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“What will happen to poverty and the American Dream by 2040? ” Discuss. Generally, poverty can be divided into 3 types, namely absolute poverty, moderate poverty and relative poverty. According to the standard set by World Bank. Absolute poverty is defined as living at less than $1 per day per person and moderate poverty Is between $1- $2. Relative poverty however Is another concept where one’s person Income Is lower than the average national Income. It can be used to Indicate the Income Inequality in a country.
In sass, regions that suffer from extreme poverty are mainly located In East Asia, South Asia, and Sub-Sahara Africa and Latin America. In 2001 , we noted that the number of extreme poverty In East Salsa and South Salsa have fallen while the number continued to rise In Sub-Sahara Africa. The number remained almost the same In Latin America. In the very same year, by studying the development potentials of developing countries globally, Goldman Cash has pointed out BRICK’ as new economic power.
Among the countries Identified by Goldman cash, China and India (the most populous country in East Asia and South Asia with the highest poverty number) gain the most attention from the world. Judging from the GAP statistics, most people will agree that that China and India will become major players in global economies by 2040 with increased income per capita and lower poverty number. However, both countries are facing various challenges in order to sustain a long-term development.
The major challenges that China faces includes high reliance on export-led manufacturing industry, aging populations attributable to the one-child policy, waste and pollution, and the widening gap between the rich and the poor. In addition, China financial market may need more reform (to reduce government control) in order to encourage more efficient allocation of capital. Continued suppression of Remind by the government to secure trade advantage and the widespread of intellectual property theft in the country are also getting more critics from the outside world.
India however has a different set of challenges. Being featured as IT service export nations, Indian’s proficiency in computer science Is Its key strength for sustained growth. However, the poor Infrastructure and bureaucratic red tape are the key problems that Indian government needs to solve In order to realize Its Industrial development potential. Looking at the economic achievement of China and India, one may say globalization has lifted hundreds of millions out of poverty.
American consumers, In return have infinite from the availability of cheap goods and services from China and India, However, behind these benefits, the American working class populations are facing unprecedented job and wage competitions from the low-skill labor in China to top IT manufacturing and IT industry. In other words, the American working classes are becoming ‘poorer’ now in terms of purchasing power as compared to the past. So, does globalization help to redistribute the wealth more equally over the world? Well, it is really hard to say.
If globalization is a game, I think American investors is the real winner out this game as they can now mobile their resources more freely to tap the investment potential all over the world in order to earn the highest return. As a result of this, it is predictable that the income gap of American population may get wider. So, instead of absolute poverty, the world, especially America may suffer from relative poverty in the future if appropriate measures are not taken to curb this problem. This is definitely not the American dream that Americans wants.