Poverty Changes

£14,000 is quite a large amount of money. Enough for 70,000 Freddos, a decade’s worth of holidays, two new Nissan Pixo’s, several thousand potatoes or a gold standard racing pigeon. However, if you’re trying to live off just that amount in modern Britain, it quickly seems quite a lot smaller. Half of that could easily disappear on rent, whilst the average British family will spend a further £4,000 on food (significantly greater than the European average, for one reason or another). Then we must factor in tax, work-related expenses, various repair bills, a TV license, utility & heating bills, petrol money and other transport expenses, and it quickly becomes apparent that trying to live on this amount will require some careful budgeting. Still, not to worry too much though; it’s certainly possible to keep the body and soul of a medium sized family together on £14k a year, if not absolutely comfortably, and in any case 70% of British families have an annual income in excess of this amount. It might not be a vast amount to live on, but it should be about enough.

However, there’s a reason I quoted £14,000 specifically in the figure above, because I recently saw another statistic saying that if one’s income is above 14 grand a year, you are one of the top 4% richest people on planet Earth. Or, to put it another way, if you were on that income, and were then to select somebody totally at random from our species, then 24 times out of 25 you would be richer than them.

Now, this slightly shocking fact, as well as being a timely reminder as to the prevalence of poverty amongst fellow members of our species, to me raises an interesting question; if £14,000 is only just about enough to let one’s life operate properly in modern Britain, how on earth does the vast majority of the world manage to survive at all on significantly less than this? More than 70% of the Chinese population (in 2008, admittedly; the rate of Chinese poverty is decreasing at a staggering rate thanks to its booming economy) live on less than $5 a day, and 35 years ago more than 80% were considered to be in absolute poverty. How does this work? How does most of the rest of the world physically survive?

The obvious starting point is the one stating that much of it barely does. Despite the last few decades of massive improvement in the living standards and poverty levels in the world in general,  the World Bank estimates that some 20% of the world’s populace is living below the absolute poverty line of surviving on less than $1.50 per person per day, or £365 a year (down from around 45% in the early 1980s- Bob Geldof’s message has packed a powerful punch). This is the generally accepted marker for being less than what a person can physically keep body and soul together on, and having such a huge proportion of people living below this marker tends to drag down the global average. Poverty is something that the last quarter of the century has seen a definitive effort on the part of humanity to reduce, but it’s still a truly vast issue across the globe.

However, the main contributing factor to me behind how a seemingly meagre amount of money in the first world would be considered bountiful wealth in the third is simply down to how economics works. We in the west are currently enjoying the fruits of two centuries of free-market capitalism, which has fundamentally changed the way our civilisation functions. When we as a race first came up with the concept of civilisation, of pooling and exchanging skills and resources for the betterment of the collective, this was largely confined to the local community, or at least to the small-scale. Farmers provided for those living in the surrounding twenty miles or so, as did brewers, hunters, and all other such ‘small businessmen’, as they would be called today. The concept of a country provided security from invasion and legal support on a larger scale, but that was about it; any international trade was generally conducted between kings and noblemen, and was very much small scale.

However, since the days of the British Empire and the Industrial Revolution, business has got steadily bigger and bigger. It started out with international trade between the colonies, and the rich untapped resources the European imperial powers found there, moved on to the industrial scale manufacture of goods, and then the high-intensity sale of consumer products to the general population. Now we have vast multinational companies organising long, exhaustive chains of supply, manufacture and retail, and our society has become firmly rooted in this intense selling international economy. Without constantly selling vast quantities of stuff to one another, the western world as we know it simply would not exist.

This process causes many side effects, but one is of particular interest; everything becomes more expensive. To summarise very simply, the basic principle of capitalism involves workers putting in work and skill to increase the value of something; that something then gets sold, and the worker then gets some of the difference between cost of materials and cost of sale as a reward for their effort. For this to work, then one’s reward for putting in your effort must be enough to purchase the stuff needed to keep you alive; capitalism rests on the principle of our bodies being X% efficient at turning the food we eat into the energy we can use to work. If business is successful, then the workers of a company (here the term ‘workers’ covers everyone from factory floor to management) will gain money in the long term, enabling them to spend more money. This means that the market increases in size, and people can either sell more goods or start selling them for a higher price, so goods become worth more, so the people making those goods start getting more money, and so on.

The net result of this is that in an ‘expensive’ economy, everyone has a relatively high income and high expenditure, because all goods, taxes, land, utilities etc. cost quite a lot; but, for all practical purposes, this results in a remarkably similar situation to a ‘cheap’ economy, where the full force of western capitalism hasn’t quite taken hold yet- for, whilst the people residing there have less money, the stuff that is there costs less having not been through the corporation wringer. So, why would we find it tricky to live on less money than the top 4% of the world’s population? Blame the Industrial Revolution.


A Brief History of Copyright

Yeah, sorry to be returning to this topic yet again, I am perfectly aware that I am probably going to be repeating an awful lot of stuff that either a) I’ve said already or b) you already know. Nonetheless, having spent a frustrating amount of time in recent weeks getting very annoyed at clever people saying stupid things, I feel the need to inform the world if only to satisfy my own simmering anger at something really not worth getting angry about. So:

Over the past year or so, the rise of a whole host of FLLAs (Four Letter Legal Acronyms) from SOPA to ACTA has, as I have previously documented, sent the internet and the world at large in to paroxysms of mayhem at the very idea that Google might break and/or they would have to pay to watch the latest Marvel film. Naturally, they also provoked a lot of debate, ranging in intelligence from intellectual to average denizen of the web, on the subject of copyright and copyright law. I personally think that the best way to understand anything is to try and understand exactly why and how stuff came to exist in the first place, so today I present a historical analysis of copyright law and how it came into being.

Let us travel back in time, back to our stereotypical club-wielding tribe of stone age human. Back then, the leader not only controlled and lead the tribe, but ensured that every facet of it worked to increase his and everyone else’s chance of survival, and chance of ensuring that the next meal would be coming along. In short, what was good for the tribe was good for the people in it. If anyone came up with a new idea or technological innovation, such as a shield for example, this design would also be appropriated and used for the good of the tribe. You worked for the tribe, and in return the tribe gave you protection, help gathering food and such and, through your collective efforts, you stayed alive. Everybody wins.

However, over time the tribes began to get bigger. One tribe would conquer their neighbours, gaining more power and thus enabling them to take on bigger, larger, more powerful tribes and absorb them too. Gradually, territories, nations and empires form, and what was once a small group in which everyone knew everyone else became a far larger organisation. The problem as things get bigger is that what’s good for a country starts to not necessarily become as good for the individual. As a tribe gets larger, the individual becomes more independent of the motions of his leader, to the point at which the knowledge that you have helped the security of your tribe does not bear a direct connection to the availability of your next meal- especially if the tribe adopts a capitalist model of ‘get yer own food’ (as opposed to a more communist one of ‘hunters pool your resources and share between everyone’ as is common in a very small-scale situation when it is easy to organise). In this scenario, sharing an innovation for ‘the good of the tribe’ has far less of a tangible benefit for the individual.

Historically, this rarely proved to be much of a problem- the only people with the time and resources to invest in discovering or producing something new were the church, who generally shared between themselves knowledge that would have been useless to the illiterate majority anyway, and those working for the monarchy or nobility, who were the bosses anyway. However, with the invention of the printing press around the start of the 16th century, this all changed. Public literacy was on the up and the press now meant that anyone (well, anyone rich enough to afford the printers’ fees)  could publish books and information on a grand scale. Whilst previously the copying of a book required many man-hours of labour from a skilled scribe, who were rare, expensive and carefully controlled, now the process was quick, easy and available. The impact of the printing press was made all the greater by the social change of the few hundred years between the Renaissance and today, as the establishment of a less feudal and more merit-based social system, with proper professions springing up as opposed to general peasantry, meaning that more people had the money to afford such publishing, preventing the use of the press being restricted solely to the nobility.

What all this meant was that more and more normal (at least, relatively normal) people could begin contributing ideas to society- but they weren’t about to give them up to their ruler ‘for the good of the tribe’. They wanted payment, compensation for their work, a financial acknowledgement of the hours they’d put in to try and make the world a better place and an encouragement for others to follow in their footsteps. So they sold their work, as was their due. However, selling a book, which basically only contains information, is not like selling something physical, like food. All the value is contained in the words, not the paper, meaning that somebody else with access to a printing press could also make money from the work you put in by running of copies of your book on their machine, meaning they were profiting from your work. This can significantly cut or even (if the other salesman is rich and can afford to undercut your prices) nullify any profits you stand to make from the publication of your work, discouraging you from putting the work in in the first place.

Now, even the most draconian of governments can recognise that your citizens producing material that could not only benefit your nation’s happiness but also potentially have great material use is a valuable potential resource, and that they should be doing what they can to promote the production of that material, if only to save having to put in the large investment of time and resources themselves. So, it makes sense to encourage the production of this material, by ensuring that people have a financial incentive to do it. This must involve protecting them from touts attempting to copy their work, and hence we arrive at the principle of copyright: that a person responsible for the creation of a work of art, literature, film or music, or who is responsible for some form of technological innovation, should have legal control over the release & sale of that work for at least a set period of time. And here, as I will explain next time, things start to get complicated…