Forbes had an interesting article last week about Bono, Bono's 'Humbling' Realizations About Aid, Capitalism And Nerds.
Bono has learned much about music over more than three decades with U2. But alongside that has been a lifelong lesson in campaigning — the activist for poverty reduction in Africa spoke frankly on Friday about how his views about philanthropy had now stretched to include an appreciation for capitalism.
The Irish singer and co-founder of ONE, a campaigning group that fights poverty and disease in Africa, said it had been “a humbling thing for me” to realize the importance of capitalism and entrepreneurialism in philanthropy, particularly as someone who “got into this as a righteous anger activist with all the cliches.”
“Job creators and innovators are just the key, and aid is just a bridge,” he told an audience of 200 leading technology entrepreneurs and investors at the F.ounders tech conference in Dublin. “We see it as startup money, investment in new countries. A humbling thing was to learn the role of commerce.” ...
Poverty is not first and foremost an absence wealth. Poverty is exclusion from networks of productivity and exchange. Inclusion into those networks is the solution.
Economic development has three stages, much like triage. Stage 1 is relief. The bleeding has to be stopped and the patient has to be stabilized. Stage 2 is rehabilitation. Wounds need to be healed and the person needs to be nurtured to health. Stage 3 is development. Assisting a relatively healthy patient toward greater health and flourishing.
In the face of a natural disaster like a tsunami or a hurricane, we must do relief. Water, food, clothing, shelter, and medical care are paramount. Once the situation is stabilized comes a time of rebuilding basic infrastructure. But if we want to help beyond relief and rehabilitation, the focus must be upon expanding inclusion in networks of productivity and exchange. All three stages are necessary but all three have a different focus.
The propensity of Western advocates for the poor is to see most instances of poverty as problems needing relief, with maybe some cases needing rehabilitation. Economic development isn't even on the radar. (And in fact, words like "markets" and "development" are voiced with derision in some quarters.) But at any given moment, very few poor nations are in need of significant relief, some could use rehabilitative work, and most need economic development. We treat countries needing economic development as victims needing relief. The consequences can be devastating.
When aid grows to be about 7% of nation's economy a transformation begins to take place. National leaders turn their attention away from their domestic business sector. They feel less and less accountabile to making their domestic economy work or to being responsive to their constituents. Their energies turn toward the aid giver. The mission becomes retention and expansion of aid.
Yet Western advocates talk in terms of the West has X% of the world's wealth while sub-Saharan African countries have only Y%. Solution? Give wealth to equalize the difference and "relieve" the poverty. As Bono has learned, this "relief" orientation is not only not the answer, it is a contributor to sustained impoverishment. Development and expansion of networks of productivity and exchange are the answer.