THE FLAT EARTH HYPOTHESIS Poverty, capitalism and you
Remembering capitalism
Capitalism is the system in which ‘capital’ is invested to produce profits and increase the accumulation of capital
Global capitalism has produced unprecedented wealth
Yet the influence of global corporations and the profit motive has produced a number of difficulties
To what extent… ….has globalisation, or global capitalism, been beneficial for the global poor? ….do we live in an increasingly ‘flat’ earth?
And, what does this have to do with us?
Today 1.
2.
3.
4.
Understanding global poverty The capitalist dream: Progress up the development ladder The Marxist nightmare: Exploitation and vulnerability Sub-Saharan Africa: Poverty outside of capitalism
What would it mean to be in poverty?
Absolute Poverty 
Absolute, or extreme, poverty is an income measure that calculates the minimum income required to meet basic needs (e.g. not die)

The difficulty comes in measuring income and deciding what are basic needs (and how much they cost) in each location
Measuring absolute poverty
World Bank measurements of absolute poverty are based on ‘Purchasing Power Parity’ (PPP)
PPP measures the amount of money needed to purchase the same ‘basket’ of goods in each country, expressed in US dollars
In principle one PPP dollar is the same in each country
The World Bank defines extreme poverty as living on less than $1.90 a day (£1.40)
What would be the minimum basic needs be in London?
How would you live?
If your income was reduced to £1.40 per day, or £9.80 per week, how would you live? Would
you have shelter?
Where
would you get your food and water?
If
you had no land, or no opportunity to find formal employment, how would you try to find income?
Is anyone in London living in poverty?
Poverty: World Bank World Bank: Poverty is pronounced deprivation in well-being, and comprises many dimensions. It includes low incomes and the inability to acquire the basic goods and services necessary for survival with dignity. Poverty also encompasses low levels of health and education, poor access to clean water and sanitation, inadequate physical security, lack of voice, and insufficient capacity and opportunity to better one’s life
Poverty: United Nations United Nations: Fundamentally, poverty is a denial of choices and opportunities, a violation of human dignity. It means lack of basic capacity to participate effectively in society. It means not having enough to feed and clothe a family, not having a school or clinic to go to, not having the land on which to grow one’s food or a job to earn one’s living, not having access to credit. It means insecurity, powerlessness and exclusion of individuals, households and communities. It means susceptibility to violence, and it often implies living in marginal or fragile environments, without access to clean water or sanitation.
Poverty before modernity
For large periods of human history poverty was seen as both natural and inevitable Inevitable
because there were not enough resources for everyone
Natural
because those who experienced poverty were born into that condition and had no means to rise above it
With the ideals of modernity and the economic progress of the industrial revolution came the possibility that poverty could, and should, be overcome
Millennium Development Goals (MDGs)
The MDGs were set by the United Nations in 2000 to be achieved by 2015, with a baseline of 1990
Along with the ‘Make Poverty History’ campaign, the MDGs symbolised a new participative, interactive and individual approach to poverty
One of the eight goals was to ‘eradicate extreme poverty and hunger’, which has three measures: 1. 2.
3.
Halve, between 1990 and 2015, the proportion of people whose income is less than $1 a day Achieve full and productive employment and decent work for all, including women and young people Halve, between 1990 and 2015, the proportion of people who suffer from hunger
Progress!
The Live8/Make Poverty History campaigns did make significant contributions to reducing global poverty, although some promises were not kept
Huge amounts of 3rd world debt was cancelled, allowing for much higher public spending in these countries
In the ten African countries that have had debts cancelled, there have been increases of around 40% on education spending and 70% in healthcare
Aid increased significantly: Africa received around US$11 billion more aid in 2010 than in 2004
Poverty and you Whilst considerable progress has been made, substantial poverty remains. What is behind these trends? Progress had been achieved through the global expansion of capitalism
A.
1.
Progress has masked the continued exploitation by the West of the rest
B.
1.

Your consumption produces demand which creates jobs that reduce poverty
Your consumption exploits vulnerable people and maintains their misery Both these perspectives acknowledge the benefits of scientific advances in public health and agriculture, along with the value of aid and charitable contributions
The flattening earth
Capitalism is naturally expansive: in order to find places to invest money, the owners of capital are always searching for new markets, new consumers and new resources
Going in search of these markets, capitalism has expanded across the world through multi-national companies and global economic reform
These factors have brought a huge supply of labour into the global market, leading to a ‘convergence effect’ and the idea of a global development ladder
The Development Ladder
The idea of a development ladder was popularised by Jeffery Sachs (one of the authors of the MDGs)
It suggests that climbing out of poverty is possible, but is incrementally achieved by making the economy more open to markets and other economies
Here ‘intensive manufacturing’ is just one step up the economic ladder
Globalising employment
What are the origins of the possessions you have on you today?
The capitalist dream
A nation increases its investment in education, law and order and infrastructure (often through aid and restructuring loans from global economic institutions)
It is able to attract Western companies to build factories based upon the abundance of cheap labour – the country’s natural advantage
The newly employed now have money to spend in other businesses, which also attract outside investment
As the economy expands, more tax is able to be spent on services, particularly on education
The cost of labour rises and manufacturing jobs go to other countries
The Marxist nightmare 
Economic restructuring of agriculture propels large populations to migrate into urban slums

There are a number of small garment factories in their slum but, with so many people wanting jobs, the owners pay only what they have to keep their workers alive

Unable to get a job at the factories, the majority of people enter an informal economy of begging, temporary stalls and prostitution
If you had a fashion company, would you employ workers from Bangladesh or the UK?
Is your phone good for the world, or just for you?
Below the Sahara Desert
Sub-Saharan Poverty
The climate in parts of this region is particularly harsh, making it difficult to grow crops without technological intervention
Many areas lack access to ports for trade and fresh water for irrigation and health
Much of the area exists in a ‘poverty trap’ whereby public heath issues, a historical lack of infrastructure and education prevent them from climbing onto the ‘development ladder’
People spend too much of their money on survival rather than ‘investment’
Foreign investment is often low and the educated elite often migrate
Approximately 40% of African born scientists live in the OECD
That investment that does exist is often highly exploitative
What has this got to do with you?
With the advent of globalisation and the idea of an interconnectedness world, there was an increased focus on global poverty
We experience this interconnectedness through the media as well as through economic associations
This comes to imply that we are responsible for that poverty, often through charitable discourse
These discourses appeal to us as consumers who have the capacity to respond
Congratulations !
You have just won £1million… … but it all has to be given to charity Where will it go?
Charitable difficulties
Charity implies a choice rather than a moral obligation
It also takes away responsibility from Western citizens/nations – there is no sense that the winners of capitalism might be responsible
Charitable giving, and aid, can be a short term band-aid rather than being a long-term solution
Do the rich (you?) have a moral responsibility to help the (distant) poor?
Next Week WEEK 8 IT’S GETTING HOT IN HERE: CLIMATE CHANGE AND THE LIMITS TO EXPANSION
READING:
Urry, J. (2010) Sociology and Climate Change. Sociological Review. 57 (s2), pp.84-100 Sachs, J. (2008) The Anthropocene in Commonwealth Wealth. Penguin: London, pp.57-82