By Bethany Foster, Colorado Christian University Student
In August of 2013, I went to the TOMS Warehouse Sale in downtown Denver. Amongst a baffling array of colorful shoes and shoppers intent on adding to their shoe collections, I saw many signs with the slogan “One for One,” the business model that every sale results in a donation to someone in need. I became determined to find out the process by which TOMS gives shoes to people around the world. The knowledge I gained lent valuable insight into the world of charity and foreign aid.
TOMS’ business model and expansion is notable. According to TOM’s website, the company has given away over 10 million pairs of shoes since its conception in 2006. The “One for One” strategy has been critical for building TOMS’ success on charitable principles. In addition to shoes, TOMS also has corresponding programs which donate eyewear and clean water to various countries. TOMS’ website claims it works to “identify global needs and create products to help address them.”
On first glance, TOMS seems to be benefiting the poorest of the world.
Unfortunately, a more critical understanding exposes a less positive prognosis.
While good intentions drive charity, kindness is not guaranteed to bring people out of poverty. Dr. Michal Bauman, a professor at Hillsdale College, addresses this problem in his paper, The Dangerous Samaritans. Throughout the paper, he shows charity and foreign aid both treat symptoms of poverty instead of poverty itself. Charity often forgets long-term consequences in its haste to help people as quickly as possible.
We only have to look at the nation of Africa to see truth in these claims. In Africa, millions of dollars of foreign aid and enormous amounts of donations have flooded the economy. Included in this list are millions of TOMS shoes. With this scale of stimulus, Africa should be a thriving nation. The Cato Institute states Africa’s foreign aid projects are “a theater of the absurd – the blind leading the blind.” Between 1960 and 1997, over $500 billion was given to Africa, according to the Cato Institute. Instead of building a strong economy, aid and charity have only increased dependence and stifled African businesses.
So what are the implications for TOMS? Like other misguided philanthropic attempts, TOMS’ business model has increased dependency. Due to pressure from the media and the public, TOMS has attempted to implement programs which strengthen economies. These programs include: microfinance seminars, providing employment for local women, and building shoe factories. Ultimately, whatever good these programs are doing are cancelled by the consequences of TOMS’ charity.
TOMS’ model does not actual solve social problems. The shoe program seeks to solve the issues associated with children walking barefoot. Even this basic problem remains unsolved by the “One for One” model. Once a child receives a pair of shoes, the shoes last only a few months, leaving the child barefoot again. The sight and water programs also have various drawbacks including implementation difficulties. Ultimately, TOMS has encouraged entitlement mentalities and has harmed countless economies.
Now that we have determined TOMS has failed to address poverty, what are some of the solutions? First, we must understand poverty is a complex social problem without easy fixes. The Poverty of Nations provides a clearer understanding of the causes of poverty. As a whole, western culture needs to understand aid and charity will never create independently wealthy nations. Instead, companies like TOMS need to create sustainable fixes. Solutions should be encouraged that provide long-term responses to problems; instead of contributing to poverty.
Poverty is a complicated issue that demands careful solutions. Charity and aid have crippled poor nations for many years, and these nations cannot become self-sufficient while burdened with good intentions. While TOMS appears to be a company concerned with human flourishing, under closer analysis it simply becomes another failed attempt at foreign aid. I will believe in TOMS’ charity once the company uses its entire business – jobs, manufacturing and marketing – to increase the economic stability of impoverished nations. With this sort of business model in mind, perhaps TOMS will never go out of style.