Joining Derek Thompson and Matthew Yglesias to fight global poverty

GiveDirectly is making a world of difference. Join us in driving that change forward.

I’m joining a group of Substackers to raise money for 800 families in Rwanda who are struggling under intense poverty.

Will you help us raise $1,000,000?

If every American Inequality reader gave just $40 right now we would hit our goal immediately.

For the next week, I will also match all donations for everyone who becomes a paid subscriber to American Inequality.

GiveDirectly is also matching the first $600,000 in donations. Americans spent more money this past Black Friday in years. Let’s make this the biggest Giving Tuesday as well.

If you’re unsure about why these types of initiatives are so important, consider one of GiveDirectly’s program in Flint. Michigan.

A program in Flint. Michigan provided $1,500 for all expectant mothers during pregnancy and $500 per month for the first year of their infant’s life. The only steps mothers had to take to get this benefit was to upload a copy of their ultrasound and a government ID to an online portal. For Angela Sintery, this was a lifeline that she could hardly believe was real. From 2014 to 2019 Flint, Michigan had undrinkable water that exposed nearly 100,000 residents to elevated lead levels, including roughly 12,000 children. 1 in 3 families in flint live in poverty. Angela had been through a lot during this period and now she was pregnant with her second child 19 years after having her first. But in May 2024, she gave birth to a healthy baby girl in thanks to this financial support

“I used that money to buy my car seat, to buy a bassinet and a crib,” Angela said. She was also able to take the first 14 weeks of her daughter’s life off from work, and afford diapers and wipes in the months to come. Today, Angela’s daughter is 19 months old and attending daycare at the same preschool where “It really takes a lot of stress away from you being a mom,” said Sintery. “I was very fortunate and grateful.”

The program was part of GiveDirectly’s direct cash giving program called RxKids. A statewide study of more than 450,000 births across Michigan found that in Flint premature birth rates fell by up to 18%, low birth weight births dropped by up to 27%, and millions of dollars in healthcare costs were reduced compared to similar cities that did not have an RxKids program. In another study of RxKids researchers found the program nearly eliminated evictions, reduced housing debt, and gave families the security to buy the food they wanted.

It is hard to understate how impactful direct cash giving can be. I’ve been trying to sing this from the rooftops for years. It is one of the most efficient ways to deliver aid that has proven to:

• More than double incomes

• Increase school enrollment and entrepreneurship

• Decrease skipped meals

• Decrease illness and depression

• Cut domestic violence by one third

• Does not decrease hours worked or increase spending on temptation goods like tobacco and alcohol

Nevertheless, there are no silver bullets. As amazing as direct cash giving can be - especially for new mothers, low-income families, and people struggling with a range of social maladies - direct cash programs have come under threat over the last few years. The headlines from a randomized control trial from OpenResearch pilot gave 3,000 people $1,000 per month over 3 years and indicated it had found mixed results. Another headline from a randomized control trial called “Baby’s First Years” gave mothers with infants $333/month for 4 years and found no statistically significant impacts on children’s language, executive function, socio-emotional problems or brain activity measures.

But digging deeper into the data shows that the results were far more mixed. Not only were there still some benefits accrued, but many pointed to the fact that improving ‘brain activity measurement’ is not the type of question that low-income struggling mothers like Angela Sinestry care most about. They want the autonomy, financial support, and latitude to spend money the way they need.

Direct cash giving isn’t only good for the families receiving money, it also can uplift the entire economy of a region. Direct cash programs have found that when people have more funds, they are more likely to start businesses, more likely to buy goods from other local businesses which can spur their growth, and more likely to invest in children and education which further accelerates the flywheel. All of this spending creates a “multiplier” effect on a local economy, which multi-year long studies covering tens of thousands of people showing that every $1 delivered had doubled its value into $2.50 in new economic activity.

GiveDirectly is sending cash directly to 335 families in two different towns in Rwanda. Most of the families there are living on $1 to $2 per day. If families in Flint, Michigan can see a massive step-change improvement in their lives, think what it can do for families living with so much less who need so much more. Last year’s campaign directly helped families secure housing and build savings to prepare for the future. In a time when it is so easy to focus on the challenges at home, I want us to think globally about the impact that we can have.

If you aren’t convinced yet of the value of direct cash, listen to what Matthew Yglesias has to say about why this is so important.

Will you be a change-maker who helps us reach $1,00,000?

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For the next week, I will also match all donations for everyone who becomes a paid subscriber to American Inequality.

Please also check out the fundraising pages for Matthew Yglesias, Derek Thompson, Scott Alexander, The Bulwark, The Argument, Lenny Rachitsky, Timothy B. Lee, Tim Miller, and more.