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                                                             International Poverty Rates


    Despite the effusive praise by some praising of the 'equality' and the 'elimination of poverty' in Sweden, the remarkably low poverty rate in Sweden might not accurately described the conditions there. A Syracuse University study explained (90):

For example, the European Union has chosen an official line equal to 60 percent of the mean income for measuring poverty (Eurostat, 2000). However, the approach of using the average to establish a poverty line means that changes in the incomes of the richest persons affect the poverty threshold, which many scholars reject on theoretical grounds (Jäntti and Danziger, 2000: 327). Therefore, many researchers prefer using the median to establish a relative poverty line. For example, the most widely used definition of a relative poverty line establishes the threshold equal to 50 percent of the median income (Rainwater, Smeeding and Burtless, 2002). Regardless, a clear consensus is lacking and relative poverty rates based on various fractions (40, 50 and 60 percent) of either mean or median income are often reported. (90)

    The international poverty figures we hear cited all the time do not measure poverty at all! (245) The only thing they measure is inequality. For example, by calculating the percentage of people below 50% of the median income (median is middle not average [mean]), the Syracuse study found poverty rates of 6.6% for Sweden and 16.9% for the United States. But this says nothing about what the median income is! For example, if the median yearly income is $10,000 in Sweden, but $100,000 in the United States, which country suffers the most poverty? Perhaps this is why that Heritage study showed that our 'poor' citizens are better off than the average citizens in some countries (who probably have lower 'poverty' rates!). [note: the Census Bureau's poverty figures are not measured this way; as Chart 34 shows the Census Bureau's poverty rate is 12.1. It would be interesting to measure poverty rates of other countries using the Census Bureau's methods.]

    From the Heritage foundation (this is shifted down because it is referenced in the previous paragraph):

 The average poor American has more living space than the average individual living in Paris, London, Vienna, Athens and other cities throughout Europe. (Note: These comparisons are to the average citizens in foreign countries not to those classified as poor.) (61)

    The Australian treasury department did a study which looked at world per capita income levels Chart 50 (91):

    Using the commonly used poverty standard, more impoverished people exist in 2000 then 1900. This is a ridiculous notion, and the study warns: 

If the erroneous belief that international inequality is still worsening is not contested, it can damage confidence in open global markets for trade and investment. History has shown open markets to be the best vehicle for accelerated global and regional growth in income and living standards for the poor, and thereby for improvements in Australia’s own security and living standards. (91)

    But even so, inequality is nothing to run away from (99). It is the natural result of human progress. This is why it has been said 'a rising tide raises all boats'. The richest societies are, almost by definition, the most unequal: 

From the dawn of human history to the mid-18th century, the world was a much more equal place than today. Productivity levels across the world were very low and fairly uniform. (91)

    Economist Jane Jacobs once said: 

    "Poverty has no causes. Only prosperity has causes... Poverty can be overcome only if the relevant economic processes are in motion." (92)

    Economist Nathan Rosenberg proclaimed:

"The perception of poverty as morally intolerable in a rich society had to await the emergence of a rich society." (92)

    And Winston Churchill once profoundly stated:

The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries. (93)

    Perhaps this is what we are seeing take place in Sweden...


See, Inequality, Aid, and the Nature of Governments


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