Are Diaspora Remittances More Effective than Developmental Aid?

Photo by Daquella manera

According to diaspora expert and economist, David Phillips, the growing global trend of human migration may prove to be one of the most effective ways to bring development and aid to impoverished nations.  Phillips argues in a new book entitled Development Without Aid: The Decline of Development Aid and the Rise of the Diaspora, (you'll want to shop for the Kindle version) that remittances from diasporas tend to provide a more consistent source of public goods than direct humanitarian aid which is often diverted to "conspicuous consumption".  His arguments are nicely summarized in a recent post over at the People Move blog.

Phillip's brief article is a bit technical in places but very insightful.  We keep telling you all that diaspora phenomenon is revolutionizing the world.  The scattering of people is the key missiological issue of our time - the human tidal wave is upon us!

Here's a powerful paragraph from Phillips:

Relatively recently the World’s diasporas have emerged. Over 215 million first generation ‘permanent’ migrants now live in host countries. Remittances have risen significantly faster than migrant populations which have risen faster than the world population. By 2014 they will surpass half a trillion dollars, four times official development aid. In Sub Saharan Africa remittances have doubled since 2006 and on a realistic count significantly exceed aid. The average skill levels and incomes of migrants have also risen and their average educational levels exceed those of many rich countries including the US. Increasingly diaspora flows are being invested rather than consumed.

I hope you will check out David Phillips' article and take some extra time to explore the excellent "People Move" blog by the World Bank.

The High Cost of Poverty

Photo By Alex Barth

A great post over at Red Letter Christians highlighted the "high cost" of being poor in America.  For example, did you know that food, transportation, and insurance can all be more expensive for those living in poverty?  For example, lower income people often have to pay higher car insurance premiums and there are often many costs associated with accessing money if you are poor.  Consider:

Even using money itself is expensive. Checking accounts often charge monthly fees unless one maintains a minimum balance or direct deposit. Without a checking account, it can costsignificant fees to cash a paycheck. Without checks, one is also often charged a fee to pay utility bills. And sometimes the money’s just not there to pay for food and for the electricity, so you put off the electricity bill, even though you know you’ll incur a late fee. And saving money for the future?Worry instead about surviving today.

So without access to banking services, many must turn to predatory payday lenders. You can borrow $300 for a $47 fee. That’s only if you pay it back within a week (806% APR). But now at least your rent is covered. Credit card interest rates also vary by income. Making standard minimum payments, it will take 13 years to pay off a $4000 credit card balance carrying the typical 11.5% APR. Bear in mind that the majority of uninsured folks carry over $2000 in medical debt alone.

I encourage you to visit this post but also to check out this educational, interactive game:

Spent - This game simulates a situation of sudden poverty (like a job loss) and challenges you to make it through the month.  I found the choices presented to be about 50% similar to what may be faced by some of our refugee and poorer immigrant friends.  

I also appreciated this list "Being poor is . . ."

For a more global perspective, I would point you again to Wilbur Sargunaraj's video about poverty.

Meet Cultural Intelligence Ambassador, Wilbur Sargunaraj - @wilburworldwide

Today, I want to ensure that all of my readers have been properly introduced to my new friend, Mr. Wilbur Sargunaraj.  Wilbur is known around the world as "India's First YouTube Star" and has several million views on his YouTube channel to prove it.  He's gained his "Simple Superstar" status first through great comedy and music, but I am discovering that this is only the tip of the iceberg for Mr. Wilbur!

What I love most about Wilbur is his role as a global ambassador for "Cultural Intelligence" (CQ).  CQ is a concept that comes from David Livermore, who's book Serving with Eyes Wide Open is something I've recommended for years.  In his passion to bring equality and unity in the context of an increasingly globalized and diverse world, Wilbur is traveling the world on a mission to raise up "First Class" world citizens who know how to engage cross-culturally and treasure people from all backgrounds.

As I've been getting to know Mr. Wilbur recently, I have been delighted to find a man of deep humility who is passionately seeking to use his gifts to make the world a better place.  I find the Lord giving me a deep appreciation and respect for the work he is doing and know that you will also.

Here's a quick introduction "Wilburwood" --

Wilbur's most popular music video: Love Marriage:


A couple very popular CQ videos on how to use Indian, European and Japanese toilets (worlds apart):


The trailer for Wilbur's upcoming feature film, Simple Superstar:


And, most importantly, get a taste of Wilbur's heart for critical global issues by watching "Why Poverty":


I would also encourage you to check out Mr. Wilbur on Facebook and Twitter.