Poverty Returns with Misguided Policy by Franz Segbers

By Franz Segbers

Poverty in a rich country is the result of political decisions and is not a natural phenomenon.  Poverty is produced.  It is not made by the poor even if responsibility is shifted to them.  Income poverty is the end on a scale of income conditions whose other end is formed by wealth.  Therefore we cannot speak of poverty and be silent about wealth.

• Language: English
• Publisher: Smashwords
• Release date: Oct 2, 2017
• ISBN: 9781370185078

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Poverty Returns with Misguided Policy

Franz Segbers

Copyright 2018 Franz Segbers

Published by Marc Batko at Smashwords

ISBN: 9781370457168

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Table of Contents

About Franz Segbers

1. Poverty Returns with Misguided Policy

2. Work and Human Rights

3. Forgive us our Debts

4. Democracy and the Social State

5. Capitalism as a Religion

6. Capitalism in the Faith Crisis

7. The Great Ecumene against Capitalism

8. Social Justice and the Sacred Nature of the Person

About Franz Segbers

Franz Segbers, born August 8, 1949 in Gelsenkirchen, is a German theologian. He studied catholic theology, pedagogy and the social sciences at the University of Munster. He was a social or industrial pastor in Frankfurt up to 1985. Out of protest against the repression of liberation theology, he withdrew from the Roman Catholic Church in 1986. He was a professor of social ethics at the Philipps-University in Marburg from 2004. He has urged a just distribution of paid work and is a shining example of social enlightenment and progressive theology. His website offers scores of essays, lectures and books.

Segbers is engaged in the struggle against neoliberal globalization and works with Marxist categories in a theological criticism of capitalism as a religion. The future of work and globalization on the background of Christian social ethics are two of his research interests.

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1. Poverty Returns WITH MISGUIDED POLICY

By Franz Segbers

[This article published on May 12, 2011, is translated abridged from the German on the Internet. Up to 2014, Dr. Segbers was a professor at the University of Marburg.]

When you hear the word poverty, what picture do you have? Is it the beggar, the unemployed Hartz IV recipient or the woman, the single parent taking care of her children? Who comes to your mind?

Poverty in Germany strikes the long-term unemployed engineer, the academically trained single parent, the factory- and service person slaving away, the deregulated subcontracted worker, the creative and precarious small- or Internet entrepreneur and parts of the core personnel in businesses. Very normal pensioners stand in line at the soup kitchens. Poverty extends to the middle classes and our communities that for a long while were not stricken by poverty.

I was not really described as poor. Elisabeth is a single parent. She lives with her two children in a small apartment on the outskirts of Frankfurt. She has a part-time job that she supplements with Hartz IV (radical German welfare reform that combined unemployment assistance and income support, drastically reduced the duration of benefits and was ruled in violation of civil rights by the German Constitutional Court). She has slightly more than 900 euros. Is she poor? No, she says. We have a tight budget but we aren't starving. When the children need new things, I get money from my parents… She has no prospect of a full-time job…

There are many Elisabeths in Germany. Every eighth person has to manage with an income below the subsistence level. European statistics set the mark at 60% of the median income of the country. Whoever has less is defined as poor. Three groups are particularly afflicted by poverty: unemployed at 54%, single parents at 40% and migrants at 27%. Those are nationwide numbers; the Berlin numbers are always higher. But poverty is different than income poverty or lack of money. There is no objective definition of poverty. Poverty means fellow persons have to live in miserable housing, have low-paying work, can hardly feed themselves and suffer with poorer access to education. This undersupply is largely a consequence of income poverty. The more or the less a rich society is ready to hand over part of its wealth to combat the plight of fellow citizens, the more or the less poverty exists in a society. Poverty is the exclusion of people from the possibilities and resources of a society. Why are they excluded? Who excludes them?

Poverty is returning. That must be our first discovery when we speak about poverty in Germany. Once it was fought and became a marginal problem. Why is it returning? For a long while, there was the firm belief that life goes forward and we live in an elevator society. Our children will be better off. That was the motto when I was growing up. This picture of the elevator society where everyone would be prosperous is not reality any more. Everyone is not on an upward course any more. The picture has turned upside down. While some are going upward, others are going downward. A Lord's Prayer society has replaced the elevator society. The formerly secure middle class at its outskirts has long been eroding. Children with good education can not find good jobs and work their way from one traineeship to the next and one temporary job to the next.

In the 1980s, unemployment was the main reason for poverty. In the 1990s, child poverty moved into the center of attention. Since the turn of the millennium, work is the main reason for poverty. Now poverty gnaws in the situations of many families who are counted in the middle class. Why is that? Why is poverty returning and why is the number of the poor increasing – and also the number of the rich? Why is the middle class shriveling?

The poor are the first ones who suffer from a false or misguided economic and political policy. Economic and financial crisis on one hand the crises of the social state are two sides of one and the same coin of a flawed economic and social policy. A policy according to the motto Less state and more market has failed. That was the EKD's (Evangelical church in Germany) theme in its word on the global economic- and financial crisis of June 2010. In its Foreword to the memorandum, Wolfgang Huber, chairperson of the EKD, said: A new era or chronology has begun. We speak of the time after the crisis as twenty years ago in Germany after the turn… The call for a strong state can suddenly be heard where privatization and deregulation were heralded as bringers of economic prosperity.

The financial market crisis has not ended by any means – it has only shifted. It has become a crisis of the public budget. The crisis costs should now be shifted to the weaker and the poor and not be assumed by the profiteers of the crisis, the banks, the speculators and the wealthy. The German government has made it unmistakably clear from whom it will get the money to finance the financial crisis. The austerity package of over 80 billion euros altogether will result in more poverty. There can be no talk of social justice as long as Germany represents a tax haven for heirs, speculators and the super-rich.

The tax revenues are rising again. The question is: who pays for the state and its tasks? Consumers and dependent employees finance the state. However, owners of capital are spared. The extent of their exemption is amazing… This discrepancy has a system. Like the Black-Red coalition, the Red-Green coalition ensures that consumers above all pay for the expenditures of the state by paying the sales tax, the energy tax, the lotto tax, the tobacco tax or the insurance tax. On the other hand, the taxes on profits and incomes are constantly falling – and recently only amounted to 39.2% of state revenue. This shift is dramatic since everyone pays the consumer taxes – whether poor or rich. Officially taxation in Germany should be according to output. The technical term is progression. However progressive income taxes are actually becoming increasingly insignificant. The tax reforms of Red-Green and Black-Red were not without consequences. Public poverty rose when the top tax rate fell from 53% to 42% and owners of capital only had to pay a 25% compensation tax on their interests and dividends.

The empty public treasuries are politically caused and are not natural phenomena. For years, the financial- and budgetary policy relied on tax reduction…

The consolidation of the budget in view of massive state indebtedness is strategically instrumentalized for the absolutely necessary reorganization of the social state. The revenue side is not a theme since budget revitalization is declared the pressing goal. Social-political reforms for the whole society are made plausible by pointing to the empty treasuries. The practical restraint – saving or economizing – is imperative and prevails at the end. So a policy of empty treasuries is staged through rigorous revenue cuts.