Asking the Hard Questions: A Personal Reflection on Economics
Sarvodaya volunteers build a road in Sri Lanka, c. 1994.
A recent converation with a friend of mine reminded me of this article I wrote following a summer indepedent study program in India and Sri Lanka in 1998. It was posted in my first website in 1999. I reproduce it here because I believe the questions and principles are still sound:
During my summer trip to India, I learned that children are starving in Bangladesh. Why? An American boycott of products made with child labor put them out of work. Now they have no way to support themselves. My trip to Asia challenged some of my most deeply-held values: children should not have to work, yet for these children the alternative is starvation. Sometimes, as in this case, applying the values we hold dear may actually make a situation worse— and we don't even know it. Economies are delicate organisms in which people find niches in which they can make a living. Whether child labor in Bangladesh, begging in India, or prostitution in Thailand, the methods may be offensive to us. But before we apply our standards of judgment, we must look at the alternative these people face. Frequently the option we find offensive is their best chance for survival. This doesn't mean we must accept prostitution, or any of the other degrading ways people find to survive. But it does mean we can't eliminate it without seeking a meaningful alternative. In my travels through Asia, I was struck by how much an economy resembles an ecology— a delicately balanced set of interactive relationships. And, like an ecology, changing any single element throws the rest out of balance. Ecologically, this was etched in my consciousness as a child at the Squam Lake Science Center in New Hampshire. One of the early resorts on the lake embarked on a successful campaign to rid the area of skunks, which it found to be a nuisance to its guests. But in a couple of years, the birds disappeared. The skunk was the only natural predator of the snapping turtle: skunks would eat the turtles' eggs. With no skunks, the snapping turtle population exploded, devouring fish, amphibians, and birds— eliminating the very wildlife that tourists came to see. The same is true of economies. For example, in Thailand the government encourages growing fruit for export to increase cash flow. And, indeed, with more foreign demand, the price of fruit has risen in the marketplace. But, while cash flow has increased, now the Thai villagers can't afford to buy fruit for their families. They have lost the benefits of a diet high in fruit, and as a result their health is in decline. In Sri Lanka, some of my fellow foreigners laughed at my annoyance at being overcharged because I was American. "You can afford it," they said. But if I pay five times what a mango is worth, I help one family economically, but I also raise the value of the mango in the local economy, making it less affordable for the rest of the people. Pineapples, for example, once cheap in the countryside, are now relatively expensive because the farmers found a way to sell to tourist hotels in the capitol. That's good for the pineapple farmers, but not so good for their neighbors and former customers. Every economic intervention carries consequences, which we may not think through to their conclusion. Take charity, for example. In Bangalore, I gave to the beggars— at least, some of the beggars— trusting that, while I was doing nothing to change their long-term perspective, at least my small gift would help them in the short run. Later, in Delhi, the sheer number of people with their hand out was overwhelming. I couldn't give to all. I couldn't give to any significant percentage. When I gave a rupee, a man ridiculed me for not giving ten. And if I gave to one, others mobbed me. I began to ask myself some hard questions. Hard, because I don't want to think of myself as uncompassionate. But the questions need to be asked. What happens when I give to a beggar? First, I encourage unemployment. I send the economic message that I will support a person without fair exchange for goods or labor. Doing so is not inherently wrong— there are many people who cannot work. But the effect of giving can clearly be seen in the swarms of beggars who inhabit the tourist areas of Delhi, Agra, Varanasi, and Dharmsala. And I have to believe that if a man or woman is healthy enough to chase me down the street asking for money, they must be healthy enough to do some kind of work. The problem is, wages are low and begging pays better. One friend related the story that a wealthy Indian man offered one beggar child a job. But when the boy heard the wages of the job, he laughed, saying he could make three times that with less effort by begging. By my own calculations, a beggar at the bus stands of Sri Lanka can easily make 3-4 times the daily wage of a laborer. In India, some of the poorest families will cripple their own children because it increases the child's chance for survival through begging. And every time I give to a beggar, I support that perception. How can someone like myself, from a prosperous Western country, evaluate such a quandary? It offends my sensibilities. I want to judge such a practice harshly. But how can I do so when, as with child labor, the alternative may be death by starvation? At the same time, I cannot accept that such practices are right. I cannot give money and turn away, accepting that I have done my best. And I cannot, like some conservatives, say that these people are inferior and do not deserve my attention and compassion. I must ask how I can help them. But clearly, this must be thought through carefully— a simple gesture to soothe my conscience may make things worse instead of better. The problem is so big, it's difficult to get one's mind around. The easy answer is to give nothing to anyone— but that's hardly the compassionate answer. A more difficult path lies in examining the problem and seeing how my actions affect (and might affect) the lives of real people surviving in the economies I encounter. There are two points that leap out at me, and beg to be addressed. First, much of the suffering of the world is the direct result of industrialization and the consumer economy. Industrialization requires a pool of cheap, landless labor, and every country has had to decimate its agricultural sector in order to begin the Western model of industrialization. In Sri Lanka, farmers leave their land and go to Colombo, where they can easily triple their income. But without self-sufficient food production, their new salaries are not enough, and they find themselves struggling for daily existence. Income increases, and so does poverty. It looks good on paper, unless one visits the Colombo slums where so many people live in a single shack that they must sleep in shifts because there's not enough room for them all to lie down. In Thailand, small farms fail when they try to move toward cash crops. The children go to the cities to look for work, but there's not enough work. They enter the brothels. According to one estimate, 95% of Thai village children (male and female) will engage in prostitution at some time in their lives. And, according to recent statistics, in some provinces HIV infection among young men is at 11% and rising. These are some of the costs of the Western model of industrialization. But is not the only model of economic progress. Sarvodaya in Sri Lanka, DISAC in Thailand, and others around the world are quietly promoting economic progress which is not at the expense of the well-being of the farmers. Working with communities, they find innovative ways of increasing production and income without sacrificing food production or social fabric. This, of course, is not popular with Western corporate interests and local industrialists. The reason is simple: if the profits go to the villagers, then the industrialists don't increase their wealth. And lets face it: with every Coke sold in India, with every KFC meal sold in Thailand, someone in the West gets richer, and there's a little less capital in the village. When the West speaks of economic progress, we're not doing it out of philanthropy. There's a second issue, related and yet separate, and that is population. In its natural state, a population will continue to expand until limited by lack of resources. This is the classic Malthusian doctrine: if humanity does not limit itself, nature will step in. In practice, this means that people all over the world are starving, and more food means more people, not a better quality of life. Again, one must ask if this is "acceptable." Or one can ask, is there an alternative? The answer is yes. Birth rates can, with effort, be brought under control. India Today reports that three of India's four southern states are on a path to Zero Population Growth (Jairam Ramesh, "Three Bundles of Joy," India Today, August 10, 1998, page 50). It can be achieved. But it takes effort, it takes investment, and it takes commitment. And it's going to have to answer the question, what happens if we eliminate the vast pool of virtual slave labor from our economy? What happens if everyone on earth gets a living wage? Because reducing the birth rate has economic consequences. Labor costs will go up. Eliminating starvation is going to cut into someone's profits. On a country by country basis, this makes limiting population growth difficult. When the standard of living improves in Sri Lanka, for example, the labor costs begin to rise (and vice-versa). This causes foreign companies to look for cheaper labor elsewhere, increasing unemployment and reducing profits for the Sri Lankan investment partners as well as forcing wages downward again. Thus the international economic system works to promote poverty rather than alleviate it. This should be no surprise: capitalism is about the concentration of capital. Since Adam Smith, it has been recognized that corporations work to concentrate wealth, and the job of government is to limit that concentration. But that limiting function has somehow been overlooked. On a national level, the United States in particular can no longer stomach the language of wealth redistribution. On an international level, there is no authority which could begin to do so. What then is the answer to such a complicated dilemma? What can one person do to work for positive change? Clearly it's not enough to rely on economic forces nor on the goodwill of governments to promote the changes that need to be made: the economic system discourages either from having positive effects. But I believe there are some things we can do that can make a difference. Here are some suggestions I've tried to incorporate into my own life based on the things I have seen, and I invite you to adopt them as well: • Give, but give wisely. Support organizations which promote community economics. Some examples are: The Sarvodaya Shramadana Movement in Sri Lanka, DISAC in Thailand, and the Grameen Bank in Bangladesh. There are many more. The Green Party is one organization that supports community economics in the industrialized world. • Favor development over relief. Is it better to give someone a fish, or to teach them how to fish? There are many starving people in the world, the victims of economic changes, wars, and natural disasters. But ultimately their lives will not change until the reasons for their starvation are addressed. • Buy from local businesses, not corporations, as much as possible, to promote local retention of profits. (This applies both at home and while traveling abroad.) And let's not forget: by definition, individual human beings have the capacity to be ethical; corporate bodies do not. • Promote education, everywhere. In most cases, lower birth rates are linked to higher education levels especially among women. And more education helps people better answer the hard questions we all face as the world gets smaller. • Consume less. This is a real challenge for us as Americans: our society makes it almost impossible even to eliminate waste. Yet our 6% of the world's population uses 40% of the energy. Let's think about our lives: Can we choose products and packaging which are recyclable? Do we really need all the plastic, the goofy advertising knickknacks, the electronic accessories? We don't need to go back to the stone age, but how much do we really need when the rest of the world has so little? • Volunteer. Get your hands dirty. Help out in the inner city, or in Tijuana, or India. Whatever you can do. Whether your effort makes a noticeable difference is not so important: what matters is that we reach out our hands to those in need, that we look them in the eyes and see them as people. Only then can we see the problems as they really are: as people who suffer, as people who have to make hard choices. People all over the world have to make hard choices every day in order to survive. It's only fair that we should make some hard choices, too.Asking the Hard Questions:
A Personal Reflection on Economics
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