Nova workboard

a blog from young economists at Nova SBE

Give a man a fish and you’ll feed him for a day

When discussing poverty and policies to fight it, it is very common to find people who are against raising subsidies, arguing they incentive the poor to be lazy and not work, yet are in favor of institutions such as Santa Casa da Misericórdia or Banco Alimentar Contra a Fome, since they provide for those in need. Unless those people do not mind having the poor struggling with poverty for the rest of their lives, it is, however, an incorrect perspective.

The Portuguese government gives subsidies such as the RSI and the unemployment subsidy, that not only provide a certain amount of money every month (that can work as an additional wage in the case of the RSI for those working at very low wages) but also demand the receiver to actively look for a job, or at least have him do volunteer work (in the cases where they are working adults). Although they are not perfect (they do not, for example, offer the possibility to refuse a job without losing the support, which will coerce the receiver to accept any job offer they have, even at a very low wage), arguing these subsidies incentive the receivers not to work is either naïve or dishonest, and it portraits unemployment as a consequence of laziness and individual lack of ability and not as a macroeconomic problem.

On the other hand, charity institutions that provide food, shelter and support for people in need (Banco Alimentar distributes food to over 390.000 people and Santa Casa does charity in many different areas), although doing a necessary work – as long as there are people needing their services they will continue to make sense –, do not emancipate the poor in the same way a subsidy does, since they do not provide direct financial aid and therefore take autonomy away from them. Ironically, their leaders are often the ones promoting the “lazy subsidies” discourse – see for example the case of Isabel Jonet, mostly known for blaming the poor for being poor.

Another thing that aggravates the poverty problem is the government feeling it does not have to take responsibility for those in need since charity institutions will keep them from being completely helpless, and since the government collaborates with these institutions by giving them fiscal benefits they can be perceived as an alternative way of fighting poverty and not a complementary nor a temporary measure (in 2011, for example, the government transferred to the responsibility of Santa Casa the management of 38 establishments). Therefore, instead of focusing on eradicating poverty, it relies on short-term solutions that perpetuate it, in the sense that they give a false sense of ‘helping’ the poor without providing them the tools to escape the poverty trap.

Since these institutions play such an important role in helping and providing for the less privileged, it should be a concern of the government to have a say in how they are managed and what kind of work they should be doing. If these were public institutions, the government would be able to use them as a complementary source of help and search for an effective way of solving poverty, unemployment and social exclusion.

Ana Martins, 734

Author: studentnovasbe

Master student in Nova Sbe

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