There are many reasons why foreign aid and handouts do not succeed in lifting anybody out of poverty, but one of the main reasons is that progress requires effort. Sadly, there is no effort involved in being the recipient of a handout.
In The Great Escape Angus Deaton argues that the way to help people who have been 'left behind' by progress is not by throwing money at them. Of course, if you are feeling guilty about being far too rich for the redemption of your mortal soul (remember, blessed are the poor) you might succeed in feeling a bit better about yourself if you throw money at the problem of inequality because at least then you've done your bit and you can sleep easier at night. Ah, redistribution. So foreign aid does at least achieve the benefit of soothing the conscience of those who give. Other than that, it helps nobody. Deaton calls this the 'aid illusion'.
As every banker knows (yes, I know we hate bankers because they're rich, but bear with me) if you pour money into a good project you're probably going to get a good return on your investment, and also help the person who had a great project and just needed money to fund it. If you pour money into the pockets of a wastrel you're going to get nothing back and also the wastrel will most likely find a way to dig himself deeper into his ongoing difficulties. All this is common sense.
This is where the idea of effort comes in. Pouring foreign aid into a space where the right effort to achieve the right sorts of things is absent will never produce anything. Development artists like Oxfam know this, so they go out there and say to poor folk in the Third World 'what do YOU want to do, what are YOUR priorities' before pouring in the money. This is a way of checking that they are not 'imposing' their own values on other people because that would be almost like colonialism and colonialism is passé. Too bad that the projects being funded do not have a snowball's chance in hell of ever working out. Never mind those ridiculous 'before' and 'after' photographs they send in glossy brochures when they're trying to shake you down and guilt you into donating your hard-earned pennies. The truth is that if those poor folk really had a good workable project in mind, they would have found funding for it long before the development artists showed up.
The most harmful and most poisonous effect of foreign aid is in giving recipients the illusion that no effort is required to achieve a situation where money comes pouring in, kindly donated by the taxpayers of rich countries. And no, 'if you give me lots of money I will dig a well' is not effort because nobody should need millions of dollars in foreign aid to figure out how to extract clean drinking water from the river flowing past their hut. Especially in the age of internet, when there's a free clip on youtube that will show you how to do anything in easy steps (with pictures and diagrams). People are not stupid. They will figure out a way to fix their own problems if they are left to get on with it.
These things take a huge amount of effort to figure out, with lots of trial and error and pain along the way, but there are no shortcuts. Handouts only make things worse and prolong the agony. You could argue that nobody is forced to accept a handout and they could simply say 'no, thank you, that's very kind but I prefer to make my own way', and there is much to be said in favour of having a bit of pride and saying no to charity. It's just that it can be hard to say no when a development artist is waving free money in your face, especially if you're a greedy and corrupt government official in a rickety African country and you know that nobody will follow up with you to check how you spent the money so you can quickly deposit it in your offshore bank accounts and leave your people to starve. After all, if they starve, Oxfam will just come back and drop food parcels on them so it's fine. The temptations are real, but saying no is within anybody's power.
When you think of the blood, sweat and tears that went into the fight for every human being to be free, it's a tragedy to choose to spend that freedom by living off the largesse of others.
There are three major problems with trickle-down economics. First, trickles are far too slow and inadequate. Nobody wants a poxy trickle of wealth filtering through to them in the cheap seats down below, drop by fecking drop. Sod that. "Thanks for that trickle!" are the words they will never cry. A waterfall would be more acceptable. Luckily, there is a better and faster way to Get Rich Quick.
The world looks like a rational place, everything functioning according to immutable universal principles, economies growing and people thriving as they experience lives of increasing abundance…until you bring in the twin notions of Justice and Equality. That’s where it all begins to unravel.
Poor Thomas Stuart. He must have been suffering from a grave mental affliction. Why else would he try to stand on his own two feet and subsist on his own wages, in conditions where he obviously needed help in order to attain a higher standard of living?
Corporations like Uber and Amazon are the byword for innovation and technological advances - the app to connect drivers with passengers, the ability to obtain virtually anything under the sun within minutes, and ultimately, of course, the driverless car. Such corporations do not make it easy to regulate work. It's almost as if they're so busy innovating, and creating opportunities for many workers to earn a wage and hence be less poor, that they haven't taken a moment to spare a thought for the regulatory challenges.
It's very easy to argue that rich people should be made to pay for the stuff other people want, because they're rich and they can afford it. This is usually justified as being necessary for the public good.
Everybody knows the one about Adam Smith and the selfish baker who, like, wait for it . . . makes people pay before they eat his bread. Dirty money changes hands. I know, shocking.
Let's start by blasting all the bankers into outer space. What could go wrong?
Banker-bashing is great fun, because nobody likes bankers (even bankers avoid other bankers at dinner parties). The main reason for public interest in the recent RBS litigation was that everyone wanted to see Sir Fred the Shred in the dock, being asked awkward questions by the shareholders' lawyer.
What happens when we let untidy and chaotic markets fix wages?