Does wealth cause poverty?

It would if there were a fixed amount of wealth, but there obviously isn’t. There are issues here about what we should do if we wanted to move to a zero growth world in order to reduce our environmental impact, because then the amount of wealth would indeed be fixed. But that is not the world we currently live in.

It would if the wealthy stole from or exploited the poor to get rich. Of course this has often happened and still happens. Not only do people cheat and steal directly from others but people have often appropriated the commons to enrich themselves at the expense of their neighbours, from the early enclosures of common land for example to the despoiling of the environment as an economic “externality”. But to see whether this happens in any particular instance we must look at the facts, inconvenient though this may be for ideologues. The Marxist notion that any and profit is expropriated from the workers, for example, was probably more often true than not in the aftermath of the industrial revolution, but it need not be true. There can surely be such a thing as a fair wage, there can be such a thing as a fair return to enterprise or invention. To declare all profit as expropriation is to expound a tautology once it is declared in advance that all value is from labour. That is not to deny that some employers will grab whatever they can from their workers in the name of free enterprise, but not all profit is dishonest.

A better explanation of poverty existing side by side with wealth is thus that in economic relations human values are very often forgotten. People succumb to their own greed. People do not deal fairly or justly with other people. So of course there are plenty of cases of exploitation and expropriation, more than enough to keep the simple myths of the dogmatic left alive. But again, these are because values are forgotten, not because exploitation is necessarily at the heart of economic relations.

If everyone had sufficient, there would be no moral problem with some having more than sufficient. There might be practical arguments – which would have to be based on empirical evidence – that society could be better, safer, more cohesive at lower levels of inequality, but there would be no moral case for equality if everyone had enough. As a simple demonstration, inequality as such could easily be reduced by destroying the wealth of the rich. Would this help the poor? Obviously not, which shows that inequality is a false target.

Poverty itself is absolutely what we should be taking aim at. The moral outrage is that so many do not have enough. The hyper-rich may be too powerful for everyone else’s good, but that is another argument. They may have become hyper-rich by dubious means, but that too is another argument although it is one we should engage in more vigorously. Focusing on wealth as if it is the direct and only cause of poverty is a distraction which does no one any good.

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