Poverty and Inequality: Same Difference?

Stephen Sinclair, Reader in Social Policy, Yunus Centre for Social Business and Health, Glasgow Caledonian University

Poverty initially seems like a straightforward matter and academics can’t expect to be thanked for complicating it. However there are occasions when it is important to challenge what might appear attractively simple accounts of an issue and argue that it is necessary to think again. One recent example of this is an article by John Lanchester arguing that ‘if I could, I would ban the word poverty from use in a UK context’ and replace it with ‘inequality’. John Lanchester is a writer whose novels I have enjoyed, and he wrote one of the most accessible and engaging accounts of the credit crunch and economic crisis, but in this case he is seriously mistaken. There is a real and significant difference between poverty and inequality, and his objections to so called ‘relative’ definitions of poverty are based on a misunderstanding.

Lanchester argues that referring to the deprivation which undeniably exists in the UK as ‘poverty’ confuses the issue. He argues that ‘People look around the UK and just don’t believe in the existence of genuinely poor people… They don’t think that what is called poverty constitutes actual poverty’, and that ‘when we talk about poverty in the UK, we aren’t talking about the same kind of poverty as in the developing world’, because ‘Nobody [In the UK] … is lacking the means of subsistence: nobody is “poor”.’

Leaving aside the question of the scale of subsistence deprivation in the UK, the principal problem with Lanchester’s view – and here is where social science must complicate the issue – is that he misunderstands the meaning of ‘absolute’ and ‘relative’ poverty. These concepts were complicated – but also clarified – by Amartya Sen over 30 years ago. While the terms ‘absolute’ and ‘relative’ poverty may be convenient ways to distinguish different technical approaches to measurement, at a more fundamental level this apparent contrast is misleading: poverty has both absolute and relative aspects. Understanding this requires appreciating Sen’s explanation that ‘There is a difference between achieving relatively less than others, and achieving absolutely less because of falling behind others.’ The former situation is inequality, the latter condition is poverty.

To grasp Sen’s distinction it helps to consider the implications of a much-quoted passage from Adam Smith’s Enquiry into the Nature and Causes of the Wealth of Nations (1776):

 By necessaries I understand, not only the commodities which are indispensably necessary for the support of life,but whatever the custom of the country renders it indecent for creditable people, even of the lowest order, to be without. A linen shirt, for example, is, strictly speaking, not a necessary of life … But in the present times, through the greater part of Europe, a creditable day-labourer would be ashamed to appear in public without a linen shirt … Custom, in the same manner, has rendered leather shoes a necessary of life in England. The poorest creditable person of either sex would be ashamed to appear in public without them

No one (least of all Smith or Sen) denies that some needs, such as minimum calorie requirements, sufficient clothing and accommodation to keep warm, etc. are universal. However, even these ‘absolute’ essentials are relative in how they can be acquired in different societies or what they cost at different times. More importantly, Smith’s point is that we are all social beings and our basic needs are socially conditioned. Mollie Orshansky, who developed the first national measures and indicators of poverty for the US government, once said that ‘Poverty, like beauty, lies in the eye of the beholder’. This does not mean that poverty is a purely subjective idea which can mean whatever anyone wants. The significance of Orshansky’s point is that poverty includes an aspect of social judgement: those ashamed to appear in public because of inadequate income are in a condition of poverty even if they are not starving nor destitute.

Poverty, properly understood, is a condition of having too few resources to maintain a basic standard of living, including whatever is required to maintain decency, integrity of identity or to appear and participate in society without shame and stigma. This is not the same as merely having less than others; i.e. inequality. The minimum standard of living will vary over time and across societies, but the existence of a standard itself is a consistent social principle. This does not imply egalitarianism: it is not the case that everyone needs access to everything that everyone else possesses, only that there is a threshold of minimum decency which all must have to avoid poverty.

Of course, the destitute and starving lack sufficient resources to survive, but just as not suffering from a terminal illness does not mean that someone is ‘healthy’ so too having enough calories or clothing to survive does not mean that someone has avoided poverty. Variations in international standards of living are widely accepted: few argue that simply because people in Britain are not dying of diarrhoea or Cholera that there is no illness here. This shows that, for some welfare issues at least, the British public are able to grasp that minimum standards can be context-dependence and relative.

The difficulty with existing ‘relative’ definitions of poverty is not that that they are counter-intuitive nor conceptually complex. Rather the issue is that, provided there is little visible outright destitution, poverty in the UK is largely denied. While they might support access to a minimum standard of health care, the British public generally do not accept the right of everyone to what T.H. Marshall described as the conditions of social citizenship, that is ‘the right to share to the full in the social heritage and to live the life of a civilised being according to the standards prevailing in the society’. It might be unpleasant to accept this feature of public opinion, but facing it at least clarifies the nature of the obstacle, rather than arguing that poverty does not exist, or redefining it as something different – inequality – in order to reflect popular attitudes.



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