This isn’t going to be a popular comment, yet, it has to be said because it is painfully obvious reality escapes some.
Here it goes:
The poor do not elevate the poor out of poverty.
If you want to chip away at poverty you have to create incentives for entrepreneurs, investors, business people and, yes, the rich, to engage in favorable economic activity. One of the simplest ways to do this is through the tax code. As much as I hate using taxation to promote behavior, that’s the best way we know so far.
We have lifted more people out of poverty through these methods than any other way.
Be careful what you wish for, because government has never, in the history of humanity, elevated the poor. Quite to the contrary.
For one, taxes are levied by governments not the free market. China has lifted 800 million out of poverty and wasn't because they all of a sudden decided to collectively pull their bootstraps. The free market is what doesn't alleviate poverty, quite the opposite.
> China has lifted 800 million out of poverty and wasn't because they all of a sudden decided to collectively pull their bootstraps.
The disconnect in what you are implying here is astounding.
China elevated massive numbers of people out of poverty precisely because they turned violently capitalistic and entrepreneurial when it comes to business, far more so than likely any other society on the planet. The main decision their government made was to get the heck out of the way.
I can understand that people who might not do business directly with Chinese companies likely lack an understanding of what things look like. Well, I do, have been for decades. I am sad to say doing business with Chinese companies can be massively easier than with US companies. The entrepreneurial spirit and drive in China is incredibly strong and refreshing to watch. You actually want to do business with them because they want to get things done.
If you think government has the power to raise 800 million people out of poverty in complete isolation of a massive step change in business activity you don't have even the most fundamental understanding of economics.
This is one of the most perplexing things I continue to experience on HN. This is a Y-combinator related forum. You'd think people voicing opinions here would have a modicum of business and economics chops. You'd think that, at the very least, they would devote a bit of time to doing simple math before forming opinions. And yet, what you see here time and time again are comments such as yours, which reveal a deep disconnect between even the most basic understanding of how the world operates and the importance of business.
FDR’s New Deal certainly helped a lot of poor people in the USA, as did the roll out of the welfare state and NHS in the UK, and pensions in Germany.
That said, government intervention is not sufficient. It must come with structural improvements, and not just be free handouts. And too much help can also be counter-productive by crowding out the very thing it’s trying to nurture.
> FDR’s New Deal certainly helped a lot of poor people in the USA
Not quite. As is usually the case with such programs, people tend to form opinions based on what is easily and externally visible. Reality isn't every that simple. The truth of the matter is that the not-easily-visible aspects of this plan harmed the poor and middle class for decades. Yes, lots of people were busy, but, no, it didn't elevate millions out of poverty and into the middle class.
This article touches the surface of some of the issues:
Reality is not described by a single variable, it is a complex multivariate problem. A program that promises more jobs is never without consequences. The details are always in the unseen variables that don't make it into political speeches or headlines. Nobody talks about them, and yet, that's where reality lies.
If you give a starving person food so that they might live, and then the number of people who depend on free food goes up, did you do a good thing? That's an ethical question with no "right" answer.
I suspect most libertarians and those who lean to the right would say "no, you saved one person but weakened the system as a whole, and thus you have created more hungry people". Whereas socialists and those who lean to the left would say "yes, because saving a human life when you can is always a good thing".
As I see it, the biggest problem in modern society is that we've stopped respecting the right for everybody to have their own view on issues like that, and instead come to believe that "the other" is so wrong that they must be corrected at all costs. I believe the Cato Institute is just as guilty of that as AOC's horde of Twitter followers.
> The poor do not elevate the poor out of poverty.
What a bizarre, paternalistic take. This is the same sort of narcissistic logic that led to Reagan's golden showers^W^W trickle-down economics.
I mean, I agree about entrepeneurs. Historically, the thing that has lifted communities out of poverty has been entrepeneurs in that community that contribute back to it. In other words, the poor very much elevate the poor out of poverty.
The rest of your comment (e.g. "and, yes, the rich") is just weird apologetics for people that don't need it, and can pay for it anyways, so why are you wasting your time doing it for free?
Really? I can understand if the truth might be offensive to you...yet that doesn't mean it isn't true or that the statement is mean-spirited or paternalistic.
Try to start a company without money and see how well it goes. I mean, you are reading this an a forum run by Y Combinator. Easy questions: In the history of humanity, how many sizeable companies were financed and launched by the poor? I think the number is pretty close to zero. In the context of the history of business, less than a rounding error.
> Historically, the thing that has lifted communities out of poverty has been entrepeneurs in that community that contribute back to it.
This is a fantasy. The best you are going to get in this scenario are a smattering of small businesses that will produce low and mid skill jobs and low wages. While it does happen, the percentage of these businesses that make it big is but a rounding error. There are examples, like the pizza joint of fast food restaurant that went national. Think places like Dominos and McDonalds. Rare, very rare, and we might even argue about who they actually elevated and where. Most local businesses remain small mom-and-pop entities incapable of elevating communities, as you put it, out of poverty. There are entire towns we can use as examples of how what you say simply does not work.
> In other words, the poor very much elevate the poor out of poverty.
No. Save very rare corner cases, the only way you elevate large numbers of people out of poverty is through massive external investments. This means people or companies with money come into a town and make very large investments that results in large numbers of jobs as well as opportunities to ascend through the ranks.
Please post a link to a business school study that explains how a 100% poor community without external investment elevated itself into the middle class. Since you say that this is "historically" the case, there ought to be thousands of such studies for you to pull from, hundreds, certainly. All I want is one.
They really don't. You're misusing the word "lobby".
Churches and charities don't lobby politically for poor people, they take them on as a righteous burden to bear. Some churches and charities are even used as tax breaks for rich people.
Unions used to, to some degree. They've mostly been neutered and have very limited political capital.
That’s a “no true Scotsman” argument if ever I’ve heard one. You can’t say nobody helps the poor, then disparage the significant amount of help people do give.
I belong to a church, and the minister frequently represents vulnerable people in the local community to politicians. He’s also sponsored by the church to attend events campaigning on behalf of low-paid people in the UK. And we contribute to a fund which publishes articles and runs events to raise awareness about homelessness.
If that doesn’t count as lobbying for people then I don’t know what does. I do wish it were more effective.
It's not a "no true Scotsman" argument because "help" is a vague term to begin with.
Lots of churches say nice things while extracting maximum revenue from their congregation. Can you point to any actual political changes that have occurred as a result, or is it just some nice words?
I get the feeling I could write a long list with everything religious groups have done to help the poor - from the abolition of slavery, to Sikh Gurudwaras providing food, to groups like “Christians Against Poverty” campaigning against excessive interest on payday loans - but somehow none of that would count.
