It pains me to see people going to stores to buy canned foods or physical things for charities. Because afterwards, people have to spend time to sort the goods, ship it out, and distribute the goods, which are resource intensive activities. And then the final recipient has no say in what they receive either... in many cases the donated items go unused. And even if they are useful, a constant infusion of effectively free goods can distort the local economies.
I used to work in a food bank warehouse, and yes, sorting the goods was a great deal of effort. We sorted them by 'urgency' and use-by date. Canned food was very helpful, because it lasts between the big giving times - people donate primarily in autumn and christmas, and there is a big defecit during the summer, so having long-lasting things was always a blessing.
The main thing that would help would be standardising the placement and format of use-by dates on products. Some few products have absurd locations for the use-by date, such as inside of the container!
Very, very little food was wasted.
Yes, the recipient didn't have a great deal of choice. However, practically, this simply won't be possible without waste, as you'd have to have enough food to offer a choice, and some wouldn't be picked. However, the packages that we provided people were balanced nutritionally, and we took feedback from them regularly about what worked for them and what didn't. We made sure they got a lot of basic, versatile ingredients, such as onions, pasta, rice etc.
In adittion to this, have a little perspective. People who are relying on these kinds of programmes very rarely complain that they don't have choice, as they are glad to have anything at all. We also try to make sure each person recieves some "interesting" items along with basic ingredients, to allow them to experement, and provide diversity.
Things we always needed more of: Long-life milk, or powdered milk. Fruit juice, especially long-life juice or concentrated juice. Fresh vegetables and onions can be helpful, although if you really do want to help its best to confer with the local volunteers on what they need most at the moment.
Things we had too much of: Tea and coffee. Sometimes we'd get a large donation of fruit from supermarkets, but that was usually solved by effort (banannas that can't be given away made into bananna bread or baby formula, or in the worst-case compost for a community garden)
I don't think we should be comparing "donated goods" to "nothing", rather "donated goods" to "cash aid".
If the money used to buy the goods and transport it were issued as cash, could it do more good?
So basically they gave entire communities 17% of a years salary and looked at what happened to the community afterwards. My naive reaction is that this would funnel significant amounts of goods from nearby communities to these enriched communities because it was such a huge amount.
These extra goods would let people spend more time enriching it, creating more economic activity here but less in neighboring communities who sold their goods. For example, the mill, it didn't have enough grain to mill before but now they had money to buy grain. Doesn't this mean that some other miller somewhere else in Kenya now has less grain to mill? Or is Kenya importing grain? So to me it seems like this study ignored the externalities by just looking at the effects on the local community and not the entirety.
I don't really buy the argument that more money increased economic activity, then the problem would easily be solved by just printing money. Many countries have tried that and failed.
An excellent example was 2008, when printing $800B did not cause inflation. Printing $1.2T would also not have caused inflation, and would have ended the recession, but the Senate preferred to extend the recession, to blame on Obama, instead.
Yes, their grain mill example is strange. But what they imply is yes. Either more is imported, or not exported or created/grown.
A better example is the clients buy a TV, then the benefits like family planning from watching things like soapies come through, which stops the destruction of wealth.
Don't get the printing money link.
Money from outside the country is given which allows them to import things they want or hire unemployed people to to create, who then might import things with their wages.
Rather than giving TV's you allow them to chose, so houses don't end up with two TV's, they might spend the money on schooling or a phone rather than a second TV.
Could it be possible that the improvements they saw in these communities were the result of better ability to bribe officials? That they couldn't get the supplies they were entitled to without spending extra cash?
>But that was just the beginning.
>"That money goes to local businesses," says Miguel. "They sell more. They generate more revenue. And then eventually that gets passed on into labor earnings for their workers."
>The net effect: Every dollar in cash aid increased total economic activity in the area by $2.60.
Amazing. This is almost like what happens when (poor) families receive a tax cut.
Companies are sitting on hundreds of billions of dollars in liquid currency. That stagnant money has a massive negative effect on the world. It's not a big deal when a family hoards 10k in cash. But when something like 8% the US GDP languishes in cash that's a whole lot of lost economic movement.
What needs to be learned here is that extractive economic models have created so many of the problems that our cities face. There are real consequences measured in human lives and suffering when people extract labor to become billionaires.
Feels like this is where government should come in and increases taxes on these corporations/wealthy and funnel money to the lower income. Which will incentivize corporations/wealthy to provide services to get the money from the low income.
> Companies are sitting on hundreds of billions of dollars in liquid currency. That stagnant money has a massive negative effect on the world
Shouldn't we start thinking about taxing wealth? Why tax sales, property (house) and income only?
These measures should feel more painful the wealthier one is to spur action, capital utilization, and change for the betterment of all, not for ones vanity or expensive habits.
Ultimately I'm skeptical, because there isn't a good model of it working well anywhere else, or even at smaller scales. If the argument is that it only works at the largest scales with 100% buy-in... that's an awfully risky policy.
And among economists it's basically Saez and Zucman vs everyone else, not particularly promising. This is at least the most reasonable position I found, which is that it might work but we shouldn't rely on it to raise as much as we expect: https://www.project-syndicate.org/commentary/elizabeth-warre...
So, what would be an alternative to these economic models that would actually be beneficial to individuals, families and businesses? That would be the real lesson drawn from the education.
This should be reversed. I don't want to pay for the stupid lost bets, but everyone should reap the rewards when someone wins big. Investments are risks and investors have found ways to absolve themselves of risk by pushing the consequences onto everyone but themselves.
I started writing a lot more. It was just a disjointed rant. Basically our economic system is a mess that screws most people over. We need to fix this by solving the problems the vulnerable face. Don't like it? Leave society completely. The cost of inclusion is helping your neighbors no matter how much you don't want to.
And interesting side point is that the multiplier (obviously) is much lower as the savings rate increases, and also if the cash infusion is used mostly to pay down debt, because neither will translate into further spending cycles.
So when confidence is high and interest rates are low, the money multiplier will be at its highest.
Now all we have to do is to remember this 'very carefully done' study, so that it doesn't have to be repeated in a century.
"We learn from history that we don't learn from history." - Hegel
But I suppose it's always good to get some quantitative confirmation.
In regards to latter half of your comment. The value is robbed from them by not valuing their efforts fairly in comparison to the value added by the equipment used to scale the operation. Sure you can hyperfocus on the study's cohort but then what's the point of any discussion at all?