Squalor occurs most frequently when people in poverty do not have resources and feel helpless to do anything about it.
Is prosperity the opposite of poverty? Are we prepared to suffer less greed and spend less on things like ringtones and bling for our phones or name label goods? Would this in fact cause more poverty in those countries where a subsistence wage is paid for producing the wants (as opposed to needs) of we greedy westerners?
I know in Australia poverty, relative to the grossly distended stomachs of the starving in 3rd world countries, could be said not to exist and I suspect likewise in any first world nation.
I think tho that there needs to be a definition of poverty before it can be addressed, and the steps we need to take to eliminate it as the OP said.
This question necessitates more questions before we can even begin to look at answers. The short and trite answers just don't cut it!