Friday, July 6, 2012

Catalytic Philanthropy vs. Charity

Which approach will be most effective to tackling our water conservation and shortage challenges in the years ahead? 

At least 840 million people - the majority of them poor - do not have access to water around the world. Tensions between countries such as India and China over water resources increased in recent years as both populations and economies grew and water resources were stressed. 

There are thousands of charity organizations dedicated to solving the problem of water access around the world, but charity may not be the best way to solve the crisis of water accessibility and prevent it from becoming a next global security threat.

The key is actually creating self-sustained markets, according to Gary White, co-founder and CEO of is currently creating a program to give micro-loans to the poor in India that will help them connect to the existing water infrastructure in the country, rather than pay up to seven times as much for water sold by vendors. 

"The solution there lies with the poor themselves and trying to unleash this tremendous power they have as customers and citizens," said White during a panel at the Aspen Ideas Festival on the question "Is Water the Next Global Security Threat?" 

"The fact is that the water utility is there," he said. "Hundreds of millions could get access to water given the right financial tools and access to capital." 

White added that charitable organizations may dig wells that give water for free, but they are often unusable after more than a few years because they dry up or lack capital to be maintained. "We do need philanthropy and catalytic philanthropy as opposed to charity," White said. 

Panelist Steven McCormick, president of the Gordon and Betty Moore Foundation and former president and CEO of The Nature Conservancy, agreed that markets need to be harnessed in order to solve the world's water crises, saying that they could drive behavior that results in water conservation. 

He warned against the risks of privatization, however. "Privatization and ownership of water needs to be very, very carefully managed," he said. "That could lead to a lot of unintended consequences." 

Sylvia Lee, water manager for Skoll Global Threats, said that private sector involvement in water management around the world had increased in the last five years and was encouraging. She also said that greater government involvement around the world in designing better water policies is occurring.  

"I am optimistic because, personally, I believe water is too important for us not to cooperate over," said Lee. "Everyone understands that without water, we will die."

The Atlantic

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