The BBC has a troubling video about the destruction of the Malawi cotton and textile industries due to Western charity. Before the video, I want to say a few things about economic aid and development.
Economic Development comes in three modes: relief, rehabilitation, and development. When people are at the edge of survival, say during a famine or after a major natural disaster, they need the basics of life just to make it to the next day. This is relief. Second, once the immediate needs are stabilized, work begins restoring homes, governance, services, and infrastructure. This is rehabilitation. As rehabilitation takes root, improving productivity and opportunities for exchange, leading to an upward cycle of prosperity, becomes the driving concern. This is development.
Treating less affluent people who are in the development stage as though they need relief is incredibly destructive. American charities repeatedly gather surplus goods and dump them into some targeted community (a relief tactic). No consideration is given to the fact that some local merchants and workers make their livelihoods by providing these goods locally. No business can compete with free. Entire local industries are wiped out, jobs destroyed, and people form a dependency on outsiders for goods they once produced. After a while, charities get bored with their initiative and move on to something else, leaving the community cut off from the supply of free goods and no local industry to supply them.
This relief mentality is especially pervasive in the church. "Helping the poor" is one-dimensional, exclusively focused on consumption and distribution: "Consume less to give more." There is an implicit zero-sum game mentality: "The only way someone gets more is when I (and others like me) have less." If people are poor, then the only solution is to redistribute all our "stuff" more equitably. That means giving our stuff so we can "relieve" the poverty of others. Production, the third critical piece of economic analysis, is nowhere in view.
This mentality is deeply rooted in the ancient order of the world of which the biblical cultures were a part. There was no way to alter the land's productivity or human labor significantly. But in the last three centuries, we have discovered how to alter production radically. This revolution in production, combined with expansive trade, has led to the prosperity of the modern age. Yet so many Christian institutions and intellectuals continue to live in pre-Eighteenth Century economic mentalities.
Muhammad Yunnis, champion of the microfinance movement, uses the image of the bonsai tree to illustrate an important point:
"To me, the poor are like Bonsai trees. When you plant the best seed of the tallest tree in a six-inch deep flower pot, you get a perfect replica of the tallest tree, but it is only inches tall. There is nothing wrong with the seed you planted; only the soil-base you provided was inadequate.
Poor people are bonsai people. There is nothing wrong with their seeds. Only society never gave them a base to grow on." Creating a World Without Poverty: Social Business and the Future of Capitalism
Essential to a fertile "soil-base" for these bonsai people is inclusion in networks of productivity and exchange.
Affluent economies of today did not become prosperous by snatching up a disproportionate share of a fixed amount of stuff. As a thought experiment, imagine ten apples sitting on a table. These are all the apples known to exist. Also, imagine ten people seated around the table, each owning one apple. Now redistribute the apples so that one person has 100 apples. It is not possible! Today's American economy is many times larger than the entire global economy of 200 years ago. There weren't enough "apples" 200 years ago to account for today's prosperous economies. The driving force in rising prosperity was wealth creation through rising productivity and exchange, not confiscation. Given the appropriate soil base, any of today's bonsai economies can experience similar transformations.
This does not dismiss a need for moral reflection on consumption and distribution. There is a need. But such reflection must occur within the modern framing that includes the centrality of productivity and exchange, not within the zero-sum game framing of the ancient order. It needs to abandon one-dimensional understandings in favor of organic bonsai conceptual models. Thoughtless redistribution of goods grounded in a relief mentality is positively toxic to the soil base of bonsai economies. The video below is just one of countless examples. God's love and justice require better from us.
(The video can be seen at How second-hand clothes kill business for Malawi’s tailors.)
If you are interested in reading more about this topic, you might try two important books: When Helping Hurts: How to Alleviate Poverty Without Hurting the Poor . . . and Yourself and Toxic Charity: How Churches and Charities Hurt Those They Help (And How to Reverse It)
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