84% of World Population Subsists on under $20 a Day: Pew Report

Despite significant advances in communications, agriculture and bio-technology over the past 15 years, the overwhelming majority of the world population continues to live in economic privation, according to a report on global incomes published this week by the Pew Research Centre.
The report, entitled “A Global Middle Class is More Promise than Reality,” classifies 71 per cent of the world population as either poor or low-income, subsisting on less than $10 a day. The report concludes that 84 per cent lives on less than $20 a day, or $7,300 a year, an income level associated with “deep poverty” in developed countries.
Only seven per cent of the world population lives on what the report calls a “high” income level of more than $50 a day, or $18,000 a year. The great majority of these people live in Europe or America.
In the years following the turn of the millennium, and especially before the 2008 financial crash, the supposed emergence of a new “global middle class,” particularly in developing countries, was touted by the political establishment as proof that the capitalist system was capable of bringing economic prosperity to people living in poverty in Asia, Latin America and Africa.
The Pew report pours cold water on such claims. “The global middle class is smaller than we think, it is less well off than we think, and it is more regionally concentrated than we think,” Rakesh Kochhar, the study’s lead author, was reported as saying.
The report finds that even countries that “sharply” reduced the worst forms of poverty “experienced little change in the share of middle-income populations.” While the report notes that there has been a reduction in the number of people living on less than $2 a day, it points out that those who have ascended from the lowest depths have for the most party landed in the “low-income” category of $2-10 a day – a level that would classify them as living in extreme poverty by US standards.
The report uses the latest purchasing power parity data to analyse and compare the distribution of incomes throughout the world. It covers 111 countries, which account for 88 per cent of the world’s population, and spans the years 2001 through 2011.
Over that period, the share of the world’s population classified as “upper-middle income,” making between $20 and $50 a day, grew from 7 per cent to 9 per cent. This was significantly less than the growth of the share of the population making between $10 and $20 per day, which increased from 7 per cent to 13 per cent between 2001 and 2011.
The great majority of the increase in “middle income” people occurred in China and other high-growth countries in the Pacific whose economies have rapidly expanded over this period….
The statistics presented in the Pew report underscore the basic fact that the capitalist system has proven incapable of providing a decent standard of living for the vast majority of the world’s people.