Many young Christians look up to social entrepreneurs like U2’s front man Bono, co-founder of ONE, and Blake Mycoskie, founder of TOMS Shoes, for their companies’ philanthropic missions. However, academics and economists have criticized both men for dumping aid into impoverished communities, which ends up hurting the economy by undermining local business.
Last year, Bono came to a “humbling” realization and publicly announced his conviction that commerce is the key in economic development, not aid. Now, Mycoskie is joining his side.
The Problem with “Buy One, Give One”
TOMS Shoes has gained notable attention and success since it opened for business in 2006, whether it was driven by the trend appeal or tug-at-the-heart-strings factor of the “BOGO” (buy one, give one) model. BOGO initiatives like these have great intentions and often receive heavy support from socially-conscious Christian circles. But buyers make the mistake of the bad economist: they focus on the positive effects on one group and overlook the negative effects on another.
TOMS’ BOGO model has been subject to economic criticism for displacing local shoe producers. How can shoemakers in Haiti compete with free shoes? They can’t.
Ultimately, free donations end up being a “hand out” rather than a “hand up” for the poor.
But the good news is, TOMS is finally listening to its critics.
TOMS Takes Critics’ Advice
At the Clinton Global Initiative Conference in late September, Mycoskie announced TOMS will begin manufacturing shoes in Haiti at the beginning of next year, with one hundred Haitians on their payroll. By 2015, the company will produce one-third of its shoes in the countries where they are donated. This new and improved business model will provide shoes and jobs for Haiti, supporting the growth of a sustainable Haitian shoe industry.
President of HOPE International, Peter Greer, explains why he refused to wear TOMS in the past, but now champions the shoes:
For years, I’ve resisted the TOMS Shoes craze. It wasn’t just because the early shoes look like slippers, but because it seemed to perpetuate an out-of-style paradigm of charity. But today, the shoes I’m wearing proudly display the blue and white TOMS flag…They recognize that the greatest good might not be the shoes they give away, but the jobs they create.
From Aid to Enterprise
In New York last month at the conference, Mycoskie made it clear he means business:
I want everyone to hear me clearly: This is not just additional aid to Haiti…This marks a major investment and will have one of the most important investment returns possible—and that is improving people’s lives.
TOMS is moving from a simplistic, temporary, short-term mentality to a holistic, sustainable, long-term development approach. This paradigm shift is important because it gets at the heart of the matter: human dignity.
Employment addresses the needs of a person beyond his or her feet, not only because it provides a steady flow of income, but because work is dignifying.
As Christians, we should be encouraged to see both Bono and Mycoskie humbly accept criticism and change their practices to better care for the poor. Helping the needy is a Christian duty, and it’s up to the body of Christ to fight poverty in the most effective way possible.
Mycoskie’s decision to begin manufacturing in Haiti is something to celebrate. And I might celebrate by buying my first pair of TOMS Shoes.
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