What policies will reduce poverty – and how do we pay for them?
by John Myles
Social policy debates about income distribution have shifted sharply in the past few years. For decades, Canadian attention was focused almost exclusively on the ups and downs of the “poverty rate.” The one great success of the Occupy Movement in 2011 was to shift attention to the larger issue of income inequality and the phenomenal rise in the incomes of the top 1 per cent, a trend that has continued. As a result, “poverty talk” has faded somewhat.
Is it time for another look? One reason to think so is that in normative terms, trends in inequality immediately bring us back to asking questions about poverty.
In his influential A Theory of Justice,1 John Rawls concluded that a rise in inequality is morally acceptable if it is to the absolute benefit of the least well off. He attached substantial ethical weight to absolute – not relative – improvement for the poor. We know that income inequality has risen significantly since the 1980s. So a reasonable question to ask is whether the forces that have generated the inequality surge have been accompanied by improvement in the living standards of the poor. At first glance, the question may appear odd. If inequality rises, doesn’t this mean that the poor are worse off? Not necessarily. Poverty is measured relative to the “middle,” not to the top. By and large incomes in the middle and the bottom have moved in tandem in the past three decades, while top incomes have gained.