First, the Toms buy-one-give-one model does not actually solve a social problem. Rather, the charitable act of donating a free pair of shoes serves as little more than a short-term fix in a system in need of long-term, multi-faceted economic development, health, sanitation, and education solutions.
“What’s wrong with giving away shoes?” you might be thinking. “At least they’re doing something.” The problem, we’ve learned, is when that “something” can do more harm than good. As Time recently noted, an increasing number of foreign aid practitioners and agencies are recognizing that charitable gifts from abroad can distort developing markets and undermine local businesses by creating an entirely unsustainable aid-based economy. By undercutting local prices, Western donations often hurt the farmers, workers, traders, and sellers whose success is critical to lifting entire communities out of poverty. That means every free shoe donated actually works against the long-term development goals of the communities we are trying to help.
The fact is, Toms isn’t designed to build the economies of developing countries. It’s designed to make western consumers feel good. We can see that in the company’s origin story, as the Toms website proudly tells it, in which founder Blake Mycoskie saw the problems barefoot children in Argentina faced and decided to start Toms. Mr. Mycoskie didn’t ask villagers what they needed most or talk to experts about how to lift villages out of long-term poverty. Instead, he built a company that felt good and that was good enough for him and Toms’s nascent consumers.