Bolsa Familia: Welfare Payments That Work

By Shlomo  Maital   

           Bolsa Familiar 1

                        Bolsa Familiar graph                         

  As the super-rich and powerful of the world gather at Davos, Switzerland, the amount of hypocrisy spoken there about battling poverty could sink a mid-sized country.  The super-rich wring their hands…and the next moment, use both of them to grasp more and more assets. 

   Right under our noses is one possible solution.  Theory doesn’t help.  We need to see what works.  Check out Brazil.   “Bolsa Família (formerly Bolsa Escola) started in the 1990s and expanded rapidly in 2001 and 2002. It provides monthly cash payments to poor households if their school-aged children (between the ages of 6 and 15) are enrolled in school, and if their younger children (under age 6) have received vaccinations.”  In other words – attach the welfare conditionally to actions that will help get the NEXT generation out of poverty, through good health and good education and schooling.

   The result?   Look at the graph above.  Since Bolsa Famliar was introduced rural poverty declined steeply, and urban poverty declined impressively,  where poverty is measured as living on under $1.25 daily.    There is still severe poverty in Brazil – but Bolsa Familiar is helping to battle it. 

  The basic idea is so simple.  To survive, poor families have to send kids out to work sometime.   Offer them help – but condition it on sending the kids to school.  Now, if the super-rich at Davos could take a moment from the ski slopes and fancy restaurants, perhaps they might consider investing some of the trillions they have in a large-scale pilot project, for very poor countries, along the lines of Bolsa Familia.  That might diminish slightly the cynical hypocritical atmosphere that is so evident.