# Can we have a polite discussion about poverty, government, and free markets? **URL:** \ **Category:** Great Debates\ **Created:** [September 10, 2012, 10:02pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339 "2012-09-10T22:02:03Z")\ **Posts on this page:** 20\ **Page:** 3
**Author:** ![sisu](https://avatars.discourse-cdn.com/v4/letter/s/df705f/32.png) [@sisu](https://boards.straightdope.com/u/sisu)\ **Post date:** [September 11, 2012, 7:12am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/41 "2012-09-11T07:12:27Z")
> [@moonshot925](#): > > In 1913 in the USA there certainly was free market capitalism. Total government spending only represented 8-10% of national income. Federal government revenue came from small excise taxes and duties on imports. The private sector was left alone. No rules and regulations. Duties on imports is a really good way to slant the market in your favor, so NO it was not free market economy at the time. They were protected and subsidized by the gubberment, corruption was rampant and yes lots of people died due to malnutrition. Monopolies were allowed to form, cartels flourished and people were routinely killed in performing their jobs. So a small government is great as long as it is putting it’s focus on the right things, that is ensuring the best outcomes for it’s population. That’s the whole population and not some subset. So again we seem to see that good government regulation combined with relatively “free” markets seems to deliver the “best” outcomes. ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [September 11, 2012, 5:54pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/42 "2012-09-11T17:54:53Z")
> [@Terr](#): > > First one has to define “poverty”. The federal poverty level used by US government is just some arbitrary income figure. So if you have $1M in the bank, at 2% interest, thus your income is $20K/year, you’re under this poverty line. I’m curious who this person is who was somehow able to accumulate $1 million, yet is so inept at personal finance that they’re keeping it all in an account that earns 2%. Yeah, there are a few people who get windfalls they don’t know how to deal with, but not enough to mean we should change a perfectly reasonable and workable definition of poverty because of some 0.01% of people are weird outliers that don’t fit. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [September 11, 2012, 7:47pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/43 "2012-09-11T19:47:35Z")
> [@moonshot925](#): > > In 1913 in the USA there certainly was free market capitalism. Total government spending only represented 8-10% of national income. Federal government revenue came from small excise taxes and duties on imports. The private sector was left alone. No rules and regulations. So, you like children working. You like conditions that led to the Triangle fire. Did we really get poorer as a nation when we reduced or eliminated the abuses? And how do you count things like clean air and clean water in wealth? ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [September 11, 2012, 8:44pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/44 "2012-09-11T20:44:29Z")
> [@iamthewalrus\_3](#): > > I’m curious who this person is who was somehow able to accumulate $1 million, yet is so inept at personal finance that they’re keeping it all in an account that earns 2%. Easy. Let’s say I have $1M, I have some money in interest-bearing (or dividend-bearing) instruments, that bring me $20K/year. The rest is in stocks, and those appreciate nicely, thank you very much, and I am not selling them. So my income is $20K this year, below poverty level. Should I be counted as “poor”? And no, that’s not a good definition of poor. Someone earning 20K/year in East Podunk may be living very well on it. Someone earning $20K/year in NYC is probably starving. ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [September 11, 2012, 11:31pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/45 "2012-09-11T23:31:16Z")
> [@Terr](#): > > Easy. Let’s say I have $1M, I have some money in interest-bearing (or dividend-bearing) instruments, that bring me $20K/year. The rest is in stocks, and those appreciate nicely, thank you very much, and I am not selling them. So my income is $20K this year, below poverty level. Should I be counted as “poor”? Sure. You’re not really. But there aren’t enough of you to necessitate a more complicated definition and all the extra expense of dealing with it. > [@](#): > > And no, that’s not a good definition of poor. Someone earning 20K/year in East Podunk may be living very well on it. Someone earning $20K/year in NYC is probably starving. Well, neither one is particularly rich. I agree with what you’re saying about living expenses varying quite a lot in this country. But at some point we need to come up with an approximation, and summarize the myriad of individual financial circumstances down to a few categories, ideally, using data that we already collect and is known to be pretty reliable, since coming up with a better model without the data to use it doesn’t really get us anywhere. If we just use a flat $20k/yr, how bad is our model compared to the reality (of who’s ‘really’ poor)? It’s not perfect, but I’d claim that it’s probably good enough to use for meaningful discussion. ---
**Author:** ![Kobal2](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kobal2/32/20_2.png) [@Kobal2](https://boards.straightdope.com/u/Kobal2)\ **Post date:** [September 11, 2012, 11:49pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/46 "2012-09-11T23:49:22Z")
> [@moonshot925](#): > > The private sector was left alone. No rules and regulations. Ah yes, [simpler, more idyllic times](http://en.wikipedia.org/wiki/Radium_girls)… ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [September 11, 2012, 11:57pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/47 "2012-09-11T23:57:44Z")
> [@iamthewalrus\_3](#): > > Sure. You’re not really. But there aren’t enough of you to necessitate a more complicated definition and all the extra expense of dealing with it. How do you know there aren’t enough of me? > [@](#): > > If we just use a flat $20k/yr, how bad is our model compared to the reality (of who’s ‘really’ poor)? In order to know that, you have to define reality (that is, who’s “really” poor) first. ---
**Author:** ![Mosier](https://avatars.discourse-cdn.com/v4/letter/m/7ea924/32.png) [@Mosier](https://boards.straightdope.com/u/Mosier)\ **Post date:** [September 12, 2012, 12:46am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/48 "2012-09-12T00:46:41Z")
Holy crap, arguing semantics is so friggin’ pointless. ---
**Author:** ![moonshot925](https://avatars.discourse-cdn.com/v4/letter/m/f0a364/32.png) [@moonshot925](https://boards.straightdope.com/u/moonshot925)\ **Post date:** [September 12, 2012, 12:48am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/49 "2012-09-12T00:48:20Z")
> [@Voyager](#): > > So, you like children working. You like conditions that led to the Triangle fire. Did we really get poorer as a nation when we reduced or eliminated the abuses? And how do you count things like clean air and clean water in wealth? I am not at all endorsing the standard of living 100 years ago. Just making the point that the USA was the richest country in the world at that time. ---
**Author:** ![sisu](https://avatars.discourse-cdn.com/v4/letter/s/df705f/32.png) [@sisu](https://boards.straightdope.com/u/sisu)\ **Post date:** [September 12, 2012, 3:12am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/50 "2012-09-12T03:12:47Z")
> [@Mosier](#): > > Holy crap, arguing semantics is so friggin’ pointless. If you are going to say Holy crap, you should really make the C in crap uppercase. 😛 ---
**Author:** ![ITR\_champion](https://avatars.discourse-cdn.com/v4/letter/i/c67d28/32.png) [@ITR\_champion](https://boards.straightdope.com/u/ITR_champion)\ **Post date:** [September 12, 2012, 3:35am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/51 "2012-09-12T03:35:44Z")
> [@Mosier](#): > > This is where I disagree with you. Take a look at any place in the world with a higher life expectancy, lower poverty rate, lower violent crime rate, and better standard of living than the United States, and tell me what all of them have in common. What exactly am I supposed to see? Let’s take the top five countries on the economic freedom index: Hong Kong, Singapore, Australia, New Zealand, and Switzerland. These countries have lower crime rates, less poverty, and higher leife expectancy than the United States. (“Standard of living” is a fungible term, but analyses [like this one](http://internationalliving.com/2010/02/quality-of-life-2010/#) tend to rank countries with high economic freedom near the top.) ---
**Author:** ![ITR\_champion](https://avatars.discourse-cdn.com/v4/letter/i/c67d28/32.png) [@ITR\_champion](https://boards.straightdope.com/u/ITR_champion)\ **Post date:** [September 12, 2012, 3:53am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/52 "2012-09-12T03:53:19Z")
> [@Richard\_Parker](#): > > Actually, the correlation you claim to see on cursory analysis isn’t obvious at all. Of the top 5 countries in the Heritage Index, 4 aren’t listed. Canada, which is number 6, is on par with the Bahamas and Georgia. Chile is matched with Azerbaijan. > > Obviously there is some correlation between economic freedom and prosperity. But in terms of modern US policy, more economic freedom means becoming more like Hong Kong. If your thesis is that countries with Hong Kong’s level of laissez faire markets have less poverty, you’ve not submitted any evidence for it. True enough. The data on poverty rates comes from sources which generally haven’t bothered collecting data in Hong Kong and suchlike places, presumably because they know that poverty barely exists there. We can, however, find date elsewhere, for instance in the conomic pages of the [CIA World Fact Book](https://www.cia.gov/library/publications/the-world-factbook/geos/us.html). It says that in the USA the poorest 10% of the population controls 2% of income and consumption while the richest 10% controls 30%. In Singapore, Australia, and Switzerland the distribution is less lopsided. (Data aren’t given for Hong Kong or New Zealand.) The top five countries also have lower unemployment rates than the USA. ---
**Author:** ![WillFarnaby](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/willfarnaby/32/514_2.png) [@WillFarnaby](https://boards.straightdope.com/u/WillFarnaby)\ **Post date:** [September 12, 2012, 5:06am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/53 "2012-09-12T05:06:52Z")
> [@Mosier](#): > > It was the complete devastation of every major world economy in WW2 that made the USA so rich, and I don’t think those same principles should be used again. Check your dates. The US was becoming an economic powerhouse for at least half a century before WWII. ---
**Author:** ![Mosier](https://avatars.discourse-cdn.com/v4/letter/m/7ea924/32.png) [@Mosier](https://boards.straightdope.com/u/Mosier)\ **Post date:** [September 12, 2012, 5:07am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/54 "2012-09-12T05:07:51Z")
> [@ITR\_champion](#): > > What exactly am I supposed to see? Let’s take the top five countries on the economic freedom index: Hong Kong, Singapore, Australia, New Zealand, and Switzerland. These countries have lower crime rates, less poverty, and higher leife expectancy than the United States. (“Standard of living” is a fungible term, but analyses [like this one](http://internationalliving.com/2010/02/quality-of-life-2010/#) tend to rank countries with high economic freedom near the top.) You can count on the Heritage Foundation to invent a term like “economic freedom” and define it in a way that favors capitalism with few regulations. When you take a look at the [Human Development Index](http://en.wikipedia.org/wiki/List_of_countries_by_inequality-adjusted_HDI), though, you find places with much more reasonable economic policy in the top. People live longer and better lives in places where capitalism is balanced by strong government regulation, and health care is socialized. Canadians, French, English, Norweigians, Danes, Dutch, Icelanders, and citizens of all sorts of other evil socialist countries just flat out have better lives than we do in America. We are more productive than other countries who’s citizens have better lives than we do. We work harder for less, just so our rich end up richer than their rich do. The really funny part is that you’re [not actually more likely](http://www.huffingtonpost.ca/2012/06/12/countries-with-most-millionaires_n_1590824.html#slide=1087643) to become rich in America than everywhere else. Low/No regulation capitalism is just a way to drift closer to defacto feudalism, where the only people with any significant power in the government are the vanishingly small proportion of extravagantly wealthy, who live on the fruits of everyone else’s labor. ---
**Author:** ![sisu](https://avatars.discourse-cdn.com/v4/letter/s/df705f/32.png) [@sisu](https://boards.straightdope.com/u/sisu)\ **Post date:** [September 12, 2012, 6:46am UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/55 "2012-09-12T06:46:29Z")
> [@Mosier](#): > > Low/No regulation capitalism is just a way to drift closer to defacto feudalism, where the only people with any significant power in the government are the vanishingly small proportion of extravagantly wealthy, who live on the fruits of everyone else’s labor. Yep that is my view from down under, regulation is the key. ---
**Author:** ![Evil\_Captor](https://avatars.discourse-cdn.com/v4/letter/e/f17d59/32.png) [@Evil\_Captor](https://boards.straightdope.com/u/Evil_Captor)\ **Post date:** [September 12, 2012, 2:06pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/56 "2012-09-12T14:06:31Z")
> [@Mosier](#): > > You can count on the Heritage Foundation to invent a term like “economic freedom” and define it in a way that favors capitalism with few regulations. > > When you take a look at the [Human Development Index](http://en.wikipedia.org/wiki/List_of_countries_by_inequality-adjusted_HDI), though, you find places with much more reasonable economic policy in the top. People live longer and better lives in places where capitalism is balanced by strong government regulation, and health care is socialized. Canadians, French, English, Norweigians, Danes, Dutch, Icelanders, and citizens of all sorts of other evil socialist countries just flat out have better lives than we do in America. > > We are more productive than other countries who’s citizens have better lives than we do. We work harder for less, just so our rich end up richer than their rich do. > > The really funny part is that you’re [not actually more likely](http://www.huffingtonpost.ca/2012/06/12/countries-with-most-millionaires_n_1590824.html#slide=1087643) to become rich in America than everywhere else. > > Low/No regulation capitalism is just a way to drift closer to defacto feudalism, where the only people with any significant power in the government are the vanishingly small proportion of extravagantly wealthy, who live on the fruits of everyone else’s labor. Which of course is EXACTLY what’s happening in America. The wealthy are using their control of many media outlets to exploit the fears and bigotry of the middle class and the poor and get them to vote agaisnt their own economic interests by waggling the specters of gay marriage and abortion at them. They have used the increasing reliance politicians have on money to gain control over members of both the major political parties. I do not know that I would describe America as feudalistic, but we are DEFINITELY well into being a wealthy oligarchy. America is fast becoming a Third World country. That is the direction we are moving in. ---
**Author:** ![Richard\_Parker](https://avatars.discourse-cdn.com/v4/letter/r/35a633/32.png) [@Richard\_Parker](https://boards.straightdope.com/u/Richard_Parker)\ **Post date:** [September 12, 2012, 2:09pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/57 "2012-09-12T14:09:36Z")
> [@ITR\_champion](#): > > True enough. The data on poverty rates comes from sources which generally haven’t bothered collecting data in Hong Kong and suchlike places, presumably because they know that poverty barely exists there. Is you’re serious about this stuff, you should take a moment to research poverty in Hong Kong. This comment is breathtakingly wrong. ---
**Author:** ![Sateryn76](https://avatars.discourse-cdn.com/v4/letter/s/a88e4f/32.png) [@Sateryn76](https://boards.straightdope.com/u/Sateryn76)\ **Post date:** [September 12, 2012, 2:41pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/58 "2012-09-12T14:41:41Z")
> [@Evil\_Captor](#): > > Which of course is EXACTLY what’s happening in America. The wealthy are using their control of many media outlets to exploit the fears and bigotry of the middle class and the poor and get them to vote agaisnt their own economic interests by waggling the specters of gay marriage and abortion at them. They have used the increasing reliance politicians have on money to gain control over members of both the major political parties. I do not know that I would describe America as feudalistic, but we are DEFINITELY well into being a wealthy oligarchy. America is fast becoming a Third World country. That is the direction we are moving in. You really have a poor opinion of the intelligence level of the middle class and poor. You don’t think that they are able to absorb information from all sides and then make a decision? That they are apt to fall for “finger waggling”? Nice. ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [September 12, 2012, 2:49pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/59 "2012-09-12T14:49:21Z")
> [@Sateryn76](#): > > You really have a poor opinion of the intelligence level of the middle class and poor. You don’t think that they are able to absorb information from all sides and then make a decision? That they are apt to fall for “finger waggling”? Of course. I find that liberals divide those who vote for the “other side” into two groups: either scoundrels or morons. ---
**Author:** ![ITR\_champion](https://avatars.discourse-cdn.com/v4/letter/i/c67d28/32.png) [@ITR\_champion](https://boards.straightdope.com/u/ITR_champion)\ **Post date:** [September 12, 2012, 3:14pm UTC](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339/60 "2012-09-12T15:14:25Z")
> [@Mosier](#): > > You can count on the Heritage Foundation to invent a term like “economic freedom” and define it in a way that favors capitalism with few regulations. > > When you take a look at the [Human Development Index](http://en.wikipedia.org/wiki/List_of_countries_by_inequality-adjusted_HDI), though, you find places with much more reasonable economic policy in the top. People live longer and better lives in places where capitalism is balanced by strong government regulation, and health care is socialized. Canadians, French, English, Norweigians, Danes, Dutch, Icelanders, and citizens of all sorts of other evil socialist countries just flat out have better lives than we do in America. > > We are more productive than other countries who’s citizens have better lives than we do. We work harder for less, just so our rich end up richer than their rich do. > > The really funny part is that you’re [not actually more likely](http://www.huffingtonpost.ca/2012/06/12/countries-with-most-millionaires_n_1590824.html#slide=1087643) to become rich in America than everywhere else. > > Low/No regulation capitalism is just a way to drift closer to defacto feudalism, where the only people with any significant power in the government are the vanishingly small proportion of extravagantly wealthy, who live on the fruits of everyone else’s labor. First of all, according to the Wikipedia page that you linked to, the United States is tied for third in the Human Development Index worldwide, trailing only Australia and Norway. You may have been looking at the numbers for the inequality adjusted HDI, in which the USA is number 23–still vastly above the world average. Also, the Huffington Post slideshow you linked appears to say the exact opposite of what you claim. It says that the percentage of millionaires in the United States _is_ higher than almost anywhere else. The only countries with a larger percentage of millionaires are three oil-rich Arab states and three countries with more economic freedom than the US. (Hong Kong, Singapore, and Switzerland) So the data that you yourself have presented hardly justify claims about “de facto feudalism” in the United States. As for the notion that “Canadians, French, English, Norweigians, Danes, Dutch, [and] Icelanders” live better lives than us because of “strong government regulation”, much of the data points the other way. For instance, on the Index of Economic Freedom, we see that Denmark gets scores of 99.1, 92.1, and 80.7 on business, labor, and monetary freedom. The United States gets scores of 91.1, 95.8, and 77.2. All told, Denmark has more freedom than the United States in seven out of ten categories. Likewise for Australia, the UK, Canada, and many others that rank high on the HDI and IHDI: they all beat the USA is many categories. Even Norway is ahead of or only slightly behind the USA in most of the categories of economic freedom. [Previous page](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339.md?page=2) [Next page](https://boards.straightdope.com/t/can-we-have-a-polite-discussion-about-poverty-government-and-free-markets/634339.md?page=4)