Short-term survival, long-term sustainability - Acumen

Short-term survival, long-term sustainability

By Acumen on December 05, 2005

Acumen Fund CEO Jacqueline Novogratz has been visiting earthquake-affected areas of Pakistan, and documenting her travels in a journal. Excerpts of each day’s entry will be posted.

December 4 – Bagh

The village is a cluster of about 1,000 houses on a hillside, most of which were destroyed or badly damaged. Huge piles of timber over here and stones over there have been accumulated, and as far as the eye can see are piles of rubble and twisted metal roofs – all that is left of what served as homes for generations.

With a half-million homes to repair or rebuild, there is no way that aid agencies will reach everyone. People will have to build their own homes – which is why the government is promising $2,500 per family to this end. Whether families spend the money on a new home immediately or spend it on other things and then start rebuilding slowly over generations, as is the tradition, does not seem to be a concern to the government. The problem, of course, is that this laissez-faire approach will not ensure structures able to withstand another earthquake or natural disaster. It will most definitely result in higher materials prices – it already has – although some people will indeed build improved homes. The lost opportunity seems to be a failure to create systems and incentives that both result in better homes as well as improved local communities and jobs. With a $5 billion infusion, both are possible.

Provided people really get the promised compensation – and everyone with real losses is included – this could be seen as an insurance compensation program allowing for new economies to spring up to solve problems both in the short term and hopefully, into the long term. But programs are not simply pumping money into demand, but also into the supply side in a chaotic fashion. Some organizations are building free houses and giving them to people who have lost their homes. How to avoid double subsidies for some, then, and nothing for others? People with connections who know how to work the system always benefit in these kinds of situations. The poorest with the least access always lose. Who will get the promised houses? How will those families be chosen?

You can see the disparities even in the different tent cities that have sprung up in the valleys. In one large one, we observe a cluster of tents already winterized, each covered with metal sheeting. Another cluster of canvas tents stands within close walking distance, creating an instant second-class citizenry in the social circle of the refugees. Maybe the un-winterized tent cluster is merely waiting its turn. Maybe they just weren’t as lucky in terms of the aid group that got to them first – or else they didn’t have the right connections. I keep asking myself who pulled the longer straws in this world of aid.

These are the questions for Acumen Fund: Are there opportunities to create sustainable business models that will enable individuals to tap into supplies of fairly priced materials that might be bundled with sound design advice and management oversight? Can the rebuilding be done in such a way that it creates new skills, new jobs that support and strengthen these devastated local economies? We cannot know yet, for whether and how the people will receive compensation remains to be seen; and where the market failures are most obvious must be learned; and finally, which players might be the best partners must be understood. What everyone agrees is that the NGOs alone will not reach everyone with free housing. What we don’t know is whether there are any opportunities for sustainable approaches.

But that is all for the long term. Right now, the immediate humanitarian need continues to blast you in the face right along with the cold, cold wind. How will people get through the harsh winter with inadequate tents and blankets? What could have been done better? What can be learned from it all?

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