Brazil's Incredibly Successful Social Program: Pay the Poor
Brazil's poor are rising to create a new middle class in the country and are contributing to the economic boom there.
Tina Rosenberg reports in today's New York Time's Opiniator column:
Brazil’s level of economic inequality is dropping at a faster rate than that of almost any other country. Between 2003 and 2009, the income of poor Brazilians has grown seven times as much as the income of rich Brazilians. Poverty has fallen during that time from 22 percent of the population to 7 percent.
How has this happened? Rosenberg describes one social program that has made it all possible: giving money to the poor.
The program, called Bolsa Familia (Family Grant) in Brazil, goes by different names in different places. In Mexico, where it first began on a national scale and has been equally successful at reducing poverty, it is Oportunidades. The generic term for the program is conditional cash transfers. The idea is to give regular payments to poor families, in the form of cash or electronic transfers into their bank accounts, if they meet certain requirements. The requirements vary, but many countries employ those used by Mexico: families must keep their children in school and go for regular medical checkups, and mom must attend workshops on subjects like nutrition or disease prevention. The payments almost always go to women, as they are the most likely to spend the money on their families. The elegant idea behind conditional cash transfers is to combat poverty today while breaking the cycle of poverty for tomorrow.
Rosenberg describes the program as the most important anti-poverty program the world has ever seen. And considering the scale of the countries it has worked in so far - Brazil and Mexico, the potential for what these programs can do for poor communities around the world is pretty exciting. Brazilians have a lot to celebrate this year at Rio Carnival.