In yesterday’s Poverty Reduction Committee meeting, the sub-committees presented their policy recommendations for reducing poverty in North Carolina.
The sub-committees were smaller groups assembled from the larger committee members and tasked with focusing in on more specific aspects of poverty, which included: persistent poverty, tax issues, jobs, and state programs.
Unsurprisingly, the recommendations centered on expanding government programs. Twenty-three of the recommendations involved “preserving” or expanding government programs. Not once did the question “where does this money come from?” arise. Other recommendations included several studies, along with actions such as amending annexation laws to lower the threshold for annexation for lower-income neighborhoods and altering the public school curriculum to expand “parenthood training.” One pleasant surprise, however, was the recommendation to lift the cap on charter schools to “increase access to quality education for children in poverty.”
Overall, however, the Poverty Reduction Committee’s recommendations sadly represent government’s completely backwards approach to “poverty reduction.”
There is in fact no cause of poverty. Indeed, poverty was the natural state of mankind for most of human history. As authors Nathan Rosenberg and L.E. Birdzell Jr. wrote in their book “How the West Grew Rich,” “If we take the long view of human history and judge the economic lives of our ancestors by modern standards, it is a story of almost unrelieved wretchedness. The typical human society has given only a small number of people a humane existence, while the great majority have lived in abysmal squalor.”
As human societies evolved over time, several nations grew wealthy while many others failed to develop far beyond the original state of basic sustenance.
Poverty, in reality, is the absence of wealth creation.
The focus of the commission’s attention, then, should not be what causes poverty, but what causes wealth and prosperity. After all, there is a reason Adam Smith titled his epic treatise “An Inquiry into the Nature and Causes of the Wealth of Nations” rather than “An Inquiry into the Causes of Poverty.”
North Carolina’s “Poverty Reduction Commission,” however, seems completely disinterested in learning how wealth creation can relieve poverty. The commission’s focus, rather, is centered on how to subsidize poverty through expanded government programs.
Completely absent from the commission’s discussion are policies to actually create economic growth, jobs and increase income. Curiously, not a single word of concern has yet been raised about the money that first must be removed from the private, productive economy to finance the new or expanded government programs.
In order to truly lift people out of poverty, the commission should be focused not on expanding the welfare state, but on encouraging productive activities that will generate opportunities for our state’s poor.