Dan McLaughlin

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To Home Page Latest Newsletter Column Archives Click to get these columns for your local paper	Post Comments Below © 2007 Daniel J. McLaughlin Helping The Needy Happy Father’s day to all you dads. It is good to recognize special people for what they mean to us. It affirms our love and our values. Some people, however, say that it is just another wasteful marketing gimmick in an affluent society, which diverts resources from more important things, like helping the needy. Prosperous nations are constantly being badgered by the United Nations and Non-Governmental Organizations for not doing enough to help the poor. It is very positive thing to be charitable. Most of us want to help and to do what is good. The problem is how to do it effectively. One thing has become very clear over many decades of experience. The way it is being done now is not effective. The current method of international aid and socialist welfare programs have not only not helped, they have made the situation worse. Intervention by governments is the cause, not the solution. The late Peter Bauer specialized for many decades in international economics and aid programs to poor nations. He formulated what are called the 3 M’s of foreign aid, Monuments, Mercedes’ and Machine Guns. With billions in foreign aid, dictators and corrupt bureaucrats build large monuments to their own greatness, they travel around in fleets of Mercedes Benzes, and they buy machine guns to enforce their greatness. In those countries, young smart kids don’t go to college to become doctors and scientists and such. They go into government to get their hands on some of the loot. The only way for poor nations to ascend from poverty is economic freedom. The more free the citizens, the richer they will be and the faster the economy will grow. The least free countries are worse than stagnating, they are declining in real terms. Their economies fall apart. As government power over individual lives increases, the well being of the individuals decreases. Given that you are compassionate and really want to help the poor in the long term, how can it best be accomplished? If poverty is viewed as a pit, one way to help them is to throw food and supplies down to them. That is the prevailing mentality in the world development community. It will keep them from starving for the time being, and maybe give you a warm fuzzy feeling that you are a good person. It will not, however, get them out of the pit. A more effective way to help them is to send down a ladder to help them climb out. The rungs on the ladder are the attributes of economic freedom; strong private property rights and freedom of choice, protection of individuals from aggression by others, limited government regulation and taxation, and removal of barriers to free trade and open markets. Economic freedom is needed for people to prosper. There are, at this very moment, billions of people who are starving or living at near subsistence level. The only ones who are capable of being charitable to them are those that have attained some degree of wealth, primarily those living in free countries. Charitable work is important to many people, and most religious and charitable organizations make it their mission to feed the hungry. There are actions that governments can take if they sincerely wish to lift people out of poverty. First and foremost is to ensure and enhance the rights to private property and all the benefits of ownership, including profits. Those people should be protected from aggression, from other individuals and from their own government. There are also some things not to do. Don’t have minimum wage laws that un-employ them, for unemployment of the less capable is the only result of minimum wages. Don’t have unions, which exclude them from many jobs and hold the economy back. Don’t have high taxes, which separate them from their hard earned wages. Don’t have welfare, which undermines families and perpetuates dependence. Don’t strangle the economy with a jungle of regulations and limitations. In other words, don’t do what most of the development community has been ramming down the throats of perpetually less developed countries for many decades. While these things not to do are present in many advanced countries, including our own, enough wealth was built up over a long period of time to withstand the assaults. They don’t hurt our economies as much. Unfortunately, those same assaults on undeveloped nations kick them when they are down and prevent them from ever getting up. Let’s stop kicking and start helping.
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Daniel Mclaughlin Copyright © 2006 [Daniel McLaughlin]. All rights reserved. Revised: 01/06/08

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Helping The Needy

Happy Father’s day to all you dads. It is good to recognize special people for what they mean to us. It affirms our love and our values. Some people, however, say that it is just another wasteful marketing gimmick in an affluent society, which diverts resources from more important things, like helping the needy. Prosperous nations are constantly being badgered by the United Nations and Non-Governmental Organizations for not doing enough to help the poor. It is very positive thing to be charitable. Most of us want to help and to do what is good. The problem is how to do it effectively.

One thing has become very clear over many decades of experience. The way it is being done now is not effective. The current method of international aid and socialist welfare programs have not only not helped, they have made the situation worse. Intervention by governments is the cause, not the solution.

The late Peter Bauer specialized for many decades in international economics and aid programs to poor nations. He formulated what are called the 3 M’s of foreign aid, Monuments, Mercedes’ and Machine Guns. With billions in foreign aid, dictators and corrupt bureaucrats build large monuments to their own greatness, they travel around in fleets of Mercedes Benzes, and they buy machine guns to enforce their greatness. In those countries, young smart kids don’t go to college to become doctors and scientists and such. They go into government to get their hands on some of the loot.

The only way for poor nations to ascend from poverty is economic freedom. The more free the citizens, the richer they will be and the faster the economy will grow. The least free countries are worse than stagnating, they are declining in real terms. Their economies fall apart. As government power over individual lives increases, the well being of the individuals decreases.

Given that you are compassionate and really want to help the poor in the long term, how can it best be accomplished? If poverty is viewed as a pit, one way to help them is to throw food and supplies down to them. That is the prevailing mentality in the world development community. It will keep them from starving for the time being, and maybe give you a warm fuzzy feeling that you are a good person. It will not, however, get them out of the pit.

A more effective way to help them is to send down a ladder to help them climb out. The rungs on the ladder are the attributes of economic freedom; strong private property rights and freedom of choice, protection of individuals from aggression by others, limited government regulation and taxation, and removal of barriers to free trade and open markets. Economic freedom is needed for people to prosper.

There are, at this very moment, billions of people who are starving or living at near subsistence level. The only ones who are capable of being charitable to them are those that have attained some degree of wealth, primarily those living in free countries. Charitable work is important to many people, and most religious and charitable organizations make it their mission to feed the hungry.

There are actions that governments can take if they sincerely wish to lift people out of poverty. First and foremost is to ensure and enhance the rights to private property and all the benefits of ownership, including profits. Those people should be protected from aggression, from other individuals and from their own government.

There are also some things not to do. Don’t have minimum wage laws that un-employ them, for unemployment of the less capable is the only result of minimum wages. Don’t have unions, which exclude them from many jobs and hold the economy back. Don’t have high taxes, which separate them from their hard earned wages. Don’t have welfare, which undermines families and perpetuates dependence. Don’t strangle the economy with a jungle of regulations and limitations. In other words, don’t do what most of the development community has been ramming down the throats of perpetually less developed countries for many decades.

While these things not to do are present in many advanced countries, including our own, enough wealth was built up over a long period of time to withstand the assaults. They don’t hurt our economies as much. Unfortunately, those same assaults on undeveloped nations kick them when they are down and prevent them from ever getting up. Let’s stop kicking and start helping.

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