Recently, through a particularly enlightening conversation with a friend, I realized that there are, essentially, two pathways or methods of thinking about social change and development approaches. There is the “capitalistic” mode of thinking, and the “social justice” mode of thinking. While this is, essentially, the split that so starkly separates the Democrats from the Republicans, the same two viewpoints shape the actions of humanitarians, altruists, philanthropists, entrepreneurs, and everyone else involved in the aid and social change business.
The first, the “capitalistic” mode, fixates on the idea that by harnessing capitalism and economic growth, we can made progress in the developing world. More importantly, this viewpoint emphasizes the belief that people are motivated by profit – and so, by trying to make “doing good” seem profitable, it becomes possible to “exploit” people’s inherent motivations (to better themselves and maximize profit or utility) for the greater good. Here is where the entire idea of social entrepreneurship comes in. Social enterprise and social business centers around the idea that you can make money and do good at the same time, and that in fact, you don’t have to give up making money or financial sustainability to contribute positively to the world. Corporate social responsibility comes with the same idea; that by being environmentally sustainable and by contributing to development projects, a company can improve its own image (and profits) by presenting itself as more socially responsible. Additionally, there is the ideology propounded by many aid critics such as Dambisa Moyo, the author of “Dead Aid” — the idea that we need capitalism to cause economic growth, and that we need to harness foreign direct investment and international trade to help low-income countries hop onto the train of development. Finally, and most importantly (I think), at the more micro- and individualized level of development and NGO approaches to poverty eradication, there are approaches focusing on income generation; these approaches include micro-finance, helping individuals start and grow their own small businesses, helping farmers increase their yields through low-cost and innovative agricultural technologies. Basically, the idea here is that by increasing their income, people will be able to pull themselves out of poverty. Icons like Muhammad Yunus and Paul Polak have emphasized that the best way for individuals to get out of poverty fast is by increasing their incomes. This is a more “capitalistic” method of thinking because it emphasizes the individual and what they can do to get ahead in life. And for the donors/the well-off classes in society, the emphasis is on proving to them that they don’t have to give up their lifestyle if they want to make a positive difference. There’s usually not as much talk of personal sacrifice, or what we have to give up for social change. For instance, by buying books from Better World Books, we can not only get the books we want, but also contribute to literacy projects! This perspective caters to the benefits that social business provides to both the donors/contributors & the beneficiaries.
The second mode is focused more on “social justice” and equality. The idea here is that we (here I’m talking about us — the well off, the privileged) should not simply have capitalistic, profit maximizing motives. Instead, this mode of thinking strives to change and shape the incentives that motivate people in the first place. Those who share this view believe that we have to actually CHANGE people’s minds to focus less on themselves and to focus more on the community and the world they live in. The idea is to emphasize equality, fairness, and to make people feel they have an obligation to give back. This viewpoint leads to an emphasis on higher taxes, increased social services and programs, more government spending, and international aid. By emphasizing that we, the privileged echelons of society, have an obligation to give back, contribute positively to the world, and help those who are worse off than us, this way of thinking emphasizes providing free services to the poor. Instead of trying to focus on increasing a person’s income as the primary way of getting them out of poverty, people and organizations with this perspective might try to provide free health services, free legal services, free infrastructure like wells, free access to education including building schools and providing scholarships to children, and much more. International donors fund many such projects because of the obligation to give back, but the ultimate goal is to have each country’s government providing such services to its own people. The emphasis here is on improving the quality of living through, primarily, the redistribution of wealth from the rich to the poor — whether this is domestically or internationally. This is very different from the previous “capitalistic” mode, in which each person is encouraged to maximize their own wealth and well-being.
Of course, in reality, many aid programs mix the two — they might provide microfinance and skills training along with health services or educational scholarships. But ultimately, there are definitely two divergent “modes of thinking” or perspectives at play when it comes to social change and international development.
What do you think? Is there one better way of going about social change & development, or are the two approaches best combined? Should we try to cater to people’s “innate” incentive to maximize their own profit & well-being, or should we try to change people’s minds to make them feel an obligation to sacrifice for the greater good?
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