A Case Study in Toxic Charity: Malawi and Donated Clothes

 The BBC has a troubling video about the destruction of the Malawi cotton and textile industries as a consequence of Western charity. Before getting to 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 stablized, work begins on 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 are in need of relief is incredibly destructive. American charities repeatedly gather up surplus goods and dump them into some targeted community (a relief tactic). No consideration is given to the fact that there are local merchants and workers who make their livelihoods providing these goods locally. No business can compete with free. Entire local industires are wiped out, jobs destroyed, and people form dependency on outsiders for goods they once produced. After awhile, charities get bored with their intiative and move on to something else, leaving the community cut off from the supply of free goods and no local industry to supply the them.

This relief mentality is especially pervassive in the church. "Helping the poor" is one-dimensional, exclusively focused on matters of consumption and distribtuion: "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" in a more equitable manner.  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 significantly alter the productivity of either the land or human labor. But in the last three centuries we have discovered how to radically alter production. It is this revolution in production, combined with expansive trade, that has led to the prosperity of the modern age. Yet so many Christian instittutions and intellecturals continue to live in pre-Eighteenth Century economic mentalities.

Muhammad Yunnis, champion of the mircofinance 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 disproportinate share of a fixed amount of stuff. As a thought expriment, 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 is not dismiss a need for moral reflection on consumption and distribution. There definitely is a need. But such reflection needs to 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 bonasi 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 requires better from us.

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)

Comments

[ceemac]

It looks like two separate problems tend to get conflated or at least connected in unhelpful ways in well off societies.

1. What is the best way or ways to help the poor move out of poverty?

2. How do we get people in affluent societies to live moral or virtuous lives?

Of course a problem with the second question is that there is not agreement as to the nature of a virtuous life among all Christians. I suspect you would get very different answers if you asked Jim Wallis and John Sirico of Acton to describe virtuous behavior.

[Michael W. Kruse]

I think you've nailed the two separate issues. Actually, I think at the private individual level, Wallis and Sirico might not be that far apart. The divide is in terms of societal systems and structures.

[Percival]

Used clothes are part of the global economy. I don't think that local industries can or should be shielded from the global economy. Although the clothes were cast off in the West, much like recycled aluminum or paper, they can be re-marketed. I don't think this is the best illustration of your very valid point about how charities, by shattering local markets, often hurt developing economies. Unlike food aid, for example, people donated those clothes for the benefit of the local Salvation Army, Goodwill, etc. They were not aiming for Africa.

[Michael W. Kruse]

Fair enough.

[micahj]

"I don't think that local industries can or should be shielded from the global economy."
I agree Percival however, every economy does it in some form or fashion.
I think there is more to it as well. The issue certainly is not with individuals making donations. I think we would all agree that that is virtuous, where the alternative is to throw them away.
But it is the role of charities and the courses of action they choose to take that has to be questioned.
Did these charities put any work into analyzing the impact of throwing these goods into the market? I don't know the answer to that, but often times the answer is "no."
It has to be attacked from both sides. Charities must consider the impacts that relief aid has, and enterprises must adapt and meet the needs of the community.
The video didn't provide enough insight into how the flea market works but it did say "cheap clothes" not "free clothes." So it may be that the flea market itself is the enterprise that is flourishing. Or is there an opportunity for an entrepreneur to acquire the best of the donated clothes and setup a shop for himself to resell them?

[Percival]

Micah,
As I understand it, the Western charities sort the clothes into categories and they are bundled into huge bales and sold to brokers on the international market. Those bales are shipped overseas and resold to local wholesale agents who distribute them to sellers in the local market. Supply and demand at work, full of the usual complications of unintended consequences.

The charities benefit because they have sold a supply of things from a glutted market in the West to people who actually want them. The Western donor often supposes those clothes are going to the needy in their community, but that is only true for a small percentage of the donations.

[Michael W. Kruse]

I don't know a lot about the specifics of the Malawi case but the vid certainly implies that there was a significant influx of used clothes that has destabilized the market. The clothes are apparently being sold dirt cheap in the markets in Malawi and that is because someone has provided the clothes to the vendors either free or at minimal cost. It operates much like a subsidy, creating an unfair advantage. That is what I perceive the charities are doing.

A region, in this case Malawi, was targeted for this type of aid. After a few years, the charity tires of this focus and leaves. Then comes someone giving away bags of rice until they tire as well. Each episode does considerable damage to a sector of the local economy.

We need to think more creatively about how to help these economies grow.

[danakx]

Hi Michael, I am currently co-teaching a weekly workshop style class for 14 homeschooled, high school juniors and seniors, focusing on world issues and how Christians should think about, care about the world and others who dwell in it with us. These are all good-hearted kids who have been very involved in missions trips and local projects with the homeless, etc. I'd like to help them begin to think outside the box a bit and challenge some of their thinking on "help" and caring for the poor in less patronizing, sensational, and actually more beneficial/connecting, ways. Have you done a review on either of the two books you link to above, or is there one you think would be particularly appropriate and helpful reading for this age student? Most of the students are already taking full-time dual-enrollment classes at the local community college, so they're not likely to willingly take on a heavy or dry academic book, but if one of the books is not a hard read, but still challenging in its thinking, I'd consider having the students read and discuss it. Any input would be appreciated! Thanks!

[Michael W. Kruse]

I don't have an extensive review of either book. Both books are written for popular audiences. The authors of both books write in an engaging style. I think both books would be accessible to your students.

Based on what you have described, I suspect "Toxic Charity" might be the better place to start, but it is a tough call. Lupton is a pastor and does a good job of critiquing the church mindset. "When Helping Hurts" gets a little more into what economic development is. Their passages about the difference between relief, rehabilitation, and development are worth the price of the book alone. "Toxic" goes a little more into unmaksing dysfunctional thinking while the other book focuses more on articulating a healthy model.

Neither book as an academic yawn. I think you would do well with either.

[danakx]

Thank you! That is very helpful.