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Ralf Seiffe suggests, "The Live 8 sponsors will soon learn what real poverty professionals have already learned--curing poverty is impossible when the objects of your efforts are content to stay right where they are."

Tuesday, July 19, 2005

By Ralf Seiffe

OPINION - I’ve had enough of the Live 8 controversy and the obvious observations offered by our side. What troubles me is why the intelligentsia of Rock and Roll continues to undertake work that they know---or should know---will keep the downtrodden oppressed.

It seems that the only sure method to beat poverty has long been known.

The New Testament reveals that it’s better to teach a man to fish than it is to simply supply the fish now and again. And, when the fisherman increases his productivity by catching more than he needs, he has enough to supply his neighbors. When he does, poverty evaporates.

This simple process occurs only when there is some reward for making the extra effort. There must be some market for the fisherman’s marginal labor and his customers must produce some good or service to exchange for those extra fish. If not, the fisherman will revert to catching only what he can eat.

Logical, mostly conservative, commentators observe that the Live 8er’s--and the poverty professionals--interpose themselves into these nascent markets and introduce externalities that prevent the formation of efficient markets.

By supplying food or other goods, the local producers cannot compete and are, therefore, driven from those markets. It reverses the lesson of teaching someone to fish; instead, it supplies fish and thereby removes any incentive for the locals to learn to provide for themselves. Such economies never rise above subsistence levels.

The great mystery is why a population prefers to live a miserable existence when they could do better.

Subsistence in a world of plenty is not limited to Africa, the latest target of the do-gooders. It is here in America, too, distributed equally in our cities and rural areas. Despite the fact that poverty has been defined up to include those who own cars, rent cable TV and have a high index of fast food usage, there is a rime of poverty that all efforts and treasure have failed to eradicate.

One lesson the rock star impresarios might contemplate is our American experience over the last third of the 20th Century.

Here, despite an effort that dwarfs the nation’s combined expenditures on defense, we haven’t moved the proportion in poverty by as much as a tenth. That being so, is there any hope that outside intervenors can change the situation anywhere else? Can these geriatric rockers have any effect in impoverished nations without the benefit of those “extra fishes” Americans were willing to contribute to our poor?

I don’t think so. The Live 8 sponsors will soon learn what real poverty professionals have already learned--curing poverty is impossible when the objects of your efforts are content to stay right where they are.

The Dark Continent’s economists have it right; the more aid we send the less likely it is that the locals will begin building fishing boats.

Worse, the political nature of the aid transfers creates a perverse incentive to use political means to appropriate the material sent with such good---if economically misguided---intentions. This huge criminal opportunity creates and funds the kleptocratic despots, which have become so common since de-colonization.in Africa.

On the other hand, the river of money flowing from the northern hemisphere to the southern has not escaped the poverty professionals. It does have a salubrious effect on one form of economic privation--their own.

They know that human nature guarantees some proportion of any population will be content with perpetual poverty. They also know that the northern hemisphere has an almost infinite capacity to feel guilt for their own success and needs to “do something”.

By combining these two permanent motivations, the poverty professionals ensure that river of money never silts up and provides them the opportunity to divert a big portion into their own millponds.

This diversion ranges from money that enriches corrupt United Nations officials to that which covers the meager paychecks of very proper, guileless and completely dedicated employees of a poverty fighter on the south side of Chicago. They benefit as much as their charges and it is in the interest of these professionals to protect and defend the status quo. If this was not the case, these professionals would simply take the piles of money, divide by the number in poverty and send them a check.

That gets us back to the Bilbos and Gandalfs of the make-believe world of Live 8.

They certainly know that the handouts they are raising will not and cannot accomplish their stated goals.

Yet, these must be intelligent people to have reached the pinnacle of their professions---they must have set some accomplishable objective. Perhaps it’s the same one as the poverty pros: It’s all about me.

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Ralf Seiffe advises business start-ups and product launches from Chicago, Illinois and is a political analyst and columnist for the Illinois Leader.