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The Progressive Economics Forum

Poverty reduction strategies

“Targets and timelines” is the new mantra for anti-poverty activists, and increasingly, governments. When it comes to climate change, taking it seriously means setting goals and deadlines to meet them, a process now underway, if perhaps too slowly. The same is true for poverty reduction. If we are serious about eradicating poverty (say, over the course of a generation) we need those targets and timelines to focus our attention in policy making, and to serve as a comparator for evaluation.

The Library of Parliament has two new reports on poverty reduction strategies: one on plans in Newfoundland and Quebec; the other on plans in the UK and Ireland. Both are short briefing note length pieces but give a good overview of the fundamentals that we should think about moving poverty reduction strategies forward in other jurisdictions.

That said, some joker out there will surely comment that we can never eliminate poverty when we use relative poverty measures. I disagree: if we take a relative measure like half the median income, poverty is zero if we raise all incomes below half the median above it. The same is true for the LICO.

Enjoy and share:

Comments

Comment from Phillip Huggan
Time: June 11, 2008, 11:55 am

I can’t find an earlier thread about poverty on Indian Reserves so I’ll post here:
I think a major problem in economic development on remote reserves is because they are located uneconomically for the most part. I’m not going into the historics of this, but an obvious conclusion is that Urban Reserves are a good idea. I’d think scaling up such a strategy would have to come with caveats to avoid subsidizing bad economic development strategies and public backlash.

Businesses based in, and employees of Indian Reserves don’t pay income taxes, yet still get use of social programmes funded by the public tax base. So I’d think the tax exemption on urban reserves should come with some sort sunset clause. Say, a partial tax-free status in one generation plus education time required to train business owners and employees (30 years?) and full tax-free status after two generations (55 years?). If the programme hasn’t addressed poverty among the initial Indian Reserve, say via remittance payments from the city reserve analogous to remittances immigrants send to their families still living in their home country, it is probably the wrong strategy.
Also, if urban reserves are granted as part of historic treaty obligations, I think the property values of cities should factor into the equation. For example, in Winnipeg there is housing stock on a former military base that is sitting unused (rather than temporarily rented) and is being contested by many groups, including an Indian Band. If the land were to be granted to the Band, I think it should reflect the increased value of city property values. If a Band is owed 100km of land by Ottawa, if the land is 10x more value than farm land (I don’t know what to use as a baseline) it should count for more, maybe not 10x more, but some multiplier.
I haven’t looked at these issues in detail as historic civic and economic development on and off reserve, is a big field.

Comment from Phillip Huggan
Time: June 11, 2008, 12:22 pm

The above prescription is too simple. If an urban reserve grocery store is competing across the street from a non-reserve store, the on-reserve store can out-compete even with bad business practises. This would encourage racism. Possible solutions in additional or instead of a sunset clause include capping the urban reserve tax-free revenues, or indexing the tax treatment of the business/employee to the location-dependance of the business. Urban reserves shouldn’t be able to cause the hollowing-out of grocery stores in the surrounding region, but an Urban Reserve software company competing against Bangalore; the latter isn’t likely to unleash reverse racism.

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