BUSINESS WORLD Is Capitalism the Cause of Poverty in Sierra Leone? Posted by Bakarr Turay on Apr 19, 2009, 10:22

Capitalism or the way it is being interpreted and implemented is being blamed for the present financial crisis and the world’s ever-increasing poverty levels. Capitalism has brought about a society of unfortunate victims of consumerism. Over-consumption stems from individuals frustration and is fuelled by organizations greed. Encouraging people to behave as individual consumptive units erodes the social fabric, damages relationships and fuelling the worldwide growth of depression, unemployment and poverty. Greed in the name of profit maximization (the center piece of capitalism) is responsible for the construction of walls around us that exclude others into abject poverty.

Take for example, in Sierra Leone poverty is an unfortunate daily reality for 70% of the people of this resourceful country. As in many other developing countries, poverty in Sierra Leone is most pervasive in rural areas, where two-thirds of the country’s population resides and where eight out of ten are considered poor. While living conditions in Freetown are crowded, and life is difficult, poverty levels are actually much lower in the capital than in rural areas and secondary towns. In Sierra Leone, poverty is associated with larger households, households with older heads, those that are headed by a female, and those engaged in subsistence agriculture. As stated in the PRSP, most of the rural-working population is underemployed and its productivity is very low with most of the production being home-consumed and in most cases inadequate to meet the basic daily caloric requirements.

Going by impressions on the human senses, poverty in Sierra Leone is manifested by the presence of the following features:

·        Many people living and working in relatively confined spaces so that there is overcrowding in workplaces, in houses, on the roads, and in the markets;

·        Sprawling slums in urban areas characterized by narrow and dark alleys, small makeshift shelters, an accumulation of stinking garbage, poor drainage, poor lighting, and frequent flooding;

·        Poor sanitation facilities, pollution, and a high incidence of water-borne diseases;

·        Roads full of potholes, but congested with vehicles of all description and pedestrians, thus creating ideal conditions for accidents;

·        Beggars and street children who exist by picking the pockets of pedestrians or scavenging out of garbage heaps;

·        Ubiquitous informal sector activities such as catering, hawking, vending, car washing, shoe polishing, and subsistence agriculture;

·        A cacophony of noises of man and machine in urban areas; and

·        Inadequate amenities such as recreational parks and public toilets.

Why are People Poor?

The intensity of absolute poverty and its accompanying effects as a result of economic reforms has become a matter of concern to national governments, local authorities, individuals, as well as the international community. This concern has brought back into focus the purpose of development and modernization.

I believe that the first step in alleviating poverty is to find answers to the following questions: Who are the poor people? Where are they found? Why are they poor? What are they doing to survive? How can they be assisted so they can better help themselves? A lot of analysts have argued that people are poor because they want to be poor; and they frequently cited laziness as the basis for such an assertion. Such Analysts (who are mainly white collar-job holders) argue that people are lazy, avoid responsibility and unwilling to take risks; and that is why they poor.

While I agree to some extent with their assertion, I would like to point out in this article that lazy people in Sierra Leone are in the insignificant minority; and that there are many hard working people who are still very poor for reasons that are discussed below. It is my strongest conviction that people generally want to live at least an average life-able to meet the basic necessities of life such as housing, food, clothing, health and education of their loved ones. Such people normally rise up early in the morning and go to bed late at night in a bid to meet their basic needs, but all to no avail. This clearly shows that there are structural factors limiting the progress of many people in their attempt to liberate themselves from the shackles of poverty.

Reasons as to why people are poor include the following: Firstly, poverty is an intergenerational phenomenon. That is, if you were born to poor parents, they would not be able to educate you or set you up in life. It is believed that this “inherited poverty” is quite difficult to deal with, given that the individual is locked in a cycle know as the vicious cycle of poverty-no education-no modern skills-low paid job-low income-abject poverty. This means that those that are born with ‘no silver spoon in their mouths’ find very difficult to break out of this cycle of poverty and climb up the ladder, no matter how hard working they may be. Secondly, capitalism and other structural barriers have been identified as major reasons for people being poor.

People could be poor as a result of structural, exogenous factors as limited resources, lack of skills, ‘location’ disadvantage, and other factors inherent in the social and political setup. The poverty of the disabled, orphans, and households headed by single parents derive from structural factors. The social exclusion of women is an important cause of poverty among women in this country. The notion that ‘women are meant for the kitchen’ has deprived women in the past of valuable resources that could have enabled them to escape poverty. Some attribute their persistence of poverty and social problems to capitalism as a system of resources allocation. Many proponents of capitalism, however, argue that the dark side of capitalism that we see is often a result of true free market capitalism being absent. What has been operating is a “failed version” of capitalism. Nonetheless, owing to the negative social and economic outcomes of this “failed version” that restricts competition and equal access; many people tend to see capitalism “as a system of the rich, by the rich and for the rich”.

Following this line of argument and logic, most economists then tend to suggest that measures be introduced to improve competition and equal access to make capitalism work for everyone, especially the poor. Or to put it in another way, “make markets work for the poor” as much as they work for the rich. Also poverty could be mainly due to changes in domestic macroeconomic policies that may result in price changes, increased unemployment, and so on. The adoption of the structural adjustment programmes (SAPs) of the IMF/World Bank in the early 1990, for example, led to the massive retrenchment of public workers especially in the Ministry of Works (MOW) and the Public Words Division (PWD), which transformed into semi-autonomous body now known as Sierra Leone Roads Authority (SLRA). Many of the workers that were retrenched found themselves in poverty as they became unemployed and vulnerable.

In addition, natural calamities such as drought and manmade disasters such as wars and environmental degradation also induce poverty. Many analysts believe that the 10-year rebel war resulted in massive destruction the economic and social fabric of the country; and this in turn reduced many Sierra Leonean to beg for their living as displaced persons, refugees or other category. The war made hard-working people-farmers, teachers, private and public workers to be destitute and hence poor. Similarly, deterioration of basic services in health, water and education can readily become structural cause of poverty with under-fed, under-equipped, under-maintained, and under-supplied systems providing decreasing quality of service with severe capacity to work, human capital and social well-being implications.  There is also a lack of participation by, and a failure to draw in, the poor in the design of development programs.

Specifically, there need to be ways in which policy makers can link up their strategies, policies, and programs aimed at poverty reduction; ways in which policy makers can facilitate private and grassroots initiatives to reduce urban poverty; ways government officials initiatives can support the poor and most vulnerable groups; good practices that can be strengthened and replicated; actions required to promote a more enabling environment; and ways in which urban local authorities can integrate urban poverty concerns into their development plans.

How to Help the Poor

In order to help the poor, we must allow capitalism to work for the poor just as it is working for the rich. The widening gap of inequality between the rich and the poor in this country is becoming unbearable. Just take look at the number of jeeps plying the streets of Freetown compared with the increasing number of pedestrians ‘Abu-Blacking’ every day to and from work. In order to reduce this gap, there is need for increased integration of the Sierra Leone agricultural economy into regional and global markets can help the poor in a number of ways. New market opportunities may be created, new varieties and technologies may become available, and prices may become more advantageous for poor farmers and consumers. But the benefits to trade integration will not be realized simply through policy changes at the border. Investments will have to be made both at the producer level, to increase productivity, and at strategic points along commodity value chains, in order to improve the efficiency of the string of transactions that occur between producers and the border.

Also attention must be paid to product, labor, and land market structures in the relevant commodity sectors to ensure that a minimum degree of competition, infrastructure, and institutional capacity exists so that the benefits of trade extend all the way to the poorest households in Sierra Leone. Attention should also be given to the following areas: Investment in people is an essential element in any strategy to reduce poverty. Greater access to basic services (education, health, water, etc.) by the poor is important both in fostering their dignity of life and enabling them to take better advantage of economic opportunities. On a related note, one of the key objectives of any community development program should be to ensure that gender imbalances are not worsened and, if possible, to correct any existing imbalances by the activities it supports.

In addition to conducting an in-depth study to understand poverty, there is need to understand the current gender status and relations in the communities and municipalities. Gender selection of informal sector activities may, for example, provide an insight into how women have been marginalized into particular activities or, alternatively, into their comparative advantages. In addition, many observers agree that local democratic governance is a key factor in promoting poverty reduction. A healthy interplay ought to be promoted among community groups, NGOs, and other people’s organizations.