My generation has a much easier time distinguishing India as an emerging economy than my parent’s generation. We don’t remember it for the disaster that it used to be. We don’t remember that what Africa is today, India used to be. And so, the question has to be asked. What helped India turn the corner? Was it foreign aid/charity or was it Dell Computers? Are Indians empowering themselves and growing their middle class by me giving them money or by Dell Computers giving them jobs. I think it’s the later, and I think it’s going to always be the later.
Does me handing money to someone that is hungry get them food? Yes. Does it get there children food? Yes, maybe. Does it give their children’s children food? Undoubtedly no. So, I’ve provided temporary relief but not cured the problem. What if someone close to you had a treatable form of cancer and the doctor told you that instead of treating the problem they were just going to provide relief? You would be livid. Poverty is a treatable (but not curable) problem. It’s being treated right now in India and China. But, instead what, if we instead gave that person a loan. And they used that money to start a business. And that business provided their children with money and food and education. And when I say business, I’m not saying that they build a telecommunications company. But maybe they do. Africa has had the highest growth rate for mobile phone users the past 10 years. Someone has to sell the the hardware. Someone has to provide the services. There are woman in India who sell sachets (think smaller than what you get in a hotel) of shampoo and soap they purchased using loans of $200 in rural areas. There are people in Brazil who sell the minutes on their sell phones. What if we helped people buy and cultivate land to grow coffee that rich Americans will pay outrageous prices for?
We (the US) have spent close to $2.5 trillion (and remember generally no more than 40% of money that is donated actually the reaches those that need it, the other 60% is sunk into administrative costs) on foreign aid the past 50 years, with little to show for it. Why? One, is because it makes us feel good. Giving money makes us feel like better humans and is the lowest cost denominator in appeasing our soul. Two, it helps the American economy. When the US pledges to send food to XYZ country, almost all that is sent on US produce. When the US pledges drugs to be sent to ABC country, those must be FDA-approved. That’s big business, especially for industries that are heavily subsidized and need buyers for products. Three, it’s a way for the US to spread their power across the globe.
I don’t think all of societal problems can be solved with capitalism. In fact, I don’t think that most of them can. Really, only poverty. That’s not to say that I think we can make it where no one is poor. Socialism does not work. If you took a group of the ten richest people and put them on another planet. The 10th richest person would not be considered the 10th richest. That person would be considered the poorest.
Give a man a fish, feed him for a day. Teach a man to fish, and feed him for a lifetime.
Song Recommendation – Two Daughters and a Beautiful Wife by The Drive-By Truckers
(Who I’m going to see next weekend at Headliners. Get your tickets fast because their sure to sell out. DMassey might have an extra one, let me know if you're interested.)
Thinking about all this made me think about one of my experiences in England. The experience has no no bearing on the previous situations, because the circumstances are completely different. This is about a bum. When I studied in England they put us up in this flat in a super nice part of town (when you have the word Royal in the name of the borough, you know you got it made). This guy used to sit in front of the store on the corner (across from the Lamborghini dealership) and ask for change every time you walked in and out. Would give you a dirty look if you didn’t give him money. Everyday. Sitting there. Asking for money. So, the last day we are there (not kidding, the very last day), I see this guy count his money, run down the street (first time I’ve seen him move), buy a beer, chug the beer, and sit back down in his spot to start begging for another beer. So, I went back to America angry that I thought I was helping this guy out all summer, when in actuality he was getting drunk off of my money.
If you wanna read more about this topics from this post you can check out:
The Fortune At The Bottom Of The Pyramid by C.K. Prahalad
Bill Gates Calls For Kinder Capitalism
The White Man's Burden by William Easterly
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2 comments:
Is this possibly in relation to my post the other day, or has it just been on your mind?
I understand that partially, those two are just symbols for different types of help. However, this is still an unequal comparison.
Mother Teresa's goal in life was to reach the physically and spiritually poor in the name of Jesus.
Dell's goal is to run their business as efficiently as possible, and that means the cheapest and most capable workers. India has that. The fact that India's economy and people benefited greatly was just a bi-product.
Mother Teresa's resources in comparison to Dell's don't even show up on the chart. However, she started Missionaries of Charity. According to Wikipedia, at the time of her death "was operating 610 missions in 123 countries." 610 missions with 4500 nuns who have devoted their lives to the same cause. There are several branches of this organization for priests and brothers too.
Now, considering that Dell is giving people jobs to support their family for generations while doing nothing for them spiritually (India is 80% Hindu and 13% Muslim), and Mother Teresa is providing physical and spiritual needs in the name of Jesus to save people's souls for eternity, which do you think is more important?
What does food and money mean to you without salvation?
Now, I like your point about loans and stuff so I think I will focus on that for my next post.
Two things. The first is that I've been trying the time to write this post since I read the Bill Gates article in the WSJ, but have only now found the time....with finals and all (I don't think that's how it's supposed to work).
Second thing is that, while the Mother Teresa/Dell comparison is fun and sensationalistic (?), her work is not something I intend to discount. What really should bear the brunt of my anger is charity. Charity for charity's sake. It is a short term solution to a long term problem.
Indeed, Dell did go to India because they had the cheapest labor. They will also go to Brazil and then to Vietnam when the economic scales are tipped and India becomes too expensive. But, the growth for the Indian economy will continue to be sustained. India put it self in that position through education. Those cheap laborers that Dell wanted were both cheap and educated. That's what got them to the position they are in. A long term view is needed.
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