Small scale philanthropy: does it work?

According to Wikipedia, the word philanthropy means “the act of donating money, goods, time, or effort to support a charitable cause, usually over an extended period of time and in regard to a defined objective. In a more fundamental sense, philanthropy may encompass any altruistic activity which is intended to promote good or improve human quality.”

Somehow, I have always related philanthropy to rich people. Rich like in stinking rich. People such as Bill Gates or George Soros, serving the noble cause of helping poor and deprived people by using part of their enormous wealth to improve their lives rather than just buying more sports cars, jewelry and villas (or whatever rich people buy for themselves).

But I have reconsidered, realizing what is really quite self-evident when you give it some thought: philanthropy might work just as well (or probably even better) on a smaller scale, without creating large foundations and employing hordes of bureaucrats just to manage and supervise the money.

By Western standards, I am not rich. But by Cape Verdean standards, every westerner living here is rich. One day one of our night guards (not the same guy as described in my previous entry about Christmas stress) approached me and asked if I would be in a position to give a contribution to him in order to build a simple house for him and his family.

My first reaction was negative, of course. Philanthropy and altruism does not come very easy in the western culture, unfortunately – somehow characteristics like doubt, selfishness, greed, suspiciousness and cynicism tend to be stronger most of the time. But after giving it some further thought and discussing the matter with my wife, I decided to take a closer look at his request.

I started out by doing some further research. What was his life situation? What kind of house was he talking about? Was he to be trusted? Could he handle money? Did he show any indications of drug abuse?

So I visited his home and family (a girlfriend and a 4 month old baby), and discovered that they lived in a 10 square meter room without windows, ventilation, water and sanitation. In fact, I would best describe the room as a rat hole. I particularly remember the stench, and I thought to myself that no one should have to live like this, especially not with a little baby. For this, they pay about 40 euros a month, which is a great deal considering his monthly salary of about 100 euros from the guard company where he is employed (a salary which I find remarkably low by the way, considering the high fees we have to pay to this company for its services).

I then examined the location where he wanted to build his house: a small piece of land in the outskirts of Praia, overlooking large part of the town. A basic concrete foundation was already in place, which I took as a sign of his personal commitment to the project.

My conclusion was that the guy seemed to be determined, honest and responsible, and very serious about this project. The next question was of course: what would the construction of this sort of building cost? So I asked for a detailed budget plan as a basis for further discussion. It turned out that the budget was reasonable – around 1000 euros for the complete construction.

Together with my wife, we worked out the following proposal for him and his family to consider: We would provide him the money he needed to build the house, up to a limit of 1000 euros, whereof 50% would be a contribution and the other half would be a long term loan to be paid back monthly as soon as he moved in (the same amount that he currently pays for the room they rent). The budget would be divided into four, and after spending each quarter of the sum, he would provide receipts or other proof of payments for all of the expenses. The plan was inspired by the idea of micro-crediting, a method that seems to become more and more widespread in development aid. He accepted the terms more than willingly, and we wrote a simple contract to keep it all in writing.

This all took place in November 2006. Today the house is built, and the family moved in last week. By all means it is no palace but rather a crude and simple concrete building with one large room, a door and a window, in the middle of a steep slope, partly covered with garbage and junk. But it is a home that they own, considerably better than the rathole where they lived before, and with a potential for gradual improvement - “poca á poco” as they say here.

I am intrigued to see if we will get back the part of the sum that we lent him, through monthly payments. I know many people governed by doubt and cynicism, who would tell me that we will never see that money again, and that, even if we did, we are completely crazy to give away so much money to a stranger without receiving anything in return.

However, I would argue that it actually already has given me a good return. I have learned a lot about the everyday life of the Cape Verdeans, and I have made a new friend. Also, it fills me with a tremendous joy to see the concrete result of this project and of the idea that I have contributed to improving the living conditions for this family and for the little baby. All for the cost of a plane ticket Praia - Lisbonor 5 pairs of Diesel jeans. And I come realize that the art of giving, the ability of generosity, is probably significantly underrated in our western society.

My conclusion is so far that this project has been very rewarding both for this family and for me. I remain convinced that the loan will be repaid. And that small scale philanthropy actually works. At least until otherwise is proven.