Offering frequent news and analysis from the majestic Evergreen State and beyond, The Cascadia Advocate is the Northwest Progressive Institute's unconventional perspective on world, national, and local politics.

Wednesday, January 13, 2010

Haiti quake: why you should donate money rather than food

I was working on another post related to last week's The return of local, but then Haiti got hit yesterday by an awful earthquake. I'll get back to the local thing next week, but somehow Haiti seems more important to talk about. It is not, however, completely unrelated.

Even in a place like Haiti, in the aftermath of a devastating natural disaster, local still matters.

That's why, if you're inclined to help Haitians through this experience, you would do well to text "HAITI" to the cell number 90999. Do so and a $10 donation, which will be charged to your phone bill, will end up in the hands of the Red Cross. (See also President Obama's statement and explanation.)

Permit me a brief digression into the not-so-distant past to explain why money is more helpful than goods.

Those of us who are old enough to remember the '70s and '80s will recall that it was a time of intense famine in many parts of Africa. Our televisions were plastered with ads from relief agencies urging us to donate to them so they could send food, blankets, medicines, et cetera. We saw pictures of emaciated children, their bellies bloated with gas. We heard stories of people so hungry they took to eating clay just to feel full for a while.

Relief agencies, many with assistance and backing from the U.S. Government, sent millions of tons of supplies. I still remember pictures of huge warehouses, stacked floor-to-ceiling with burlap bags of rice, destined for Africa.

Predictably, we then heard news stories about corruption, supplies being diverted from their intended destinations, and all other manner of distribution problems.

What none of us realized at the time--although in hindsight it's bloody obvious--is that sending material aid is fundamentally the wrong strategy for dealing with humanitarian crises.

What none of us realized is that famine in Africa wasn't a matter of insufficient local production. It still isn't today; they actually do grow food in Africa. Famine is mostly an economic problem of the people needing the food not having the money to buy it.

When people can't buy food, you can do one of two things: send them food so they don't have to buy it, or send them money so they can buy it.

Sadly, we sent food. Anybody who was awake for an introductory economics class should have been able to predict the results: the problem only gets worse.

When we send millions of tons of free rice into a country, even if that rice doesn't get distributed the way you hoped, you destroy the livelihoods of farmers in the region. When we flood the market with free food, even the people who do have money stop buying food. They'll take the free rice too and spend their money on other things.

Result: we destroy the farm economy. There's no demand for locally farmed food when there's free American rice all over the place. We fed some people for a day, at the cost of destroying their country's ability to feed itself for tomorrow.

Brilliant move, America.

If we send money instead, it's the opposite. Sure, there will be some inflation, but more people will be able to buy some food at all. That doesn't destroy demand, it *creates* demand. That, in turn, pushes more people into the business of farming, which helps the local supply and drives prices back down.

Result: when the foreign money dries up, there's more local food available and more people have livelihoods producing it than before. Win/win.

So that's how we royally screwed over about a billion Africans in the '70s and '80s. Let's not do the same to Haiti, where getting by is already hard enough. Haiti is a much smaller place, but there's no reason the same economic laws wouldn't apply to it, too.

Some relief aid in the form of food, tents, medicines, blankets, et cetera is certainly warranted. I'm not saying that. But the worst thing we could do would be to drown them in relief supplies that only destroy the local economy and leave everyone worse off in the long run.

So send money. Text "HAITI" to 90999. Enable Haitians to rebuild their local economy, by literally investing in them to do so. Whatever they can still produce locally, they will buy locally if we help them do it. Whatever they can't, they'll buy from foreign sources but only until their local production comes back online.


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