Ted Rodriguez had been living on the streets for two decades when he stumbled across a briefcase containing $100,000. This was no happy accident. The cash had been left there by TV producers who wanted him to find it.
They wanted to see if the 45-year-old man would turn his life around or spend the money recklessly.
They told Ted he could only keep the money if he agreed to be filmed for a documentary.
Ted jumped at the chance. He first rented a motel room, but years of sleeping outside made it difficult to adjust. He ended up sleeping on the floor.
Ted didn’t spend much money at first. That changed when other homeless people caught wind of his lucky break. Being a nice guy, Ted chose to spread the wealth. If anyone came to him with a sob story, he would help. He even bought people cars.
Women also began to flock to Ted. He knew they were only after the money, but he didn’t care.
Within eight months, he had blown everything. He returned to the streets with nothing.
Some say this experiment was doomed to fail. But others believe giving money directly to people in need can be successful.
Every year, billions of dollars are spent on aid for people trapped in poverty. This aid is delivered in the form of sacks of grain, medical supplies, clothes, tents, and job training. Implicit in this charity is the idea that poor people cannot be trusted with the money.
A charity called GiveDirectly is changing this way of thinking. They believe our whole approach of choosing how to help the world’s poorest is flawed. The poor can choose for themselves much better than any aid agency can.
In Kenya, Rwanda, and Uganda, GiveDirectly has given nearly 65 million dollars in cash with no strings attached. And they have found that people don’t waste the money. Recipients have, by and large, used the money to escape poverty. New roofs, school fees, seeds, fertilizer, livestock, and starting small businesses are some of the things that the money is used for.
While being given money was not the answer for Ted Rodriguez, perhaps it was the huge windfall that prevented his success. If he were given that money over the course of ten years, the story might have ended differently. GiveDirectly has shown over ten years that people can be trusted to make wise decisions, and that poor people are the best judges of what they need to escape poverty.