Walt Ratterman died during the earthquake in Haiti.
“He has personally brought light to thousands of people around the world.”
Walt Ratterman died during the earthquake in Haiti.
“He has personally brought light to thousands of people around the world.”
With well over $1B donated so far to Haiti relief, the issue is not more donations, but effective deployment of existing donations. If the Indian Ocean tsunami of Dec 2004 is any lesson, nine months after well-meaning intentions, just 39% of the money promised had been spent. It was just not possible to spend the donations faster in any reasonably helpful way. It is even more likely this will be the case in the devastation of Haiti.
What’s Next?
Paul Collier, an economist at Oxford University and author of The Bottom Billion, believes that a temporary new administration (instead of the current Haiti government) is required to administer proper allocation and investment of donor monies. The emphasis is on investment, not just unaccountable hand-outs which Collier knows have been a complete boondoogle in Haiti and other poor countries.
There is enthusiasm from folks like Jeff Sachs for donors to commit $10-15B to Haiti for a grand 5 year rebuild. While this sounds all wonderful and hopeful and exciting, this has been tried many times in situations like Haiti and has not worked. Easterly, a former World Banker, has de-mystified this failed approach with data. Calderisi, another World Banker has documented the failure of this strategy in Africa.
Bottoms Up, Not Top Down
Status quo approaches to aid are fundamentally flawed because they focus on a top-down “planner” approach where the giver assumes to know the formula which will work. The real world doesn’t work this way. This contrasts with the bottoms-up “searcher” approach where ownership is taken locally to experiment to find local solutions which actually work on the ground.
From a previous blog post:
The main issue, [Easterly] argues, is that our international aid agencies … are run by planners, not the entrepreneurial, finding-what-works “searchers”. We in the West are very utopian with a grand plan to eliminate poverty always the goal and what the politicians like to talk about.
If we really care about prosperity for Haitians
In the short-term, many Haitians need help to survive. Most of this must come from foreign charity. Let’s not confuse this with what Haitians need longer-term to thrive.
I believe Haitians deserve the opportunity for a better future, not another failed attempt of utopian charity. To increase their own prosperity, Haitians must attract foreign private capital and generate an export economy which leverages its key competitive advantages … low cost of labor and proximity to the USA export market … to grow its economy. A purely super-sized continuation of what some have called Haiti, “The Republic of NGOs” is recipe for continued human misery for most Haitians.
Here’s what readers were most interested in reading on DefeatPoverty.com in 2009:
1. The Caste System in India Lives
4. Does Microfinance Impact Poverty?
8. Is the World Getting Better?
10. Microfranchising
And the top 5 most read new posts in 2009:
2. Kiva provides Microfinance Loans in USA
3. Microfinance Heats Up in East Africa

Bogalay book donation ceremony in March 2009
Last summer, I officially joined as a founding board member of a new start-up non-profit called Nargis Library Recovery (NRL). This NGO was started last year in response to the devastating 2008 Nargis cyclone (hurricane) which wiped out large portions of the Irrawaddy Delta leaving an estimated 135,000 people dead, 800,000 homeless, destroying much of the infrastructure … including about 2,000 libraries.
I want to do this until I die
In late 2007, I first met NRL’s founder, Dr. John Badgley, a well-known grassroots activist who started the Institute of the Rockies in the 1970’s and has had a distinguished career in the academic world with specialties in Asia Studies and libraries. Dr. Badgley is a Burmese speaker (Myanmar was previously known as Burma) and has extensive relationships in Myanmar with scholars, monks, librarians, business leaders and more. Dr. Badgley retired a number of years ago, but like most activist leaders, that just provided him more opportunity to focus on changing the world! At our inaugural board meeting, when we asked John how much compensation he would like/expect for being Executive Director, he responded by saying that it really didn’t matter as he was committed to supporting the recovery of the Myanmar libraries until he died.
2009 Accomplishments
In our recent board meeting, we walked through the humbling list of 2009 accomplishments we were able to make … all on a bootstrap budget of ~$40,000 plus LOTS of volunteer time and in-kind donations. Here is a sampling:
For 2010, we have some additional exciting plans including rebuilding our first libraries in addition to delivering at least 300,000 books in libraries in Myanmar.
Read more and see photos at Nargis Library Recovery
I thought that the change I voted for was going to prioritize a more rational and facts-based approach to addressing the major issues of our times. I thought that we actually were going to start to abandon our top-down, failed-from-the-start approaches to helping the poorest and to start “exploring” new approaches that might actually work.
Bjorn Lomborg leads the Copenhagen Consensus Center (Facebook page), a think-tank that recommends to governments and philanthropists around the world about the best ways to spend aid and development money … based on primary research and the consensus opinion of a lot of smart people who look at the data. Bjorn thinks that climate change is a major issue and he thinks we’re thinking about it all the wrong way.
In an op-ed piece today, he argues “Investing in energy R&D might work. Mandated emissions cuts (haven’t and) won’t.”
What is an example of a better investment?
Focusing on investments to reduce the at-risk malaria population (mosquito nets, environmentally safe indoor DDT sprays and new therapies) would save 78,000 times more lives than the same money spent on climate change.
Some more Bang for the Buck recommendations.
If you have an open mind to hear a perspective not getting the media attention in Copenhagen this week, I highly recommend that you read Bjorn’s article.
Please post your thoughts in comments about what you think of Bjorn’s thoughts and reasonings.
Bjorn Lomborg of the Copenhagen Consensus (see my previous post on Priorities for helping the world’s poor), posted an OpEd in today’s WSJ entitled “The View from Vanuatu on Climate Change“. Vanuatu politicians have been some of the most vocal proponents of carbon cuts to prevent global warming destructive impacts on his country.
Rather than theorizing a lot about what the poor really want (which is essentially the approach of the Copenhagen Consensus), he decided to visit the tiny island nation of Vanuatu and ask some locals about how they would prioritize things.
Here’s what one woman said: “Having a boat in the village to use for fishing, transporting goods to sell, and to get to hospital in emergencies. She doesn’t want more aid money because ‘there is too much corruption in the government and it goes in people’s pockets,’ but she would like microfinance schemes instead. ‘Give money directly to the people for businesses so we can support ourselves without having to rely on government.’”
I won’t comment here on the extreme disconnect between her country’s president and her situation.
Microfinance is very effective in getting cash to the poor
One of the lesser told benefits of microfinance is that money actually does get into the hands of the poor. Every penny of every $50 loan is accounted for in financial records which are then audited regularly. Every borrower has a pass book which details what they’ve received and paid. And I know from first hand experience that even illiterate borrowers understand very clearly exactly what they’ve received, paid back and their outstanding balances. It is much more difficult for governments and other middlemen to get in between the transactions and fraudulently steal money designated for the poor like what happens in most other charitable schemes.
As Mother Teresa would say (in paraphrase), “We talk a lot about the poor when we need to be talking to the poor.”
Norman Borlaug, aged 95, died this past Saturday. In 1999, the Atlantic Monthly estimated that his efforts (along with the people he trained and institutes he founded) had saved more than one billion lives … almost all in developing countries. [Thanks to Gregg Easterbrook who posted op-ed piece today.]
You’re probably asking … what the heck did he do to have such an impact?
Borlaug was a key innovator in agriculture productivity. He developed higher yield crops which required less water, less pesticides, were more disease resistant and thrived under much more varied and adverse conditions than previous cereal breeds. He is often referred to as the father of the Green Revolution.
A few big picture stats:
Changing history in India and Pakistan
In the 1965 India/Pakistan famine, Borlaug traveled with 35 truck loads of high-yield seeds to the Indian subcontinent. In the midst of a famine (and a war), he (and his Mexican assistants) sowed the first crop with these seeds. Within 3 years, Pakistan was self-sufficient in wheat production and within 6 years, India was self-sufficient in all cereal production. There hasn’t been a shortage of food since then in those countries. He appropriately received the Nobel Peace Prize.
Backlash from people who have never gone hungry
As he ventured into seeking to provide similar cereal crop benefits to Africa, he was denounced by critics because his techniques require some pesticides as well as fertilizers. Here’s some of his responses:
“[Most Western environmentalists] have never experienced the physical sensation of hunger. They do their lobbying from comfortable office suites in Washington or Brussels. If they lived just one month amid the misery of the developing world, as I have for 50 years, they’d be crying out for tractors and fertilizers and irrigation canals and be outraged that fashionable elitists in wealthy nations were trying to deny them these things.”
“Without high-yield agriculture, increases in food output would have been realized through drastic expansion of acres under cultivation, losses of pristine land a hundred times greater than all losses to urban and suburban expansion.”
In nations which have adopted his techniques, population growth as slowed as less workers are needed to produce food.
On behalf of the billions of people who have benefited from Borlaug’s pioneering work, I say “thank you.”

The Economist published an article called, A partial marvel, last month which summarizes the results of various research which evaluates the value of microcredit in helping the poor. The Net: Not everything (as expected) is rosy.
Here are a few highlights:
I met up recently with Whit Alexander, a co-founder of board game company Cranium which they sold last year to Hasbro. He has provided the seed funding for a new social business venture called Burro.
Whit believes that there is a huge opportunity to develop quality branded products and a distribution channel optimized for the bottom of the pyramid (4B+ people who live on < $2/day). His goal is to deliver products at reduced cost to these customers which also improve their lives.
Their first business line is renting rechargeable batteries starting in Ghana. Why, you might ask?
Here’s how their model works:
Currently they are operating a pilot in Ghana to demonstrate the business model and get the kinks figured out. Once they’ve got the model figured out, they plan to expand their branch network plus to offer additional products through their growing distribution channel.
I was introduced recently to VillageReach, an innovative non-profit headquartered in Seattle which is focused on addressing one of the largest issues in healthcare delivery systems in emerging countries … delivery to the local clinic.
There was an interesting article in this weekend’s Wall Street Journal’s Weekend Journal called “A New Dawn” which featured too very different perspectives on climate change. One article by Ian McEwan focuses on how developed countries should focus our budgets on climate change and the second article by Bjorn Lomborg focuses on how we need to focus our budgets on doing things which will have the broadest impact for humanity and the world.
I think both articles are a good read and both articulate very strong perspectives and arguments. I am most intrigued though by the arguments made by Bjorn Lomborg as they are more global in nature, so I’m going to focus more on his ideas in this article. Lomborg is a professor at Copenhagen Business School and the organizer of the Copenhagen Consensus, an interesting gathering of some of the world’s smartest scientists and economists which attempts to gain a “consensus” on the priorities for doing the most good with our investments. I wrote about this process earlier.
Here are a few of Lomborg’s facts/observation of climate change forecasts:
He points out that these climate change-related investments might make sense as the top priority in a world of infinite resources and no other major issues. The reality is that we face many other moral decisions … life and death decisions affecting 10’s of millions of people … which must be considered. Here are some of the other potential priorities:
I am not an expert on the numbers quoted, so that requires further review and validation. I do admire intellectual honesty and a genuine debate with all of the facts on the table as we have some very important priority decisions to make now with a new President and Congress. I’m hoping we’ll put aside philosophical arguments and let the best ideas win out … especially for the sake of the world’s poor who have no voice.