Intermediate Technology Excerpts from Small is Beautiful: Economics as if People Mattered E.F. Schumacher, 1973 In many places in the world today the poor are getting poorer while the rich are getting richer, and the established processes of foreign aid and development planning appear to be unable to overcome this tendency. In fact, they often seem to promote it, for it is always easier to help those who can help themselves than to help the helpless. Nearly all the so-called developing countries have a modern sector where the patterns of living and working are similar to those of the developed countries. But they also have a non-modern sector, accounting for the vast majority of the total population, where the patterns of living and working are not only profoundly unsatisfactory but also in a process of accelerating decay. I am concerned here exclusively with the problem of helping the people in the non-modern sector. This does not imply the suggestion that constructive work in the modern sector should be discontinued, and there can be no doubt that it will continue in any case. But it does imply the conviction that all successes in the modern sector are likely to be illusory unless there is also a healthy growth—or at least a healthy condition of stability—among the very great numbers of people today whose life is characterized not only by dire poverty but also by hopelessness. The Condition of the Poor What is the typical condition of the poor in most of the so-called developing countries? Their work opportunities are so restricted that they cannot work their way out of misery. They are underemployed or totally unemployed, and when they do find occasional work their productivity is exceedingly low. Some of them have land, but often too little. Many have no land and no prospect of ever getting any. There is no hope for them in the rural areas and hence they drift into the big cities. But there is no work for them in the big cities either and, of course, no housing. All the same, they flock into the cities because the chances of finding some work appear to be greater there than in the villages, where they are nil. The open and disguised unemployment in the rural areas is often thought to be due entirely to population growth, and no doubt this is an important contributory factor. But those who hold this view still have to explain why additional people cannot do additional work. It is said that they cannot work because they lack “capital.” But what is “capital”? It is the product of human work. The lack of capital can explain a low level of productivity, but it cannot explain a lack of work opportunities. The fact remains, however, that great numbers of people do not work or work only intermittently, and that they are therefore poor and helpless and often desperate enough to leave the village to search for some kind of existence in the big city. Rural unemployment produces mass migration into cities, leading to a rate of urban growth which would tax the resources of even the richest societies. Rural unemployment becomes urban unemployment.Help to Those Who Need It Most The problem may therefore be stated quite simply thus: what can be done to bring health to economic life outside the big cities, in the small towns and villages which still contain — in most cases — eighty to ninety percent of the total population? As long as the development effort is concentrated mainly on the big cities, where it is easiest to establish new industries, to staff them with managers and men, and to find finance and markets to keep them going, the competition from these industries will further disrupt and destroy non-agricultural production in the rest of the country, will cause additional unemployment outside, and will further accelerate the migration of destitute people into towns that cannot absorb them. The “process of mutual poisoning” will not be halted. It is necessary, therefore, that at least an important part of the development effort should by-pass the big cities and be directly concerned with the creation of an “agro-industrial structure” in the rural and small-town areas. In this connection it is necessary to emphasize that the primary need is workplaces, literally millions of workplaces. No one, of course, would suggest that output-per-person is unimportant; but the primary consideration cannot be to maximize output per worker; it must be to maximize work opportunities for the unemployed and under-employed. For a poor man the chance to work is the greatest of all need, and even poorly paid and relatively unproductive work is better than idleness. “Coverage must come before perfection,” to use the words of Mr. Gabriel Ardant (International Labour Review, 1963). It is important that there should be enough work for all because that is the only way to eliminate anti- productive reflexes and create a new state of mind — that of a country where labor has become precious and must be put to the best possible use. In other words, the economic calculus which measures success in terms of output or income, without consideration of the numbers of jobs, is quite inappropriate in the conditions here under consideration, for it implies a static approach to the problem of development. The dynamic approach pays heed to the needs and reactions of people: their first need is to start work of some kind that brings some reward, however small; it is only when they experience that their time and labor is of value that they can become interested in making it more valuable. It is therefore more important that everybody should produce something than that a few people should each produce a great deal, and this remains true even if in some exceptional cases the total output under the former arrangement should be smaller than it would be under the latter arrangement. It will not remain smaller, because this is a dynamic situation capable of generating growth. An unemployed man is a desperate man and he is practically forced into migration. This is another justification for the assertion that the provision of work opportunities is the primary need and should be the primary objective of economic planning. Without it, the drift of people into the large cities cannot be mitigated, let alone halted. The Nature of the TaskThe task, then, is to bring into existence millions of new workplaces in the rural areas and small towns. That modern