A New Approach to Aid: How a Basic Income Program Saved a Namibian Village
Part 3: 'I'm Doing Very Well'
On a sweltering afternoon in Otjivero, the young woman is standing behind her wooden counter, flipping through a book of clear plastic sleeves. The sleeves contain German baking recipes she has written onto the pages in ballpoint pen. "I've sold out today," she says. "Let me see what I'm baking tomorrow." She continues to flip through her book, looking for white bread, roll and cake recipes. The words "Good Life After Struggle" are written in big red letters on the outside of her hut. It's the name of her bakery, the most successful business in the village.
She already knew how to bake, after spending years working as a cook for a farmer -- for the paltry wage of 32 a month. "He didn't even give me meat or milk," says Nembwaya. She was barely able to feed her children, and the nearest school was several kilometers away, so that her daughters had to walk the long distance in the ditch next to the road every day. Eventually she decided that living on the farm was unbearable, and she moved to Otjivero. Nembwaya was lucky. Only a few weeks after arriving in the village, she was registered for the basic income. She had also brought along a few recipes.
With the first 100 dollars, she bought a bag of flour, some yeast, firewood and an aluminum sheet. She dug a hole in the sand in front of her hut, placed the wood in the hole and lit a fire. Then she placed an oil drum over the fire. She filled empty sardine cans with a dough she had made with the flour and placed them inside the hot drum, replaced the lid and waited. After 20 minutes, Nembwaya had her first batch of miniature loaves of bread.
She started selling the mini-loaves for one Namibian dollar apiece. Word spread quickly that Frieda was selling bread, that it was inexpensive and tasted good, and that you had to get there early before she sold out. After 10 months, Nembwaya had made enough money to buy a stove for 3,000 Namibian dollars, something that hardly anyone else in the village owned. She is proud of her acquisition. "Look, three burners," she says. She opens the lid, closes it, then opens it again and pulls out her sardine tins. "Now I can bake 250 little loaves a day," she says. That translates into 250 dollars a day in revenue.
'We Farmers Are Always the Bad Guys'
Siggi von Lüttwitz, the farmer, is not familiar with Frieda Nembwaya's story, and perhaps it wouldn't interest him if he were. He too receives the 100 dollars a month, which he doesn't need. Compared with the people in Otjivero, Lüttwitz is rich. "I don't see what all this is supposed to achieve," he says, smoking his unfiltered cigarettes. "They're just as dirty and tattered as they were before." He doesn't believe that people have a right to a guaranteed subsistence. He says: "If I give you 100 dollars, you should at least give me 90 dollars of work in return."
What he finds most offensive about the basic income scheme, he says, is not the basic income itself, but the fact that the white farmers are always seen as the bogeymen. Now that the village has garnered so much attention, says Lüttwitz, the way the situation is portrayed here is far too one-sided, especially with the bishop and Haarmann constantly spreading so much positive news.
"And we farmers are always the bad guys," he says, "as if we were to blame for the poverty, and as if we had never tried to help the people in Otjivero. That's just reverse racism."
These sentiments prompted Lüttwitz to comment on the basic income scheme in the local paper. Since the money was distributed in the village, he wrote, burglaries and poaching have increased, and so has alcohol consumption.
But the police statistics, Haarmann's numbers and the people in Otjivero tell a different story. It's as if the farmers lived on one planet and the proponents of the basic income on another.
Haarmann says that he doesn't understand why the farmers are reacting so emotionally to the basic income. One farmer, who baited a Swedish camera team with his eight dogs, says that he had received emails with racist comments. "I assume that the farmers are afraid," says Haarmann -- afraid that the poor will gain some influence and deprive the rich, white 20 percent of the population of some of their power. Their dissatisfaction probably stems in part from the fact that if a basic income is widely introduced, it will be the rich whose taxes will go up to help pay for the program.
"One hundred dollars isn't much," says Haarmann. "You can't expect every citizen to immediately open a successful business with the money." Or that people will stop drinking from one day to the next, or that they will start wearing brand-new clothing and living in stone houses. "But at least we can see to it that they have enough to eat." And if some happen to develop a business plan that helps them become independent, he says, "then so much the better."
Building Higher Fences
After a few months Frieda Nembwaya, the baker, had her first competitors. She spends some of the money she earns at other local businesses, and she says she will soon need to hire her first employee. Microlending programs in developing countries have also shown that when poor people gain access to money, a large percentage manage to attain financial independence -- by starting businesses like hair salons and telephone call shops.
A few weeks ago, Dirk Haarmann published his annual report, which he sent to politicians, the United Nations and even a few presidents. According to the report, economic activity in the village has grown by 10 percent, more people are paying tuition and doctors' fees, health is improving and the crime rate is down.
The report also stated that the basic income could be funded through the tax system by increasing the value-added tax or income tax by a few percent. Only 3 percent of the gross domestic product, or 115 million, would be enough to provide a basic income for all Namibians.
Reactions to the idea have been cautious but positive. The UN Commission for Social Development has defined Otjivero as a "best practice" model. Hage Geingob, the former Namibian prime minister and current trade and industry minister, has commented positively on the pilot project. A group of 16 members of parliament recently paid a visit to Otjivero, where they watched Frieda Nembwaya bake her bread and Sarah Katangolo feed her chickens. The National Planning Commission called the BIG program a forward-looking concept for the country's economic development.
But what if Otjivero remains nothing but an experiment?
Frieda Nembwaya, the baker, says that she is worried, but prepared. Haarmann says that he is drumming up additional donations to keep the flow of money going for a short time, so that he can gradually phase out the program over a few months, perhaps even half a year.
"And if the government still doesn't do anything," he says, "the rich will soon be building higher electric fences."
Find out more about the project at www.bignam.org.
Translated from the German by Christopher Sultan
- Part 1: How a Basic Income Program Saved a Namibian Village
- Part 2: A Village of Entrepreneurs
- Part 3: 'I'm Doing Very Well'
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