More important than questions about motives are questions about whether there is an obligation for the rich to give, and if so, how much they should give. A few years ago, an African-American cabdriver taking me to the Inter-American Development Bank in Washington asked me if I worked at the bank. I told him I did not but was speaking at a conference on development and aid. He then assumed that I was an economist, but when I said no, my training was in philosophy, he asked me if I thought the U.S. should give foreign aid. When I answered affirmatively, he replied that the government shouldn’t tax people in order to give their money to others. That, he thought, was robbery. When I asked if he believed that the rich should voluntarily donate some of what they earn to the poor, he said that if someone had worked for his money, he wasn’t going to tell him what to do with it.
At that point we reached our destination. Had the journey continued, I might have tried to persuade him that people can earn large amounts only when they live under favorable social circumstances, and that they don’t create those circumstances by themselves. I could have quoted Warren Buffett’s acknowledgment that society is responsible for much of his wealth. “If you stick me down in the middle of Bangladesh or Peru,” he said, “you’ll find out how much this talent is going to produce in the wrong kind of soil.” The Nobel Prize-winning economist and social scientist Herbert Simon estimated that “social capital” is responsible for at least 90 percent of what people earn in wealthy societies like those of the United States or northwestern Europe. By social capital Simon meant not only natural resources but, more important, the technology and organizational skills in the community, and the presence of good government. These are the foundation on which the rich can begin their work. “On moral grounds,” Simon added, “we could argue for a flat income tax of 90 percent.” Simon was not, of course, advocating so steep a rate of tax, for he was well aware of disincentive effects. But his estimate does undermine the argument that the rich are entitled to keep their wealth because it is all a result of their hard work. If Simon is right, that is true of at most 10 percent of it.
Perhaps, though, our obligation to help the poor is even stronger than this example implies, for we are less innocent than the passer-by who did nothing to cause the child to fall into the pond. Thomas Pogge, a philosopher at Columbia University, has argued that at least some of our affluence comes at the expense of the poor. He bases this claim not simply on the usual critique of the barriers that Europe and the United States maintain against agricultural imports from developing countries but also on less familiar aspects of our trade with developing countries. For example, he points out that international corporations are willing to make deals to buy natural resources from any government, no matter how it has come to power. This provides a huge financial incentive for groups to try to overthrow the existing government. Successful rebels are rewarded by being able to sell off the nation’s oil, minerals or timber.
In their dealings with corrupt dictators in developing countries, Pogge asserts, international corporations are morally no better than someone who knowingly buys stolen goods — with the difference that the international legal and political order recognizes the corporations, not as criminals in possession of stolen goods but as the legal owners of the goods they have bought. This situation is, of course, beneficial for the industrial nations, because it enables us to obtain the raw materials we need to maintain our prosperity, but it is a disaster for resource-rich developing countries, turning the wealth that should benefit them into a curse that leads to a cycle of coups, civil wars and corruption and is of little benefit to the people as a whole.
In this light, our obligation to the poor is not just one of providing assistance to strangers but one of compensation for harms that we have caused and are still causing them. It might be argued that we do not owe the poor compensation, because our affluence actually benefits them. Living luxuriously, it is said, provides employment, and so wealth trickles down, helping the poor more effectively than aid does. But the rich in industrialized nations buy virtually nothing that is made by the very poor. During the past 20 years of economic globalization, although expanding trade has helped lift many of the world’s poor out of poverty, it has failed to benefit the poorest 10 percent of the world’s population. Some of the extremely poor, most of whom live in sub-Saharan Africa, have nothing to sell that rich people want, while others lack the infrastructure to get their goods to market. If they can get their crops to a port, European and U.S. subsidies often mean that they cannot sell them, despite — as for example in the case of West African cotton growers who compete with vastly larger and richer U.S. cotton producers — having a lower production cost than the subsidized producers in the rich nations.
The remedy to these problems, it might reasonably be suggested, should come from the state, not from private philanthropy. When aid comes through the government, everyone who earns above the tax-free threshold contributes something, with more collected from those with greater ability to pay. Much as we may applaud what Gates and Buffett are doing, we can also be troubled by a system that leaves the fate of hundreds of millions of people hanging on the decisions of two or three private citizens. But the amount of foreign development aid given by the U.S. government is, at 22 cents for every $100 the nation earns, about the same, as a percentage of gross national income, as Portugal gives and about half that of the U.K. Worse still, much of it is directed where it best suits U.S. strategic interests — Iraq is now by far the largest recipient of U.S. development aid, and Egypt, Jordan, Pakistan and Afghanistan all rank in the Top 10. Less than a quarter of official U.S. development aid — barely a nickel in every $100 of our G.N.I. — goes to the world’s poorest nations.
Adding private philanthropy to U.S. government aid improves this picture, because Americans privately give more per capita to international philanthropic causes than the citizens of almost any other nation. Even when private donations are included, however, countries like Norway, Denmark, Sweden and the Netherlands give three or four times as much foreign aid, in proportion to the size of their economies, as the U.S. gives — with a much larger percentage going to the poorest nations. At least as things now stand, the case for philanthropic efforts to relieve global poverty is not susceptible to the argument that the government has taken care of the problem. And even if official U.S. aid were better-directed and comparable, relative to our gross domestic product, with that of the most generous nations, there would still be a role for private philanthropy. Unconstrained by diplomatic considerations or the desire to swing votes at the United Nations, private donors can more easily avoid dealing with corrupt or wasteful governments. They can go directly into the field, working with local villages and grass-roots organizations.
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Jim Nichols
A Speculative Fiction
www.JimNichols4.com
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