The political debate about poverty is entirely dominated by groups calling for more income transfers to the poor. However, now that the scope of our welfare state has reached – or even surpassed – Scandinavian levels, surely this approach has run its course. Award-winning author Kristian Niemietz lays out another approach to dealing with the problem of poverty – one that focuses on addressing the problems caused by government interventions that raise the cost of living. These interventions are enormous in their effect on the poor. As the author points out, the poverty lobbies are more or less silent on these crucial matters. This has not always been the case. In the past, free-trade movements, for example, had been seen as pro-poor movements.
Alongside radical market reforms, the author proposes wide-ranging welfare reform to encourage work and remove the penalties on family formation. This would include a form of negative income tax system and the localisation of welfare decisions.