Edoardo Campanella writes in Barron’s about dubious schemes designed to battle poverty in Europe.
The poor don’t often decide elections in the advanced world, and yet they are being wooed heavily in Italy’s current electoral campaign. Former Prime Minister Silvio Berlusconi, the leader of Forza Italia, has proposed a “dignity income,” while Beppe Grillo, the comedian and shadow leader of the Five Star Movement, has likewise called for a “citizenship income.”
Both of these proposals—which would entail generous monthly payments to the disadvantaged—are questionable in terms of their design. But they do at least shed light on the rapidly worsening problem of widespread poverty across Europe. …
… The situation is equally worrisome at a Continental level. In the European Union in 2016, 117.5 million people, or roughly a fourth of the population, were at risk of falling into poverty or a state of social exclusion. Since 2008, Italy, Spain, and Greece have added almost six million people to that total, while in France and Germany the proportion of the population that is poor has remained stable, at about 20%.
In the aftermath of the 2008 financial crisis, the probability of falling into poverty increased overall, but particularly for the young, owing to cuts in nonpension social benefits and a tendency in European labor markets to preserve insiders’ jobs. From 2007 to 2015, the proportion of Europeans ages 18 to 29 at risk of falling into poverty increased from 19% to 24%; for those 65 and older, it fell from 19% to 14%.
