TOMS, Good Intentions, and Misguided Philanthropy

By Bethany Foster, Colorado Christian University Student

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In August of 2013, I went to the TOMS Warehouse Sale in downtown Denver. Amongst a baffling array of colorful shoes and shoppers intent on adding to their shoe collections, I saw many signs with the slogan “One for One,” the business model that every sale results in a donation to someone in need. I became determined to find out the process by which TOMS gives shoes to people around the world. The knowledge I gained lent valuable insight into the world of charity and foreign aid.

TOMS’ business model and expansion is notable. According to TOM’s website, the company has given away over 10 million pairs of shoes since its conception in 2006. The “One for One” strategy has been critical for building TOMS’ success on charitable principles. In addition to shoes, TOMS also has corresponding programs which donate eyewear and clean water to various countries. TOMS’ website claims it works to “identify global needs and create products to help address them.”

On first glance, TOMS seems to be benefiting the poorest of the world.

Unfortunately, a more critical understanding exposes a less positive prognosis.

While good intentions drive charity, kindness is not guaranteed to bring people out of poverty. Dr. Michal Bauman, a professor at Hillsdale College, addresses this problem in his paper, The Dangerous Samaritans. Throughout the paper, he shows charity and foreign aid both treat symptoms of poverty instead of poverty itself. Charity often forgets long-term consequences in its haste to help people as quickly as possible.

We only have to look at the nation of Africa to see truth in these claims. In Africa, millions of dollars of foreign aid and enormous amounts of donations have flooded the economy. Included in this list are millions of TOMS shoes. With this scale of stimulus, Africa should be a thriving nation. The Cato Institute states Africa’s foreign aid projects are “a theater of the absurd – the blind leading the blind.” Between 1960 and 1997, over $500 billion was given to Africa, according to the Cato Institute. Instead of building a strong economy, aid and charity have only increased dependence and stifled African businesses.

So what are the implications for TOMS? Like other misguided philanthropic attempts, TOMS’ business model has increased dependency. Due to pressure from the media and the public, TOMS has attempted to implement programs which strengthen economies. These programs include: microfinance seminars, providing employment for local women, and building shoe factories. Ultimately, whatever good these programs are doing are cancelled by the consequences of TOMS’ charity.

TOMS’ model does not actual solve social problems. The shoe program seeks to solve the issues associated with children walking barefoot. Even this basic problem remains unsolved by the “One for One” model. Once a child receives a pair of shoes, the shoes last only a few months, leaving the child barefoot again. The sight and water programs also have various drawbacks including implementation difficulties. Ultimately, TOMS has encouraged entitlement mentalities and has harmed countless economies.

Now that we have determined TOMS has failed to address poverty, what are some of the solutions? First, we must understand poverty is a complex social problem without easy fixes. The Poverty of Nations provides a clearer understanding of the causes of poverty. As a whole, western culture needs to understand aid and charity will never create independently wealthy nations. Instead, companies like TOMS need to create sustainable fixes. Solutions should be encouraged that provide long-term responses to problems; instead of contributing to poverty.

Poverty is a complicated issue that demands careful solutions. Charity and aid have crippled poor nations for many years, and these nations cannot become self-sufficient while burdened with good intentions. While TOMS appears to be a company concerned with human flourishing, under closer analysis it simply becomes another failed attempt at foreign aid. I will believe in TOMS’ charity once the company uses its entire business – jobs, manufacturing and marketing – to increase the economic stability of impoverished nations. With this sort of business model in mind, perhaps TOMS will never go out of style.

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Facts Matter: India and Economics

 

By Hannah Bowden, Colorado Christian University Student

India

Over one billion people reside in India. It is the second most populous country on our planet. There are so many slums in India that they cannot all be counted, and according to the Times of India, over 68 million people reside in them. However, with all of its desolation and extreme poverty, it is estimated that India will surpass Japan and become the third largest economy in the year 2028. When a country allows corruption to reign because most “laws” are merely guidelines and not enforced, the wealth of a rapidly growing economy does not reach all levels of the society. For those of us who care about India, understanding the relationship between America and India helps us grasp how we as Americans can help spur on India’s economy from abroad.

So how does this all affect America? According to the US-Indian Embassy, back in 2009 President Obama entered into a strategic partnership with Prime Minister of India, Manmohan Singh. This basically means that they agreed to collaborate together through various things like education, energy, defense and security, science and technology, etc. Since then the trade relationship has grown exponentially. In 2013, India benefitted by a 4.11% growth rate in bilateral goods, which was 0.71% quicker than the average bilateral goods growth rate. The U.S., however, had a growth rate of 16.12% with India. This agreement between the two countries has been helpful for both because they can freely import and export goods while being reassured of their own overall economic stability.

So let’s look at another quick timeline of growth in India. Back in the late 1980s, India had a 10% trend growth, at times, but held onto a stable 6%. With these numbers, many speculated India would easily escape ominous poverty by providing more opportunities and jobs for those at the bottom of the income ladder. While the economy has and will continue to grow, the Economist points out that the path in which India was expected to grow is not occurring. The rate has now slowed to 6.1% and poverty levels are not dropping as people had initially speculated. Were people being too hopeful regarding the lessening of poverty? Is this still plausible, and if so, how? India can lessen their numbers in poverty, but for them it has to first begin with reforming their laws to protect and uphold human rights and freedom.

While it is not altogether a hopeless task, this can be a daunting when paired with deep misunderstandings that the West holds. We are blessed to have our freedom and individualization. In India, the caste system is extremely connected with the issue of poverty. Hindus believe that if you are born into a lower caste, then that is your Karma, and you must wait until you pass into another life to be different.  Simple ways that we can help to alleviate poverty and give current and future generations better opportunities can come in the form of child sponsorship programs or buying clothing or jewelry through fair trade non-profits such as Noonday Collection or Ten Thousand Villages.

Let this quote from Gary Haugen be at the forefront of our minds:

“But God has given us the words of hope. This is no small gift; for it is hope, more than anything else, that we need.”

Instead of becoming overwhelmed by the facts, let’s seek to understand that everyone can make a positive difference to help others. Oftentimes it can be in an easier way than we might think.

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We Know What’s Best for You: An Alternative View of Sweatshops

By Stephen T. Scheffel, Colorado Christian University Student

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Why have capitalists lost the moral argument? Why have we given up the argument of what is right and just by simply looking to persuade with practical arguments? Yes, the free market is the best option. Yes, the free market makes more sense. And yes, the free market will lead to more prosperity for more people. The problem is that those arguments have not been enough. We need to tug on heartstrings to be convincing that our way is moral.

One topic that capitalists rarely handle well is the issue of sweatshops.

If you were to ask anyone in America about sweatshops, possible words you would hear would be wrong, inhumane, and unjust. It is easy to see why a 21st century American has these perceptions. We can’t relate to these horrible working conditions because our economy has developed so far beyond being dominated by sweatshops. However, the working conditions in the United States and the working conditions in developing countries are incomparable. What we would consider to be awful working conditions in the United States would be often considered preferred working conditions in developing countries.

I believe that free trade is vital to international prosperity and the more we engage in the world economy, the better it is for everyone involved. I have always had a negative inclination towards sweatshops until I came across an essay written by Matt Zwolinski, a philosophy professor at the University of San Diego. He made a point that I had simply not thought of before reading his essay, and I do not believe many Americans have entertained this notion. His main argument is that people who work in sweatshops typically choose to work in sweatshops. According Zwolinski, third party that attempts to intervene, such as governments or boycott groups, are violating the workers’ autonomy. This really struck a chord with me. Zwolinski is essentially saying that these boycotters or regulating governments consider themselves to be in a superior position to make decisions for these workers. The international community tends to think that Americans have a superiority complex, and liberals tend to blame that notion on conservatives. However, it is often bleeding heart liberals who advocate boycotts of sweatshop products and government regulation of working environments. We need to remember that people in developing countries are just that, people. Americans are not superior to these international workers. They have every right to make decisions for themselves. Part of human dignity is providing better opportunities, yes, but it is also allowing individuals to make decisions for themselves. We see the impoverished as people who need help, but we forget that they choose to work in sweatshops. More often than not, working in sweatshops is an improvement from an alternative of begging, subsistence farming, or relying upon aid

Now I do not want you to get the impression that I think sweatshops are amazing. I truly wish that those workers could work in higher quality working conditions. But the fact is, for a country to develop economically, sweatshops are a step towards better working conditions. The next time you hear someone talk about the inhumanity of sweatshops, and how we should not purchase products manufactured in those conditions, tell them that advocating for boycotts is far more dehumanizing than working in a sweatshop. Sweatshop workers have the ability to make a decision for themselves as human beings–let us let them make that decision while working within charity and international development to make their options better.

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The Sacred-Secular Divide

Editor’s note: Below is an article written by Kevin Miller, who first set me on the path of exploring the sacred-secular divide nearly three years ago. I reference that process here.  -Gillian

By Kevin Miller, Executive-in-Residence at Colorado Christian University church

The sacred-secular divide? There’s really no such thing for Christians, of course, although it exists in the minds of some sincere Christians.

The key question that everyone, everywhere, in any era must answer is: in which Kingdom are you a primary citizen? For the born-again believer, that would be the Kingdom of God. That’s Good News!

And the Christian has an extraordinary privilege: sojourner status and impact in the kingdoms of this world for the Kingdom of God. That means that the believer is called, each and every day, to impact his or her world for Christ, no matter what vocation or calling. There is no sacred-secular divide.

In fact, that’s the very plan of God. Pastors simply can’t get to every office building and manufacturing plant, to every truck stop and capitol dome, to every home and school in order to minister the Word of God in speech and deed. Instead, every believer—every Christian is in the priesthood, of course—is called to the privilege of being a robust witness for Christ.

This works—on a very practical basis—to proclaim the Good News in every nook and cranny in every nation, sooner or later.

If there is a phrase that should be banished in Christian dialogue, it’s this: “full-time ministry.” That’s because “full-time ministry” is typically used to indicate that some Christians are on a different (higher) plane of ministry than others. But what it really means is that the paycheck for the Christian in “full-time ministry” is formally issued by a church or visibly-Christian non-profit organization.

But God has a different plan—not only that every Christian is in full-time ministry, but that most Christians’ ministry is supported by employers and customers who have no idea that they are not only engaging a very competent individual in commerce, but that those resources are supporting a wise, timely engaging of the Gospel.

That’s why, on the first day of class in the Business 101 class at Colorado Christian University, I ask this question: who here is called to full-time ministry? Typically, only a few students raise their hands. We correct that misconception immediately, and then proceed to teach the art and science of doing business in the real world. The competence that results from such study undergirds the pioneering witness for Christ in the workplace. In fact, that’s a guiding principle at the School of Business and Leadership at CCU: “competence is the pioneering witness for Christ in the workplace.”

So, what about the sacred-secular divide? There’s no such thing. Christians are called to lead an uncompartmentalized life in Christ, regardless of their place of employment. What a privilege!

____________________________

For more information on Miller, check out his Crossover Network here.

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The New Minimum Wage Policy

By Brooke Ehlert, Colorado Christian University Student

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President Obama recently pushing for a raise of the federal minimum wage laws, there has been a significant amount of debate on both sides on wage laws. Those who criticize the President’s plan state that this would discourage businesses from hiring. At a time a time when we need to encourage job growth, this is a serious concern, especially considering the fact that unemployment for those between eighteen and thirty is significantly higher than other groups. The fact that new minimum wage laws will apply government employee and contractors means that our taxes will be paying higher wages as well.

The minimum wage laws were enacted in 1938 by President Roosevelt. Since then, the rate and coverage has been increased significantly by Congress. While the states are allowed to set their own wage rates in accordance with federal laws, they are required to have some form of laws: either their own or the federal laws. According to the CATO Institute, these wage laws cover about 85% of the workforce. The goal of these laws was intended to help workers–particularly low skill workers, youth and minorities. Those who support these laws believe that they will help raise the standard of living for these people.

But what they neglect to consider is the impact on the economy and on business. On one hand, minimum wage laws were enacted as protectionist policies for unions and certain businesses. On the other, it was meant to help fight poverty. The basic model most people use is that the core components are a negatively sloped demand curve and a wage rate that clears the market and is not controlled by minimum wage. There are several flaws in this policy, however. Number one is that someone has to pay for this: minimum wage policy is a redistributive policy. And it has the tendency to increase unemployment because employers cannot afford to pay that much more to their workers, especially if they are a small business. Those who are hurt the most are the ones the policy is seeking to help.

But one of the major issues with the most current minimum wage laws is not the fact that it is simply a bad policy; it is the fact that President Obama is making this an executive order. In the past, this has been done by legislative action with support from both sides. With employees from certain places of employment seeking higher wages, and Democrats pushing for a raise in the minimum wage, Obama has decided to take matters in his own hands. Fox News suggests that President Obama brought this up in his State of the Union address to “avoid the appearance of being a lame duck President.” Whatever the President’s agenda, it is unprecedented to affect the minimum wage through an executive order, and those supporting it should reevaluate the impacts that minimum wages have had throughout history.

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CCU’s Faith and Economics Conference Breaks Down Walls

By Gabe Knipp, Colorado Christian University Marketing and Communicaitons

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April 14—Scott Moore, an expert on social enterprise and successful businessman, told the audience of over 300 his story. “God was teaching me that charity won’t end poverty,” he exclaimed. “But opportunity will.”

The event was The Greatest Good: Nil Sine Numine Conference, and it wasn’t your typical conference on economics and work.

The seeds were planted in the summer of 2013, when Colorado Christian University seniors Christian Schlenker and Gillian Foster were approached by Professor Greg Schaller to apply for a grant. The Values and Capitalism initiative of the American Enterprise Institute was giving out mini-grants to students who would explore the moral and material natures of a market economy.

After discussing the matter, and paring down their goals to something practical, Schlenker and Foster combined their passions of theology and economics with the goal of creating dialogue and educating others in the realm of social enterprise.

“We believe that for people to truly thrive they must have both spiritual and economic welfare,” notes Foster. “We wanted to explore that idea and communicate it to others.”

Their blog engaged CCU students and created awareness, but the culmination of their goal was an all-day conference combining students, local leaders, and experts in the realm of faith, work, and economics. With help from CCU’s School of Humanities and Sciences, the Values and Capitalism initiative, and Café 180—a local business practicing social enterprise—catering lunch, they gathered everyone together.

Again and again, panel speakers encouraged attendees to break down walls in their thinking. The morning’s session focused on the problematic break between faith and work. “The evangelical church is filled with dualists,” noted Dr. Don Payne of Denver Seminary. “We need to change how we talk about things like full-time ministry, because we’re all called to full-time ministry. Language shapes everything.”

Jeff Haanen, of the Denver Institute for Faith and Work, added that the question is, “What does it look like to bring Christ into all spaces?”

The panel also featured Brian Gray of Denver Seminary and Hugh Welchel, the executive director for the Institute of Faith, Work, and Economics.

Dr. Wayne Grudem, the plenary speaker, piggybacked on the morning’s panel as he shifted to address systemic issues of poverty. He, too, stressed the need for humanizing and value-giving work, while laying out political, cultural, and economic conditions necessary for such work to occur. “The problem is not inequality,” he asserted. “The problem is poverty. Do poor people have the opportunity to get ahead?”

The conference closed with a panel of social enterprise experts—Chelsie Antos of Trades of Hope, Chris Horst of HOPE International, Sarah Lesyinski of Café 180, and Scott Moore. Moore told stories of how he learned to break down thought-barriers and combine for-profit business with non-profit ideals—social enterprise in a nutshell. He described a business he runs in Colorado Springs that practices reverse-discrimination, only hiring ex-convicts and addicts, because they are discriminated against elsewhere.

Sarah Lesyinski agreed. The local café allows patrons to set their own prices for the food they buy, and offers the opportunity to work if people cannot pay. “It allows people to work with dignity, because everyone has something to give.”

The Greatest Good: Nil Sine Numine Conference combines the social enterprise concept of “the greater good” with Colorado’s state motto, translated as “Nothing without the Deity,” as it explores spiritual and economic welfare. For more, visit nilsinenumine.org.

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Watch Our Conference!

Today’s the day!

Starting at 9:30am MST, we kick off our conference in Denver.  For more details, check out the event page here.

If you’re unable to attend, check out this link for the live stream. Click the image below for an overview of our schedule.

See you there!

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