Economic freedom, not government programs, is key to poverty reduction – Orange County Register

0


People have struggled with the best way to deal with poverty since the earliest societies, but the answer is obvious if we just look at history.

From the Renaissance to the Industrial Revolution until modern times, poverty has been more radically and rapidly alleviated whenever people are free to work in an occupation of their choice, to keep the fruits of their labor, to acquire and to retain private property and rely on a legal system to protect their personal and economic freedoms.

Over the past decades, this era of relatively free enterprise and global trade has resulted in an unprecedented reduction in poverty.

This may come as a surprise to many who have heard the narrative, popular in the media and in some academic circles, that not only the rich get richer, the poor get poorer.

Indeed, when a survey conducted by Hans Rosling for Gapminder asked people whether the share of the world’s population living in extreme poverty had a) almost doubled, b) stayed about the same, or c) a nearly halved over the past 20 years, only 5 percent of Americans correctly answered that it had been nearly halved.

According to World Bank estimates, the share of people living in extreme poverty, defined as living on less than $ 1.90 per day, has steadily declined from 36 percent in 1990 to 10 percent in 2015 ( and about 8.6 percent in 2018) – the lowest level in recorded history.

In total, 1.1 billion people have been lifted out of extreme poverty in just a quarter of a century – a formidable achievement!

Moreover, 80 percent of those who remain in extreme poverty are concentrated in sub-Saharan Africa and South Asia, mainly in countries characterized by war, corruption and a lack of economic freedom.

These findings are reinforced by various freedom indices, such as the Fraser Institute’s annual Economic Freedom of the World (or its Human Freedom Index, which includes measures of personal freedom in addition to economic freedom).

Studies like this consistently show an incredibly strong correlation between nations that offer greater economic and personal freedom and desirable characteristics like higher per capita income and economic growth, lower poverty levels, and longer life expectancy. , lower infant mortality rates, greater gender equality and generally higher levels of happiness.

So while many focus on the next government program that they are sure will be the silver bullet to reducing poverty, the best solution is simply to create the conditions that allow people to prosper by eliminating government laws and regulations. which exacerbate poverty by restricting the economic and personal situation. freedoms.

Adam B. Summers is a researcher at the Independent Institute and a former columnist and columnist for the Orange County Register and the Southern California News Group.


Share.

Leave A Reply