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Sun, Dec 17, 2006
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Poverty Alleviation
Crisis Management

Poverty Alleviation
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The government must take effective measures to re-engineer the distribution system of essential commodities so that the vulnerable strata are the biggest beneficiary.
Many economic experts are of the opinion that poverty is rearing its ugly head in Iran, as the prices of housing, public services (transportation, health), as well as other essential commodities, go through the roof. Under the circumstances, people are no longer able or willing to invest in the production and services sectors, and the purchasing power of households has deteriorated.
As Persian daily Donya-ye Eqtesad reports, poverty has many aspects and includes:
- Lack of material need, typically including the necessities of daily life, like (food, clothing and shelter). Poverty in this sense may be understood as the deprivation of essential goods and services.
- Insufficient income and savings.
- Social exclusion, dependency and the inability to participate in society. This would emanate from lack of education and information.

Difficulties
To resolve the problem and increase peopleÕs standard of living, Iranian governments have granted direct and indirect subsidies for basic products and services, in addition to other supportive measures. This is important because governments have always tried to focus their programs on lowering the costs of living at all levels.
However, inefficient supervision over programs designed to reduce costs have increased public income and at the same time have had inflationary effects. This has also resulted in increasing the volume of liquidity and psychological pressures. All these have worked together to form a vicious cycle of poverty.
In the past, housing was one of the main areas in which households spent a large portion of their income. State policies were designed in such a way that households could not go up the property ladder, let alone invest in the housing market.
And in the absence of economic leverage, people are unable to save, let alone invest in productive activities.
Given their financial means, people usually face two options:
- Participation in activities with quick and guaranteed returns: In this case, most activities are centered on middlemen activities and there is no productive activity in sight. In other words, there are no productive investment activities.
The outcome is further inflation for the national economy. And this is made worse by middlemen activities in commodities such as medicine.
- Purchase of luxury goods: In the absence of an institutionalized culture to save and invest, and also lack of trust and higher risks in the production sector, people tend to purchase luxury goods, which besides being inflationary, is also counterproductive.

GovÕt Measures
The government should devise policies that impact households directly and help strike a balance between their incomes and expenditures. It is also expected to make fundamental changes in its policies and prioritize the amelioration of economic pressures.
The housing sector is where most of the household money are usually spent on. So the government should step forward with policies to make housing more accessible.
The government should act in a determined and active manner to help reduce peopleÕs daily expenditures. To start with, it can proceed by eliminating land prices from the cost of house construction. The policy has been successful in small towns and should be extended to major cities.
In the services sector, the government should organize and devise a specific strategy. For instance, the policy of improving public transportation is high on the agenda of many governments across the globe and should be seriously implemented in Iran, as it reduces expenditures for ordinary citizens and resolves problems related to pollution and public health.
To this end, the government of President Mahmoud Ahmadinejad is expected to pave the way for implementing related policies. The government should also implement policies to reduce the indirect cost of transportation on the prices of basic goods.
Other public services such as inexpensive health and treatment should also be provided, in view of the current high costs. The prevention, treatment and management of illness and the preservation of mental and physical wellbeing is of pivotal importance.
The government must take effective measures to re-engineer the distribution system of essential commodities so that the vulnerable strata are the biggest beneficiary. To start with, it should eliminate middlemen and oversee the distribution of products at reasonable prices, in cooperation with producers and consumers.
Only by providing affordable essential goods and services, boosting income and facilitating social assistance will it be possible for the government to prepare a level playing-field for all strata and put an end to the cycle of poverty nationwide.

Crisis Management
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Emergency or disaster management is the discipline dealing with natural disasters across the globe.
Crisis management involves identifying a crisis, planning a response and resolving the same.
According to Moj News Agency, crisis management can be applied in almost any field of endeavor, but is most commonly used in international relations, political science, business and management. Many nations have developed crisis response guides, which identify potential situations such as quakes and other disasters.
Research in recent years shows that most financial and infrastructural damage caused in certain countries is because of the absence of crisis management. And even when these countries attempt to repair the damage, it is made ineffective by lacking a scientific basis, training and preparation.

Research
Research conducted by experts on economic development shows that money alone cannot bolster national development and growth. This is because in most cases technical knowledge helps to prevent or minimize damage caused by natural disasters in many countries.
The chief aim of crisis management is to improve the ability to withstand crisis and minimize damage. In non-trade organizations providing services, managers aim to achieve maximum results with minimum costs.
Crisis management can be divided into crisis bargaining and negotiation, crisis decision-making and crisis dynamics.
In business, there are three main types of crises:
- Financial Crisis: Short-term liquidity or cash flow problems; and long-term bankruptcy problems.
- Public Relations Crisis: Negative publicity that could adversely affect the success of the company .
- Strategic Crisis: Changes in the business environment that call the viability of the company into question.
It goes without saying that certain preliminary measures need to be taken to prevent a crisis. For instance, companies should always plan ahead and project likely outcomes. They should avoid decisions that have the potential to turn into a crisis, know their worst-case scenarios and have a contingency plan for it.
Just like other professions, crisis management is a technical knowledge characterizing the process of directing all or part of an organization or business through the deployment of resources for correcting an anomalous situation. Equipped with management know-how, managers can work better and deliver better results.
Management is an art and organized knowledge is a science. Art and science complement each other and therefore an effective crisis management is both a science and an art.

Integration
Emergency or disaster management is the discipline dealing with avoiding risks and tackling natural disasters across the globe. It is a discipline that involves preparing, supporting and rebuilding society when natural or man-made disasters occur.
It is the continuous process by which all individuals, groups and communities manage hazards in an effort to avoid or restructure the impact of disasters resulting from the hazards.
Effective emergency management relies heavily on thorough integration of plans involving both government and non-government sectors. Activities at each level (individual, group, community) affect the other levels. It is common to place the responsibility of governmental emergency management with the institutions for civil defense or within the conventional structure of the emergency services. In the private sector, emergency management is commonly referred to as business continuity management.
A common language will force responsible organizations to use stable and standard reforms. And a common structure, which complies with standard structures for organizations in charge of handling emergency crisis, also facilitates inter-organizational communications.
Today, complex organizational and environmental structures have led to widespread cause and effect interaction. It is not easy to come up with a categorization for all, simply because their activities gradually become more specialized during the process.
Technological preparations to address complex situations require more care and accuracy while preparing organizational responses to crises. Not taking them seriously will increase the risk of losses and slow the rate of social and economic recovery. This calls for a management structure that is able to identify, plan, confront and resolve a crisis.