Two insights on the nature of poverty.
Donald J. Boudreaux, Globalization (on trade not politics):
Henry Hazlitt, Why Some People Are Poorer than OthersA far more interesting question is what causes this wealth.
Before we explore the answer to this question, it’s interesting to notice that Smith did not ask “what causes poverty.” Smith would have found such a question to be odd, if not downright meaningless. In Smith’s time, even in relatively prosperous western Europe, poverty was widespread. Poverty was the norm. Smith understood that poverty has no causes; it is (to use a modern term) humankind’s default mode. If each of us does nothing, if each of us exerts no creativity and no effort, we will all be miserably poor. It is no challenge to “create” poverty.
The real challenge, Smith realized, is to create wealth, especially enough wealth so that it is regularly available to ordinary people.
Throughout history, until about the middle of the 18th century, mass poverty was nearly everywhere the normal condition of man. Then capital accumulation and a series of major inventions ushered in the Industrial Revolution. In spite of occasional setbacks, economic progress became accelerative. Today, in the United States, in Canada, in nearly all of Europe, in Australia, New Zealand, and Japan, mass poverty has been practically eliminated. It has either been conquered or is in process of being conquered by a progressive capitalism. Mass poverty is still found in most of Latin America, most of Asia, and most of Africa.
...This problem is nearly always referred to by socialists as "the paradox of poverty in the midst of plenty." The implication of the phrase is not only that such poverty is inexcusable, but that its existence must be the fault of those who have the "plenty." We are most likely to see the problem clearly, however, if we stop blaming "society" in advance and seek an unemotional analysis.
Poverty is the norm. One rises out of it by creating wealth, in production and/or trade.