Chapter 6 Flashcards
The Persistence of Poverty
- UNDP defines human poverty as “denial of choices and opportunities for living a tolerable life”
- World Bank defines income poverty as living on less than $1 per day
- Multidimensional Poverty Index (MPI) identifies 3 major dimensions: living standards, education and health
- Using this measure 1.7 billion people (1/3 of total population) in 109 countries live in poverty
Measuring Poverty
- Absolute poverty measure an essential basket of goods and services deemed necessary for physical survival
- Relative poverty is based on how low one’s income is relative to other Canadians
Low Income Cut-Offs (LICOs)
-Canada is one of only a few countries without a poverty line
-Statscan sets LICOs based on relative and absolute measures and is referred to as “straitened circumstances” or “relative necessities”
-The LICO changes based on region and household size
A family is considered “low-income” when it falls below the cut-off for it’s size and region
Other Measures (LICO)
-Market Basket Measure (MBM)
Absolute measure based on the cost of purchasing a set basket of goods
-Low Income Measure (LIM)
Used for international comparisons of child poverty
Relative low-income as one-half median adjusted income of country
Social Exclusion
- Alternate way of conceptualizing poverty related to marginalization
- Having limited opportunities or abilities to participate in the social, economic, and cultural activities of society
- Poverty is not just a low degree of well-being, but the inability to pursue well-being due to lack of opportunities
Myths About The Poor
- Poverty is the failure of the individual
- Welfare recipients are able-bodied men who are simply lazy
- The poor do not want to work
- Poor people do not pay taxes
- Welfare system is rife with cheating and fraud
- We cannot afford the social programs needed to eliminate poverty
- All children in Canada are assured a decent start in life
- Welfare rates are too generous
Explanations of Poverty
- Human Capital Perspective
- Market Economy Perspective
- Political Economy Perspective
Human Capital Perspective (explanations of poverty)
- Poverty is related to characteristics of individuals (education, age, health, mobility)
- Income-leisure choice theory (people will choose between paid employment and unpaid leisure)
- Income distribution based on supply and demand: workers receive what they contribute
- Emphasis on education and job training to break poverty cycle
Market Economy Perspective (explanation of poverty)
-Emphasis on broader economy and society
-Market conditions are critical (supply & demand)
-Markets can be limited by non-economic factors such as:
Socialization: people may be conditioned to believe certtain things about themselves and their position in society
Discrimination: Negative stereotypes, racial discrimination, and employment barriers may limit employment oppurtunities
- explanation of low incomes= Growth of secondary labour
Political Economy Perspective (explanation of poverty)
- focuses on a relationship between politics and economics
- Concentrated ownership affects government policy
- Capital owners control wages and employment
- Stratification in the market helps employers keep wages down based on gender, age, race, or sexual orientation
- discrimination on ethnicity= effects immigrants and people with color
How Much Poverty?
- Poverty Headcount: how many people are poor
- Poverty Gap: how far they fall below poverty line
- Poverty Duration: how long are they poor
Poverty Headcount
- Based on 2010 LICOs 9% of total Canadian population lives in poverty
- This excludes people living on reserves, Territorial residents & people living in institutional homes
- BC has highest rate of poverty (11.5%) and PEI has lowest (3.9
Depth of Poverty
- Total shortfall from the poverty line
- Poverty gap: is measurement of how much additional income is required to be above poverty line
- Lone parent families living at 85% of LICO; couples with 2 children living at 67% of LICO
Poverty Duration
- Vulnerable groups face higher risk of long-term poverty= people with disabilities, lone parents, recent immigrantrs, Aboriginal people
- 17% of Canadians experienced poverty for one or more years over period 2005-2010
- People had greater difficulties exiting poverty since the economic crisis (great recession) of 2008
Inequality and Poverty
- Poverty refers to a benchmark standard
- Inequality refers to differences between groups
- total income is divided between households is a measure of inequality = also known as income distribution
Quintile Income Distribution
- Quintile represents one fifth of the total number of people being studied
- Top quintile is the 20% of population with highest incomes; bottom quintile is 20% of population with lowest income
- In Canada, in 2010, the top quintile had an average income 9.3 times that bottom 20%.
Gini Coefficient
- Measures the degree of inequality in income distribution
- Values range from 0 to 1 (0 means income is equally divided; 1 means perfectly unequal distribution)
- Income inequality is higher in Canada than 11 similar countries; although more equal than the US
- Income inequality has risen in Canada over last 20 years
Social Assistance: Minimum Income Program
- Has roots in early charity relief and English poor laws
- Bare minimum funds for people with no employment or other income
- Based on needs test
- Each province and territory designs and administers own program
Social Assistance Eligibility
- Age (18–65)
- In most provinces, students are ineligible
- Parents must try to secure support payments
- People with disabilities require medical certification
- Striking workers usually ineligible
- Family class immigrants are usually ineligible
Social Assistance Eligibility
- Financial Eligibility: test compares household’s assets with its needs
- Administrative Eligibility: application, evidence of eligibility, meet with worker etc.
- Categorical Eligibility: different reasons to request assistance
Social Assistance Effectiveness
- Measure of effectiveness is comparison of welfare amounts and after-tax LICO levels
- Based on 2010 data, when adjusted for inflation, welfare incomes consistently below adequacy levels
- The most vulnerable group depending on welfare income is single unattached individuals
The working poor
- A working poor person is an individual whose family income is below poverty threshold
- > Paid work itself is not a guarantee of an adequate family income
- > Many of the poor are employed, but job opportunities do not provide sufficient income for family well-being or survival
- > Working poor are younger, more likely to be immigrants, single (or sole family earner) with low educational levels
Homelessness
-Homelessness is on the rise as a result of increasing poverty rates
->Absolute Homelessness:
No housing at all or in shelters
->Relative Homelessness:
Situation where housing does not meet the UN’s basic standards
-Homeless seen on street are chronically homeless—less than 20% of all homeless people
- Reasons for homelessness include economic crisis, mental health problems, violence or abuse in home, substance abuse problems or lack of supportive network
- > Hidden homeless include:
- families living in shelters
- Families living in sub-standard shelter
- A ‘Housing First’ strategy has recommended more low-cost affordable housing
Food insecurity
- More Canadians relying on food banks and feeding programs
- In 2012, 1900 food programs service almost 900,000 people
- Over 38% are under age of 18
- Food banks typically volunteer run, and run in conjunction with emergency shelters
- Decrease in social safety net has put food security in jeopardy
welfare reform
-Workfare
Requirement to work as term of eligibility for social assistance
-Spouse-in-the-house rule
Ineligible for welfare if there is evidence of a person of the opposite sex in the house
-Welfare fraud
A more coercive and disciplinary approach being used towards welfare recipients
Workfare
- Refusal to participate in work programs results in penalties
- Drawn sharp criticism from advocacy groups as it is shown to be ineffective, expensive and related to antiquated poor laws
- Formal workfare: community placement, employment placement
- De facto workfare: strict enforcement of job-search and training requirements
Spouse-in-the-house
- Member of opposite sex staying in house considered unacceptable
- Federal definition of spouse challenged under Charter in 1987
- Ontario’s definition of spouse implied economic interdependence began with co-habitation
- This policy deemed unconstitutional in 2002
- Women’s groups argue against any law that requires women to be economically tied to men
