The Sachs Report and the Millennium Development Goals project are a major advance over the approach of the Washington Consensus that for several years dominated much analysis and policy on economic development and policy questions. The Report and the MDGs project are valuable in going beyond a simplistic reliance on the market and a single-minded focus on economic growth to solve problems of poverty. Nonetheless, their failure to address issues of income (and wealth) distribution and power is a serious shortcoming that limits the extent to which poverty alleviation can be effectively addressed. Part of the problem lies in addressing poverty as simply an absolute issue; if the distributional aspect of poverty were recognized, these issues could not be elided from the discussion.
There are alternatives, various ways in which issues of distribution and power can be brought to the fore in poverty alleviation policy. At the foundation of alternative policies is a fundamentally different approach – different from that of the Sachs Report – to the role of the poor themselves. As Tariq Banuri (2005, p. 43) points out, “…the focus of [the Sachs Report] is not the empowerment of the poor nor the creation of knowledge to be placed in the hands of the poor; rather its focus is on doing something for the poor.” The Report essentially ignores an approach that “emphasizes investing in the social capital of the poor, social mobilization, building collective organization, enabling collective decision-making to emerge, and strengthening communities and community action. This [would enable] the poor to take charge of the process. Advocates of this approach never cease to remind us to treat the poor not as a problem but as people.”
Much is made of the concept of “empowerment” – in the Sachs Report, in various World Bank documents, and in many other discussions of poverty and economic development. Yet empowerment is usually presented in the narrowest economic terms, as a process or product of raising the incomes of the poor and educating (i.e., providing schooling for) the poor. Power, however, is a relative concept. To the extent that income is a foundation for power, it is relative income that matters. If, for example, the income of society’s bottom quintile rises by ten percent while that of the rest of society also rises by ten percent, it is difficult to argue that the former has more power. People in the bottom quintile may have a bit more flexibility in their lives, and this would seem to give them a bit more power in their relations with the rest of society. Still, the other members of society would have also gained flexibility. Without any change in the distribution of income, it is hard to see how the income increase would confer more power on the poor.
Power, furthermore, is not simply a product of income (or wealth). It depends on a complex of social and political arrangements – the social capital, social mobilization, collective organization and decision making, and the strengthening of communities referred to by Banuri. There are programs that could further such arrangements, programs that would tend to improve the distribution of income and power in low-income countries and thereby contribute significantly to poverty reduction.
41 Some of the issues discussed in this section are taken up at length in MacEwan (1999).