Turning yachts to bread

Posted on May 25, 2011 by David Creech

On Thursday mornings I often meet with the men in my church for breakfast and a Bible study.  It is a time of good fun and healthy conversation.  Last week one of the regulars forwarded this post by Tony Schwartz on the Harvard Business Review blog page.  The upshot of the argument is that if the richest 1% in the United States gave more of their money (see the post for the dollar and percentage increments) to aid instead of, say, purchasing a 200 million dollar yacht, we would exceed 115-189 billion dollars that the UN estimates is needed annually to meet the Millennium Development Goals.  The post elicited a good deal of reaction and spirited debate, much of which was in disagreement with the gist of Schwartz’s argument.

I can sympathize with the gut level injustice of so much money spent on something that feels so unnecessary while millions die each year (to say nothing of those who continue to live in devastating poverty) because they lack of basic necessities like food and water.  That said, I must say that I too find the argument (and Peter Singer’s thinking as well) not altogether compelling.  I wish that ending poverty were as simple as taking a yacht and turning it into food.

I offer the following thoughts in outline.  If something grabs your interest, feel free to comment.  If there is a bullet you would like to see further developed, let me know!

  • It is not the man with the yacht that is the problem.  It is the system that allows for (and even encourages) such wide discrepancies.  (On this I highly recommend Joerg Rieger, especially his No Rising Tide.)
  • Redistribution of wealth is part of the solution.  Whether it is in the form of generous donors or reforming tax and trade policy, in a global economy, money has to be distributed more fairly than at present.  This does not mean that everyone has to have the same amount of wealth and resources.
  • All due respect to the UN and Jeff Sachs (and I know this sounds very arrogant), throwing large amounts of money at a problem has not been proven to be an effective solution (Bill Easterly has my back on this one).  The data from the Millennium Villages project is mixed at best.
  1. One problem is corruption.  Will the money go where it is intended?  Somalia was recently in the news because leaders redirected nearly 80 million dollars intended for aid into their own personal bank accounts.  In Nicaragua, I heard a critic of the government declare “If you are a politician and you are not stealing money, you are not honest, you are stupid.”  In 2004, hospitals in Chad (relayed by Paul Collier in The Bottom Billion) received less than 1% of the intended funds (the other 99% simply disappeared!).
  2. A second problem is that of absorption—can the receiving community put the money that is given to work?  Do they have the systems and structures in place to use the money effectively to address hunger and poverty?  Haiti is a prime example of how difficult it can be to absorb aid.
  3. Both of these problems point to the need for systemic solutions.  Money alone will not fix bad governance or solve conflicts.  The various –isms (racism, sexism, and others) cannot be addressed monetarily.  Even in the Global North the income gap is still too often defined by these and other prejudices.
  • The way forward involves a comprehensive approach.
  1. Political advocacy, first by voting, then by weighing in on proposals (if you have not already, please join the e-advocacy network!) is essential.  Our budget priorities should match our values.  As the saying goes, a budget is a moral document.  We need a budget that fully funds those programs which support those who are poorest and most vulnerable.  We need a trade policy that is not at odds with our aid objectives.  We need an energy policy that does not trash the planet.
  2. Educate ourselves and others about the root causes of hunger and poverty.  Check out this list of books I’ve found helpful to get started.  Host and attend forums on poverty.  Read good blogs (like this one!).  Think hard about how a lifestyle (for lack of a better term) choice or a candidate or a policy impacts those who are poorest and most vulnerable.
  3. As my priest says, give time, talent, and treasure (yes, a comprehensive approach does cost money).  Our choices do matter, and I think that the choices we make as a community (however broadly we want to define that) matter even more.

These are my first thoughts.  What are yours?

-David Creech