Small Is Beautiful: A Study of Economics as if People Mattered (23 page)

It is much easier to deal with goods than with people - if only because goods have no minds of their own and raise no problems of communication.

When !he emphasis is on people, communications problems become paramount. Why are the helpers and who are those to be helped? The helpers, by and large, are rich, educated (in a somewhat specialised sense), and town-based. Those who most need help are poor, uneducated, and rurally based. This means that three tremendous gulfs separate the former from the latter: the gulf between rich and poor; the gulf between educated and uneducated; and the gulf between city-men and country-folk, which includes that between industry and agriculture. The first problem of development aid is bow to bridge these three gulfs. A great effort of imagination, study, and compassion is needed to do so. The methods of production, the patterns of consumption, the systems of ideas and of values that suit relatively affluent and educated city people are unlikely to suit poor, semi-illiterate peasants. Poor peasants cannot suddenly acquire the outlook and habits of sophisticated city people. If the people cannot adapt themselves to the methods, then the methods must be adapted to the people.

This is the whole crux of the matter.

There are, moreover, many features of the rich man's economy which are so questionable in themselves and, in any case, so inappropriate for poor communities that successful adaptation of the people to these features would spell ruin. If the nature of change is such that nothing is left for the fathers to teach their sons, or for the sons to accept from their fathers, family life collapses. The life, work, and happiness of all societies depend on certain

'psychological structures' which are infinitely precious and highly vulnerable. Social cohesion, co-operation, mutual respect and above all self-respect, courage in the face of adversity, and the ability to bear hardship - all this and much else disintegrates and disappears when these 'psychological structures' are gravely damaged. A man is destroyed by the inner conviction of uselessness. No amount of economic growth can compensate for such losses - though this may be an idle reflection, since economic growth is normally inhibited by them.

None of these awesome problems figure noticeably in the cosy theories of most of our development economists. The failure of the first development decade is attributed simply to an insufficiency of aid appropriations or, worse still, to certain alleged defects inherent in the societies and populations of the developing countries. A study of the current literature could lead one to suppose that the decisive question was whether aid was dispensed multilaterally or bilaterally, or that an improvement in the terms of trade for primary commodities, a removal of trade barriers, guarantees for private investors, or the effective introduction of birth control, were the only things that really mattered.

Now, I am far from suggesting that any of these items are irrelevant, but they do not seem to go to the heart of the matter, and there is in any case precious little constructive action flowing from the innumerable discussions which concentrate on them. The heart of the matter, as I see it, is the stark fact that world poverty is primarily a problem of two million villages, and thus a problem of two thousand million villagers. The solution cannot be found in the cities of the Door countries. Unless life in the hinterland can be made tolerable, the problem of world poverty is in- soluble and will inevitably get worse.

All important insights are missed if we continue to think of development mainly in quantitative terms and in those vast abstractions - like GNP, investment, savings, etc. - which have their usefulness in the study of developed countries but have virtually no relevance to development problems as such. (Nor did they play the slightest part in the actual development of the rich countries!) Aid can be considered successful only if it helps to mobilise the labour-power of the masses in the receiving country and raises productivity without 'saving' labour. The common criterion of success, namely the growth of GNP, is utterly misleading and, in fact, must of necessity lead to phenomena which can only be de- scribed as neo-colonialism.

I hesitate to use this term because it has a nasty sound and appears to imply a deliberate intention on the part of the aid- givers. Is there such an intention? On the whole, I think, there is not. But this makes the problem greater instead of smaller. Unintentional neo-colonialism is far more insidious and infinitely more difficult to combat than neo-colonialism intentionally pursued. It results from the mere drift of things, supported by the best intentions. Methods of production, standards of consumption, criteria of success or failure, systems of values. and behaviour patterns establish themselves in poor countries which, being (doubtfully) appropriate only to conditions of affluence already achieved, fix the poor countries ever more inescapably in a condition of utter dependence on the rich. The most obvious example and symptom is increasing indebtedness. This is widely recognised, and well- meaning people draw the simple conclusion that grants are better than loans, and cheap loans better than dear ones. True enough.

But increasing indebtedness is not the most serious matter. After all, if a debtor cannot pay he ceases to pay - a risk the creditor must always have had in mind.

Far more serious is the dependence created when a poor country fails for the production and consumption patterns of the rich. A textile mill I recently visited in Africa provides a telling example. The manager showed me with considerable pride that his factory was at the highest technological level to be found anywhere in the world Why was it so highly automated? 'Because.' he said, 'African labour, unused to industrial work, would make mistakes, whereas automated machinery does not make mistakes. The quality standards demanded today.' he explained, 'are such that my product must be perfect to be able to find a market.' He summed up his policy by saying: 'Surely, my task is to eliminate the human factor.' Nor is this all.

Because of inappropriate quality standards, all his equipment had to be imported from the most advanced countries; the sophisticated equipment demanded that all higher management and maintenance personnel had to be imported. Even the raw materials had to be imported because the locally grown cotton was too short for top quality yarn and the postulated standards demanded the use of a high percentage of man-made fibres. This is not an untypical case. Anyone who has taken the trouble to look systematically at actual 'development' projects - instead of merely studying development plans and econometric models - knows of countless such cases: soap factories producing luxury soap by such sensitive processes that only highly refined materials can be used, which must be imported at high prices while the local raw materials are exported at low prices; food-processing plants; packing stations; motorisation, and so on - all on the rich man's pattern. In many cases, local fruit goes to waste because the consumer allegedly demands quality standards which relate solely to eye-appeal and can be met only by fruit imported from Australia or California where the application of an immense science and a fantastic technology ensures that every apple is of the same size and without the slightest visible blemish. The examples could be multiplied without end. Poor countries slip - and are pushed - into the adaptation of production methods and consumption standards which destroy the possibilities of self-reliance and self-help. The results are unintentional neo-colonialism and hopelessness for the poor.

How, then, is it possible to help these two million villages? First, the quantitative aspect. If we take the total of western aid after eliminating certain items which have nothing to do with development, and divide it by the number of people living in the developing countries, we arrive at a per-head figure of rather less than Pounds 2 a year. Considered as an income supplement, this is, of course, negligible and derisory. Many people therefore plead that the rich countries ought to make a much bigger financial effort - and it would be perverse to refuse to support this plea, But what is it that one could reasonably expect to achieve? A per-head figure of Pounds 3

a year, or Pounds 4 a year? As a subsidy, a sort of 'public assistance'

payment, even Pounds 4 a year is hardly less derisory than the present figure.

To illustrate the problem further, we may consider the case of a small group of developing countries which receive supplementary income on a truly magnificent scale - the oil producing countries of the Middle East, Libya, and Venezuela. Their tax and royalty income from the oil companies in 1968 reached Pounds 2,349 million, or roughly Pounds 50 per head of their populations. Is this input of funds producing healthy and stable societies, contented populations, the progressive elimination of rural poverty, a flourishing agriculture, and widespread industrialisation? In spite of some very limited successes, the answer is certainly no. Money alone does not do the trick. The quantitative aspect is quite secondary to the qualitative aspect. If the policy is wrong, money will not make it right; and if the policy is right, money may not, in fact, present an unduly difficult problem.

Let us turn then to the qualitative aspect. If we have learnt anything from the last ten or twenty years of development effort. it is that the problem presents an enormous intellectual challenge. The aid-givers - rich, educated, town-based - know how to do things in their own way: but do they know how to assist self-help among two million villages, 'among two thousand million villagers - poor, uneducated, country-based? They know how to do a few big things in big towns; but do they know how to do thousands of small things in rural areas? They know how to do things with lots of capital: but do they know how to do them with lots of labour - initially untrained labour at that?

On the whole, they do not know; but there are many experienced people who do know, each of them in their own limited field of experience. In other words, the necessary knowledge, by and large, exists; but it does not exist in an organised, readily accessible form. It is scattered, unsystematic, unorganised and no doubt also incomplete.

The best aid to give is intellectual aid, a gift of useful knowledge. A gift of knowledge is infinitely preferable to a gift of material things. There are many reasons for this. Nothing becomes truly 'one's own' except on the basis of some genuine effort or sacrifice. A gift of material goods can be appropriated by the recipient without effort or sacrifice; it therefore rarely becomes 'his own' and is all too frequently and easily treated as a mere windfall. A gift of intellectual goods, a gift of knowledge, is a very different matter. Without a genuine effort of appropriation on the part of the recipient there is no gift. To appropriate the gift and to make it one's own is the same thing, and 'neither moth nor rust doth corrupt'. The gift of material goods makes people dependent, but the gift of knowledge makes them free -

provided it is the right kind of knowledge, of course. The gift of knowledge also has far more lasting effects and is far more closely relevant to the concept of 'development'. Give a man a fish, as the saying goes, and you are helping him a little bit for a very short while; teach him the art of fishing, and he can help himself all his life. On a higher level: supply him with fishing tackle; this will cost you a good deal of money, and the result remains doubtful; but even if fruitful, the man's continuing livelihood will still be dependent upon you for replacements. But teach him to make his own fishing tackle and you have helped him to become not only self-supporting, but also self-reliant and independent.

This, then, should become the ever-increasing preoccupation of aid programmes - to make men self-reliant and independent by the generous supply of the appropriate intellectual gifts, gifts of relevant knowledge on the methods of self-help. This approach, incidentally, also has the advantage of being relatively cheap, that is to say, of making money go a very long way. For Pounds 100 you may be able to equip one man with certain means Of production; but for the same money you may well be able to teach a hundred men to equip themselves. Perhaps a little 'pump-priming' by way of material goods will in some cases be helpful to speed the process; but this would be purely incidental and secondary, and if the goods are rightly chosen. those who need them can probably pay

A fundamental reorientation of aid in the direction I advocate would require only a marginal reallocation of funds. If Britain is currently giving aid to the tune of about Pounds 250 million a year, the diversion of merely one per cent of this sum to the organisation and mobilisation of ‘gifts of knowledge' would, I am certain, change all prospects and open a new and much more hopeful era in the history of 'development'. One per cent, after all, is about E2t million - a sum of money which would go a very, very long way for this purpose if intelligently employed. And it might make the other ninety-nine per cent immensely more fruitful,

Once we see the task of aid as primarily one of supplying relevant knowledge, experience, know-how, etc. - that is to say, intellectual rather than material goods - it is clear that the present organisation of the overseas development effort is far from adequate. This is natural as long as the main task is seen as one of making funds available for a variety of needs and projects proposed by the recipient country, the availability of the knowledge factor being more or less taken for granted. What I am saying is simply that this availability cannot be taken for granted, that it is precisely this knowledge factor which is conspicuously lacking, that this is the gap, the

'missing link', in the whole enterprise. I am not saying that no knowledge is currently being supplied: this would be ridiculous. No, there is a plentiful flow of know-how, but it is based on the implicit assumption that what is good for the rich must obviously be good for the poor. As I have argued above, this assumption is wrong, or at least only very partially right and preponderantly wrong.

So we get back to our two million villages and have to see how we can make relevant knowledge available to them. To do so, we must first possess this knowledge ourselves. Before we can talk about giving aid, we must have something to give. We do not have thousands of poverty-stricken villages in our country; so what do we know about effective methods of self-help in such circumstances? The beginning of wisdom is the admission of one's own lack of knowledge. As long as we think we know, when in fact we do not, we shall continue to go to the poor and demonstrate to them all the marvellous things they could do if they were already rich. This has been the main failure of aid to date.