Alleviating Poverty Through Incentive Based Aid Programs

Poverty is an issue affecting countries in approximately two thirds of the world we live in, and with increased globalization it is a problem that has ramifications never felt before in the Western world. The question of how to alleviate poverty and suffering in our world is one that has plagued the minds of people for years; the simple answer provided by many is simply to increase money, however does this increase really help alleviate poverty or does it have the potential to make the problem even worse?

An article which appeared August 21, 2007 in the International Herald Tribune entitled Managing Globalization: To reduce poverty, money isn't everything by Daniel Altman addresses this issue by examining two South American countries Brazil and Venezuela. Incomes in both countries are rising but poverty is only actually being alleviated in Brazil despite Hugo Chavez's socialist platform and agenda of equality for all. Incomes in Venezuela have been rising due to the high price of oil of which they have an abundant supply whereas Brazil's economy has been rising due to "relatively firm economic policies" and "confidence in its business prospects among both locals and foreigners" (Managing Globalization by Altman). The poverty rate in Venezuela has been fluctuating since Chavez's election from 50 percent when elected in 1999 to 60 percent in 2003 back down to 40 percent in 2005. The figures follow the level of economic growth more closely than the level of investment by Chavez's government. Furthermore many experts (UN Human Development Index) measure poverty not just by purchasing power but by other factors such as literacy, infant mortality, and life expectancy. In these areas Venezuela's progress stops, their infant mortality rate is below the regional average decreasing 17 percent since Chavez's election, illiteracy is higher, as well as underweight births. The downfall of Chavez's program to eliminate poverty is that aid is not given off the basis of need, and is not used as an incentive to better educate people but instead is a response to political loyalty. An effective way of improving the well being of the poor in other countries has been to link economic aid with useful actions such as attending school or going to the doctor. Venezuela rewards those who are loyal to Chavez.

In contrast to Venezuela, Brazil's success has been wide spread. The country has attracted foreign investment, lowered illiteracy, and increased life expectancy. Brazil has geared its monetary benefits for families and is linked to "actions such as attendance in school, prenatal care, and childhood vaccinations". Brazil's incentive based aid system not only help with immediate aid to the poor but is contingent on the poor taking steps to better themselves so they will be better equipped to improve their situation.

By looking at these two countries it becomes apparent that in order for economic aid to be useful it must be geared in such a way that it promotes the betterment of the people it is meant to help. The aid must not only meet the immediate need but should be contingent upon helping the people receiving it improve them selves. Only through well thought out aid programs that encourage people to improve there own conditions can we hope to make a significant dent in the poverty crisis affecting our world.

refernces:

Altman, D. (2007, August 21). Managing Globalization: To reduce poverty, money isn't everything. International Herald Tribune. Retrieved August 21, 2007, from http://www.iht.com/bin/print.php?id=7191319/