The Costs of Poverty
by Veronica Walsh, BA, BSW
Selkirk, Manitoba - 2005

Adopted by Emptyplates 2005
- A Poverty Awareness Project, as reflecting the views and goals of its members.

In Canada, we say that we are very caring and compassionate people and that we believe in equality, justice, fairness and helping those who need help. We maintain that the dignity of each person is important and each is entitled to a reasonable quality of life, health, basic comforts, freedom and personal security. And yet, in this great country, there are many people living in poverty. And the reality of poverty is that it denies individuals and families equality, justice, dignity, health, freedom, basic comforts and personal security. Despite government promises to eliminate poverty, we still have a system that has not eliminated poverty and has created many of the economic difficulties, labour shortages and health related crisis's we are experiencing in this country. This system maintains control over resources and people's lives by providing insufficient funds for healthy living. Attempts are made to meet needs and provide other resources through a complex network of charitable organizations and individual donations. This document outlines how this present system is inconsistent with our stated values, how it is expensive for all of us and detrimental to the economic health of our communities and our country.

  I will compare this present method with another method, sometimes called the Guaranteed Income method, which is a Tax Based method. This is not my original idea and it is not a new idea. I heard about it many years ago.

  The intention of the tax-based method is to provide individuals and families with sufficient income for healthy living using a system already in place. This will be substantially more economical to administer and will provide greater benefits for the recipients and communities.

  I hope I have adequately represented the intention of those who deserve the credit for the initiation of this method of resource distribution.

  My commentary is based my personal and professional experience, some formal education on poverty issues, discussions, and detailed evaluation of events witnessed and information read or heard over a 50 year lifespan.

I do acknowledge that my analysis maybe incorrect and am interested in hearing from anyone who can provide information that I should be aware of or consider.

Present Method:Welfare & Charity

Large, expensive, bureaucracy-based system. Maintains control. Impacts individuals, families and communities adversely in may ways.

---Physical Health---

  • People unable to purchase healthy food for adequate nutrition. Results often include: poor health, obesity, diabetics, heart disease, high cholesterol, high blood pressure, cancer, strokes, compromised learning, poor dental health, organic based mental and emotional health difficulties.
  • Increased demand for health care. High cost for diagnostic equipment, clinics, professionals, doctors, dental care, drugs.
  • Has created a health care crisis in which adequate staff levels are impossible to maintain and workers are subjects to extremely high levels of stress.
  • Patients provided with short-term care and then they return to situation in which good health can not be maintained. Conditions become chronic. Ongoing need for treatments and re-hospitalizations.
  • Use of prescriptions and chemical based methods of attempting to maintain health. Often these have side effects that create additional medical complications

Principle: deal only with affects of poverty

---Emotional Health---

  • People in financial need have high levels of stress, despair, anger, loss of control and depression.
  • Persons living with these conditions are more likely to need mental health services and hospitalizations.
  • Persons provided with short-term care and return to situation where mental and emotional health can not be maintained and basic needs are not met. Thus, maintaining the cycle.
  • A result is a crisis parallel to the one in the physical health-care system.
  • Increased potential for family conflict, domestic violence, family breakup, children in care, suicide, drugs, alcohol, and gambling and other addictions as a means of attempting to escape or attempting to cope.
  • Persons whose basic needs are not met attempt to obtain needs through criminal or socially inappropriate active. Thus, the fact that poor people are more likely to be in conflict with the law and to be incarcerated or to be engaged in prostitution.
  • Community requires more support services in form of Social Services, police, courts, addiction counseling. Workers within these system are overworked and stress.

Principle: People are punished for their lack of self-sufficiency by denying them the means for quality of life, recreation and comforts.

---Spiritual Health---

  • This impact is in many ways invisible and thus more difficult for people to see or understand.
  • People in poverty are subjected to the affect of limited choices, lack of control, constant denial and lack of basic needs and comforts, being forced to accept second rate and second-hand, poor housing options and verbal and non-verbal constant reminders of inferiority. Consequently, many suffer from low self-esteem, lack of confidence and pride.
  • As a Social Worker, who has facilitated empowerment and personal growth for many individuals I know that self-esteem, confidence and pride are the foundation blocks that all must have in order to transition from spiritual illness to spiritual health.
  • Some people create these foundation blocks for themselves. But for many this does not occur without support. And for them, the common advice" Just get a job", is not a solution.


  • Families in poverty do not have adequate money for leisure, equipment, fees. Subsidized programs do not guaranteed involvement. (Source Winnipeg Free Press, March 26th, 2005, page A16.) "Kids from low-income families are hesitant to sign up. Some don't want to face the embarrassment of having to prove their family's low-income status to get ... waiver. Others .,, still feel awkward about testing their skills against kids from wealthier neighborhoods who have had years of coaching.... Some are ashamed of their no-name shoes."
  • Continue to value people based on their economic contribution to the community. Do not make allowance for individual circumstances or history. One solution fits all.

---Educational and vocational---

  • Individuals without adequate nutrition are compromised in their ability to learn. Do more poorly in school. Lower levels of success in university, college and professional.
  • Families unable to afford educational supports systems available to wealthier families, Example, computers, cable and satellite TV channels which provide educational and creative programs
  • Children of families in poverty are disadvantaged in educational field and are more likely to be poor themselves, than children from wealthier families.

---Direct Cost---

  • Society now pays for a wide variety of provincial and Federal benefits and subsidy programs. Each has their own criteria and administrative systems. We maintain a very complex and expensive welfare system including salaries, many buildings, phones, office supplies, furniture, utilities, computers, staffing costs such as benefits, pensions.
  • I do not hesitate to say that the cost of these systems are at least 3 times the cost of what is actually spent for direct benefits of clients. It is probable that my estimate is low.

Principle: Maintains control regardless of cost

---Impact on Community---

  • Demand on food banks to supply goods that can be stored. Some fruits and vegetables but often pasta and other high calorie, high salt and sugar items that have a low comparative nutritional value.
  • Food banks and agency provided goods and services not available to all that need them. Inherent inequality in system based on location and community response.
  • Growth of many disease-based and agencies, (e.g. diabetics association, heart association, cancer related agencies, stroke association). They often respond with educational programs that promote healthier choices. These are necessary but can NOT be effective if people can not afford to make those choices for their family.
  • Ongoing demand for funding from community for the administration and service cost for these disease-based agencies. Additional cost to society.
  • Community members and businesses constantly asked to support the network of charities, provide food for food banks, donate to Christmas Cheer Board, clothing for needy, gifts and items for charity fundraising.
  • Persons living in poverty not able to purchase food from community businesses. Businesses throw away food or donate excess to food bank. Other unsold products also donated to charities.
  • Business lose money on product and respond by raising costs for other customers, laying off staff, moving or closing their business.
  • Benefits of this system concentrated for those whom profit from taxpayer based income such as publicly paid staff in welfare system, publicly paid health care professions, health equipment suppliers, drug companies and those persons who are able to benefits from successful charitable campaigns.
  • Those who gain substantial benefits are able to spend revenue outside of community and country.

Principle: Maintains the status quo for the greater benefit of a few.

--Philosophical basis for the present system--

  • Based on old beliefs poor not worthy of better
  • Individual not worthy of respect, dignity
  • Value of person based directly on his/her economic contribution
  • Assumption that poor are lazy and everyone can get a job.
  • Based on lack of knowledge of the real impact of poverty.

We have been spinning the wheel in the same direction for so long it is now spinning out of control.

Proposed Method: Guaranteed Income

Provide sufficient income for adequate, healthy living including food, clothing, household, transportation, leisure, and emotional and spiritual pursuits. Income may be provided totally through this system or a combination of wages and Tax-Based subsidy when wages are not sufficient. Income tax-based system - already in place. Positive impacts on individuals, families, and communities in many ways.

---Physical Health---

  • People are able to purchase healthy food for adequate nutrition. Results are better short-term and long-term health - physically and emotionally.
  • Decreased demand for health care services, equipment, staff, clinics, etc. Lower cost.
  • Increased potential to maintain adequate staffs levels. Lower stress levels for health care professionals.
  • People have ability to maintain good health through proper nutrition and the purchase of community-based goods and services.
  • Reduced need for drugs and other artificial means of attempting to maintain health. Lower cost, less danger of additional medical complication.

Principle: Eliminate poverty, prevent illness and poor health, maintain health.

---Emotional Health---

  • Reduced stress, despair, less worry, increased sense of control, dignity and well being results in better emotional health.
  • Decreased demand for mental health services. Healthy people make healthier choices and are more productive.
  • Fewer people in mental health system and trapped in cycle of emotional and mental illness.
  • With education and personal empowerment programs people will be able to obtain and maintain a more satisfying quality of life.
  • Increased potential for healthier, functional family and benefits gained from security and family unity.
  • Increased personal satisfaction and control reduces need to use criminal activity or illegal means to meet basic needs.
  • Long-term result will be reduced need for community support services and reduced cost to maintain systems.

Principle - Provide means for people to have reasonable qualify of life, comforts and emotional expression according to our stated values.

---Spiritual Health---

  • Financial resources will increase control, feelings of empowerment and increase quality of life factors.
  • However, the affects of poverty can not be erased simply by proving money. There is a need for supports programs to assist many people with personal development, self-esteem and confidence building, spiritual healing and growth.
  • Some families and individuals will equire long-term education and support programs for their journeys and transition.
  • Only when the present controlling and bureaucratic programs are replaced by these support and education programs , can we truly say we have "Welfare System"


  • Dignity and self-respect are basic foundation blocks for health and growth.
  • Families have money for recreation and physical activity and thus obtain the physical health benefits as well as increased confidence, self-esteem and dignity of involvement and control.

Principle: Acknowledge the individual worth of each person, appreciate that each deserves to live a life of dignity, assist each one as necessary to grow and achieve their maximum potential.

---Education and vocational---

  • Increased ability to learn.
  • Greater equality in access to educational support and information for all citizens.
  • Investment in the future.

Principle - Reduce chance that next generation will live in poverty.

---Direct Cost---

  • The cost of providing resources directly to thousands of Canadian Families is substantially less that the present system.
  • Plus, the benefits to the individual are greater, the benefits to the families are greater, and the benefits to society are greater.
  • The measurable costs are substantially less; the benefits are immense and unmeasureable for present and future generations.

Principle: Implement a less expensive system with greater benefits than the present system.


---Impact on Community---

  • Demand on food banks decreased. Families have control over nutrition.
  • Resources available on more equitable basis. Not dependent on location and response of community.
  • Health educational programs will still be needed for many years. However, now families have resources to benefit from the nutritional information provided.
  • Need for education will be lessened as knowledge transferred from one generation to another through family.
  • As ability to make healthier choices increases and education programs are effective, demand for services and financing of disease based organizations decreases.
  • Providing funding to people in need will reduce need for charity and yearly campaigns. As well, individuals and families will have dignity and freedom to choose.
  • Businesses will benefit directly from sale of product because of increased community revenue. Reduced waste and revenue loss.
  • Consumers benefits. Increased employment in local community. Increased tax base because of financial exchange.
  • Benefits widely distribute throughout communities, as more people will have more money to support all business.
  • Persons receiving assistance or increased minimum wage will spend the majority of their income within home community.

Principle - Implement a new system with greater benefits for more people and community.


--Philosophical basis for new system--

  • Based on new beliefs
  • Everyone is worthy, equal and entitled to resources.
  • Individual is worthy of respect and dignity.
  • Person valued as a human and it is recognized that contribution to society may not be economical.
  • Understanding that person maybe have unknown barriers to employment.
  • We, as a society, are caring and compassionate.
  • Based on sharing and humanitarian values even if knowledge and understanding are absent.

Solution: Spin the wheel in the other direction.