Manage Poverty level in the country

Eradication of poverty remains a major challenge of planned economic development. Poverty is a complex, multifaceted condition, with contributing factors that include lack of education, low wages, family composition, job availability and others. There are two major types of poverty -

1. Absolute poverty - when people have insufficient income to afford the necessities of life such as food, rent and clothing.

2. Relative poverty - when people have significantly less income than the average income for society. 

Some policies such as promoting economic growth may be successful in reducing absolute poverty but less successful in relative poverty. 

With flat incomes and inequality stuck at historically high levels, one might assume that chronic economic insecurity and an out of equilibrium, not straight level / aligned proper economy, are the new normal and that nothing can be done to fix it. But they are the direct result of policy choices that put wealth and income in the hands of a few at the expense of growing a strong middle class. Different policy choices can bring different outcomes which results into improved outcomes in both the long and short term. 

There is nothing like inevitable poverty. We just need to build the political will to enact the policies which will increase economic security, expand opportunities and grow the middle class.

To summarize, in order to reduce poverty, Govt. policies could include -

1. Minimum wages, regulation of labor markets, fixing statutory minimum wages.

2. Means-tested welfare benefits to the poorest in the society such as unemployment benefits, food stamps, income support, housing benefit. Such benefits are often unpopular because people are stigmatized as poor. It may create a disincentive to earn a higher wage with a fear of losing some of benefits and pay more tax. Some relatively poor may fall just outside the qualifying limit.  

3. Free market policies to promote Economic growth with the hope that rising living standards will filter down to the poorest in the society.

4. Direct provision of goods and services - like subsidized housing, free education and healthcare. 

5. Ensure that all marginalized communities are given the tools they need to succeed is key to all other solutions to poverty. 

6. Use tax revenue to improve public infrastructure

7. End war and conflict. 

8. Embrace cash and microfinance. 

9. Close tax loopholes that benefits mainly the wealthy e.g. cap on deductions for employer- provided health insurance.  

These are small steps but promises a ripple effect of change to manage poverty.

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