Government and Poverty

To summarize, the government has a role only when there is a market problem—market failure or a concern for equity. In that case, the government should either regulate the market, or ensure that public agencies directly or indirectly provide the public service. These governmental responsibilities are magnified in the case of the poor because markets for the poor fail more often and the poor are critically dependent on the public services.

Public Services

To achieve a more egalitarian society, the government is responsible for providing additional services to the poor, services that it might not provide to affluent people, such as basic health care and basic nutrition. In India there is a political movement to make the right to food a legal entitlement. The Congress Party election manifesto for 2009 included a promise to enact a right to food act, and the government is working on it now. Finance minister Pranab Mukherjee said in June 2010, “Earlier, we felt development will take place due to trickling down effect, but now the focus is on empowering people by giving them entitlements backed by legal enactment.”8 There have even been demands that the right to food should be extended to include safe drinking water and other health concerns.

Providing access to the basic public services is an essential part of poverty reduction. Amartya Sen says, “Social and economic factors such as basic education, elementary health care, and secure employment are important not only in their own right, but also for the role they can play in giving people opportunity to approach the world with courage and freedom.”9 The most important role of the government in poverty reduction is providing basic public services to the poor. Yet the governments in most developing countries have failed dismally to provide these basic services. Whereas the rich often purchase these services from private enterprises, it is the middle class that is the main beneficiary of the public service expenditures. The poor have no or little access to these services, or get very low-quality public services, or pay very high prices for private services. For example, the rich go to world-class private hospitals and clinics. The middle class has access to reasonable public health facilities. While public health centers do exist to serve rural and poor areas, these centers are grossly underfunded and understaffed. Even worse, the staff may not be qualified, and are often absent.

The children of the rich go to exclusive private schools. The middle class uses a mix of private and public schools. Children of the poor often do not go to school or go to low-quality public schools. In one survey, a quarter of the teachers were absent and another quarter was present but not teaching. Absentee rates for teachers and health workers are higher in poorer regions. The rich hire private guards. The middle class lives in reasonably well- policed neighborhoods. The poor have little protection from thugs and criminals. The rich have ample access to clean water; they purchase bottled-drinking water, drill private tube wells, and use booster pumps. The middle class settles for piped water, even if only for a few hours a day, and often must boil the water to make it potable. The poor have no or little access to a clean public water supply, and often drink polluted water. In a “tragedy of the commons,” the drilling of private wells by the rich probably depletes the water table, reducing the water supply for others.

The burden of the failure of public services is also borne dispro- portionably by women, which exacerbates gender inequality. Lack of access to toilets poses a bigger problem for women because of anatomy, modesty, and susceptibility to attack. Women often lose much time to hauling buckets of water over long distances. They are more likely than men to need medical care; they are expected to care for sick family members, especially children. Girls also attend school less often, especially in poor families.

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