It’s not often I find a charity that I like, so when I do I get pretty excited. That was the case with Kiva, an organization that is not so much charity as micro-lending. I helped finance a loan to a guy in Azerbaijan to buy extra cows so he could increase his business. Tracking it over time was easy as I got updates from Kiva, and it was a good experience all in all. So much so that I’ve put more money in, which I loan back out as it’s repaid. When I heard about another organization that is now doing micro-lending, I was interested, and figured it was a clone that would attempt to mirror Kiva’s success. It’s called OptINnow, and although it is similar to Kiva, there are some important differences.
Micro-lending is exactly what you think it is. Giving out small loans, which isn’t really that complex of an idea. It’s important because your random person in a third world country might not have access to a bank in order to get a loan. If you have more money on hand, you can buy raw materials in bulk and get a better price. You cut costs and expand your business. A lot of people bring up the whole fish metaphor to describe it, because it’s not just dumping money on a village every other month and wishing them the best of luck. It’s helping to create long-term jobs and wealth. The main difference between Kiva and OptINnow is that with Kiva you get paid back and can loan the money out again. With OptINnow you lend your money out, then when it gets paid back it goes to the bank to be loaned out again automatically. By the bank.
Most people will think that the not getting paid back option is the better one. I mean, it’s not that much money, and it’s not like you make money the other way. So why not just loan through the organization that reuses the funds automatically? I mean, what kind of person makes someone pay back charity? We are still teaching people to fish, right? And if someone wants to get involved again, they have to put more money in. OptINnow even says on the website that they are going to end global poverty faster. How fucking awesome is that? They aren’t just some run of the mill Toyota of ending global poverty. They are the fucking Cadillac of wiping out poor people! Er—ending poverty, I mean.
I hate catch terms like “Ending Poverty,” “War on Drugs,” “War on Illiteracy,” or “End Hunger.” These phrases are thrown around all the time to fool people into agreeing with you on one point. Once someone agrees with that one thing, it’s easier to convince him or her of something else. No one’s going to say “fuck ending poverty, let’s expand that shit,” or “woohoo, let’s all get illiterate and do heroin,” so it’s pretty much stating the obvious to give people a warm fuzzy. I wonder about any organization that states an impossible goal. Would you invest in a company whose stated goal was to shrink the Earth, throw it at Carrot Top, and see what joke he made of it? You wouldn’t if you were smart, or in any way sane.
I also like to know where my money is going, because it’s my responsibility what happens with that money. People think that every dollar they donate ends up helping people, and that is just not true. With Kiva, I know where my money is. I can log on and check it. With OptINnow, you don’t have that after your initial loan. You only have the guarantee that they have regulations and standards for their lending partners. Go ahead and try to think about how this could go wrong. Maybe an example involving predatory lending and banks incentivized by a system to give out as many loans as possible regardless of ability to pay back. Throwing money around without accounting for it is irresponsible, and if you don’t believe so, look at our current financial crisis. Irresponsible lending has wreaked havoc on our financial system. They can say they won’t do things like predatory lending, but the way their system is designed, it will inevitably grow beyond what they can reasonably monitor.
The idea of an economic cluster fuck causing problems is something that is hitting home with America right now, but it’s not new. Charities with little thought of the economic consequences continue to thrive, however. People donating clothes to a third world country think they are doing good, but what about the textile industries of the countries? From the people growing cotton to the people working in the clothing store, they are screwed because they can’t compete with free. The only hope they have is armed men stealing all the clothes and selling them as retro clothing to hipsters in the US and Europe. What happens to the other already established business in these areas when some corrupt bank decides to give out lots of low interest loans to some guy who then undercuts his competition. He runs his business at a loss for as long as it takes, because the bank is begging to give him more money.
The religious aspect of the organization also bothers me, given that some of the interest collected goes to things like business training, mentoring services, and AIDS/HIV education. Disregarding the first two, even though they have their own issues, looking at the last in the context of religion and recent news makes me extremely wary. If you haven’t kept up, I’m referring to the Pope saying that condoms are making the problem of AIDS worse in Africa. In a continent ravaged by AIDS, religious institutions are continuously telling people that the only way to prevent it is marriage or abstinence. It’s more important for the pope to prevent what he sees as sin than to prevent suffering.
The only verifiable guarantee that OptINnow offers is that tax-exempt churches are backing the organization. There’s no guarantee that they will not put “saving” people above helping people. We shouldn’t expect differently, because that is what the bible tells them to do. If you believe in the bible and an afterlife, it should be more important for you to convert people and save their souls. I’m not comfortable with that, and I can’t ensure that my donation won’t be used for supplying private religious schools with bibles. They say under their frequently asked questions that many of their entrepreneurs operate private schools for the poor. That doesn’t sound to me like a business that can make money and will continue to rely on loans. Personally, I wouldn’t loan money to them. I’d loan it to a local business to expand, employ more people, and enrich the entire community so the public schools are up to snuff. That’s just me, though. Maybe I just need Jesus.
Many people have suffered for the best intentions of those thousands of mile away. Charities run around dumping goods and services on people without ever bothering to stop and ask what happens next week or month. Most people don’t give consistently. When there’s plenty coming in, a lot of people are being helped and lives are being saved. Except, the local economy is being propped up and people are having children based on a living that may disappear (too bad the pope likes riding bareback so much). It’s not just about teaching someone to fish, it’s about having an infrastructure capable of sustaining all the people bleeding hearts want to save. Because at the end of the day, no matter how much good they are trying to do, the consequences are there and it doesn’t matter how pure their intentions were. They are still responsible.
{ 1 comment… read it below or add one }
Good to know. I've been looking into Kiva as a good opportunity to put our money where our mouth is.