( music playing )
( no audible dialogue )
MICHAEL: Machiavelli said,
"The reason there will be no change
"is because the people
"who stand to lose from change
"have all the power,
"and the people who stand to gain from change
have none of the power."
Machiavelli...
was describing
the global aid system today.
( indistinct chatter )
MICHAEL: So as we talk about development,
we have to talk about
who has the power and who should have it.
( metal grinding )
Hello.
( music playing )
MAGATTE: There's a certain paradigm
in which we try to help the poor,
and it comes with underlying assumptions
and images about poor people.
It comes from a good heart.
( children singing )
They give us food.
They bring us shoes.
They dig us wells.
They encourage others to give.
Give now
and lives will be saved.
Thank you.
BONO: We're gonna end extreme poverty,
we're gonna make poverty history,
that's what's fallen to us to do.
( indistinct chatter )
The problem is,
it does not work.
( music playing )
DANIEL: The way that we help the poor
needs to change.
MAGATTE: Everybody knows it.
It's failed everywhere it's been tried.
MAGATTE: Everybody talks about it.
BONO: Paternalism,
the old way we did development,
is no match for partnership.
And yet...
the icons of charity
remain the same.
It's not simply foreign aid
or religious charity
or NGOs
or social entrepreneurs.
The rich patronize the poor.
The poor resent the rich.
Every 10 or 20 years we try something new,
and then...
10 or 20 years later,
we look back.
What we find is that we're looking
at the same broken system.
The name of the system
is paternalism.
( music playing )
* It's Christmas time *
* There's no need *
* To be afraid
* At Christmas time
* We let in light
* And we banish shade
MAGATTE: The Christmas song
raised awareness,
and it was in response
to a particular crisis.
I understand that.
But it also perpetuates
a false image
of Africa as barren
and a sentimental image
of Africans
as helpless and dependent.
* Oh
* Where nothing
* Ever grows
* No rain or rivers flow
* Do they know
* It's Christmas time *
* At all?
* Oh
( music playing )
FINN: * It's Christmas time *
* There's no need to be afraid... *
MAGATTE: And here we are,
a generation later,
and the same song,
the same images are back.
With the same lyrics,
the same silliness
of Africa not having any rain,
not having any river,
and us Africans not knowing
that it's Christmas time.
People are taking these songs
so to heart,
and the Glee generation
are taking songs like
"Do They Know It's Christmas?"
and reimagining them.
and rearranging them
and, you know,
doing their thing to them,
and that gives new life
to that idea.
It makes me very happy indeed.
* And there won't be snow *
* In Africa
* This Christmas time
* This Christmas time, no
MAGATTE: What makes Bono happy about this?
By now, Bono should know better.
HERMAN: The international media
keeps telling Africans
and their locals that,
"Oh, Africa is poor, Africa is poor,
Africa is poor."
Africa has always been
a reservoir for resources
for the rest of the world.
The countries they are calling poor
are oil-rich, diamond-rich,
timber rich, and land-rich,
and gold-rich, and they are in good locations
for tourism.
The people here are not stupid.
They're just disconnected from global trade, that's all.
* Feed the world
* Let them know
* It's Christmas time *
* And feed...
* The world
* Let them know
* It's Christmas time *
* And feed the world
( whipping rice straws )
BILL: Since 1981, the United States
has followed a policy
until last year
so we started rethinking it,
thatwe rich countries
that produce a lot of food
should sell it to poor countries
and relieve them of the burden
of producing their own food, so thank goodness
they can leap directly
into the industrial era.
It has not worked.
It may have been good for some of my farmers in Arkansas,
but it has not worked.
It was a mistake.
It was a mistake that I was a party to.
I am not pointing the finger at anybody.
I did that, I have to live every day
with the consequences
of the lost capacity
to produce a rice crop in Haiti
to feed those people.
Because of what I did,
nobody else.
Everybody talks about rice because it's a famous example.
NARRATOR: Timothy Schwartz is an anthropologist
who has spent the past 20 years
working in Haiti.
He has consulted with USAID,
The World Bank,
and multinational charities
like CARE and World Vision.
He chronicled
his experiences in his book,
Travesty in Haiti: A True Account
of Christian Missions,
Orphanages, Food Aid,
Fraud, and Drug Trafficking.
TIMOTHY: In the early '80s, when we were able
to force Haiti or convince Haiti
to reduce their tariff to three percent,
which meant that U.S. rice was coming in,
but was already subsidized,
the levels would vary from 35% to 100%.
So, the Haitian rice producer had to compete
with subsidized U.S. rice
produced by agro-industry.
MARCELA: Agricultural subsidies
are a huge distortion
for world markets,
particularly the poor.
They happen because...
local interests
want to protect
their markets,
and they do that at the expense
of other countries
that don't have the same power
to negotiate the bilateral agreements
with large powers
like the U.S.
ANDREAS: What the companies
in the rich countries do
is they lobby their governments and say,
"We need to have protection
from competitors from poor countries,"
so they block them out,
first with tariffs and import duties,
and then they ask
their government for subsidies
so they can produce more.
Then they produce a surplus,
and guess what they do with the surplus?
The surplus goes
and is dumped into a poor country.
So what we end up doing
is destroying
the local market and destroying
the very companies
that we first blocked out
of our market.
JACOB: ( speaking foreign language )
FARMER: ( speaking foreign language )
( indistinct chatter )
JOEL: When you go to Haiti
or you see--I mean, it breaks your heart.
You see people,
impoverished people are hungry.
That is primarily
either a distribution
or an indigenous
lack of production.
( music playing )
NARRATOR: Joel Salatin is a third-generation
Virginia farmer
whose Polyface Farm
has been featured
in National Geographic,
The New York Times,
and Michael Pollan's
The Omnivore's Dilemma.
Salatin's books
argue for the virtues of sustainable biomimicry
and increased localized food production.
JOEL: A few years ago,
when I was a U.S. delegate
to Terra Madre,
which was the big international
Slow Food convivium
in Turin, Italy.
When I wasn't speaking, I went...
and attended as many
of the African delegation speakers
as I possibly could.
What each of these delegates
said was,
"You Americans...
"butt out.
"We don't need your foreign aid.
We can feed ourselves."
And they would list
these wonderful
perennial nut-bearing trees
and things that had now
been cut down
because of cheap
Western dumping, foreign aid,
into those cultures,
which depressed the price
of their locally
produced food,
and here we are poor
and we're not feeding ourselves,
not because we can't,
but because...
this Western dumping.
KENNETH: In the '80s, Haiti was...
self-sufficient in rice.
That is true.
In the '80s,
we ate rice twice,
at the most three times a week.
Rice was...
a luxury item.
The farmer
was producing other
and a more balanced
nutritional system that was
some sort of a Haitian culture.
When they started flooding
the Haitian market
with subsidized rice,
what actually happened is that
rice became a cheaper commodity,
and rice has become the center
of the eating habit.
From three times a week,
now we're consuming rice
three times a day,
seven days a week.
People eat rice for breakfast,
for lunch, and for dinner,
because rice has become so cheap
but it has become so cheap
because it was subsidized.
TIMOTHY: And none of that was an accident.
They knew very well in Congress,
and you read the minutes
and people have written about this
and I wrote about it in Travesty.
They would say this in Congress,
"We wanna turn Haiti into the Taiwan
of the Caribbean."
So you had a, kind of, a marriage.
The food lobby, the U .S. farmers
who wanted to sell more products
so Haiti could be shifted into
a consumer of U.S. agricultural products,
it's good for us.
Then you had the offshore venture capitalists
who wanted to promote
industry in this--
in the urban areas.
They argued it was good for Haiti
because it gives people jobs.
And then you had a third partner in this,
and that was the conservationists,
because Haiti, with the--
with the erosion
and the deforestation,
was considered a serious problem,
a serious ecological problem for the entire region.
You've got runoff
in the mountains, erosion,
you know, dirt going into the ocean,
smothering the reefs,
so we need to get the peasants off the hills
with their inefficient
hillside farming
of beans and corn.
We get them out of the mountains
and down into the cities and working in the factories
so we can preserve the mountains,
trees can grow back.
So it's this nice little picture
of all three, you know,
conservationists,
and offshore venture capitalists
who are promoting factories,
and the U.S. farm lobby.
And what beautiful logic. I mean, it could--
come on, you step back. How can you argue with it?
REPORTER: What brought about the change in your thinking
to have you issue your apology the other day
about the food policies?
We genuinely thought
we were helping Haiti
when we...
restored President Aristide,
made a commitment to help rebuild the infrastructure
through the Army Corps of Engineers there,
and do a lot of other things,
and we made this devil's bargain on rice,
and it wasn't the right thing to do.
DANIEL: Think about it.
If you are in the countryside,
you used to farm and you used
to produce rice competitively,
now there's a cheap rice coming in
and you don't have anything to do there.
KENNETH: Because farmers
could not make a living outside
in the rural area, they moved in
looking for better days
into Port-au-Prince,
and we overbuilt slums.
And what it did
is it actually
created more poverty.
TIMOTHY: I'm not saying they were wrong. I'm not saying
it was--and it wasn't-- it certainly wasn't evil,
but the side effects of this plan,
this social engineering
that came from the North,
was massive slums
built with concrete
and poorly constructed.
On a fault line.
MAN: This is CNN, Breaking News.
ANDERSON: If you're-- if you're just joining us
we are following the breaking news out of Haiti,
the largest most powerful earthquake
in the region's history
has crippled the country,
measuring 7.0.
Its epicenter was just a few miles outside
the capital, Port-au-Prince.
( music playing )
DANIEL: It hit when I was on the road.
And you think of your family,
you think of your
brothers and sisters,
and that night
was a nightmare.
The next morning we woke up
and the whole place
was down,
especially downtown was--
had the effect of a bomb.
After the earthquake there was a lot of needs.
It was good that
people came in and start helping.
The problem is that
the short-term natural disaster
turned into a long-term
unnatural disaster.
( indistinct chatter )
ANDREAS: When that earthquake hit,
there is no question,
it's a human non-negotiable,
to go in there and help at any cost,
except that once you are in that
feeling of helping people,
it actually makes us
feel good to help,
to be Superman, to show up
and save somebody,
and then we don't let go.
CORRIGAN: When the January 12th earthquake
hit in 2010,
this individual from Thailand
had emailed
because he had gone through
the tsunami in Thailand,
and he said, you know,
"I'm so glad that you survived
"this national disaster.
"I'm just praying that you'll survive
the arrival of all the NGOs."
And I didn't really understand
what he meant at the time.
The earthquake happened
almost three years ago now,
and there's still
free rice being delivered,
and it's still hurting
the Haitian economy.
It's not an emergency anymore.
DANIEL: It is a republic of NGOs
because there are more NGOs
per capita here
than anywhere else in the world.
I don't have the official number,
but they claim that in Haiti alone
there's 10,000 NGOs.
( music playing )
DANIEL: The NGOs, they do some help,
but they're trying to find ways for them
to keep giving away
free stuff,
as if they didn't want
the Haitians to stand up for themselves.
Do you see what I mean?
( metal grinding )
( music playing )
JEAN-RONEL: My name is Jean-Ronel Noel.
I am the cofounder of ENERSA.
My partner and I, Alex Georges,
we started in my garage
six, seven years ago,
making small experiments with the solar panels.
This is the raw material.
We work them to become
actual street lights,
solar street lights.
JEAN-RONEL: We wanted to be part
of something special,
and because both of us, we grew up in Haiti,
so you know, we know what the situation is.
We have plenty of sunshine,
so is there a way that you can harvest energy
from the sun and to resolve
the energy problem?
So this is something that is
completely different,
and it was something completely new.
At the beginning,
almost everybody thought,
"Those guys were really crazy.
"They don't have nothing to do?
"Spending their time making some experiment
"on solar panels
and LED light bulbs?"
And even now we come with the product and say,
"This is Haitian-made product."
Most people, they don't believe us.
At the beginning,
having a five hundred dollars contract
was great news,
because we have--
we have money for next week.
This is the way we started.
Now, we have like...
big contract
and we have...
62 employees right now,
so we think we found
the right track.
( metal grinding )
Most of the
employees we have
come from shanty towns.
Some from Cite Soleil,
some from Maissade, Cite Castro,
you know, a very populated area.
We train them here.
There is no Social Security Network
in Haiti.
So for our workers, we are
the Social Security Network.
If they were not working,
probably some of them would be
gang members.
In fact,
when we were starting ENERSA, I mean,
the situation was really, really bad in Haiti.
And some of the guys,
they are trying to recruit them
to become gang members,
I mean, they offer you like 500 US
and a gun,
and you are unemployed guy,
you have no future
in this city, so that you don't see yourself
as part of nothing,
so it's easy
to accept this offer.
I mean, the temptation is high.
And some of the guys at the beginning,
I mean, we were really smart
and they were calling me and say,
"Geez, I have no money. I have nothing."
I said, "Don't go there,
"don't go there,
because you have no future in the gang."
( machine whirring )
JEAN-RONEL: We have installed
200 lights in Cite Soleil.
They know that ENERSA
is hiring people from Cite Soleil,
and brought the light
to Cite Soleil.
When you do something, you can see the impact
on the population and you can say,
"This is because of me."
( music playing )
MAN: * Work for your money *
* You got to work *
* For your pay *
* You got to work *
* For your children *
* You got to work *
* For your pay *
FRANTZ: ( speaking foreign language )
-( speaking foreign language ) -( speaking foreign language )
( speaking foreign language )
( laughing )
( horn honking )
WOMAN: Sugar?
With your coffee?
Yes, yes, yes.
Coffee needs to be very,
very sweet in Haiti. It's more like
coffee syrup than coffee.
Right after the earthquake, you had a lot
of need for solar
because powers was completely out
in Port-au-Prince.
NGOs started to feel
the need for solar,
went to donors abroad
that sent
the solar equipment from abroad.
So then when we managed
after a few weeks
to be able to secure the facility
to get some production going again,
then the demand stopped,
because it's hard to compete with free.
Because we-- when you had companies
sending a thousand
solar panels to Haiti
for free,
how are you going to sell?
So it comes from a-- from a good heart,
I totally understand.
People didn't know that there was
any solar available,
and people had this conception that
"Oh, in Haiti, you know, there's nothing,
"So I have to come with everything,
even with water if I want it."
So we really suffered
from that perception.
( machine whirring )
ALEX: From an average,
before the earthquake,
of 50 street lights
a month in average,
we went from January to June,
we sold 5 street lights.
JEAN-RONEL: After the earthquake,
we are competing
mostly against NGO.
So NGOs were coming
with their solar panels,
solar street lights,
and they are giving them for free.
So what about local businessmen?
So what do you expect them to do?
MAN: Did you ever talk to those people
who were giving it for free and say, "Hey,
what are you guys doing?"
Oh, we met them many times.
Those NGOs, they are changing
the mentality of the people.
Now you have like a generation
with a dependence mentality.
ALEX: When it becomes
an industry of its own,
the industry of charity,
it creates more harm
than good to the country.
But there are different ways that can help.
( indistinct chatter )
JEAN-RONEL: We have done experience with
Partners Worldwide.
They are working in Haiti,
and these are NGO
that support businesses.
So they help you
set up your business.
They give you training,
they try to put you on their network,
they try to sell your goods.
( Speaks foreign language )
JEAN-RONEL: They do everything that can
help your business grow.
Some NGOs also are
training technicians,
construction workers,
mechanic guys, electricians,
and they are giving them possibility
to start their own business.
They are teaching them how to fish,
not to give them the fish every day.
Your goal should be
to give me a fishing rod
and to teach me how to fish
and then move out,
but after 40 years,
if you're still here,
there is a problem.
( music playing )
NARRATOR: The current model of development began
in the wake of World War II,
and the end of colonialism.
Many believed that one of the causes of the war
was the catastrophic economic condition in Europe
in the 1930s.
As the war came to an end,
leading economists
and delegates from around the world
met in Bretton Woods, New Hampshire
to create organizations
that would help stabilize
the international economic system.
They formed GATT,
the General Agreements
on Tariffs and Trade,
later to become the WTO,
the International Monetary Fund
or IMF,
and the International Bank
for Reconstruction and Development,
known as The World Bank.
The goal of The World Bank
was originally to help
rebuild war-torn Europe,
but this role was soon taken over
by the Marshall Plan.
MAN: In Washington, George C. Marshall
made known the principles of the plan
that was later to bear his name.
There is no doubt whatever in my mind
that if we decide to do this thing,
we can do it successfully.
MAN: Later, President Truman
drove to the capital to put the Marshall Plan
for European Aid before Congress.
HARRY: I am here today
to report to you
on the critical nature
of the situation in Europe
and to recommend action
for your consideration.
NARRATOR: As Europe's war-torn economies
began to turn around,
many credited the Marshall Plan
as playing a key role
in jumpstarting their growth
and this approach
of providing foreign aid
became the model for helping
the developing world as well.
The idea was that if you could build up
infrastructure, electricity, and education,
it would spark the process of economic development
and countries could make the leap
into industrialism.
The World Bank found its new mission,
promoting development in Africa,
Asia, and Latin America.
KIBAKI: Today,
the Board of Governors
of the International Bank
for Reconstruction
and Development
and the International Monetary Fund
meet for the first time
on the continent
of Africa.
NARRATOR: Foreign aid or what's called
"official development assistance,"
consists of government- to-government transfers,
and can take the form
of grants or loans.
Tax dollars go to governments
and international organizations,
which transfer funds to governments
in the developing world
for things like food,
infrastructure,
and healthcare.
The aid may include contingencies
requiring recipient countries
to implement policies
that donor countries deem beneficial.
Over time, as foreign aid
has expanded,
consultants,
non-governmental organizations,
and charities
also receive aid money
from governments
to implement projects
and will often contract
with additional charities and NGOs.
Catholic Relief Services
receives over 70%
of its budget from government money.
While in 2012,
World Vision received close
to $175 million,
and the international development firm
Chamonix,
more than $500 million
in government contracts.
A recent drive
for increased foreign aid
is the United Nation's
Millennium Development Goals,
with the aim of eradicating
extreme poverty
by the year 2015.
With over 400 proposed interventions,
the goals have been endorsed
by government leaders,
promoted by celebrities,
and thousands of charities
and universities
have signed on.
Foreign aid has become
the cornerstone
for the West's engagement
with what became known as
the Third World.
( music playing )
( engine revving )
TIMOTHY: The nice explanation
for development,you know,
the sympathetic explanation
is to relate it to the Marshall Plan,
relate it to the developing of Europe
and the--and the idea that we could go
into these developing countries
and help build an economy
and build infrastructure.
So yeah, the nice way to say it
and what people who are involved in the system,
the UNCID, and all these guys,
they all trace themselves back to the Marshall Plan,
because it was a success.
And yeah, that's the nice twist.
I think a better way to understand it
is in the context of the Cold War,
competing for the resources
in a Neo-Neo
type of colonialism.
You know, I've talked to Haitians saying,
"You know, we had colonialism,
"We had neocolonialism,
"We had Neo-neocolonialism.
And now we have development,"
which is just another colonialism.
THEODORE: I once spent
a rather happy afternoon
in a place called Malabo,
counting the number of vehicles
of different aid agencies.
NARRATOR: Theodore Dalrymple
is an English physician
who has worked in Tanzania,
Zimbabwe, South Africa,
and the Gilbert Islands.
He returned to the United Kingdom
in 1990,where he served
as a psychiatrist with prisoners
and in inner-city Birmingham.
He is the author of numerous books,
including Zanzibar to Timbuktu,
and Life at the Bottom.
THEODORE: Malabo is the
capital of Equatorial Guinea,
where the first democratically elected president
killed or drove into exile
approximately a third of the population.
And he used to keep
the national treasury under his bed.
When the president left the capital,
they turned the electricity off
as being no longer required.
So, I counted the number
of aid agencies,
and I think I counted,
in about three hours,
I counted 27
in large white Toyotas,
air-conditioned, of course.
And really the devastation of
Equatorial Guinea
was very good business for them.
The salary is very good,
it tends to be tax-free.
Unlike your life at home,
you will have servants
and I think it was Shumpita
who said that, "One servant is worth
a household full of appliances."
HERMAN: A lot of the donor agencies,
when I see their country heads
driving around in their posh cars
and living in their big houses,
I see multiple colonial governors.
This is the new face of the colonial governor.
NARRATOR: Guinean software entrepreneur,
Herman Chinery-Hesse,
is the founder of SOFTtribe and BSL.
He began in 1991
working out of his parents' home
to develop a line of software
especially suited
for the developing world,
and then began selling door-to-door.
A leading technology pioneer,
he has been called "The Bill Gates of Africa,"
and has been featured on BBC
and in newspapers around the globe.
He is now working
to connect rural entrepreneurs
to wider markets
through innovative smartphone applications.
HERMAN: I think that The World Bank
and other such donor organizations
have an agenda
outside the development
of our countries.
To a large extent, our governments
have been held captive
by the donor agencies,
the international donor community,
who are not, in my view,
particularly interested
in seeing the growth
of local business,
because then the tax base
will represent
a revenue source for the government
and therefore put the international donor agencies
out of business.
MAN: Thank you very much.
Thank you for your patience.
( applause )
JOHN: We are no longer getting excited
by aid
from IMF,
from The World Bank.
They perpetuate your misery
by giving you a loan,
make you a slave,
economic slave,
because you are chained
by the loan,
so it becomes
a way of colonizing
the economies
of the poor countries.
Now, there are a lot of Africans
who are very angry,
angry
at the condition of Africa.
The Cheetah Generation
is a new breed of Africans.
They're not gonna wait for governments
to do things for them.
That's the Cheetah Generation.
And Africa's salvation rests
on the backs of these Cheetahs.
In contrast, of course,
we have the Hippo Generation.
( audience laughing )
GEORGE: The Hippo Generation
are the ruling elites.
They are those who have monopolized
political power,
and they are those who are stuck
in their muddy pedagogical patch.
And they believe that the only way
you can solve the problems in Africa
is by giving the state more power
and more foreign aid,
and it is on the back
of this Hippo Generation
which the United Nations,
The World Bank, and the IMF have been trying
to hitch a ride with this
same old aid-driven boondoggle.
And that's why we're not getting anywhere in Africa.
Out of the 54 African countries,
only 16 of them are democratic.
Now, these leaders stay in office 10, 20, 30,
and even 40 years in office.
And they don't even step down.
They groom their sons to take over.
Africans are fed up
with this kind of leadership.
MAGATTE: When people support
more foreign aid for Africa,
the more they're condemning us in Africa
to live under dictators
who will not respect our rights
to access to rule of law.
No doubt originally
the idea was compassionate.
You saw people suffering from poverty,
and therefore your immediate response
is to give.
But unfortunately,
giving on a large scale
distorts.
Take a country like Tanzania
where I actually worked,
its greatest receipts
in foreign currency
were from aid,
and the whole of the political process
actually was who got their hands
on the aid.
MAGATTE: Make no mistake, I am not against
humanitarian aid.
Of course,
if something, a disaster happens,
we better rally and help each other.
But when humanitarian aid
becomes a way of life,
then we all have a big problem.
Emergency disaster relief
has become the permanent model,
and that model
is what I call
the current aid industry.
HERMAN: I have never heard of a country
that developed on aid.
If you know of one, just let me know.
I know about countries
that developed on trade,
and innovation, and business.
I don't know of any country
that got so much aid
and then suddenly became a first-world country.
I have never heard of such a country,
so the track is wrong.
That track ends to nowhere.
PAUL: There is a school of thought out there
that I don't agree with
where indeed people
think they owe the poor people
to give them money
without thinking about how
they are going to use this money.
Aid leads to more aid
and more aid and more aid
and less independence
of the people that are receiving aid.
Second is the wrong notion
for people who have money
or who give aid,
they feel good that they're helping,
but the best way to help
is to help people
to be able to stand on their own.
HERMAN: Our governments are not encouraged
to buy local.
Now, when we talk
to the international donor community,
they say it's not their policy
and that we're
in cloud cuckoo land.
When we talk to the government,
the government says,
"Hey, we're not allowed to buy,
with donor money, local products."
That's just the way it is.
It's their money, they decide who gets it.
For example, five companies in Ghana
got together to bid for a contract, together.
Now, everything was going very well,
we were competent to do the work,
guess what happens? We are bidding
against some European companies.
One of the companies got their government
to loan our government money,
very soft loan,
for the project.
Our folks in the government said,
"Hey, you know, we love you very much,
but nothing beats free money."
We lost our money.
You know what we ended up doing?
We ended up working as subcontractors
to the Europeans.
They gave us the worst part
of the business.
The most difficult and least profitable part,
we wound up doing it
because we were better at doing the work.
So they got the best of both worlds.
Their government paid,
we ended up doing the work,
they took the money.
That's not development,
that's not assistance,
that's...
thuggery.
THEODORE: A large part of aid is, of course,
the subsidy to the companies
that do the work
in African countries.
I myself worked on such a project,
and I saw myself
the incredible waste.
It was a road project actually in Tanzania
and the foreign aid amounted
to a huge subsidy
for a company that could not possibly
have got the contract in a--
in a real market.
And these can amount
to hundreds of millions of dollars.
( music playing )
THEODORE: And the so-called foreign aid
actually goes back to the people
working for the company,
and I suppose the shareholders
of that company.
And I, myself, am personally
a beneficiary of that.
Anyway, I-- in essence
I bought--
I bought my first house
from the proceeds of foreign aid.
Foreign aid has been excellent to me.
It's aided me immensely.
It's allowed me to have an interesting life,
to travel,
live in good conditions,
be well paid, no tax.
Couldn't be better.
TIMOTHY: Everybody in development agrees.
Everybody knows the system doesn't work.
They don't say it in public,
but when you sit down
and have beers with somebody,
or you sit down in a meal,
we all say the same thing,
the system is broke and it's not working.
It's not happening like it's supposed to be.
And everybody--
some people get very emotional about it.
Everybody in development knows this is--this--
there's something rotten.
They know.
We don't have to say anything
that everybody else doesn't know.
( music playing )
NARRATOR: What began as a plan
to jumpstart economies
and promote development
has, over time,
developed into a complex system
of global humanitarianism.
The system includes everything from governments
and multinational corporations
to aid agencies, NGOs,
charities, celebrities,
and social entrepreneurs.
The goal is to help,
but the incentives and the interplay
of these different components
ended up creating
a global poverty industry.
Perhaps the best way to understandit
is through what one of the founders of sociology,
French sociologist,
Emile Durkheim
called a social fact,
a broad tapestry
of norms, assumptions,
and social and economic institutions
that transcend any one individual
or organization.
The social fact puts constraints
on how we think and act,
leading us to take many things for granted.
It becomes simply
the way things are done.
This doesn't mean there is never innovation
or attempts to fix the system.
People are always coming up
with creative ideas
and approaches.
The trouble is that most of the innovation
takes place within the assumptions, beliefs,
and values of the social fact.
At its core, the social fact
situates the poor as the other,
as objects of charity
rather than as the subjects,
the active protagonists,
in their own story
of development.
People have the internal capacity
to rise out of poverty,
but they do so only
when they have certain key things
many of us take for granted,
like legal protection
from theft and violence,
justice in the courts,
the ability to get title
to one's land,
freedom to start
and register a business,
and links to wider circles
of exchange.
The difficulty is that
this ladder to prosperity
is missing in many places
around the world
and the current system
creates incentives for governments,
not to build it.
MICHAEL: Whenever you have an aid agreement,
those consultants come into the country
and they don't work for the country,
they work for the foreign aid establishment.
And so what you find
is that the aid establishment severs
the link between the leader
of a country and his people,
because you've got all these consultants
running around doing their thing,
purportedly to work for the people,
but in reality their masters
are in Washington and Tokyo
and London and Paris.
So that's what part
of what's broken with aid.
NARRATOR: Poor people have become the clients
of a vast global poverty industry.
If they climb out of poverty,
the industry becomes obsolete.
So a question we need
to ask ourselves is this,
who benefits the most
from the way things
are currently set up,
the people we are trying to help
or the people who work
in the poverty industry?
( vehicle honking )
EVA: When I was growing up,
we didn't have second-hand clothing
from Europe and the U.S. and Canada.
In Kenya,
my mother took me to a store
and she bought me a beautiful T-shirt
that said, "Made in Kenya.
Kenya Cotton."
Today,
I would struggle to find a T-shirt
like that for my daughter.
Why? Because the influx
of second-hand clothing
that makes its way here
from Europe and the U.S. and Canada
has negatively impacted
on our textile industry
in Kenya.
Massive layoffs in the '80s
and the '90s,
factories that shut down.
What happened to our cotton farms?
When I was growing up in this country,
we could have bought cotton
in varieties and types
that are incomparable,
but that's all gone
because of the impact,
the negative impact,
of the apparel imports
at a second-hand level.
PETER: Growing up, the model that I saw
was this model that we would have
a shoe driveat church
and we'd all give our excess shoes
and then our shoes, we never knew what happened,
but we knew that we were responding
to this desire that we had to help the poor,
the vulnerable.
What I experienced living overseas,
especially in Rwanda
was the end of the story.
The collection, in some ways,
is the easy part.
The distribution is where there are
a lot of complications.
And I had my eyes opened to this
through a friendship with Jean.
And Jean was a friend in Rwanda,
and he told me the story
that after the Rwandan genocide,
that he had a church from Atlanta
that started sending over eggs
and ended up just distributing eggs
in this small community outside of Kigali.
And that seems like a great thing to do, right?
The church wanted to help
after the genocide.
But Jono, a few years before,
had started a small egg business himself.
He put this investment in all
the materials that he needed
to start this egg business.
His business was starting to grow,
it was starting to take off,
and then all of a sudden in one summer,
there become this surplus of eggs
that were flooding the market in his area,
and so this desire that the church had
to really take care of a need,
it did take care of a need,
but the problem is that
it put Jono out of business.
He ended up selling his hens,
and then the next year, the church decided
to focus its attention
to somewhere else in the world.
Jono was out of business.
No one else was there providing eggs,
and so they had to bring the eggs in
from another community.
So this desire to help in that community,
according to Jono,
actually had a long-term negative impact
on that community.
MICHAEL: If you go to an aid conference now,
as opposed to 20 years ago, and say,
"How many people are involved with charities?"
Nobody raises their hand,
because charity has become a bad word,
so they call themselves social entrepreneurs.
NARRATOR: A recent trend in development
has been the increasing popularity
of social entrepreneurship,
which applies business models
to pressing social problems.
One of the leaders and most recognized
social entrepreneurs
is Blake Mycoskie,
the founder of TOMS Shoes.
( music playing )
BLAKE:About 15 months ago,
I was
down in Argentina on vacation,
actually trying to learn to play polo.
When I was down there,
I noticed that a lot of the polo players
and a lot of their girlfriends and wives
wore this shoe called the Alpargatas.
And the Alpargatas is very much like
the current TOMS shoe,
but instead it had a rope sole
and just came in like navy,
black, and maroon.
But everyone wore them around
and it was very kind of trendy and chic
to wear these to the bars at night
or to the-- to the shopping mall
or to the beach.
So, kind of seeing
this new cool shoe that all these people
were wearing in Argentina that I've never seen
and seeing lots of kids without shoes,
I came up with the idea
to start TOMS Shoes.
I said to my friend, you know,
"What if we took this original Argentine shoe,
"redesign it, you made it,
"you know, chic and cool
"and fun patterns,
"and sold it in fun,
"you know, good stores in the United States,
"and every time I sell a pair,
"we would give a pair back to these children
who don't have shoes."
( speaking in Spanish )
When I was at the SEVEN Fund,
we actually gave TOMS a prize
for a movie they made about their system,
about their idea with the--
with the shoes and everything,
and at the time, I actually also thought
this was a great idea.
The basic principle of TOMS Shoes
is called one for one.
He produces the shoes when you buy one here
at a marked-up price,
at the same time one pair of shoes
is sent over back into the developing world
and given to a poor child.
The unintended consequence of this
is that, of course, there is
a local cobbler there as well
who actually makes shoes
and sells them.
Can you imagine what happened to that guy
the day the truck shows up
with TOMS Shoes on them?
Why would you go buy something that's for free?
And then to add to this complex situation,
that truck doesn't show up all the time.
Our donations have
an unpredictable impact
on the local economy,
and that wreaks havoc on a lot of businesses,
especially small and medium-sized businesses.
DANIEL: TOMS Shoes, they found
the right model that,
I don't want to say exploits,
but capture this
love of people
who want to be generous
and helpful
and they combine that
tosome kind of NGO model
to keep dumping
free stuff on the market.
MAN: Okay. Blake is also trying
to do some new things.
He has been criticized for,
you know, sending shoes.
So he's trying to develop factories
in local places
where now instead of just giving it away,
they are at least producing it in those countries.
What do you think about that?
Well,
that's good.
At least he listens.
At least they made those factories
in countries where they produce
some jobs, they pay some taxes.
ANDREAS: Would I give that company
the prize again today?
We've all learned a lot
in the meantime.
TOMS Shoes has learned a lot.
I have learned a lot.
With hindsight,
I would love to have
given him the prize
and invite more people
to bring ideas into this,
especially people from--
who are actually going to be affected
by these shoe giveaways.
When you have a company
like TOMS come in
and try to be innovative,
the downfall of this
is that they're trying to be innovative
yet they accept
the given framework.
With that framework
that is actually harmful,
if TOMS is successful,
they're making a harmful system
more effectively harmful.
Okay. Watch this.
BLAKE: What if I started a shoe company
and every time I sold a pair of shoes
I gave a pair away?
In that way, if as long as I continue
to keep selling shoes, these kids will have shoes
for the rest of their life.
Okay. What do you think about that?
Look
it's--
there's no word to describe this.
Saying that he's going to supply shoes
for people for the rest
of his life
is implying
that he would want people
to stay without shoes
for their life
so he can give them shoes.
People don't want to be receiving things
for free for all of their lives
like he says he wants to do it.
No one in Haiti
wants to be a beggar for life.
It just doesn't make any sense.
You know what the poor people--
they get?
A poor image.
The first thing that I would say to those
who say that we must come and give,
otherwise, these people are incapable of
improving their situation
and getting out of their poverty
is to ask them why.
Why do you think that?
Why are these people uniquely unable
to get out of their poverty?
Are you actually saying
that they're in some sense inferior beings?
Are they different from us?
Can they not think for themselves?
Is there not evidence, in fact,
that when given the opportunity,
they do, in fact,
get out of poverty themselves?
And secondly, I would say that,
actually what you need to do is live
in the country for
two or three years,
not just fly in,
say, "My God, isn't it terrible?
"You know,
"All those babies
"with, you know, bloated stomachs
the next morning."
No doubt, it is terrible,
but compassion is not simply
vehement expression
of a point of view.
And that
the compassionate person
has to consider
the practical effects
of what he is proposing.
( singing in foreign language )
CORRIGAN: My name is Corrigan Clay,
and my wife Shelley and I
moved to Haiti in 2008
to adopt a child,
and we were thinking at the time
that we would probably start up
an orphanage also.
I saw a picture of a little Haitian kid
on the internet
and fell in love with
the idea of Haiti
and a child from an orphanage
and being able to give a parentless child
a family.
So, today
Today
we met Wilson
for the first time,
and he gets to stay with us
in the hotel
in Port-au-Prince, Haiti,
or somewhere near there.
And
he's my
new brother.
Yeah.
As we were pursuing adoption,
the orphanage director had asked us
if we wanted to meet
the child's mother,
and we were kind of surprised
because the thought was,
"Well, wasn't he abandoned
by somebody?"
Or, "Didn't he lose his parents?"
That kind of thing.
The director of the orphanage said
she comes to visit him
every couple of weeks.
I was shocked, and I
I said, you know,
"Why does she come and see him?"
And he said, "Well, she loves him
and she wants to make sure he's okay,
and she brings him gifts and things."
Then when we met her,
I asked her, you know,
"Why did you bring him to the orphanage?"
And she said, "I just didn't have enough money to feed him.
"I don't have a good place to live.
"I live in Cite Soleil.
"There's, like, gangs
"and violence,
"and so the orphanage
was the best solution for him."
So we asked her,
"If you would have had a job,
would you have kept your child?"
And she said, "Of course I would.
Yeah."
And it was like this
this shock,
you know, of I'm spending $20,000
on this adoption
to be able to raise a child
that this mother wants.
And the
injustice of that
really took me.
CORRIGAN: So we began to have conversations
with the families of these children,
and with the children themselves,
and the orphanage we're in,
there were 24 boys
that we were taking care of
at the time.
Two of them
did not have
living parents.
As we started to learn
about other orphanages too,
and ask questions and things,
we found out that was fairly typical
that I would say conservatively,
roughly 80%
of the kids
in orphanages in Haiti
are not true orphans,
but are poverty orphans.
( music playing )
TIMOTHY: This is another kind of corruption,
another kind of destruction of this whole system.
When I did the research for CARE,
and I wrote about this in Travesty,
I couldn't find any orphans
that didn't have parents, they all had parents.
And when you really get into it, well of course
they have parents, because orphan
is a coveted position.
It's school, it's books,
it's maybe even a visa,
maybe even an adoption.
But it does perverted things
at the lower level of the system, you know.
KENNETH: Some parents, because they cannot
take care of their child
and they hear that
somebody is opening an orphanage
because some donor
wants to do good
and wants to open an orphanage,
because he hears that children,
Haitian children are dying
or suffering.
The parent would turn
their own kid to the orphanage
and would often go visit the kid
once a month.
But you have relieved the parent
of the obligation
to educate his kid,
but you've also drained that kid out
of emotional ties,
of the love of a mother,
the respect of a father,
and that kid growing up
may not have all that sense
of responsibility.
So you are actually
creating that cycle
of destruction.
CORRIGAN: After living in an orphanage for a year
and getting to know the language
and the culture and the people
and really building relationships,
we began to kind of see
that the system
of addressing the needs
of orphans
was actually a system
that was creating orphans.
The way that
charitable organizations
are addressing orphans
in Haiti is symptomatic
of a larger belief that says
these are issues that must be addressed
versus these are people that must be addressed.
Issues are addressed institutionally,
programmatically.
People are addressed
in their story,
in reflexive dialog,
through questions and listening.
There was one child in particular
in the orphanage we worked in that,
when his adoptive family
was coming to visit,
I asked him, "Hey, are you excited?
I mean, your mom and dad are coming."
And he goes, "They aren't my mom and dad."
I said, "Well, I know they're not yet,
"but they're going to be. They're adopting you.
They're going to be your family."
He's like, "No, they're never going to be
my mom and dad."
This child is about 14.
He said,
"No, my mom and dad are here
"in Haiti. I know them.
"My Haitian parents
"told me that I'm like
"the special kid in the family,
"that I get to go to the orphanage.
"I'm just going to go
"To the United States with these people,
but they're not really my family."
I said, "Well, you know,
"their expectation is that
"you're going to be a part of their family,
"and they'd probably be really hurt to know
"that you have no intention of really
"being a part of their family."
We've adopted two Haitian children,
Jackson and Ember.
Ember's mother died after childbirth,
and Jackson's mother
abandoned him at the gates of the orphanage.
She came with him
and then was supposed to bring back papers
relinquishing him, but did not.
This is Jackson right here.
He's a big boy,
but when he was,
when he was in the orphanage,
he actually almost died of starvation twice
because this institutional approach
at caring for kids,
they were just plugging him with a bottle
and they didn't know he was lactose intolerant,
and so he was throwing up all his food
and just
almost died twice.
He had to go to the hospital.
And obviously now, he's eating just fine.
How are you doing, baby?
We're advocates for adoption.
It is broken
and not right
that a kid would grow up
without parents.
That's the very same thing
that influences us to say,
don't get involved
with orphanages and adoption
that are separating kids from their parents.
If I was in
a personal financial crisis
and I could not feed my child,
I could no longer pay for their school supplies
or for them to go to school,
I didn't have enough money for them
to ride the bus, whatever,
and somebody from some other nation
came in
and said,
"Hey, you know what?
We've got a solution.
What we'll do is we'll set up
a house
where all the kids that have that problem can come live.
They're not going to be your child anymore.
You're just going to have to give them to us,
but we'll make sure they have everything they need,"
is that the solution that you'd want?
And I think most honest people would say,
"No, I wanna raise my own child.
"I just need a job.
"I need some way to make some money,
and I'm going to take care of my kid."
( music playing )
SHELLY: So we had an intern
who was there for the summer,
and she knew what my vision was
as far as starting
some sort of artisan thing.
Because we had a bunch
of people in our lives and there was about
four women who had either given their kid up
for adoption already or who were at risk for that,
and so she said,
"Can I invite them over
"For two days a week and just teach them
how to make earrings?"
I was like, "Great. Let's do it."
Bonjour.
( speaking in French )
SHELLY: December of 2009,
we had a fair here in Haiti
and I think we sold $800
worth of product, and we were so excited.
We kept growing and we had about
probably 16 to 20 artisans working.
It was in our house,
in our living room and our garage.
And then probably 2011,
we started getting into retail.
We got involved with designers
like Donna Karan.
We've been carried in stores
like The Gap, Walmart.
Disney has stuff.
In 2011, in the month of December,
we sold $100,000 worth of jewelry.
We have about 220 people
right now working.
My vision
is a thousand people.
( music playing )
CORRIGAN: When my family first came to Haiti,
we had in our savings,
it was about $35,000.
I thought
that we'd start an orphanage
and then be asking people
to help us sustain that,
so it would be this constant
need for help.
Because we started a business,
now the amount that we came with,
that's the amount that we're averaging
in income for our artisans
every month.
It's not a charitable like gift,
"Here's a bunch of money every month."
But it's something that
they can look at and say,
"This is mine. I earned it.
"It's something that I can choose
"What to do with it,
"And somebody out there
"Valued what I did
and purchased it."
( music playing )
SHELLY: Makilene is a miracle story for me.
I was walking home one day
andwalked up to my gate,
and there's this woman sitting on the ground in the dirt
with a baby in her arms.
She was covered in scabies,
her baby is covered in scabies.
They hadn't eaten.
She came here looking for an orphanage,
so the last thing I wanted to do
was send her to an orphanage,
and I said to her, "You know what?
"I'm going to make you a deal.
"Go get all your kids. Come back here,
"and I'm going to invite you to work with us.
And I'm gonna just try it."
Here she is
in Port-au-Prince with her kids.
She's not making any money yet,
so she goes to live in a tent.
( speaking in foreign language )
SHELLY: Her kids were in a horrible situation,
but she started to work.
And she
is an amazing woman.
She's an entrepreneur.
Within about three months,
she had probably 10 employees of her own.
She was talking about needing a house,
and I said, "I don't have money for a house for you,
"So let's break it down into something
that you can imagine."
I said, "If you need $2,000
for land for your home
and you're getting $12 on a necklace,
how many necklaces is that?
It's less than 200 necklaces."
And her brain just about exploded.
I mean, you could see this click in her mind.
Her eyes opened up
and she's like, "I can make 200 necklaces.
That's not a problem."
And it was about
six months or something
and she bought her own property.
( speaking in foreign language )
SHELLY: She did it herself.
It's two bedrooms. It's her own.
She never has to pay rent again.
And she's now changed her life.
( speaking in foreign language )
SHELLY: You see mostly men here,
which a lot of people are surprised about.
We started out with women,
trying to do a women's work initiative
because that's sort of the thing to do, right?
And, um, we found that fathers
are parents too,
and we also found that
in a family situation,
if mothers are all that is needed,
what role is there for a father?
And that sort of contributes
to the situation in Haiti
of fatherlessness.
Most of the guys here are fathers,
and they're working
to take care of their kids.
He's got a baby on the way.
He's got two children. He's got a baby.
You know, and they're all doing a good job
being fathers to their children right now.
I think my biggest concern
in even doing this interview
is that I don't want to come across
as critical to those
who have helped
and who have tried to help.
As we grow and we learn
and we figure things out
in the same way that I've gone through that journey,
that there is a better way to help.
Giving power
to the parents
is exponential
in how many kids you can help.
I've estimated with 250 employees,
we're helping at least
750 children,
possibly 2,000 people
if we think they're supporting their whole families.
I mean, there is no orphanage that can be sustainable
to take care of 750 children.
I mean, an orphanage of a hundred kids
has to have a minimum
of $400,000 a year,
and they have to fund-raise for that,
and they have to pull out their flies-on-child pictures,
you know, in order to do that,
which then creates this whole model
of those poor people,
those poor, desolate people.
They're not desolate.
They have hope.
They have a way to get out of it.
There's a way to fix it.
MUHAMMAD: When I talk about poverty,
one example
I like to give
is the bonsai tree.
Go and look at the tallest tree
in the forest
and pick the best seed
of the tallest tree
and plant it in a flower pot.
You get about a meter high
or less than a meter high plant.
So what's wrong with this little one?
The wrong thing is the
flower pot.
If you had planted in the real soil,
it would be as tall as the tree
that you saw in the forest.
Poor people
are bonsai people.
Society doesn't provide them the base.
The laws
and the institutions
and the policies do not allow them the base,
so they remain stunted,
and we call them poor people.
JOSHUA: My name is Joshua Omoga
I'm a businessman,
operating a shop within Kibera.
I left my rural area
to come to Nairobi
to search for a job
and better my life.
I borrowed
some money from a friend
and started by selling
vegetables
by my doorsteps.
I live in the same place I work,
and this place is very small.
The place is not mine,
so you cannot expand it.
It's not easy to
register the business
because Kibera has
temporary structures.
And the government does not recognize
temporary structures to be registered.
So that's the-- one of the challenges
I am facing.
For now, I'm saving for my
son, so that
when he reaches this,
the time he is going to start
his school,
primary level,
I'll be having something
in the account to support
his education.
My future plan is to invest
heavily in my business.
And
I'm planning to relocate from Kibera
to another place,
where life's
more better than Kibera
and register my business.
PAUL: One careless
romantic vision of the poor
is that they are being so exploited
that they should just be left
to retreat into self-sufficiency,
the organic, holistic peasant,
uncontaminated
by the dirty business
of a market economy.
And of course, that is just
romantic nonsense.
People who retreat into subsistence,
disconnected from the market,
are poor.
The only ones who are not
start off as investment bankers
and then go and live out
this romantic fantasy,
and that's fine for them.
It's no good for today's poor.
Today's poor
need all the connections
they can get.
ANDREAS: I'm frustrated with this idea
that poverty means
living on one or two dollars a day.
That is a very
bad way to state the problem.
Being poor
has something to do with being excluded
from networks of productivity and exchange.
That means cell phones,
internet, banks,
financial systems,
educational systems.
CHARLES: I started a small company,
juice processing,
based in Ghana,
selling pineapple juice,
with four or five workers,
including myself,
and I've come to the state where I have 15 workers,
and at peak season, up to 20 workers.
We start small,
tend to want to expand,
but because you are a young guy
with no collateral,
no landed property, as they call it,
you cannot access any facility or loan.
And you want to do business in Ghana, it's frustrating.
At this stage, it's more difficult
because you can't move to the middle state
that you really, really can make some money.
Because like, you need to access
sizeable amounts of money,
which family cannot get,
our friends cannot get,
and you have to pay those interest rates,
it will kill your business.
We're looking about
six to ten percent monthly.
That's about 72%
to 120% annually
of interest rate.
There is no business
that can make such profit
that you can pay off your loan
with such interest.
In Ghana, we have
small-scaled,
small micro-financing companies
that will tend to lend out
to market-women, small shops.
That micro-financing companies,
we have a lot of them in the system.
Then we have the big banks
who tend to lend out to big companies.
So, there's a gap.
There's a gap between the small
and the large scale
big companies. But in between them,
we don't have those who want to lend out
to the SMEs.
They put all the papers around like,
"SMEs, come for loan" you go there,
they don't give it to you.
The process
is so long.
Plus you're definitely not going to get it
for someone, like, who doesn't have a landed property,
who doesn't have
a land or house.
So, growing is virtually
difficult. You are at a standstill.
MAN: If you look at the distribution
in prosperous countries,
you see that most companies
are small and medium size.
If you look at that same distribution
in emerging markets,
in poor countries,
you see that there's a lot
of very small companies
and a few very large companies
and nobody in the middle.
This is called the missing middle.
And that is so important because that middle
is what creates prosperity.
MARCELA: It's not that people don't have the capacity
to be much
more efficient, it's that
the access is not democratized.
NARRATOR: One of the key factors that creates
inclusion and fairness for the poor
is justice in the courts,
or what is often referred
to by development economists
as the rule of law.
MUHAMMAD: Rule of law is
that I know what I am,
what is the rights and responsibilities
around me,
and it's protected.
That's the rule of law.
Otherwise, it's a jungle.
The most powerful one
will take everything.
And that's not a good
idea for human society.
HERNANDO: Try and imagine
a football match without rules.
Or you don't get a game going.
The rules are crucial
to get that game going.
But everybody knows how to drive a ball;
everybody knows how to buy and sell,
so there's plenty of entrepreneurship
in the--in the world.
The problem
are the rules.
In two-thirds of the world,
there isn't yet the rule of law.
( speaking in foreign language )
What makes people
interested in the rule of law,
the first thing that they understand,
is that everybody on this earth
lives on a plot of land.
And so, if you come around and say,
"Look, we have found rules
"that determine how far you can go
and how far somebody else can go,"
are you gonna share or not share water?
Are you gonna have passing rights
or not having passing rights?
People start understanding
the value of standard rules.
Property rights are a terrible problem.
Terrible, terrible problem.
Like, 60%, 70% of our people are farmers,
and just imagine if you have 10 million farmers
who have no title to the land they are farming on.
We haven't got clean title in Ghana.
It's very, very difficult.
You buy land, you have to buy it four or five times.
If you're looking for farm land
as a small peasant farmer,
looking for five acres to buy,
you can get five acres from the chief
by giving him a drink,
but you don't own the five acres,
so you can't go to the bank with the five acres
as your collateral
to then borrow money to buy a tractor.
Last time I had a meeting at The World Bank,
I asked
The World Bank officials,
"Hey, you've been working with our government
all these years."
You know this is
at the bottom of our problems.
"What are you doing about it?
"Are you saying for 20 years,
"you just forgot that
"we have a situation where anybody's business,
"anybody's house
"can suddenly come into question,
"and they might just lose their investment
and that it wouldn't encourage people to invest?"
I don't see that a lot of work has been done there,
or a lot of progress has been made there.
You can't start an economy
without ownership
not being in question.
This is my fundamental.
NARRATOR: The lack of property rights
is just one area where the rule of law
is missing.
The poor lack access
to justice in the courts
and are often locked out
of the formal economy
by complex legal structures
that only the rich and well-connected
can navigate.
MAGATTE: When I use the term
"rule of law,"
I do not want for people to think
that I'm saying we don't have enough laws.
Most of countries in Africa
don't provide good rule of law.
On one end, they are completely excluded
from the systems of
productivity,
and on the other hand,
they are basically choking
under the heaviness
of these corrupt leaders
of theirs who have put together
the worst laws possible
to allow them
to try and make it through.
HERNANDO: We ask ourselves
in Peru why poor people
are not using the law
to create their businesses?
And the running argument, of course,
is that most poor people in Peru
are dumb,
they're not educated,
they don't know how to use the law.
We have got to train them,
they're primitive.
I had this debate
with one of our lawyer friends
who insisted on the previous theory
and said that the law was fine.
The proof is that
they had established a company for me
in something less than 30 days.
So, I said, "Yes, but what happens
"if you are poor? What happens
"if you don't have the connections
"like I do that allow you to talk to a lawyer,
"that allow me to pay you in advance,
"that allow me to use a driver
"to take my paper from one
place to another?"
And so, we established a small little shop
in the outskirts of Lima,
five kilometers from the center of Lima,
where we put two sewing machines
that were supposed to be
a shirt factory.
And we put four students
and one supervisor
to go back and forth
to all the legal offices
that they discovered as they went along
that had to put their stamp
of approval
on each document that was necessary
to make this
business legal.
And they did. And it took them
289 days
working 8 hours a day.
And that's when we discovered
that the law could be friendly
for some of us and could be
the enemy for the majority.
MARCELA: And we actually
have research that shows that.
That within each country
there's a big range
in which things
can happen extremely fast
and efficient in developing countries,
if you know the minister,
if you have connections,
and if you don't, you're on the other end.
MUHAMMAD: So, it's a very partisan system.
A system which is
limited to very privileged people.
HERMAN: You are stuck in a home,
in a village, with all your skills
and all your talents,
and that's just unfortunately
the way it is.
The people here are not stupid,
they're just disconnected from global trade.
That's all.
( music playing )
One very interesting facet
which is difficult to talk about
is the celebrity culture.
You've seen it, you know,
you see Brad Pitt go to Haiti
or Bono go to Africa,
Angelina Jolie and so on.
They go with the best of their hearts,
with a good heart, into this
and they see poverty and they say,
"I want to do something."
So, they go to the establishment
and ask to help.
There,
and this is the critical factor,
they learn the old framework.
These celebrities
incorporate this message,
these cultural messages,
these harmful cultural messages,
and turn them into their songs
and activities
and into what they're saying,
and they're, in a way,
selling this to the next generation.
*There comes a time*
*When we heed*
*A certain call*
*When the world*
*Must come*
*Together as one*
*There are *
*People dying*
MAGATTE: So, celebrities have big hearts.
I think I will give them that any day.
But that's not what's the question here,
absolutely not.
But as we all know,
caring does-- is not enough,
and in this particular situation
oftentimes we find it more harmful than not.
Think about it for a second,
all the material that they use,
all the visuals that they use,
certainly in the back of people's minds,
it's creating this impression
that the Africans
are helpless people
that cannot get anything done
for themselves by themselves.
You are contributing to basically
wiring their brains in that way.
The only relationship we have to them
is to helping them.
People who are better off,
they are wiring their brain to say,
"You are not my partner."
To the poor person,
and they're wiring the brain
of a poor person
to think, "I am not good enough.
"I can't do this.
"And these people are better than me.
They're superior to me."
And this is something difficult
to talk about because who wants to point
their finger at a big celebrity
and saying, you know, "Some--
you're doing something wrong."
If I had to pick
one celebrity just to talk about,
as a-- as a point in case,
I think the one to choose is Bono,
because Bono has been at this
for a very long time.
And he has done a lot
in the field. People listen to him.
People do what he says.
And he's shown that over and again
with concerts and aid and the ONE Campaign
and things like that that he's done.
BONO: So, we're looking for a million Americans
to email us,
to join the ONE Campaign.
We are gonna end extreme poverty.
We're gonna make poverty history.
That's what's fallen to us to do.
ANDREAS: And Bono is actually,
I would say, even one of the more
sophisticated celebrities.
His thoughts have more sophistication in it
than some of the other celebrities
who run around and talk about poverty.
The thing with Bono, though, is
you know how he
talks about rocking the world
and punk and this and that.
And while Bono
rocks a lot
on the stage,
as far as the poverty
industry is concerned
and the quest to solve poverty,
Bono is about as establishment
as you can get. He is, like,
center establishment.
I think that tells you a lot
about our system.
MAGATTE: My history with Bono is very interesting.
In 2007
in Arusha during TED Global,
I was there.
Bono was sitting
probably two seats away from me.
He is very,
very much pro-aid,
to a point that he will stand up
at a TED talk
to heckle one of the speakers
because the speaker was anti-aid,
Andrew Mwenda.
Does any one of you
know a country that developed
because
of the generosity
and the kindness of another?
Well, since I'm not seeing the hand,
it appears that what I'm stating is true.
I can see Bono says he knows the country.
Which country is that?
BONO: Yeah, it's an Irish hand.
MAGATTE: And then,
seven short years later,
Bono going on record
saying... Commerce,
entrepreneurial capitalism
takes more people out of poverty than aid,
of course. We know that.
Shocking. Shocking.
I was very happy, as you can imagine.
I was like, "Wow. He heard us.
"He heard us back at TED
in 2007 in Arusha."
BONO: Well, there's one rock above ground
that I can see now.
You know what it is?
It's a headstone,
big slab of granite.
And what we around here used to call,
"The donor-recipient relationship".
Paternalism, the old way we did development,
is no match for partnership.
But then in the same--
in the same tape he's saying,
aid does work,
and you must be brain-dead
or heart-dead
to not get that.
We need aid.
Of course, we still need aid.
Of course, we do. Does anyone disagree?
Anyone apart from brain-dead,
heart-dead ideologues
or professional controversialists?
So, I am very confused by Bono.
But the good news is,
I do still believe
that Bono is probably gonna be
one of our best allies.
I feel like he's still one foot in, one foot out,
but at least there is a foot out now,
and I think he will leave the poverty industry.
I think he will.
And you know what it is?
I am deeply, deeply convinced
that Bono really, truly cares.
He cares so much, actually,
that he was willing to have
intellectual integrity
in coming around,
and in his world,
it's not easy to do what he's done.
HERMAN: For the record, I love Bono.
I happen to know Bono.
So, I love his music and he's cool.
Now, somebody like Bono
can help the process,
not in an airy-fairy
"We love Africa" way.
That doesn't help us.
But working with African countries
to execute their own agenda,
not an imported agenda.
Africans know about Africa.
Only Africans can develop Africa.
We have to sink or swim
ourselves.
Look, I'm glad people wanna help,
but we don't need
one more celebrity
doing one more pop song
or one more campaign.
But what we need
is to no longer be excluded.
( music playing )
If you really wanna help poverty,
poverty industry as we know it
has to go.
In the past, we've had
too much paternalism.
That model didn't work, okay?
A better model would be
to let's say
form partnerships with the poor
and help the poor
achieve their own dreams.
* Factory by night *
* I work in a factory *
* By night *
* Just to feed my wife *
* And save a life *
HERMAN: See, in today's world,
what Africa needs
is not aid.
We need a door in.
EVA: What we need
is to create capability
in the citizens
of this continent
to becomecreators of wealth.
The sooner we begin
to tell a beautiful story
about the African entrepreneur,
that he or she is resident
in this continent
and is doing amazing work,
then we will begin to shift mindsets.
MICHAELS: Having a heart
for the poor isn't hard.
We all have that.
But having a mind for the poor,
that's the challenge.
Can we treat them as equals,
as partners,
as colleagues?
Can we allow them
to put the locus of responsibility
for their own future on themselves,
and then be willing to be guided
by their vision?
MAGATTE: Instead of focusing on feeding
more of that system,
we need to focus more on
how are we gonna make sure
that these people who have been excluded
can now have a foot in?
And once they have a foot in,
watch the magic happen.
It's gonna happen. It's gonna happen faster
than you've ever thought,
and it's gonna be beautiful.
* And I never wanted *
* To be found *
* I never wanted more *
* Than the one right now *
* I just wanted to find *
* A piece of ground *
* So, let me down *
* In the cold hard ground *
* In the ground *
( music playing )