CSOs and State 1: AIDS and Perversion of Welfare

There was a very disturbing news from the Wall Street Journal last April about AIDS. It was entitled,

"Dangerous DecisionIn South Africa, Poor AIDS Patients Adopt Risky Ploy"
To Get Disability Payments, Some Skip Medications, Putting Lives in Peril
Aiming to Be 'Very, Very Sick'
By MICHAEL M. PHILLIPS April 7, 2006; Page A1

The South African government gives advanced anti-AIDS drugs for free to patients. The pills, antiretroviral "cocktails", would boost one's immune system, relieve symptoms and restore his/her health. In addition, the government gives out a $130-a-month disability grant, if one is really sick.

The results were rather sickening. Some poor people who have bad AIDS situation and receive the allowance from the government stopped taking the anti-AIDS medication so they will remain sick and can continue drawing the allowance. While those who have better or improved conditions have stopped taking the medicines, find ways to be infected further, to get sick further, so they will qualify for the government allowance!

According to Mr. Phillips' report, patients who do this would rather endure terrible sickness just to get the allowance so they will have extra cash to feed their kids, or pay rentals and debts, or start a small business. There are estimated 5.3 to 6.3 million HIV carriers in South Africa.

In economics, you call that behavior of choosing to be sicker to get allowance as "moral hazards" problem. If people know that there are some form of rewards or protection (bail out, subsidies, allowances, stipends, other forms of protection) if they misbehave, then they will misbehave. Well, at least for those who are desperate enough and consider the rewards for irresponsibility better than the pain (physical, emotional, whatever) of such irresponsibility.

In the Philippines and other poorer countries, there are similar behavior.
Here for instance, we have a law that squatters cannot simply be removed from the lands they're squatting on, unless the owner/s of the land (government or private) will find a relocation site for those who will be evicted, facilitate their transfer. In some government relocation sites, government even gives the relocated squatters land titles.

Result? Squatters mushrooming in many places. They just occupy private lands, or government lands. Many private land-owners are more determined to evict the squatters and guard their lots. Government, the biggest landowner in the country, even confiscating some private lands if landowners did not pay the real property taxes plus the high penalties for delayed payment, is more tolerant of squatters. Government leaders for one (from mayors, congressmen, governors to the President) often protect the squatters from eviction so long as the latter will vote for them, and support them if they are experiencing political crisis.

There are also the so-called "professional squatters". When government gives them land titles, they sell that title to other people, get the money, then hop to another lot or location and squat the area, waiting for another round of new land titles to be given to them.

So, people really respond to incentives.
If there are incentives for irresponsibility and misbehavior, or the penalties are too light for misbehavior like stealing, then some people will abuse any government welfare and remain irresponsible.
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A friend sent me also an awful news from The Washington Times (date not indicated), entitled
"AIDS INCENTIVES COSTLY TO AGENCIES"
by Karen Palmer.

The disturbing news is that in Malawi and other parts of Africa, people who are potential victims of AIDS, if not already suffering from it, now require "allowance" fees and per diems (effectively, bribes) before they will attend AIDS meetings and seminars that will directly benefit them. The going rate, according to the report, was 1,500 kwachas, or about $10 equivalent per day. And the international NGOs, or UN agencies have started the practice of distributing money to people and local government bureaucrats to entice them to come to their seminars. The report said, "Some blame UNICEF, others blame Oxfam, but no one remembers who first offered envelopes of cash in exchange for attendance. The point, they say, is that now everyone does it. And people say, 'If you don't give us pocket money, sorry, we're not interested.'"

In addition, government officials and civil servants also require payments, "sitting fee" they call it, for them to attend meetings and seminars. Continued the report, "The result is that some HIV workers use training sessions as a lucrative source of income, floating from one workshop to another, shopping around for conferences where participants stand the greatest chance of making a bit of cash."

So if the international NGOs will not give money, no one will come to their AIDS seminars, so what? The NGOs are afraid that they will have no picture and real reports to show to their donors? Then why bother to help people who don't bother to help themselves either, why put in your money (or other people's money)? And the national or local government bureaucrats, why bother to invite them if all they need is "attendance fee"?

It's bad that tax-funded government foreign aid has corrupted the concept of "national development" of many poor country governments. It's equally bad that private-funded NGO foreign aid has corrupted the concept of "personal welfare" of many poor country citizens.

Maybe we should consider the fact that if nature is killing people (AIDS, malaria, TB, and so on) and people don't want to help themselves, then let nature take its course.