From John Minto's column in today's New Zealand Herald;
The US has the highest levels of poverty in the Western world (more than 30 million) despite one of the highest per capita incomes in the world. Why would this be?
Poverty in the US is relative poverty. The US has a very high number because it has a very large population. 30 million is around 1 in 10.
One way to measure relative poverty is to base it on average median income, draw the line at half and count those falling beneath it. This report tells us that using that method 1 in 10 Australians is also living in poverty.
Another way of measuring relative poverty is based on calculating average household income (usually equivalised for size of family), drawing a line at 50 or 60 percent and counting every household that falls beneath that line.
According to MSD, the proportion of New Zealanders living in families with incomes less than 60% of the median income, adjusted for family size, housing costs and inflation since 1998, has fallen from 22% in 2001 to 19% in 2004.
At 50 percent the number falls to around one in ten also.
Now let's look at Minto's answer to his own question;
Last year in the US the increase in income of the top 1 per cent of income earners was greater than the entire income of the bottom 20 per cent of the population. What this staggering statistic means is that the bottom 20 per cent of US citizens, all of whom live in poverty, could have had their incomes doubled if the wealthiest 1 per cent had simply forgone an increase in income last year.
That's not an answer. It's a tired clapped out leftist assertion. The poor are poor because the rich are rich and if money was taken off the rich and given to the poor, then the poor wouldn't be poor any more. Ah yes. We've seen how successfully that theory works in practice.
As Minto acknowledges, the US has the highest incomes per capita in the world. Their relative poor are the relative rich by third world standards. Their relative poor are richer than New Zealand's relative poor. The US is a much richer country than New Zealand. That's because too many New Zealanders have spent too much time listening to and believing fallacies promoted by the likes of Minto.
And he has the audacity to end by saying,
"(Mike) Moore has no excuse for peddling more myths about poverty."
What's yours John?