A quick response to “The Charitable-Industrial Complex”

Peter Buffett’s “The Charitable-Industrial Complex” op-ed is notable because only rarely do wealthy people admit there’s something deeply morally wrong about accumulating wealth and the widespread existence of poverty:

As more lives and communities are destroyed by the system that creates vast amounts of wealth for the few, the more heroic it sounds to “give back.” It’s what I would call “conscience laundering” — feeling better about accumulating more than any one person could possibly need to live on by sprinkling a little around as an act of charity.

But this just keeps the existing structure of inequality in place. The rich sleep better at night, while others get just enough to keep the pot from boiling over. Nearly every time someone feels better by doing good, on the other side of the world (or street), someone else is further locked into a system that will not allow the true flourishing of his or her nature or the opportunity to live a joyful and fulfilled life.

While I’m happy to hear this critique and glad that it’s passed into the mainstream media so that elites are paying attention, I wish there was more of a direction here about where to go next.

What I like about it: Pointing out big problems: the classist misimpression that the wealthy know best about how to improve the lives of the poor, the idea that managerial and capitalist logic can easily be applied to problems that are essentially about public goods, the unwillingness of donors to give up control when they give their money, the notion that unconscionable gathering of wealth can be laundered by “giving back.”

What I worry about, especially among US-based radicals: The idea that simply abandoning or destroying these institutions or the flow of wealth they represent will solve things. This is why I’m resistant to naming this an “industrial complex”—something that must be destroyed.

The reality is that resources are wrongly distributed from the global South to a rich few every day, leaving behind both injustice and unmet needs. We can, and should, attack the injustice head-on, and fight the looting of the world by corporations and their corrupt associates in governments. But, we also need to build an infrastructure that provides public goods, like the eradication of polio, equitable titling of land, ambulances in rural communities, and emergency food assistance. The struggle is not to stop the institutions that distribute resources from northern donors to such ends, but to make them functional and to make them accountable to the people they serve.

Frankly, both liberals and radicals in the US are bad at putting their money where their heart is in challenging third world poverty. When I visited the Zapatistas, I saw desperately needed ambulances funded by Italian squatters. In Bolivia, left parties from Scandinavia run their own alternatives to the official aid system, while US Americans just complain about USAID without building alternatives. Indigenous and small farmer titles under agrarian reform there happened through official development assistance funds paired with a radical government.

Bottom line: change can cost money, and we need to think seriously about how to insist that it flows where its most needed.

Cochabamba hosts the world…

Like what is soon to be thousands and thousands of people, I’m now in Cochabamba, Bolivia. Cbba is Bolivia’s third-largest metropolis, and fourth-largest city (both of the twins, La Paz and El Alto, are larger along with Santa Cruz). If you’ve heard of Cochabamba before, it’s probably because of the April 2000 Water War. In celebration of that event’s tenth anniversary, water activists are gathering in the 3rd International Water Fair from this past Thursday until Sunday (website). And Bolivia, which played a pivotal role in the December Copenhagen Climate Summit is hosting a global gathering to re-plant the global effort to confront damaging climate change, the World Conference on Climate Change and the Rights of Mother Earth (website), Monday through Thursday in the Cochabamba suburb of Tiquipaya. So far, there are over 14,000 registrations online for the conference, with representatives of over 60 governments and over 100 countries making the trip.

Since I’ve been passionately involved in climate change issues, but am actually focusing on other matters here in Bolivia, I’ll be channeling this week direct to you here, as well as doing my best with 140 characters at a time via twitter: @CarwilJ. Stay tuned.

As Bolivia votes, a closer look…

Bolivia’s elections are prompting the mainstream press to run a series of profile pieces, such as these: “In Bolivia, a Force for Change Endures,” New York Times; “Bolivia’s Morales favored to win re-election,” Reuters.

There has also been some hyperventilating led by the Heritage Foundation’s claim that “U.S. Should Reject Illegitimate Election Process in Bolivia.” Heritage goes so far as to advocate, “The Obama Administration should … refuse to recognize the new government Morales forms, and call for Bolivia’s expulsion from the Organization of American States (OAS).”

Leaving the election’s legitimacy to the ample contingent of observers, and noting that Heritage writers have managed to trump up Senate President Oscar Ortiz’s statement with uninformed exaggerations throughout the piece, let’s turn to Heritage’s alternate universe account of the first Morales term:

Not only have Morales’s economic policies weakened and further impoverished the already destitute poor of Bolivia, but his win in the December 6 election will empower him to further persecute what little remains of a democratic alternative.

Many of Morales supporters are indigenous Bolivians from the western highlands who have been mired in poverty for generations. Improving these indigenous people’s living conditions is certainly a laudable goal, but Morales’s methodology for realizing such improvement — statist policies and totalitarian control — has been disastrous.

As it turns out, Bolivia’s economic performance is the subject of a newly released report (announcement|pdf|flash)  by the Center for Economic and Policy Research (home of Dean Baker, the economist most vocal about the housing crisis before it became headline news). In it we find:

Bolivia’s economic growth in the last four years has been higher than at any time in the last 30 years, averaging 4.9 percent annually since the current administration took office in 2006. Projected GDP growth for 2009 is the highest in the hemisphere. It is worth noting that Bolivia’s growth for 2009 follows its peak growth rate in 2008. As discussed in more detail below, Bolivia’s 2009 growth is all the more remarkable in view of the size and number of negative shocks to the economy. These included falling remittances, declining foreign investment, the United States’ revocation of trade preferences, declining export prices and markets for part of the year and other impacts of the global recession.

In short, Bolivia has ducked the Great Recession’s global impact, something achieved by only a handful of countries. How? Largely by its partial nationalizations of natural resource extraction industries, paying down external debt (including to the World Bank and IMF, with the help of debt cancellation), accumulating currency reserves, and spending them in a stimulus that is relatively larger than ours in the United States. Where has that money gone? Partly to public investment and infrastructure, and partly directly to the poor:

In the last three years the government has begun several programs targeted at the poorest Bolivians. These include payments to poor families to increase school enrollment; an expansion of public pensions to relive extreme poverty among the elderly; and most recently, payments for uninsured mothers to expand prenatal and post-natal care, to reduce infant and child mortality.

More official sources concur in the economic success, notably the International Monetary Fund: “The International Monetary Fund said in October that Bolivia is likely to post Latin America’s strongest economic growth this year at 2.8 percent” (source: Reuters; see also Bolivia’s Gross Domestic Product over time).

Five years ago, Bolivia’s national politics revolved around the future of its national gas resources. Today, none of the candidates is even suggesting a reversal of the partial nationalization that movements demanded and the Morales government has carried out.

Further background on the elections is available from: the Cochabamba-based Democracy Center (1|2|3); Upside Down World (1); Andean Information Network (1|2); InterPress Service (1); Bolivia Transition Project (“Pre-election analysis”).