Extreme Poverty—less than $2 a day?
You might have noticed a change in our tagline at Bright Hope recently. On January 1 we started using the phrase, “Helping those earning less than $2 a
day,” as a measure for who we are serving.
When I became CEO of Bright Hope in 1993, the World Bank had just started using the benchmark of less than $1 a day as the line where extreme poverty begins.
As you can imagine, defining such a standard across worldwide currencies and economies is not a easy task. Good scientific minds gathered and mathematical maneuvers were employed to reach an equitable solution. There were two main factors in deriving this number:
- Determining the standard of living across countries and examining the poorest economies to reach a true extreme poverty line.
- Equalizing the world’s currencies by creating something called, "Purchasing Power Parity" (PPP). These are exchange rates calculated to offset differences
in price levels from country to country. In other words, one "PPP" dollar should buy the same basket of goods whether in Kenya, India or the U.S.
These two steps allow the World Bank to declare a poverty figure in terms of the U.S. dollar.
In 2005, the World Bank recalculated the index and found the poverty level was at $1.25 of earnings per day and in 2017 it was recalculated again, finding $1.90 to be the line. Fluctuating currency values, inflation and other factors have produced this rise.
With this latest recalculation, our team has determined that changing our tagline to “helping those living on less than $2 a day” is a more accurate reflection of where we minister and those we want to serve.
What other factors do we look at when choosing where to serve?
The people we help tend to live in city slums and remote villages. What do they need? They need holistic approaches to health, education, employment, income generation and spiritual and emotional support. The days of thinking clean water or vaccines alone are going to lift a family out of poverty are over. Beneficiaries need holistic interventions that help on multiple levels to permanently raise the whole family from the grip of extreme poverty.
Thank you for joining this cause and becoming an Ally for the extreme poor through Bright Hope.