Something I've been pondering recently is whether a type of microloan system could work in the US. We spend a lot of money on the poor just to maintain their status as poor people, and not completely starving. Why not use a bunch of that money to give low or no interest loans to potential small business owners? I don't mean the stupid dream finding the next Steve Jobs in the ghetto. I mean a few thousand dollars to start a food truck, or to buy lawn mowing equipment, etc. Microloans have been shown to be effective and to have remarkable high repayment rates in poor countries, and I think the idea is adaptable here, although the required sums are certainly much greater in the developed world. Welfare buys food, but it doesn't buy dignity. Helping poor people to create wealth, which we actively destroyed for a century, might be a good place to start to try to rebuild dignity and community in the inner cities.
Now you hit the problem on the nail, not just in the US but most of the aid for the developing world is in the shape of basic needs, and usually after some catastrophe. People need new horizons to pull themselves out of the vicious cycle of poverty and education provides that. That doesn't seem to be true (referring to the high rates) for kiva.org - I got a lot invested on loans on that website and the rates seem reasonable. We spend a lot of money on the poor just to maintain their status as poor people, and not completely starving.
Microloans have been shown to be effective and to have remarkable high repayment rates in poor countries,
Something I've been pondering recently is whether a type of microloan system could work in the US.
Kiva also has a section for the US (called Kiva Zip), this might be what you're describing. Although the loans I've seen are not for people in extreme poverty but more starting entrepreneurs, which look fairly well off when compared with the borrowers in developing countries.
Oh right, sorry my bad. English is my second language and sometimes things escape me. Thanks for clarifying : )
WORD. Seriously, though, if you give people access to capital, they know how to use it. The access part is what's missing from the equation for many people in lower-income neighborhoods. Case study: my roommate (white guy, early 30s) owns the house we live in, the warehouse next door (which contains an aborted food truck and a million bike parts for his dream coffee/bike shop), a house about an hour away that he barely makes ends meet on by renting, and a lease in SF. Motherfucker doesn't have a day job and lives off these investments, though by a somewhat narrow margin, but, notably, got all of these by loans he took out. He knows the game and the game trusts him and his co-signers. Meanwhile, 5 blocks over, there's a dude that rolls around West Oakland on a bike mounted with a modified blender that he pedals to make daiquiris on the spot. This guy makes more profit than my roommate has in years, but lord knows he probably doesn't even have a bank account, much less does he know his way around a loan form that he could probably put to good use. Nothing against my roommate, though, he's just a lil scatterbrained, is all.Welfare buys food, but it doesn't buy dignity.