Poverty Economics
Thoughts From Tshepo Magagane
https://economics.mit.edu/people/faculty/abhijit-banerjee/poor-economics
Poverty – too many people without any idea about it have no qualms about prescribing and proscribing policies about it!
To get this out of the way – when you say “I am taking risks”, means that you are blessed with privilege and stop talking about this!
I grew up in South Africa and still spend a lot of time in the country – you had these “labour camps” called bantustans eg Batswana were forcibly moved from the likes of Gauteng (the system was the most evil thing to be concocted in human history) to what is now called North West province (and even within that, they could only live on the least attractive/fertile lands – needed a passport to even travel to those fertile lands)…
…and what I saw is how people came together to build something far bigger than anyone could imagine – people wrote A-levels / village schools produced the best of the best / sports competition at international level!
Even Royal Bafokeng live in the North West province of South Africa.
However, I have seen how people get stuck in these generational levels of poverty – it takes people something like 8 generations to break out of it…recently saw these 2 older gents in this rural place – when I was young, they were doing that trek to work – hard workers / honest…they are still doing it [hard work does not take people out of poverty].
Or you will see these older women who sell at places like taxi ranks – why have they not been able to break out of it?
They are simply shut out of the financial system.
South Africa has the most sophisticated financial and capital markets (not 3rd world level – 1st world level stuff) and the pension and insurance assets that underpin the entire thing belong to people living in villages and townships…
…and that system effectively only supports the top 40 listed companies…
…the banking system to developed that it was not impacted by GFC…and the entire capital whether in bonds all the way to junior equity, comes from the pension and insurance assets of people in villages and townships…
…and the intermediaries in this whole process have “first world living standards”…while that capital does nothing from the real owners of the said capital!
Poverty – why South Africa to date still has the worst wealth disparities…
