Kristof: Coca-Cola Trumps Charity

Nicholas Kristof, generally a standard-fare liberal columnist, devotes his New York Times column today to defending a more capitalist approach to aiding Haiti:

Nearly a year after the earthquake in Haiti, more than one million people are still living in tents and reconstruction has barely begun — and that’s a useful reminder of the limitations of charity and foreign aid. 

Private and public donations saved lives in Haiti, no question. But it’s also true that well-meaning bleeding-hearts tend to exaggerate the impact aid typically has on a country. Those nations that have managed to lift themselves out of poverty have done so mostly with trade, not aid — with giving people jobs and a ladder, not handouts and an elevator. 

As Kristof points out, trade is beneficial to all parties. By providing jobs instead of welfare, corporations can in fact provide, in the long run, a higher standard of living.

There’s another angle here, too, which Kristof (understandably) doesn’t touch on: The implications this line of thought has on domestic policy, as well.

It’s a reasonable reaction to the less fortunate to want to give some sort of welfare. But that doesn’t mean, no matter one’s intention, that it’s actually a benefit to the recipient. Indeed, trade can often times be more lasting, more sustainable, and more beneficial than aid.

Kristof himself comes down in favor of the corporations rather than state-given aid:

What Haiti needs above all these days is these kinds of livelihoods for its people, not just shipments of food and clothing. It’s hard to think of a charitable project that will be as beneficial as the Coca-Cola Company’s decision to build up the mango juice industry in Haiti, supporting 25,000 farmers. The same is true of the move by South Korean garment companies to open factories in Haiti.

As the new Congress comes in, promising to slash spending and perhaps reform welfare and entitlement programs, precisely how to assist the less fortunate – in a way that actually helps – is an important debate to begin to have.