There was an interesting story recently in The New York Times Sunday Magazine about a charity called GiveDirectly which simply gives money to poor people in Kenya, no strings attached. It’s just, “You’re poor, here’s $500. Enjoy.”
This is a radical concept in the not-for-profit world, which generally operates on the “teach a man to fish” philosophy. “Give a man a fish,” the saying goes, “and he’ll eat for a day. Teach a man to fish, and he’ll wonder why you’re teaching him to fish, since he lives in the desert.”
Rarely does a charity say, “Give a man some cash and see what the heck he does with it.”
Many people suppose that when you give money to poor people, they just spend it on frivolous things like food and medicine. So far that hasn’t been the case with GiveDirectly. People have been using the cash for starting small businesses or replacing their thatched roofs with metal ones, which actually saves money in the long run, because the thatched roofs need to be replaced a few times a year, although, on the plus side, the gutters don’t have to be cleaned.
GiveDirectly’s co-founder, Michael Faye, is quoted in the article as saying, “This puts the choice in the hands of the poor, and not me. And the truth is, I don’t think I have a very good sense of what the poor need.”
That’s quite an admission by the founder of a non-profit. It’s like the president of a TV network saying that he has no idea what people want to watch. And it probably means that the head of NBC should consider getting into fundraising.
The article profiled one of the beneficiaries of GiveDirectly’s largess, Bernard Omondi, who “lives in a small Kenyan village in a rural district called Siaya that sits right on the Equator and is almost impossible to get to.” He has used the money from GiveDirectly to start a motor scooter taxi service. It is unclear where he taxis people to since it doesn’t sound like the citizens of his village have the disposable income to take a cab down to the river to wash their clothes instead of walking. Also, I wouldn’t think he does a lot of airport runs.
Nevertheless, he has more than tripled his income. He now earns six to nine dollars a day.
But I’m not writing now about any of that. What got my attention was this paragraph in the article:
When he could find work, he made about $2 a day. When he couldn’t, his two sons sometimes went hungry. Then one morning last year, Omondi woke up to an unusual text message. “When I saw the message, I jumped up,” he recalled. “My wife said, ‘Bernard, what is it?’” He told her he had just been given $500 with no strings attached.
Assuming that by “text message,” the article doesn’t mean a villager standing outside Omondi’s hut with a Dry-Erase board, I find this paragraph shocking. I would have thought that if you lived in a small remote Kenyan village that is impossible to get to, any text message would be pretty unusual. I also would have thought that someone who makes $2 a day and whose sons sometimes starve might not have a cell phone. Especially since “…while Omondi and his neighbors have metal roofs, their houses still have dirt floors and no running water or electricity.” (Italics mine.)
So, as near as I can tell, while I can’t even get two bars on my phone a block from my house in Stamford, Connecticut, the poorest people in Kenya are happily getting frequent text messages on their hand-cranked cell phones. I’m guessing they don’t use AT&T.
Maybe you’re thinking, “But that was just one guy with a phone.” Well, you’d be wrong, as usual. In fact, so many poor Kenyans have cell phones, the devices comprise GiveDirectly’s main distribution system. According to their website, “We transfer your donation electronically to a recipient’s cell phone.”
To recap: if you’re earning $2 a day in the remotest part of Kenya, you have a solar-powered cell phone, seemingly with an unlimited data plan, and the latest banking technology.
I wouldn’t even know what to do with money transferred directly to my iPhone, although, to be honest, it sometimes takes me a few minutes to figure out how to reply to an email. So Omondi receives a few hundred dollars on his cell. Then what? The farm down the dirt road gets its mules to turn a wheel to power up its scanner so they can scan the code on Bernard’s phone and sell him some eggs? Because, let me repeat, there’s no electricity.
I was really curious about this, so I delved a bit further on the GiveDirectly website:
We move the money from our US bank to our account with Safaricom’s M-Pesa mobile payment system using a foreign exchange broker. We then transfer money from our M-Pesa account to the recipient’s M-Pesa account. As a security measure we only transfer funds to a recipient if the name in our records matches the name on the national ID document he or she used to register for M-Pesa. The recipient gets an SMS text message reminding him or her of the transfer and then collects the transfer from a local M-Pesa agent, who is typically a shopkeeper in the recipient’s village or in the nearest town. The recipient transfers his or her electronic balance to the agent’s phone in return for cash.
Jeez–wouldn’t it be a lot less complicated to just send someone to Kenya with a wad of cash?
But, okay, let me see if I have this straight. The poor people in Kenya are walking around with cell phones that incorporate an as yet uninvented permanent power supply, receive text messages often enough so that the ones about money transfers are unusual, and have international banking accounts?
All of which leaves just one question. What do the rich people in Kenya have?
See you soon.