An Interview With Fotis Georgiadis
One of our enduring perspectives on social impact work has been that we tend to get into too much hagiography and that this reinforces the idea that change is all about us, as opposed to recognizing the agency and activity of the people we want to help. So I’d like to shine the light elsewhere… and there are so many stories to choose from, as of this past fall GiveDirectly has delivered transfers to over one million recipients, and each of them has done something different with the money, so you have this incredibly rich variety that’s really reflecting of something we all know well, that everyone is different.
As a part of my series about “Big Ideas That Might Change The World In The Next Few Years” I had the pleasure of interviewing Paul Niehaus, co-founder and director of GiveDirectly, the fastest growing international non-profit of this century that lets donors send cash directly to people living in poverty. To date, they’ve distributed more than $500 million dollars to over 1 million households in 10 countries.
Niehaus is also a cofounder of two emerging markets fintech companies: Segovia, an enterprise payments platform, and Taptap Send, a consumer remittance startup. He is an Associate Professor of Economics at the University of California, San Diego, where he works with governments in emerging markets to improve the implementation of social programs. In 2013 Foreign Policy named him one of its 100 leading “Global Thinkers.”
Thank you so much for doing this with us! Before we dig in, our readers would like to get to know you a bit. Can you please tell us a story about what brought you to this specific career path?
My path has been peculiar in the sense that over the past decade I’ve been publishing academic research and helping to start nonprofits and companies at the same time.
That all got started when I was in graduate school, and some of us at the time were starting to think about what could be done to reduce corruption or “leakage” from anti-poverty programs, and we met with a fellow who was trying to bring formal banking into rural areas — I think his specific ideas was to essentially put a mobile ATM on the back of a motorcycle and go around from village to village. So we were talking about this idea and whether it could help curb leakage, and then at some point it hits you that hey, if people have access to these accounts, then I could put money into them. And wouldn’t that be an amazing opportunity?
That was the question that really set GiveDirectly in motion. And I was fortunate at that juncture to have people like my co-founders, Michael and Rohit and Jeremy, asking that question with me in a really open-minded way — not “how can we turn this into a research paper?” but “what’s the best thing we could turn this into?” It’s asking what is the essence of the opportunity, as opposed to trying to fit the opportunity into the predefined box of your own professional identity.
Can you please share with us the most interesting story that happened to you since you began your career?
I’d respectfully refocus this question on the stories of the people that GiveDirectly has served.
One of our enduring perspectives on social impact work has been that we tend to get into too much hagiography and that this reinforces the idea that change is all about us, as opposed to recognizing the agency and activity of the people we want to help. So I’d like to shine the light elsewhere… and there are so many stories to choose from, as of this past fall GiveDirectly has delivered transfers to over one million recipients, and each of them has done something different with the money, so you have this incredibly rich variety that’s really reflecting of something we all know well, that everyone is different.
That said, one story that I think a lot about is a fellow who was one of the first recipients in a basic income project we’re running in Kenya — the largest of its kind, ever. This guy had a job in town working as a security guard, and it paid well, but he had to live away from his family back in their home village.
When he started getting basic income payments he decided to quit that job and move back to the village, because he’d earn less back in the village, but he’d be able to support his kids through school, and more importantly he’d be able to see them every day.
I think about that story, and about how when we’re thinking about quality of life and about how we can help people to live better lives we tend to focus on the financial picture, because that’s something we know how to measure. But we don’t really know how to measure things like the value of being able to see your kids every day. So I turn to this story as a source of perspective, and of humility.
Let’s now move to the main focus of our interview. Can you tell us about your “Big Idea That Might Change The World”?
The idea I’ve advocated for is to simply give money to people who don’t have much of it.
It isn’t “my” idea in the sense that, first of all, it’s obvious, and then also that many people were doing it before GiveDirectly came along, and many people have been doing it in parallel. But we’ve been doing it at large scale, the largest NGO in the world now that focuses on this, and we’ve been doing it in front of an audience that had always been told, had been led to believe, that this was a crazy idea. That you obviously couldn’t just give money to people experiencing poverty, that “it’s more complicated than that,” that you have to “teach a man to fish,” etc.
And what’s embedded in these mantras, if you unpack them a bit, is a strong sense that we know what’s best for other people better than they do, and that we need to take charge of the situation. And it really flies in the face of the data — when you look at extreme poverty, hundreds of millions of people have been finding their own pathways out, very few due to any sort of help from an aid program or an NGO.
And when you look at the high-quality evaluations, experimental evaluations, that we’ve begun to conduct in the last 20 years or so and ask what seems to work well, there’s no question that generally speaking when we give money to people in poverty they use it sensibly in ways that improve their lives. Meanwhile many of the expensive programs designed by “experts” that are supposed to “teach people how to fish” actually achieve little or nothing.
So another way I would articulate the idea is that when we set out to help others we should not insist on retaining as much control, as much power. That “empowerment” isn’t a matter of marketing language but a really practical question about who gets to make the decisions. If it’s you, if it’s staff, if it’s donors, that isn’t empowerment.
How do you think this will change the world?
It already has, to a large degree. Cash transfers are now the primary tool used by anti-poverty programs in low-income countries around the world. But where I think we can still go from here is to the yet more ambitious goal of eliminating extreme poverty entirely.
It’s been hard to see a clear path to that goal in the old model, the model where we come in and build bureaucracies to design programs and hope that they are appropriately tailored to the local setting, and so on. So you have folks like Jeff Sachs saying “we can end poverty if we put in the resources,” but then all this doubt about the efficacy of the execution on that.
But now with all the evidence we have on cash transfers, and the capacity we have to deliver them globally — which has only been deepened during the pandemic, when many governments have had to find innovative ways to deliver transfers, and as a result were able to deliver additional transfers to around 2 billion people in the developing world — when you look at this, you can map out a very straightforward path to ending extreme poverty: we give everyone enough money to get them over the poverty line.
And the cost of doing that is doable, a couple of percent of income in rich countries, if we decide we want to do it.
Keeping “Black Mirror” and the “Law of Unintended Consequences” in mind, can you see any potential drawbacks about this idea that people should think more deeply about?
This is an illuminating question because it presupposes that there are intended consequences, that we’ve defined certain specific things that we want to see happen and then we need to worry about whether something different might happen. It’s very reflective of the controlling mindset that pervades thinking about development and foreign aid, the sense that we’re setting the agenda, that we need to make sure things go right by carefully anticipating and managing the various ways in which they might go wrong.
I think from the point of view of people living in extreme poverty, which is the point of view we should care about, there are some real questions worth asking. Might you feel pressured or tempted to use money in ways that you don’t really want to? Are there ways we structure transfers that help you use them more effectively? For example, people experiencing poverty often have a hard time accumulating large sums of money at once — so it can be helpful to give them a chunk of money all at once rather than stretching it out into small payments.
We could ask about the local economy — if your neighbors all receive a lot of money, are there ways that could help you, like creating new business opportunities? Are there things you’d worry about, like the price of food going up? And so on.
These are good questions to ask. But as a rich person I’d start by first sitting a bit with this tension: with cash transfers the entire point is to have “unintended” consequences. We want to de-emphasize our own intent, except in the very broad sense that we intend to give other people more say in the way their stories unfold.
Some very well known VCs read this column. If you had 60 seconds to make a pitch to a VC, what would you say? He or she might just see this if we tag them 🙂
Congratulations on your wealth. Sooner or later, when you feel the rightness and timeliness of giving much of it away, draw on what you’ve learned as an investor: sometimes we bet on plans; sometimes we bet on people. When it comes to global development, we’ve been betting almost exclusively on plans. The neglected opportunity is to bet on people.
How can our readers follow you on social media?
I occasionally share things on Twitter — @PaulFNiehaus. Also follow @GiveDirectly to learn more.
Thank you so much for joining us. This was very inspirational.
GiveDirectly: Paul Niehaus’s Big Idea that Might Change the World was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.
