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*STOP PRESS* at Davos time: Social protection a boost for the economy! (When it’s for the rich)


This year’s Davos there is a bigger spotlight than ever on inequality, but whilst the rhetoric is changing, I am struck by how entrenched assumptions and perceptions about poverty are, and this matters for social protection practitioners, writes Alexandra Barrantes.

It is encouraging to see the growing amount of research showing that low-income families (the so called ‘poor’) do not squander cash transferred to them by governments (or by donor agencies). One need only look at the current discussions around social protection investment, including in high-income countries, to see how this discourse unfolds.

How many social policy-makers and development practitioners working in poverty reduction get asked how we can make sure money transferred to the poor is not wasted on alcohol, tobacco or other so called temptation goods? There has been plenty of myth-busting research on this topic, shedding further light on the whole issue around the stigmatisation of poverty. Issues around the ‘deserving poor’ have also abounded in development literature. And Ugandan parliamentarians initially sceptical about how the Senior Citizens’ Grant would be spent reported at our event with Age International and HelpAge International that their assumptions were confounded. They reported seeing evidence of how the grant is an economic investment, spent on businesses, improvements to housing, and grandchildren’s education, and this was picked up by a Government of Uganda report.

This labelling of ‘the poor’ not only engenders crass generalisations and misconceptions but in doing so infringes individuals’ dignity.

What is not so encouraging is that, as a society in general, we are not so heavily invested in analysing (or scrutinising) how the middle classes and richer segments of society spend their monies or incomes. The justification that “it’s their income, not tax-funded or donor provided (the latter also being tax-funded but usually by citizens from another country/countries)” does not fly. This is because most likely the middle-class and those on high-incomes also receive some kind of tax-funded benefits, Government subsidies or tax incentives. And, these are usually much larger benefits than those given to those living in poverty, as even the IMF has acknowledged over energy subsidies in India, for example.

In the context of Davos and its focus on Creating a shared future in a Fractured World this year, we learn about the most inclusive economies; and the Pope stresses the danger of ‘an opulence which is no longer sustainable and frequently indifferent to the world around us, and especially to the poorest of the poor’. All of this discourse applies not only to low- and middle-income countries, but also high-income countries, such as the USA.

For quite some time now, I have wondered how the title of a magazine like How to spend it came into existence, a guide for everything you might want to spend all of your hundreds/ thousands/millions of dollars on. So, in some contexts we talk about how to spend it, and in others, we worry how ‘the poor’ seem to ‘waste’ their little resources, drawing a sharp contrast between investing in social policy and spending on luxury consumption goods.

We also are informed about The Psychology of Inequality, pointing towards research that shows how the rich and super rich also struggle with labels relating to perceptions around their consumption trends, their supposed deservingness as hard-working citizens that contribute to our societies. So, it seems we all basically have the same aspirations for leading dignified lives and being seen as productive citizens contributing towards the well-being of our families and national economies.

The statement by the UN Rapporteur on Extreme Poverty after his U.S country visit has shed further light on some crude realities American experience in their daily lives. The Rapporteur’s statement also reflects on perceptions of the rich as ‘industrious, entrepreneurial, patriotic and the drivers of economic success,’ whereas those living in poverty are seen as ‘wasters, losers and scammers’. Hence investment in social protection is seen as a waste.

Perceptions and discourses, as we well know, impact on public debates and public policy decision-making processes. So, whether it is regressive tax cuts as in the USA, fiscal austerity as in the case of Brazil, or discussions around poverty-targeted poor relief programmes in many low-income countries, perceptions and assumptions around entitlement influence the way public policies are contoured.

Let us then be more responsible in how we characterise those living in poverty and the rest of the population, and respect everyone’s dignity and self-determination in having a say in their own wellbeing and that of their families. Let us remember that we are all citizens, we all contribute to society and we all have the same entitlement to support across the lifecycle: so let’s receive this support equally without demonising the ‘poor’.

Alexandra Barrantes is Senior Social Policy Specialist at Development Pathways with experience in social protection, poverty reduction, economic, social and cultural rights, and development