Informal Cities and the Brutality of Trickle Down Economics

Ashwa’eyat, the informal cities, are an issue that spans many countries and cities across the world. Caused by povertyamongst many other things, slums are defined as ‘overcrowded residential urban area characterized by below standard housing, poor basic services, and squalor’. They are informal settlements built without the support of the state, are often overcrowded, unstable, and not secure. Because of this lack of safety and security, houses in slums are often far cheaper than houses in the city. Another issue that arises is the effect of these circumstances on a person’s mental and physical health, with people living in slums often suffering poor health. Many individuals live in slums because they are closer to the bigger cities nearby, but without the cost. 

Economists have often argued that slums are part of the pathway for people experiencing poverty to rise up the class ladder. Some studies have cited that people who live in slums move on to bigger and better things, with many of them often start their own business. These economists have argued using the trickle-down economics perspective, which theorizes that benefits for wealthier individuals (such as tax cuts, subsidies, and other forms of governmental support) will eventually ‘trickle down’ and benefit everyone else through the resulting economic growth. Some theorists, supply side ones, push for neoliberal reform, with less regulations and more tax cuts for large corporations being the center of their theory of how to raise output and create better jobs. On the demand side, believe that wealthy businessowners need this wealth in order to continue providing wages to their workers. Many have criticized trickle-down economics in general, arguing that it is political rather than scientific. An MIT study published in 2013 also disagrees with the findings of trickle-down economics, arguing against this theory and practice. It argues that slums, rather than being beneficial, temporary positions for families that are bound to disappear as the country develops, are instead poverty traps. Because of the lack of health benefits, the amount of diseases, the danger, the fires, and the lack of access to basic services, slums continue the poverty cycle and act as hurdles for people to break out of them, causing people to be automatically disadvantaged simply by being born into one of these areas. 

Many Egyptians continue to live under the harsh living standards outlined by slums. There are about 1,100 slum areas in Egypt, more than 31 percent of which are in Cairo. Cairo’s slums have often been noted as several ‘pockets’ of the city, and, according to the UN Habitat, can be classified into settlements that were once private, former agricultural land or on vacate desert land, or deteriorated sections of older parts of the city and urban ‘pockets’ of inner-city Cairo. The families that live in these slums are often poor families, who have to deal with the crime rates, poor housing, and risks associated with living in a slum. In some areas, such as Manshiet Nasser, families are at risk of rockslides from nearby hills. However, many recent efforts have been taken to rehouse individuals and upgrade the areas with the lowest living standards. 

 However, it is still important to discuss the effects of these “trickle-down” theories and policies that led to the living standards people have had to bear while others continued growing their wealth.

Slums are a global issue, with global initiatives attempting to take over the matter. Habitat for Humanity, a global initiative, suggests upgrading slums, rather than evicting families, in order to help resolve the matter. There are several initiatives meant currently dealing with this issue in Egypt, often held by the Egyptian Ministry of Planning, with a goal to eradicate the ashhwa’eyat by 2030. Hundreds of thousands of units have been built to take in relocated residents, with priority being given to people who are living on directly dangerous land; however, some residents still need to go back to the slum areas in order to continue working. The effects of this relocation, asa perceived by those displaced, is yet to be further studied. Furthermore, it is still important to discuss the effects of these “trickle-down” theories and policies that led to the living standards people have had to bear while others continued growing their wealth. People, everywhere, deserve to live in areas with access to clean water, in areas with clean water, with safety. 

Citations and sources for further reading:

“In the Slums of Cairo, Home Is a Roof Over Your Head.” United Nations Population Fund, 1 June 2007, www.unfpa.org/news/slums-cairo-home-roof-over-your-head.

Kenton, Will. “Trickle-Down Theory.” Investopedia, Investopedia, 5 Feb. 2020, www.investopedia.com/terms/t/trickledowntheory.asp.

Leila, Reem. “Safe Relocation: Egypt's Plan to Eradicate Slums by 2030 - Politics - Egypt.” Ahram Online, 2019, english.ahram.org.eg/NewsContent/1/64/325213/Egypt/Politics-/Safe-relocation-Egypts-plan-to-eradicate-slums-by-.aspx.

Marx, Benjamin, et al. “The Economics of Slums in the Developing World.” Journal of Economic Perspectives, vol. 27, no. 4, 2013, pp. 187–210., doi:10.1257/jep.27.4.187.

Sims, David, et al. “Understanding Slums: Case Studies for the Global Report 2003.” Cairo, 2003, www.ucl.ac.uk/dpu-projects/Global_Report/cities/cairo.htm.

“Urbanisation and the Rise of Slum Housing.” Habitat for Humanity GB, 18 Sept. 2018, www.habitatforhumanity.org.uk/blog/2018/09/urbanisation-slum-housing/.

“What Is a Slum? Definition of a Global Housing Crisis.” Habitat for Humanity GB, 12 June 2018, www.habitatforhumanity.org.uk/what-we-do/slum-rehabilitation/what-is-a-slum/.