How poverty lowers your IQ

A study by American psychologists conducted among Indian sugarcane farmers answers many questions about why the poor people make poor choices. It’s a bit harsh to characterize poor people in such fashion, but available data indicate that the poor person smokes more, borrows more, sells his votes, eats less healthy food and gives birth to […]

A study by American psychologists conducted among Indian sugarcane farmers answers many questions about why the poor people make poor choices.

It’s a bit harsh to characterize poor people in such fashion, but available data indicate that the poor person smokes more, borrows more, sells his votes, eats less healthy food and gives birth to children they can’t care for.

The research was simple. The psychologists simply administer IQ tests on the Indian sugarcane farmers before and after harvest.

Note that before harvest, the farmers have nothing. But after harvest, they have a good deal of money.

The result was quite surprising. There was a difference of up to 14 IQ points before the two tests. It turns out that farmers are more intelligent during harvest when they have money.

Rutger Bregman, in further discussion with one of the authors of the study, summed up the research as a scarcity mentality. When people realize something is likely to end, they go crazy about it.

If this insight holds, it then means that it doesn’t matter how much you have materially, once you are afflicted with a scarcity mentality, you’re poor.

We can use this extrapolation to explain the wickedness of leaders in Africa.

Because they know that if they leave their leadership positions, the privilege they enjoy will end, they then steal public fund to sustain their new lifestyles. They know that out of power, unlike in the developed nations, they will no longer have access to the best medical service, security, food and housing.

It is completely lost on them that instead of stealing they could provide those services for their people. So that when they leave office, they themselves would be beneficiaries.

However, how can they think in this way when their mindsets cost them a loss in IQ of up to 14 points?

But most importantly, if poverty is scarcity mentality, is there a way we can eliminate it?

Yes, many have argued. And the magic wand to do that is UBI (universal basic income) or what some experts like to call unconditional basic income. So-called because UBI is a monthly income supposed to be given to every citizen without any conditions.

The argument is that once you are given the money, you’re likely to use it to purchase products and services that make you better off. Which in turn improves your quality of life.

This makes sense. Here’s a thought experiment: imagine someone promises you a substantial amount every month for life. Would you be desperate? The value you put on your self-dignity is likely to increase. For example, it would be difficult for any politician to buy your vote.

Of course, there have been arguments against UBI. The main argument is that to pay every citizen a basic income is unsustainable.

“Nothing in the history of this country suggests Americans are ready to add that kind of burden to their current taxes,” Eduardo Porter wrote in the New York Times.

That’s Porter’s argument against those who said a UBI of monthly $1,000 should be paid to American citizens. Which will cost their government additional $3.9 trillion – a fifth of the United States’ entire economy.

But some experts have suggested lower figures such as $200 or $500.

Yet, Annie Lowrey, in an article for Medium.com said that even $1,000 is doable if the government raises some certain taxes:

“Using those kinds of taxes - on wealth, shared resources, pollution, consumption, and so on, as opposed to just income taxes - to help finance a UBI would not only be practical but also would underscore the UBI’s role as an investment in everyone and a right for everyone. It would be not just a way of taking hard-earned money out of someone’s pocketbook and putting it in someone else’s. It would reinforce that a UBI is a public good, financed with public wealth.”

UBI is getting popular around the world due to the fact that there have been positive impacts wherever it has been experimented – from Canada to India.

Yet, it’s my opinion that the idea that EVERY citizen should enjoy the UBI is piling unnecessary burden on a beautiful idea. I agree that every citizen should enjoy some income. However, those who already have some certain level of income should be excluded.

In Nigeria, the Buhari Administration is implementing a watered down version of UBI with its Poorest of the Poor programme where it pays one million Nigerians N5,000 a month. Note that five thousand naira is not a true basic income, but it’s a start.

I loved the idea of UBI so much that at a personal level, I’ve been paying people my own version for the past year.

While the FG pays one million people, I pay 60 Nigerians from my village. While the FG pays N5,000 a month, I pay half of that.

So every month, I sent N150,000 to a microfinance bank where the beneficiaries were made to open accounts.

Naysayers would argue that it would have been better to give the 150,000 to three persons per month instead of spreading it too thin. But they would have been wrong.

Like the research around the world has shown, my beneficiaries use the money to do things that make them better off. One of them was using the money as her only source of medication until she passed on recently.

In sum, even though poverty is a physical reality, it is also a mindset – a state of mind. It’s a scarcity mentality. This state of mind leads individuals to bad choices which entrenches the vicious cycle of extreme poverty in our communities.

One way to remove this mentality is to guarantee a basic income to everyone. This column advocates that every country can adopt a customized version of the UBI.