5 ways to end poverty: Why it's not a matter of money
Paul C. Godfrey is a business professor, but he has spent the last eight years traveling to Ghana, Paraguay and visiting the Navajo nation in Arizona. He has inspected corn grinders in the Painted Desert, visited a dairy school in the Chaco region, and sat down with single mothers in Salt Lake City.
Godfrey is a professor at Brigham Young University's Marriott School of Management, and associate academic director of the Melvin J. Ballard Center for Economic Self-Reliance, a university-based think tank for solutions to poverty. Godfrey, whose early work was on corporate social responsibility, has always been interested in ways that "formal organizations can make a better world."
After eight years of far-flung research, he's published his ideas on how to make that better world in “More Than Money: Five Forms of Capital to Create Wealth and Eliminate Poverty” (Stanford Business Books, 2014).
Is poverty inevitable? No, says Godfrey. But the answer is a lot more complicated than throwing money at the problem. The Deseret News interviewed Godfrey on his book, self-reliance, and where organizations and individuals go wrong with good intentions.
DN: In your book you differentiate between "Big P" poverty — poverty that's at a country-wide level, and "Little p" poverty — poverty that affects individuals and families. What's the difference and why is it important?
"Big P" poverty is the kind that needs education, financial institutions, business activity, major changes before a middle class can form and people can exit poverty. "Little p" poverty is experienced by individuals and families in the form of hunger, lack of work, lack of medical care. It matters because the longer I'm in this game, the more I realize that we will never completely resolve problems of "Big P" poverty in my lifetime or your lifetime. We can make progress, but these are big, historically entrenched, and complicated.
DN: Bill Gates recently said that we can end poverty by 2035. Are you saying that you don't buy it?
Gates is being over-optimistic. The number is always 15 to 20 years out — the Millennial Development goals said that by 2015 we would reduce poverty by half. Fifteen years is great because we can think that’s reasonable, we will still be alive then. Think about where you were in 1994 and how much the world has changed since then. What Gates says could be true, if everyone in the world wanted to eliminate poverty, but that's not the case.
However, in the case of "Little p" poverty, we can help individuals and families by identifying those that are willing to become self-reliant and leverage the capital to get out. What's realistic is to help people who want to improve their lives — we can do it.
DN: Doesn’t everyone in poverty want to improve their lives? You write about the importance of self-reliance as a character trait for getting out of poverty. But isn't that a little like blaming the poor for being poor?
That's not what I mean in terms of self-reliance. When I talk about poor people, it has no moral connotations. You can find yourself in poverty because you live under a totalitarian regime that screwed up the economy, or because you grew up in a home fractured by alcohol abuse, or in a place where the schools are really bad. But I do believe self-reliance is what psychologists would call a trait, and to some people it comes naturally, and others have to learn it or adopt it.
As I've looked at the world of social innovation, one of the traps is that organizations will take anyone who comes in the door. It's easy to lose focus when you're helping people who are not ready to be helped. One thing that I talk about in the book is that every intervention has holes in it — that we don't provide a process that does everything. There needs to be room for people to act for themselves; a filtering process. There was a group in Salt Lake that helped people out of poverty, but they didn't provide rides or child care. When I asked about it, the director said, "If they can't get over that hurdle then they won't be able to do the rest of the things in the program, as sad as that is. That's not who we can help."
DN: You write about the importance of self-reliance, and access to five key kinds of capital — institutional, human, social, organizational and physical capital. Do poor people have access to these kinds of capital, or can they be given access?
If you think of the Navajo reservation, for example, one problem there is social capital — or the resources that you can access through the networks that you have. On the reservation everyone else is poor, so your social network is accessing people in the same situation. Not everyone gets the same hand in terms of access and availability, but people can get help or change their situation. In Ghana, we met a woman who saved a nickel a day for two or three years so she could improve her storefront and eventually buy her own inventory. So she made a change, but the time horizon for effecting change is longer than we wish.
With the example of the Navajo, there are people in tribal governments and who work with tribal governments who earnestly desire to improve likelihoods and access. Going back to the idea of it being the fault of the poor that they are poor, no, it isn't their fault, but social capital is never going to find you, you have to find it.
One of the most compelling examples in your book is the San Francisco Agricultural School in Paraguay. Why is this such a success in alleviating poverty and leveraging capital?
Catholic priests ran this school for almost a century, but when government subsidies for it dried up it fell on hard times. Martin Burt took over the school, early on he realized that the funding model was unstable — if they had to rely on the government, it wouldn't work. So he essentially turned the school into a business.
He didn't turn the students into employees, exactly, but he looked at them as both partners and entrepreneurs. From 10 until 4 they studied lessons just like normal high school students, but outside of those hours they were running an agricultural business. They were raising chickens, hog farming, running the dairy all the way from breeding, milking, producing yogurt and managing sales. Students were learning how to run a business and how it works at the same time they were doing their school work. Most importantly, they were imbued with a sense of "If we don't work, our school won't succeed." That's the essence of responsibility and self-efficacy, and it's built on a long-term model. Students connect it to their families and community because they know that their work today relates to longer-term objectives, which spurs long-term thinking.
DN: So is it fair to say that self-reliance is related to privilege in some ways? Martin had access to elite education and training and was able to run this school, and now his students will have some of that same privilege, right?
Martin grew up in a home that was not poor, and I note in the book — he says that he was taught to give back, but not out of guilt, but out of joy. That's really nice because part of the problem that plagues the effort to fight poverty is when it's done by people who are trying to expunge the guilt of their own well-being instead of doing it out of joy. If I'm doing it out of fear, I'm doing it for myself. In that case, my default approach is "I know what works and want to export my solution to you." The other thing about fear is that it tends toward "I'm better than you; your poverty scares me."
Working out of joy leads to finding joint solutions. Instead of "I know everything," the attitude is "Let's figure out how to solve this together." In terms of privilege, Martin would tell you that the goal is that his students go home to their own communities, start their own dairies or agricultural businesses, and then they are able to get educated and it's an upward trend. Paying it forward builds over time. We are not going to put in better health care and education systems overnight, but eventually families with steady jobs will demand them and build their own. That's what happened in the U.S., and it took us a few centuries, and we foolishly believe others can do it in two to five years.
DN: How can those of us who are not going to start an NGO help? What should we look for?
Shop around and find organizations that are worth helping. Look for:A clear sense of mission, in terms of geography and in terms of what they do. Who are their partners — are they trying to go it alone, or do they have good partners to help with the areas that are out of their expertise? Measurable data. Can they show you how well it's working? For example, if it's an organization that builds houses for people, ask not only how many people they place, but how many people are current on their mortgages. Dig a little. Be careful of anecdotes and feel-good stories. Lastly, don't forget that being out of poverty isn't just having money. Poverty wouldn't be over just because everyone had an income. I go over this in the last chapter — being out of poverty is thriving, flourishing. A friend of mine helps build houses in Mexico. He told me a story about a woman who was in one of his houses who took him by the arm and showed him her garden. She was so enthralled and engaged in what she was doing; it gave her deep meaning and she felt she had achieved something. For him, that was a measure that she was now leaving poverty and entering prosperity.