<p>Remember the four factors of production: land, capital, labour and entrepreneurial ability.</p>
<p>The plight of the poor comes from their inability to improve their own factors of production.</p>
<p>Usually if you have a valid business model, you can secure loans from others such that your initial factors of production (or lack thereof) become less of a hindrance. </p>
<p>But poverty-stricken countries often lack such infrastructure. Mind you, many places don’t even have banks. How do you expand the scale and improve efficiency of your farm (to go beyond mere sustenance) without any banks or loans to finance your improvements? Meanwhile, you don’t even have means to store your surplus yield (any surplus is generally wasted because of a lack of food preservation facilities) in order to save up for a rainy day (or actually, a droughty year). Then of course, you don’t have insurance, to allocate resources in order to ensure that disasters and drought do not destroy improvements towards factors of production. In fact, political instability makes it extremely undesirable to try to expand your factors of production to provide beyond mere sustenance? Why? You attract attention. Warlords arrive, rape your family (e.g. as in Zimbabwe), and carry off your property. </p>
<p>Can you get an economic brain, guys? 
The lifeboat analogy is extremely flawed. Again, wealth is NOT zero sum, and most of you are acting as though the world wealth is based on mercantilism.</p>
<p>There are some very useful methods to increase the factors of production of the poor in a way that is also beneficial to the benefactor. Most people however, are blind to the economic profit that can be realised in the poor.</p>
<p>For example, do you realise that the reason that the reason why many subsistence farmers have such low incomes is that they don’t have the initial capital to travel to cities and other more-populated areas where the food prices are higher (because there is more demand for less supply)? So food is oversupplied in rural areas (resulting in extremely low prices, naturally), and you have hunger and food shortages in urban areas. Then add a drought, lack of insurance or a natural disaster, taken together with the inability to store surplus, and BOOM, you have food shortage in rural areas too. </p>
<p>There are some easy remedies for this. For example, microlending; lend a woman forty dollars (a lot of money in Africa, mind you), so she can cover the costs of travel to attractive markets, sell her crops for a much higher profit and pay you back (with fifty cents of interest), and maybe make 200 dollars more for the year. Then maybe making various other microloans so she can buy tools, make improvements to the farm. Mind you, in various developing countries simple things like BASIC FARM TOOLS are expensive. Naturally such subsistence farmers are faced with very low yields … </p>
<p>Multiply microlending by one million people, and suddenly you have a mutually beneficial business model. But of course, what bank wants to set up shop in a central location where warlords are likely to “conquer” and confiscate the 40 million dollars of capital set up for microlending? So microlending must be practiced by associations and organisations that do not have central facilities, and that migrate from place to place in order to avoid warlords and other abusive riff-raff. </p>
<p>Solving the plight of the poor is about increasing factors of PRODUCTION and decreasing WASTAGE and economic INEFFICIENCY. </p>
<p>It’s not about asking someone to leave the lifeboat so someone else can get in. That’s an extremely myopic view of economics. </p>
<p>One of the issues I think is the economic capital involved in achieving political stability. If companies and investors could find out ways to finance large-scale security and militaries who fight for liberty and fundamental rights (such as life, property, freedom of speech…), then economic investment will become more attractive. Hiring soldiers from developed countries (such as the US) is extremely expensive, but hiring soldiers from the developing country itself (which makes more economic sense) means you will get a bunch of untrustworthy hoodlums who have been raised in a culture of death and gangsterism. </p>
<p>Now, if there were only a way to inculcate in children of developing nations a culture of liberty, and at the same time give them a strong discipline to create a reliable and virtuous military that will work towards the political stability of the community, not work against it…</p>