink in the years to come. And given the way we measure poverty, that could actually mean a fall in poverty rates even while we\’re all earning less.

In fact, I would rather expect poverty rates to fall. For when things were going swimmingly, when higher incomes were indeed racing ahead, poverty as defined was increasing, wasn\’t it? Now the system is going into reverse, can\’t see why poverty rates won\’t decline.

7 thoughts on “Not really Nick”

  1. And I’m sure Gordon Brown will take the credit for “reducing” poverty as he has for oil prices. Hopefully this will discredit the whole inequality concept.

  2. I’m also sure that Polly Toynbee will start pissing and whining about absolute poverty as the key measure. After all, the speed at which she can change her views (while denying she’s changed her views) makes the Planck time look long.

  3. I’m sure that I have read somewhere that during recessions measures of inequality (relative poverty) always go down, but measures of absolute poverty always go up. Polly should therefore be welcoming the coming recession with open arms since they are always arguing that inequality is far more important than absolute poverty. They aren’t going to though.

  4. dearieme and e.m.:

    When “walking the planck” (vs. the plank), the relative difference is insignificant.

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