The economic reading from home and abroad this week has been grim. A decade ago, poverty was considered close to being eradicated in Taiwan, with less than 1 percent of the population falling below the poverty line. This week, the news is that 10,000 more households — 1.36 percent of the population — slipped below the poverty line in the second quarter, a line that is defined as a single adult earning less than NT$14,614 per month.
However, it’s not just Taiwanese who are suffering. The US Census Bureau announced on Thursday that the poverty rate in the US climbed for a third straight year last year, to the point that one in seven Americans — 14.3 percent of the population — now lives in poverty.
Taiwanese of all socioeconomic levels can at least take comfort in the fact that their basic health needs are covered, while the percentage of Americans without health insurance rose to 16.7 percent last year, or 50.7 million people. The US government has said it will take until 2019 for nearly 93 percent of Americans to have health insurance. Taiwan’s National Health Insurance system is hemorrhaging money, but at least few people are forced to choose between feeding their family or paying to mend a broken bone or combat a major illness.
Economic analysts say the US poverty picture will worsen substantially before it improves, but many people were protected somewhat by an expansion of unemployment insurance and Social Security payments. Taiwan’s safety net needs repairs, which is why the Cabinet actually wants to see more people in the below-poverty-line category. It plans to amend the Social Assistance Act (社會救助法) to redefine the poverty line, adding another 21,000 households to the 108,000 already there. Officials say that clarifying the income categories — both poverty level and low-to-middle income — would help make more people eligible for social welfare programs.
Unlike the US, however, the rise in Taiwan’s poverty rate comes at a time of economic recovery, as the economy grew more than 13 percent in the first quarter this year. To the dismay of big business, however, the Council of Labor Affairs on Monday announced plans to raise the minimum wage by 3.5 percent to NT$17,880 beginning on Jan. 1, pending Cabinet approval. Considering it has been three years since the minimum wage was last raised (which was the first change in 10 years), and the rise in the consumer price index, it’s clear the increase was warranted. Even so, business representatives delivered stark warnings of job losses and rising unemployment, which has been hovering above 5 percent this year (in the US it is 9.5 percent).
Unfortunately, the one sector in Taiwan that is hiring is temporary or “dispatch” work. The number of dispatch workers skyrocketed by 169 percent from 2006 to last year. These are just the kind of short-term, low-paying, marginal jobs that keep the working poor trapped on or below the poverty line, no matter what country they reside in.
The global recession, which began three years ago, has cost tens of thousands of jobs, with many more yet to go. It’s not that people don’t want to work or don’t have the qualifications; the jobs that would provide them with a living wage and even the chance to save some money are fast disappearing.
Taiwan has focused on training programs, subsidized employment offers and internships to boost the number of employed. These are short-term stimulus measures that will do little to create long-term employment prospects.
For more than a decade, Taiwanese lawmakers, like their counterparts in the US and elsewhere, have allowed party politics to outweigh their responsibilities to the public, and nation as a whole, when they set economic policy, shortchanging today’s voters and future generations. No nation can afford to let this situation continue.
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