Poverty poses the greatest risk

to democracies and the free enterprise system.  
 

In the Americas, we have collectively witnessed how extreme poverty has ended both the democracies and the free enterprise systems of Cuba, Venezuela, Haiti and Nicaragua.  Since 2021 democracies have ended in 7 African Nations.

 

Globally, more nations are teetering on the cusp of authoritarianism.  Poverty, growing income divides and massive youth unemployment are propelling those living in poverty to migrate to other nations as witnessed by the influx of migrants to the southern borders of both the United States and Europe.   

 

Billions of people are embroiled in the devastating cycle of poverty and unemployment, especially within youth demographics and women.  
 

Here are some facts:
 

• According to the World Bank there are 2 billion people, most of whom are women and children, who make under $4 a day which represents 25% of the global population of 8 Billion or 1 in 4 people. Homepage (worldbank.org)

• 1 in 2 people or 4 billion people are not covered by essential health services UN News

• 1 in 3 people or 2.5 billion people lack access to improved sanitation sanitation 

• 1 in 10 people or 785 million people drink unsafe water.  safe water.

• 1.2 Billion children under the age of 18 live in multidimensional poverty.   UNICEF USA
   

Global youth unemployment rates and income divides have been steadily rising, with dire consequences for emerging economies, their democracies and the business communities that help make them prosper:
 

• Women, despite representing half the global population, face disproportionate challenges, from access to education to gainful employment.

• Globally poverty and income divides are expected to increase over the next decade. South America has the highest income divide in the world today,

• Universities are not training social entrepreneurs which has resulted in a high failure rate of social enterprises caused by a global lack of the human resources to develop, manage and/or scale innovative franchisable solutions to poverty reduction challenges.  Lack of talent to manage social enterprises - NextBillion
   

The poverty-unemployment nexus has been exacerbated by global events like the pandemic combined with more costly financing, higher inflation, and increased food insecurity. 
 

Globally, the private sector has fundamentally delegated the task of “poverty reduction” to their national governments who “champion” the need to do something but all too often employ unsustainable solutions that fail to deliver it:
 

• The National Security Strategy of the United States states: “Poverty creates desperate people and unstable conditions.  A world where some live in comfort and plenty, while a quarter of the human race lives on less than $3 a day, is neither just nor stable.” Global Poverty - Borgen Project

• The United States has the world's largest poverty reduction industry  which has been unable to deliver a coherent and impactful strategy for its international development program: “Excessive red tape and regulations make the process to apply for federal funding so onerous that only insiders called the Beltway Bandits need apply”.   Follow the Money (unlockaid.org)

• In a review of typical United States developmental health awards, typically 15 to 30% pays for the contracted organization’s overhead costs (sometimes more), another 25% pays for their headquarters staff and another 25% for their staff to live in aid receiving countries to manage local partners. This leaves just 10 to 30% for actual program delivery…” Phantom Aid:  Global Health Justice (washington.edu)