Yesterday we did a piece on how conservatives and liberals differ in their views of the best way to help the poor. Here's an example of the sort of assistance that conservatives applaud.
In the past it was felt that what we needed to do was just send money to those languishing in grinding poverty in places like Chad and Haiti. It was eventually realized, however, that sending aid to foreign governments was, for a host of reasons, counterproductive. Moreover, unless people are working, unless they're struggling to make it on their own without having to rely on an indefinite stream of handouts, we might as well just burn the cash we give them for all the good it does those who receive it.
The lessons learned from our bad experience with aid led to the emergence of a number of private organizations that employed the principles of microfinance to help the poor in the third world. Microfinance groups cut out the bureaucratic government middle-man and encourage and reward entrepreneuership and self-reliance. One such organization is named Kiva.
For those who may not be familiar with Kiva and other similar groups, they work like this:
Entrepreneurs in need of funds to expand or start a business in the third world apply for a loan with a field representative who works with Kiva. Usually the loans are for a couple of hundred or a few thousand dollars. The representative assesses the credibility of the applicant, and if they are approved, their name, photo, and a brief bio are posted on the Kiva website.
People all over the world then view the request and make an online contribution (minimum of $25). Once the loan amount has been raised the loan is granted and the entrepreneuer then has about a year or so to repay it. When the lenders have been repaid they are notified and can then apply the funds to other loans if they wish.
It's an excellent way to help people without having to work through an inefficient, wasteful government bureaucracy and without just throwing money at people without demanding anything of them in return, as many welfare programs do.
Kiva affords donors an opportunity to help people who are working hard to help themselves, and one of the best aspects of the microfinance plan is that the donations can accumulate and be recycled among a series of recipients. It's a great idea all around.
Check it out.
