Five Reasons Why Donations to the Poor May Bring Bad Results
Financial Responsibility | Monday, November 27th, 2017
Does donating to poor countries actually help? Keep in mind there is a big difference between disaster response and longer term, more effective and sustainable development. Much of the time outside assistance and donations do not have much impact and in the long term, can be harmful.
When people see images of impoverished countries and situation, our first thought is, I should donate something. This is noble and shouldn’t be dismissed. However, many people fail to realize that donating to the poor often makes them poorer. It creates a vicious, unintended cycle. This isn’t an anecdotal argument either. More and more research is showing that donations have long term consequences that end up hurting more than helping.
In this post, we’re going to lay out five reasons why donating to the poor often hurts more than it helps, and then pose a possible solution. Our goal is to convince you that there is a better way.
Reason #1: The Communities Can’t Sustain the Things Donated to Them
It’s an idea that sounds great on paper and makes for ovation-garnering speeches. Go into an impoverished community, help them create life-giving resources (like a well), and then let the community reap the benefits. It sounds so noble. Enlightened. The wealthy westerners coming into rescue the poor and the impoverished who can’t survive on their own. Knights in shining armor delivering those imprisoned by their own poverty. This mentality is incredibly shortsighted and even insulting to the recipients of that charity.
It’s shortsighted because it fails to consider one massive problem: how will impoverished communities continue to support and maintain the created resources? A drilled well may function effectively for several years, but it won’t be long before it starts to break down. Where will they get the parts to repair it? Will they have the necessary technical expertise to maintain the well? These aren’t hypothetical questions. This does not mean you should do nothing. But it does mean that any solution must involve, at the minimum, the following components: time, education, partnership, a champion, and accountability.
- There is no point an external agency coming in, putting in a drill-hole and then passing it over to the local community if they can’t afford to maintain it over the next 10 or 20 years. There needs to be a proper assessment of just how much local people are able to finance these water points. It’s not enough to just drill and walk away.
What happens if this kind of support is not offered? Annie Kelly notes:
- In 2007, before the African Medical and Research Foundation and Farm-Africa began their development work in Katine, worms were found in the polluted water supply at the village of Abia, next to the Emuru swamp. A badly constructed and poorly maintained shallow well, dug by a charity, was full of soil and animal faeces and was making local people sick.
That well that you helped dig on your church mission trip? How are they going to maintain that? Are you going back every three months to fix it? Are you going to stay in constant contact to make sure they always have the supplies they need? Those parts are probably only available in other countries, so how in the world are you going to get them to those who need them?
It’s easy to feel good about yourself but you probably just made things worse.
Reason #2: It’s Misguided and Doesn’t Solve the Problem
Too often, remedies and relief are donated without considering whether they solve the problem. Take water disinfection treatments. Many organizations and donors assume that supplying water treatments is an effective solution for polluted water. And so they distribute water disinfectants in great number, feeling good about how they are fixing the problem. But they’re NOT necessarily fixing the problem. In fact, there is debate over whether some of (not all) these disinfectants actually produce real, lasting change.
- As microbiologist Paul Hunter notes:
- Disinfection household water treatments don’t seem to have any public health benefit. I’d be more than happy to change my mind if someone comes up with some good evidence, but it would have to be a large double-blinded study.
In other words, a solution that is taken as gospel by many organizations may not add much benefit at all to impoverished communities.
Don’t assume that every solution is equally good. Sure, you paid for some malaria nets to be given to a village. Is that what they need? Will that solve the most pressing problems they have? It’s easy to feel good about yourself for donating something, but you may be trying to solve the wrong problem.
Reason #3: The Solutions Aren’t Fully Developed
More and more, tech companies are trying to step into underdeveloped countries and offer solutions that will “solve” all their problems. They distribute tablets and apps and internet kiosks, believing that these will help people elevate themselves out of poverty.
And while this is a noble notion, it fails the majority of the time. Why? Because the tech companies haven’t fully developed the solutions in conjunction with local governments and businesses. If the underlying infrastructure isn’t in place, these tech solutions are like a band aid on a cannon ball wound. They may stop the bleeding for a few minutes, but they don’t solve the problem.
One of the very first learnings a donor agency or new volunteer learns is that poverty issues are never in isolation. Everything is connected, integrated, and often, complex. For example, lack of adequate income is tied to lack of education, poor infrastructure, public policy, access to capital, inferior quality water which means poor health, community loyalties, and on and on. Every initiative needs to be evaluated in terms of the multiple relationships between other issues.
Speaking of tech companies attempting to “upgrade” India, Eric Bellman writes:
- A $40 tablet that was supposed to revolutionize education has not been getting the government orders it expected. The national networks of Internet kiosks that were supposed to empower farmers have largely shut down. The $2,000 Tata Nano minicar that was supposed to allow millions of people upgrade from the dangerous family motorcycle was not popular and anti-rape apps which were supposed to use mapping and automatic SMS to protect women were never connected to the country’s police force.
You simply can’t put high-tech equipment into a country that doesn’t have the infrastructure for it. It would be like giving the Pilgrims automatic machine guns or airplanes. All chaos would break loose.
Tech nonprofits are big these days. You donate some money and they import computers into impoverished countries. But can those computers even be used, or are they going to collect dust in a warehouse? Can the country even handle this type of computer? Can it be hooked up to the internet? This is a ready, fire, aim strategy that usually hits the wrong target.
Reason #4: Donors Don’t Have A Sustainable Plan
Too often, donors come into help without any real plan for how to sustain things after they’ve left. They assume that their work is done once they’ve implemented the initial solution, not realizing that without a plan for the future things will quickly fall apart.
Too often the support structures for success are not even considered whether it be government policies, ongoing encouragement, mentoring, or something as simple as adequate financial support. Many of us live in the fantasy world that people who have lived their entire life surviving the harsh reality of poverty, doing what it takes to live with so little, suddenly can embrace and understand the values and resources that make the new intervention possible.
A prime example of this is World Bank’s billion-dollar effort to bring improved water access to the country of Tanzania. While it was certainly a noble goal, it generated a stunning lack of success.
The Global Post reports:
- In 2007 [before the project], only 54 percent of Tanzanians had access to what is called an improved water source — a water point, like a well or water pump, that is protected from contamination. By 2012, that figure had actually decreased to 53 percent, according to the latest available World Bank Data. Coupled with Tanzania’s rising population, 3.5 million more Tanzanians lacked access to improved water than did before the project began.
The problem? The lack of a sustainable plan. Over time, the water sources begin to fail and become polluted, and the local communities didn’t have the finances or resources to fix them. Suddenly, the communities are worse off than when they started.
Herbert Kashililah makes this damning statement: “If I am from the World Bank, it is easier to count new projects than try to ensure people are running their own systems.”
A problem is not a problem to be addressed by good hearted outsiders unless identified and owned by the local population, and there are champions, local people who are committed, to work and address it.
To put it into practical terms, maybe you financed a cow for a family through a charity. That’s great, but what will that cow actually do for the family? Do they even have the land necessary to pasture it? How will they afford the food? Do the people even know what’s required to raise a cow?
Reason #5: It Kills Local Economies
Several years ago, Jason Sadler had the idea to collect and donate 1 million t-shirts to Africa. Now, besides obvious questions like, “Is that what they really need?” Sadler failed to consider one enormous factor: the impact on the local economy.
What so many donors fail to realize is that their giving can actually kill a local business.
Disaster response efforts especially must be careful about destroying local businesses. It would be so much wiser to further develop the capacity of local entrepreneurs to meet the local needs. This is also true when hunger is prevalent. Buy local food first, create initiatives to produce more, purchase relief supplies locally. Organizations need to deeply consider the economic impact of their actions. Will this help or hurt the economy? Will it create or kill jobs? Will it ultimately provide self-generated income for the residents? A failure to weigh these things results in the poor becoming poorer.
Let’s say an individual had a thriving t-shirt business. He makes his livelihood and supports his family by making and selling t-shirts. What happens when a million shirts are suddenly dropped into his country? No one will buy from him. Why would they? They can get shirts for free. Suddenly the t-shirt economy is destroyed and the business goes under. What happens when the donated t-shirts wear out? There is no local business to fill the void and another donation is needed; dependency is created. All this because of the well-intentioned efforts of a donor.
Business Connect embraces the concept that self-sustaining business solutions will have longer lasting impact for the alleviation of poverty than a thousand give away products. Every donation we receive or facilitate goes through a local entrepreneur, who then gets a commission of the sale. That entrepreneur is then there to support the product for its lifespan, including maintenance and parts.
By empowering entrepreneurs, we are lifting an entire economy and helping build strong local businesses where green, life-improving products can be purchased. In the process we pay duties and the fees so that the entire economy is boosted.
This is our mission. We’re passionate about helping local communities thrive, rather than simply dropping supplies on them. It’s simply a better way.
This article originally appeared here at https://businessconnectworld.com/2017/06/07/donating-to-poor-makes-them-more-poor/ and has been republished with permission from https://businessconnectworld.com