A Critical Review on the documentary “Poverty, Inc.”

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The documentary “Poverty, Inc.” has become so influential that it is now part of many courses at the university level. The good news is that at universities we apply critical thinking to the information we receive (or we are supposed to). As a development economist, I share here my views on this famous documentary.

On the positive side, the documentary does a good job in making some points for an audience unfamiliar with economic theory, such as the idea that dependency does not end poverty, or that current foreign aid (money flows between governments) has “unintended consequences that do more harm than good.” However, both ideas are not new in development studies. The much quoted “teach a human to fish” is an idea associated with many philosophers, including Maimonides (about 850 years ago). This criticism of the structure of current foreign aid is a relatively old idea in the development literature. Perhaps the best point made by the documentary is the argument that Non-governmental Organizations (NGOs) can do a better job if they base their strategies on effective communications with local entities, although this idea is not new either.

What are, then, the problems with this documentary? Many. Firstly, the development literature has two main perspectives; namely, the conservative and the progressive. A documentary that omits a whole branch of argumentation is not responsible and carries “unintended consequences,” such as misinforming that unfamiliar audience. Besides mentioning supranational entities, the documentary did not expose crucial structural problems: there is no serious analysis on geopolitics, global power relations, or class issues, among others. A class analysis would not, for instance, focus on stressing that “NGOs need the poor to exist” but that “the rich need the poor to exist”.Read More »

The Power of the Market

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“The ‘market’ is a bad master, but can be a good servant.”
S. Chakravarty (1993: 420)

In the world today, more and more interpersonal interactions are replaced by market transactions. The market system is both an economic and a cultural phenomenon, yet we seem to be hardly aware of the values that are bound up in it. This phenomenon is manifest at many levels: from the family, through the neighbourhood and the enterprise, to the nation and the globe. If there is such a thing as global ethics, I suggest, then they are – like it or not – the ethics of the market. My purpose here is to elaborate this claim, and to assess its implications. I shall distinguish between the market as a theoretical construct in economics, and the market as a social institution.

My main hypothesis can be briefly stated as follows: the most convincing ethical argument currently being made in favour of the market is its neutrality. Whether the market is in fact neutral may be disputed. But if one accepts this claim, it implies that the market is amoral, rather than immoral, and there remain, I suggest, two objections to allowing the market ethic to prevail. The first is that this is an abrogation of moral responsibility. It implies delegating decisions of major social and material significance to powers which are beyond our control, and whose outcome is uncertain. Second, the neutrality of the market comes at a cost in social and human terms; social relations between persons are replaced by contractual relations between economic agents.Read More »