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Mains Answer Writing

20-March-2024

Q1) Without economic growth, capacity building and job creation, short-term welfare measures perpetuate poverty. Examine.

(150 Words/ 10 Marks)

ANSWER

Welfare measures are the schemes and policies that redistribute taxes through social expenditure. It is considered crucial element of poverty alleviation. But experts argue that short-term welfare measures perpetuate poverty in the long-term in contrast to long-term welfare:

Short-term Welfare

Long-term Welfare

1. High opportunity cost: Short-term welfare expenditure reduce expenditure for growth-stimulating activities. Without economic growth, the scope for job creation diminishes, hindering upward mobility and the ability of individuals to move out of the poverty-trap.

 

2. Short-term welfare measures do not address the underlying structural causes of poverty.

 

E.g., socio-economic marginalization, lack of capacity, etc.

 

3. It leads to a cycle of dependence, creating competition for unproductive ‘welfare.’

E.g., bank loan waivers for electoral gains.

 

4. It limits government capacity for public investment in social and physical infrastructure.

 

E.g., high interest burden and current revenue expenditure in budget.

 

5. It is politically disempowering. It creates a ‘Mai-baap culture,’ with the government as the master bestowing dole-outs

1. Welfare measures that are part of long-term strategies build capacities for sustainable economic growth to eliminate poverty.

E.g., investing in education, vocational training, and skill development programs.

 

2. It enhances employability,

entrepreneurship, innovation, enabling individuals to seize economic

opportunities.

E.g., SHG-bank-linkage programme.

 

3. It creates synergies for comprehensive poverty reduction. E.g., Ayushman-Bharat Yojana for health coverage for the bottom- 40% of population.

4. It creates an enabling environment for job creation.

E.g., investments in infrastructure.

 

5. It facilitates development of various

sectors.

E.g., PM Krishi Sinchai Yojana for irrigation-coverage, PM Fasal Bima Yojana for insurance penetration.

 

But short-term welfare measures are also relevant in the following ways:

  1. Short-term welfare measures are essential to alleviate immediate hardships for individuals and communities grappling with poverty.

E.g., PM Gareeb Kalyan Yojana for food security during pandemic.

  1. They reduce the cost-of-living for those living under extreme poverty.

E.g., low food expenditure due to subsidized PDS under the National Food Security Act, free electricity for upto 200 units per month etc.

  1. Short-term welfare works as a stop-gap arrangement for structural issues in economy.

E.g., role of MGNERGA in reducing migration and providing distress employment during economic downturn or due to jobless growth.

  1. Technology has improved aspects like inclusion-exclusion errors, leading to targeted benefits that empower the marginalized.

E.g., Direct-Benefit Transfers. Short-term welfare mitigates poverty through short-term consumption subsidies.

Poverty elimination requires long-term strategies that judiciously combine short-term welfare with investments in infrastructure, basic amenities, and better education and healthcare.

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