From Aid to Enterprise

Editor’s note: A version of this article first appeared at

We will always have [4]the poor among us (Matthew 26:11), but over a billion
living on less than $1 a day? It is natural for well-meaning individuals to work
to change this situation. [5]Intellectual entrepreneurs are no exception and
endeavor to apply the best ideas to poverty alleviation.

A new multifaceted initiative, called [6]PovertyCure, provides abundant
materials and [7]resources for those who want to create [8]lasting solutions to
poverty. The program is founded on the conviction that each human person can be
a source of great creativity. It [9]highlights the incentives needed to unleash
the entrepreneurial spirit that fills the developing world.

When Adam Smith wrote his famous "Inquiry into the Nature and Causes of the
[10]Wealth of Nations," he helped shift the terms of the discussion. Centuries
earlier, work focused on different aspects of poverty. Jurists and city
authorities analyzed whether the poor should be allowed to beg freely and move
to other cities. Charities were set up to help the destitute. The great
Florentine Saint, Antonino Pierozzi (1389-1459), even set up a charity to serve
the "shameful poor"—formerly rich people who were impoverished by government
attacks and injustices, but would rather die than beg. It is easy to be poor; it
is harder to understand how wealth is created. Smith changed the approach.

PovertyCure tries to create a similar shift among those who work in this field.
It seeks to move efforts [11]from aid to enterprise and from [12]paternalism to
partnerships. We often ask how to alleviate poverty. But the real question is:
How do people in the developing world create prosperity for their families and

Almost 200 organizations from over 140 countries have become [13]partners of
PovertyCure. They include churches, missionary groups, charities, universities,
non-profits, and businesses committed to a vision that recognizes the dignity
and capacity of people to create value and prosperity for their families and

Some of the best-known experts who collaborate in this effort include Oxford’s
[14]Paul Collier, Peruvian Economist [15]Hernando de Soto, Rwandan genocide
survivor [16]Immaculée Ilibagiza, the World Bank’s former Managing Director
[17]Juan José Daboub, Ghanaian Economist [18]George Ayittey, Harvard’s
[19]Marcela Escobari, and Hope International CEO [20]Peter Greer. The initiative
also includes numerous political and religious leaders, entrepreneurs,
small-business owners and missionaries fighting poverty on the grass-roots

One of the most prominent members of this network, [21]Partners Worldwide, works
in over 20 countries. It promotes partnerships for job creation. Working closely
with churches and business leaders, Partners Worldwide helped to create and
retain over 33,000 jobs in 23 countries last year.

Some of the solutions are disseminated through a recently launched six-part,
documentary-style [22]DVD series on human flourishing, along with an active
presence in social media (approaching 1 million likes on [23]Facebook). These
include opening doors of credit for the poor, simplifying and reducing barriers
of entry, liberating education markets, expanding access to clean water, and
improving the rule of law. These indirect solutions to poverty can benefit all,
but special care is required to implement them in those areas of the economy
where the poor live and try to enter into the market. Moving from aid to
enterprise projects helps them become more sustainable and help develop an
entrepreneurial mindset. The solidarity that underlies poverty-relief efforts
becomes more effective when coupled with true empowerment.

Many intellectual entrepreneurs and some of their donors and "angel investors"
tend to be single-product champions. They focus on only one element in the road
to reduce poverty, e.g., women rights, property titles, vaccines. This could
lead to neglect of the fundamental problems that impede successful outcomes in
their area of work. Pervasive corruption, for example, can have devastating
effects in health, education, and economic reforms. A fruitful dialogue among
participants in PovertyCure can increase the chances that poverty or "human
flourishing" programs will be structured with the proper incentives.

Well-intentioned efforts can also go wasted for [24]neglecting the basic lessons
of economics. PovertyCure highlights not only what has worked well but also what
has failed. Two stories from Haiti come to mind: During the 1970s, Haiti used to
be self-sufficient in rice. U.S. subsidies to the rice industry led to
surpluses, which were then shipped to Haiti as free aid. Haiti’s rice farmers
then suffered a big blow. Private charity can also have unintended consequences.
A church from Wisconsin also shipped gobs of peanut butter, forgetting that
Haiti has a pretty good climate for growing peanuts and a viable peanut-farming
sector. The free peanut butter hurt local producers.

Most religions share the view that there should be a "preferential option for
the poor." In framing a policy solution, one should always ask "how will this
affect the poor?" With its abundant policy and educational [25]resources, and
its growing network, PovertyCure promises to help many intellectual
entrepreneurs exercise this option.

*Alejandro A. Chafuen is trustee of the Acton Institute, [26]which is one of the
lead sponsors of PovertyCure.

— Dr. Alejandro A. (Alex) Chafuen ’84 is president of the [27]Atlas Economic
Research Foundation and a member of the board of advisors for [28]The Center for
Vision & Values at Grove City College. (The opinions expressed by the author are
his own and do not necessarily reflect those of Grove City College, Atlas
Economic Research Foundation, or their boards of trustees.)

© 2013 by The Center for Vision & Values at Grove City College. The views &
expressed herein may, but do not necessarily, reflect the views of Grove City

[29] | [30]


mailto:[email protected]?subject=Publication%2Fcitation%20notice&body=1.%20Submission%20title%3A%0A%0A2.%20Publication%28s%29%2Fmedia%20outlet%28s%29%3A%0A%0A3.%20Tentative%20publication%2Fcitation%20date%28s%29%3A
This message was sent by: Grove City College, 100 Campus Drive, Grove City, PA 16127