World Bank Expected to Raise Extreme Poverty Level

There has been a lot of news about the possibility of raising minimum wages to higher and higher rates. However, stories about the definition of extreme poverty make news less frequently. In fact, most would probably be surprised to find just what the extreme poverty line is on a global level.

There has been a lot of news about the possibility of raising minimum wages to higher and higher rates. However, stories about the definition of extreme poverty make news less frequently. In fact, most would probably be surprised to find just what the extreme poverty line is on a global level.

Yet, this level expects to be a focus for the United Nations General Assembly when it meets in New York City this week. While the concept of eradicating poverty has been a popular topic for the UN for many years, Marketplace.org reports that this year the UN has put reaching this goal by 2030 at the top of its list of sustainable development goals.

Of course, to wipe out extreme poverty, the world must identify an agreed upon definition of extreme poverty. The task of identifying this level has fallen to the World Bank. For its part, the World Bank may be raising the stakes for the UN by raising the standard for what the world will define as the extreme poverty line. Should its follow through with its reported plans, the World Bank will raise the level at which one is living in extreme poverty from $1.25 a day to $1.90 a day.

Needless to say, these rates would be far too low for most Americans to survive, but that is also true in other parts of the world. The World Bank’s decision to move the level of extreme poverty is a means to reflect changing standards of living around the world, according to Professor Valerie Kozel from the University of Wisconsin-Madison. Professor Kozel worked with the World Bank on poverty for many years and helped contribute to the decision to increase the extreme poverty level.

According to Kozel, the message of moving the line is to reflect a shift in the economic realities of the world, including forces such as inflation and the expenses of living in an increasingly modernized world. When the World Bank first set the extreme poverty line standard 30 years ago, those who lived above the line merely had enough money to buy sufficient food to eat. Today, however, durable goods like cell phones and transportation are nearly as important to survival as food. This is even true in many developing nations. As a result, the $1.25 line would simply be too low for many people around the world to survive, even in the nations with the lowest standards of living.