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The growing poverty in the cities raises serious concerns. The depth, duration and scale of poverty are the most important indicators of the state of the society and the effectiveness of the measures aimed at its reduction. Urban poverty is becoming one of the most acute problems facing city government bodies. On the one hand, the characteristics and nature of social inequalities in cities are changing: the distance between the poor and the rich is widening, the structure of employment is changing, the share of the poor working population is increasing, inequalities are formed in the organization of urban space (ghettos, elite areas, closed communities). On the other hand, there is a network of actors, whose activities are directed at solving the problems of poverty (public services, NGOs, charitable organizations, hospitals, local communities, etc.). All these changes not only redefine the experience of poverty, but also form new resources and barriers to exit from poverty. The paper will discuss urban poverty, associated issues, solutions, and recommendations for combating the issue.
Poverty is a socio-economic category that reflects the absolute or relative level of satisfaction of the minimum life requirements. This phenomenon is related to various reasons - demographic (incomplete families), social (disability, old age), economic (low wages, unemployment), regional-geographical (depressed areas), political (military conflicts, forced migration) (Elhadary & Samat, 2011). According to Turok and McGranahan (2013), smaller urban settlements are less productive than larger ones in high-income countries. A sharp decline in the standard of living undermines social reproduction and causes social tension in the cities. In turn, it leads to instability and generates inequality and unequal access to power and wealth.
Poverty is a social phenomenon that permeates the entire history of the development of human society. Urban poverty is a phenomenon reflecting the characteristics of the socio-economic position of the share of the urban population, in which it cannot support the generally accepted standard of living in a given society. Urban poverty differs from rural by high degree of severity and depth of poverty and formation in the conditions of high social polarization. Sulaiman, Azman, & Khan (2014) emphasize that “living in the urban areas imposes extra expenses upon the poor” (p. 64), including more expensive food and services than in rural areas. Poverty was transformed from the economic problem into a social problem. One of the main trends of this transformation was the rejection of the concept of absolute poverty in favor of the concept of relative poverty. The concepts of relative deprivation and social exclusion are becoming increasingly popular, according to which poverty reflects not much the income (economic opportunities of the family) as the way of life, the inclusion of citizens in public life, the level and quality of life in general.
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The main causes of urban poverty include the difficulties of socio-economic and political transformation, which are dictated by the unprecedented transition from a non-market to a market model of socio-economic development, with a practical lack of managerial influence of the state on these processes, the scale of the reforms, the costs of their practical implementation. Elhadary and Samat (2011) state that urban poverty is caused by “structural processes related to economic policies adopted at both national and international levels” (p.65). Thus, various policies can contribute to the development of poverty in the cities. The decline in production and a sharp reduction in the number of operating industrial enterprises concentrated in the cities can cause urban poverty. Another cause is the type of the settlement (large, medium, small town) and its inherent labor market. Social inequality in the sphere of labor relations and the level of remuneration of labor in the state and non-state sectors of the economy are also the sources of poverty. The lack of optimal conditions for the development of small and medium-sized businesses leads to poverty in the cities. Other causes are high standards of urban lifestyle, dictated by a constant increase in tariffs for housing and utilities, a high degree of commercialization of health care, education, and leisure. Loss of socio-economic links between a significant part of the urban population and the village and the lack of the opportunity to use subsidiary farming to maintain the urban standard of living create the basis for the development of urban poverty.
At the end of the 20th century, there was an important transformation of the origins, nature and consequences of urban poverty in the Western society. A new regime of urban inequality and marginality emerged (Schneider, Shiki, & Belik, 2010). It happened along with the acceleration of economic modernization that was caused by the global restructuring of capitalism, with the crystallization of the new international division of labor (generated by the high speed of the flow of finance and labor through the borders of the states), as well as the growth of the new knowledge-intensive industries creating a dual structure of employment and based on revolutionary information technology. Previously, poverty in the western megacities seemed for the most part to be a residual or short-term phenomenon, tied to the working class’ living quarters, and was perceived as geographically dispersed and correctable through further market expansion. Today, it seems more prolonged, if not permanent, and not connected to the macroeconomic trends. Nevertheless, it is tied to ill-used disadvantaged areas, in which social isolation and alienation feed each other. At the same time, there is a growing gap between such areas and those where the rest of the society lives.
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The new urban poverty is a consequence not of economic backwardness, stagnation or decline, but of inequality that arises in the context of overall economic progress and prosperity. The most surprising property of the new poverty is that it spreads in the era of capricious but steady growth, which is an evident improvement in the material situation of the most privileged members of the ‘first world’ societies. Luxury and poverty, abundance and need, wealth and hardship grow together. Thus, New York represents a shelter for the largest number of the representatives of the highest class on the planet, and the greatest army of homeless and poor in the western hemisphere. In fact, these phenomena are interrelated. The newest forms of increasing efficiency and profit-making in the sphere of high technologies, along with a decrease in the attractiveness of industrial production, trade and intermediary operations and the financial services sector crush labor and divide people into different categories both on access to permanent work, and on the level of remuneration for it. Post-industrial modernization leads, on the one hand, to the multiplication of jobs that require high qualification of technical personnel and professionals with university education, and, on the other hand, to the deprofessionalization of low-educated workers and the complete disappearance of jobs for them (Sulaiman, et al., 2014). The more the reorganized capitalist economy progresses, the wider and deeper the new marginality spreads, the wider are the ranks of those who fall into the poverty net, without delay and the right to help even though official unemployment is falling and income is growing in the country.
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Social stratification and poverty in big cities cause high mortality, shortening life expectancy, low labor productivity, degradation of personality, and various forms of deviation. Urban poverty that presents a cruel reality can be considered to be the biggest urban challenge and problem “because it is poverty which leads to many other problems in the urban areas” (Sharma, 2012, p.42). Urban poverty can become the cause of a whole complex of negative social phenomena, including crime and violence (Sulaiman, et al., 2014). A decrease in the intellectual potential of the urban population as the determining factor of competition in the conditions of globalization, a spiritual and moral crisis are the results of urban poverty. Ignoring and underestimating the problem of poverty, misunderstanding its consequences by the financial and power elite of the country poses a direct threat to its economic development, social and political stability of the society, its security.
Chronic poverty, becoming the material basis for the formation of the so-called underclass with its inherent subculture, way of life, style of behavior, increasingly demonstrates the growing signs of social tension and cultural pullback in the society. It generates a slum civilization that is characterized by mass antisocial behavior, narcotization of the population, outbreaks of infectious diseases (tuberculosis, AIDS, hepatitis), threatens social and political destabilization of society (Goswami & Manna, 2013). The problem of the formation of ghettos is one of the key issues that are related to urban poverty. The development of real estate markets in the countries with economies in transition has created a mechanism for the territorial concentration of various groups. At the same time, the collapse of public transport and public services has led to the fact that the outlying areas of cities are divorced from the main infrastructure, and their population turns into outcasts. Slums are parts of the urban space, the urban economic system, which is incorporated into the neoliberal economy. Solving the problem of ghettos can be affected by policy in the field of public services and transport, urban planning, social assistance, and housing programs (Elhadary & Samat, 2011). However, slum dwellers are in a state of undeclared war with local authorities. The authorities are clearly unhappy with the spread of such territories in their cities, which negatively affect the image of the country in the eyes of tourists and potential investors. Instead of solving the problem of poverty by reforming and improving the economy, people are often simply evicted. Most of the local people rent housing and even these poorest tenants are a source of huge profits. Nevertheless, when issues of construction and land come into play, these marginalized urban residents are very easy to evict in favor of shopping centers, highways and other more profitable architectural forms.
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To be fair, it should be said that the governments of some states have taken certain actions to implement reforms in the sphere of labor, education and welfare in their countries. An example is the programs developed in Brazil, such as Bolsa Familia and Fome Zero. During the first, more than 11 million families received benefits from the state budget (Hall, 2006). Obligatory conditions for receiving the benefits were school attendance by children and the availability of vaccinations. School meals reduced the costs of parents, and vaccinations increased the level of protection of children. The aim of the second program was to provide the population with access to drinking water and food by creating local reservoirs, public canteens and distributing vitamins. At the same time, these programs had a number of weaknesses. It should be taken into account that such programs are not able to eradicate the problem, because, despite some positive effect, they stigmatize poverty, instead of looking for a systematic approach to solving the problem.
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The state policy on combating poverty is aimed at creating conditions for the life of society in which the income of each person would be at a level not lower than the subsistence level. Unfortunately, the achievement of such a condition on the scale of the state is extremely difficult. Therefore, the problem of increasing the effectiveness of state policies to combat poverty is relevant today. Obviously, the problem of poverty requires finding solutions not only at the state, but also at the international level.
The main conditions for reducing urban poverty are a significant growth of the economy on the basis of the transition from a commodity orientation to the formation of its innovative forms and creation of the necessary conditions for the formation of a highly skilled workforce that meets the requirements of the modern production. This should be based on the latest achievements of the scientific and technological progress. Schneider et al. (2010) argue that the effective solution should be based on three levels of intervention: structural level, food policies, and responding local characteristics. Socio-economic policy should be aimed at enhancing the economic activity of the urban population, creating optimal conditions for the development of entrepreneurship, expanding small and medium-sized businesses in different types of urban settlements. It is important to develop and use effective mechanisms to prevent poverty and excessive social inequality (Goswami & Manna, 2013). Another measure that should be taken into account to prevent poverty is development and consistent implementation of the effective social programs aimed at providing targeted assistance to socially vulnerable segments of the urban population (people with disabilities, children, incomplete families, retired people, and students).
One of the main problems in the development of poverty reduction strategies is reliable information on the scale of poverty at the level of settlements. Almost every city has adopted programs dedicated to the social protection of the population (Nikku & Azman, 2014). The city budgets have determined the costs of social assistance to the poor. The basis of the municipal struggle against poverty is economic measures.
In other words, the best recommendation is creating conditions and providing the population with the opportunity to realize their labor potential, implementing not formal but productive employment that can eradicate the poverty of working people. Taking into account the fact that the main manifestation of qualitative growth affecting the incomes of the working population is the growth of labor productivity, the introduction of high technology in the production sector should be recognized as the growth factor of labor productivity. This recommendation includes the creation of favorable conditions for the development of a small business. It is crucial to provide further development and improvement of active measures to promote employment through the creation of additional jobs, the organization of paid public works, vocational training, advanced training, and retraining of unemployed. There should be equalization of access to resources, free or subsidized social services (Nikku & Azman, 2014). The conditions conducive to the mobility of skilled labor (transition to the places of its most effective use) have to be created. The development of infrastructure that facilitates the expansion of the possibilities of a poor person without increasing his/her income plays a significant role in fighting the problem of poverty in the cities. This will have a great impact on urban affairs through creating the opportunities for working people to overcome inequalities and reach material prosperity.
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The urban poverty determines a whole range of negative social consequences. The main goal of social and economic progress is reducing poverty and stipulating stability in the sphere of politics and prospects in the global world. The consequences of the transformation processes were a change in the social structure of the society, which resulted in the increased poverty, deterioration in social well-being, and exacerbation of social tension, which suggested that social and economic policies needed to be adjusted through a comprehensive analysis of the level and causes of poverty. Today, urban poverty causes a number of related issues: the development of ghettos, health problems, and social inequality. To overcome these problems, there is a need to implement a comprehensive strategy that will include economic and social measures of fighting poverty.
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