What if everything we think we know about poverty is incomplete? In this episode of the Impact Innovations Podcast, Dr. Martin Burt—founder of Fundación Paraguaya and creator of the Poverty Stoplight—challenges the notion that poverty is just about income. He shows how dignity, choice, and self-awareness are central to the problem, and how families themselves can define and eliminate poverty using this groundbreaking tool.

0:00 | Intro

1:40 | Background on Dr. Martin Burt, social entrepreneur, founder of Fundación Paraguaya, and former mayor of Asunción, Paraguay

3:46 | Martin's journey -from fighting dictatorship to building social enterprises.

6:30 | Understanding poverty in a different way! Martin's "Ahh Haa" moment.

10:28 | What is the Poverty Stoplight? And how was is developed?

15:00 | How change occurs? Self-assessment, behavioral change, and peer inspiration.

19:42 | The Poverty Stoplight is versatile and can adapt globally because the families are involved in the solution to overcoming their poverty.

21:34 | Martin doesn't focus on Poverty Reduction, but POVERTY ELIMINATION!

23:24 | Poverty is Finite! Proof from Martin's efforts in Paraguay.

24:38 | Why it's important to understand the people you help. Listen!

28:40 | Thinking back on Martin's life and advice for social entrepreneurs.

33:11 | Impact Inbox: "What does behavioral change actually look like in the social impact world?"

35:53 | Impact Opportunity: Pivot Works Madagascar

Links from this Episode

Learn more about the Poverty Stoplight: https://www.povertystoplight.org/en/

Learn more about Martin Burt: https://www.linkedin.com/in/martinburt/

Learn more about Fundacion Paraguaya: https://www.fundacionparaguaya.org.py/#/index?lang=en

Learn more about PivotWorks: https://www.pivotworks.org/

Innovate your impact today with The Impact Innovations Podcast: https://iig.uicharitable.org/

Transcript

Jaxson Thomas - Welcome to the Impact Innovation Podcast, where we elevate philanthropy to be more effective through learning, collaboration, and innovation.

My name is Jaxson Thomas, one of the team members behind the Impact Innovation Podcast and an associate at UI Charitable Advisors.

This is episode number five. In today's episode, we're diving into one of the most complex and misunderstood issues in the social impact space, poverty.

While countless organizations are working to fight poverty, approaches and definitions vary wildly. That's why we're honored to speak with Dr. Martin Burt, author of Who Owns Poverty, founder and CEO of Fundación Paraguaya and former mayor of Asunción Paraguay. Dr. Burt brings a powerful and personal perspective to this conversation. He challenges the idea that poverty is just about income and instead reframes it as a multi-dimensional issue, one that requires changes in mindset, behavior, and systems driven by individuals themselves, not only organizations or governments. If you've ever wondered what poverty really is, how to measure it, and who should be at the forefront of solving it, this episode is for you.

Later in the podcast, my co-host Tanner Mills will share this month's impact opportunity, a health-based nonprofit called Pivot Works in Madagascar. Finally, I will respond to a social impact question from one of our listening members. Let's dive right in.

Todd Manwaring - Welcome everyone today to the Impact Innovations podcast. I'm excited because today we're speaking with Martin Burt. He's been a great friend for many years. An accomplished social entrepreneur has been involved in so many different organizations. I know that you're going to be delighted hearing about the work and efforts that he's been involved in. And so welcome today, Martin.

Martin Burt - Well, hello, Todd. Thank you very much for having me. I look forward to having this conversation and seeing what we can come up with about how to accomplish social change in the world and still keep your sanity.

Todd Manwaring - There you go. ⁓ Which sometimes working on these issues, it's taxing, right? That's what you're mentioning.

Martin Burt - The idea is to lead like in everything else in life. A balanced work and life balance. really a balance in keeping your family, the people you love, at the same time as trying to alleviate unnecessary suffering.

Todd Manwaring - That's a really good point. And I think that's a good segue because you have started so many different things. You're the founder of Fundacion Paraguaya, of course in Paraguay for those of you who don’t speak Spanish. You've been involved with bringing a number of different activities to the school children in Paraguay. creating a number of agricultural schools. You've been the mayor of Asuncion Paraguay. received a PhD and so you've been very busy and really, you know, from my knothole, I've seen that you're well respected for the many activities that you've done that have really succeeded. Tell us a little bit about, who is Martin Burt?

Martin Burt - Thank you, Todd. Well, I come from a large family of six children born and raised in Paraguay, South America. I was lucky to be able to go to college in Northern California, where in the last week of my undergraduate studies, I fell in love with an American girl. That was the luckiest break I had in my life. And Dorothy, who's from Modesto, California and I got married in 1982, so that's 43 years ago. And we finished our graduate studies at George Washington University in Washington, D.C. and we moved back to Paraguay where we wanted to be part of the anti-dictatorship movement and nation building, creating a fair and just society and economy for everybody.

We started Paraguay's first development and non-governmental organization. It was still under the military dictatorship, but we were successful that they didn't ⁓ shut us down. Half of my life, I lived under a military dictatorship and half of my life I've been trying to participate in this nation-building movement of reimagining capitalism, reimagining society. It's been a very beautiful journey. I've been blessed with so many angels, for lack of a better word, who have showed up at my door and said, listen, we'd like to support you.

Who would have thought right now we have offices in Ecuador, Chicago, London, Spain, and Tanzania and we are now working in 60 countries and keep on growing.

It's just a very beautiful life of trying to bring prosperity to families around the world. And I mention families in all our work we have found that the unit of analysis is not the individual but the family household.Those who eat from the same pot and sleep under the same roof for poverty purposes. Maybe for other statistical purposes, you want to reach smaller units like the individuals, but for poverty, we have found that the energy is under the same roof be it in Chicago or in Kansas, North Carolina is exactly the same as Brazil, Mexico, South Africa, India. There's no difference at the family level.

Todd Manwaring - I remember you telling me a story about how, the agricultural school that you have, that surprised you when you went there, and they were having a different kind of graduation than had happened before. And you told me, yeah, this is really my ah ha moment. There's something here that's more than just helping someone out of poverty.

Martin Burt - Yeah. Well, to make a long story short, in 1985, we instituted the first microfinance program in Paraguay. And microfinance was invented because trickle-down economics does not always succeed. There are many people at the bottom of the pyramid who do not prosper when the economy grows for different reasons, people living in a slum, people living in a rural village. 

So microfinance was a fantastic rebaptism of a street vendor. A worthless street vendor all of a sudden was rebaptized microenterprise. And with that, she was subject to a commercial loan, savings accounts, insurance.

And she was all of a sudden treated as an economic agent, as a business. And that exploded all this trapped energy. And now there are 250 million street vendors who have been included in the financial system of the world. 

However, we discovered that not because a street vendor is treated as a micro enterprise and considered an economic agent and is given a loan and savings account and financial literacy, she will not only strengthen her precarious jobs and increase her money, but trickle down does not happen with her either. Not because she goes from earning $300 a month to earning $1,000 a month.

Proper dental care, a proper ⁓ house, proper health, it does not necessarily follow. So just increasing family income does not necessarily develop a non-poor person. 

Then we started with our financially self-sufficient agricultural schools, on top of learning by doing, we added, because we needed to survive and we needed to create a financially self-sufficient agricultural high school, we added to the learning by doing, selling and making money. 

And we saw that the high school kids in the process of selling the tomatoes that they had grown in their vegetable garden, and then the process of calculating their profit and loss. That's where the learning happened. The learning did not happen in the classroom. The learning did not happen in the vegetable garden. The learning happened when the 15, 16 year old girl learned how to engage with the supermarket manager. 

So what happened? We saw that when they graduated from high school, they graduated not only with a degree from high school, but they graduated into the middle class. They started behaving like the middle class, using middle class clothes, caring what the Joneses will think of them, aspiring to be better. 

And so we learned that some people move out of poverty without money, like a 17 year old girl. She doesn't have the $1,000 a month, but she's already behaving as a non-poor. And so this is how we developed the poverty stoplight. We said, okay, fine. All the definitions, the US federal government, the World Bank, the Inter-American Development Bank, USAID, did to what we were seeing on the terrain.

And so, my own staff said, Martin, ⁓ we need to go and consult with the poor. What does it mean for them not to be poor? And so the poor gave us a list of 50 things. You have to have enough money, you have to have a family budget, you have to have the proper toilet, you have to eat nutritious food, et cetera, et cetera. And they continued, you have to have self-esteem, you have to be motivated, you have to control your emotions, you have to have a plan. And I asked them, excuse you have to control your emotions? Yes. But what's more important, drinking water or controlling your emotions? Of course, controlling your emotions.

And so all this subjective perspective is considered by the poor as important as objective perspectives. So water, chair, bed, clothes are as important as motivation, self-esteem, dignity, aspirations. And so we developed a self-assessment because an extractive survey cannot capture other people's subjective feelings.

My team tells me, Martin, the poor are not poor. Martin, the poor have money. Martin, it has nothing to do with money. It has to do with dignity. It has to do with self-worth. It has to do with a family saying, I deserve to make more money. I deserve to have a proper toilet. And once that definition is achieved, then the family can start harvesting the fruits that are available to them. 

In some cases, it is very difficult. I don't want to simplify or appear superficial. It's hard. It's very hard. Then, that's why we say the poverty stoplight is a ⁓ coaching mechanism way to accompany. But 50% of the work is self-awareness and a sense of dignity.

Todd Manwaring - And so tell us a little bit more about this.

Martin Burt - The stories are all very similar. Take a woman who lives in a slum in Brazil to the poverty stoplight. She talks to a social worker. She is given a tablet. She sees three images, whether she is, and they all correspond to being yellow, green, or red, and she taps on the images that correspond to her. 

So at the end, ⁓ in 20 minutes, she has a dashboard, not a poverty index, because poverty index are to aggregate data for decision-makers at the top. This is a dashboard for decision-makers at the household level.

And so once she has her dashboard, the first thing that she sees is that she invariably will have more greens than yellows and reds. And it's very important because that allows people to count their blessings. Because if you don't count them, they don't count type kind of thing. ⁓ So you need to start with, when dealing with poverty, you need to start with people's strengths. You know, we are not all basket cases.

Our deprivations do not define us. On the contrary, they are the accident. Our blessings define us, what we are green in. And then the family reflects, ⁓ what should we do? Should we work on weekends? Should we learn how to save? Should we fix our teeth? ⁓ These three things we can do. ⁓ And then the family says, okay, let's do this low-hanging fruit and that other challenge. Let's start writing down our family expenses and our new family budget. And when the family achieves and becomes ⁓ green in those indicators, they go into, say, okay, we need to build a new bedroom in the house, because there are many of us now, and things like that. So they go step by step.

Todd Manwaring - As you were creating this, you were working with tens of thousands of micro entrepreneurs. And you saw that some of them were moving into the middle class. Others were not. Same thing when you mentioned the high schoolers at the agricultural school.

And the poverty stoplight was born by looking at people who on their own had been able to change aspects of their life, as you described, some of them very objective and some of them more subjective.

Martin Burt - Right. Who would have thought that people are more than willing to self-assess, reflect upon themselves, become aware. So this awareness, what in Spanish it's called conscientización ⁓ is key. As Leo Tolstow would say in his novel Anna Karenina, all happy families are alike and each unhappy family is unhappy in their own way. The same thing for poverty. The good news is that as I mentioned, we have not found a family who cannot overcome their poverty if they prioritize it.

Because the poverty stoplight is a new metric, but also a coaching methodology. Nobody can really do it alone. You gotta hold people's hands and ask them how are you doing? Do you still want to work on those issues that you mentioned last week?

Todd Manwaring - And then what I'm also hearing you say is with this stoplight of these 50 indicators, a couple of different things happen. You're mentioning how people self-assess. They go through this, on this I'm yellow, on this I'm green, on this I'm red. And ⁓ for some people, finding out that they're yellow or red and seeing what green is or seeing what the next step is, in some ways it gives them a sense of, I can accomplish that. I didn't know that that's what needed to be there. Could you describe that kind of, in some ways, I think when we were first creating this with you Brigham Young University and some other universities, I think we really saw it as a measurement tool, but quickly, became seen to be something that helped a family really recognize, ⁓ I can change this. I can change that. My neighbor is changing this. I can do that too. Talk about that a bit.

Martin Burt - We had two moments of inspiration, one is when we came across this writer based in Denver, Colorado called Ken Wilber, who says that you need to take everything at the same time. You need to take individual traits, need to take systems and structural traits, you also need to take into culture, you need to take in levels of consciousness, everything at the same, integral.

But then I met you and I met Joseph Grenny. He said, yeah, fine. Yes, you have to be integral, but start with behavior. And this is a psychologist from Stanford University called Albert Bandura. And we have operationalized Albert Bandura's theory of agency and self-efficacy into practical ways that people can change.

One of them is answering yes to, is it worth it? That has to do with motivation. And the other one has to do with, can I do it? That has to do with skills. But he said, yes, but only motivation and personal skills can't do it. You need to have social pressure, group support and peer pressure. Wow, yes. And in addition to that, only individual and social are not sufficient. You need to have structural strengths like incentives. 

And so we took ⁓ Joseph Grenny’s brilliant book called Influencer and we operationalized it for each of the 50 And so if the family decides that they are yellow in dental health, and if the family decides that that is a priority, we show them the way of overcoming their fears, their hesitations, their qualms. 

And so the poverty stoplight is very versatile and can adapt to any country. The people in Northeastern Nigeria know exactly what it means to be not poor in Northeastern Nigeria. Everybody is poor in one thing and not poor in another. So you may have two next door families, one with a grandmother living with an orphan child and next door with a family of father, mother and four children. And each reality is different. But what we have found is that ⁓ enlisting the participation of the families in the solution of their poverty, as ridiculous as it may seem, is crucial to overcoming poverty. 

And for some reason, do-gooders, and I know that they are well-intentioned in many cases, have come up with welfare programs that don't say it outright but suggest that the poor may be damaged merchandise. They can't say it in public because it's offensive. But they said, Martin, they tell me, really, you think that this African-American family living in a slum in ⁓ Winston-Salem, North Carolina can overcome poverty? And I said, yes. Yes. But you need to enlist them.

It has to be their project, not the city's project, not the county's, not the state's. And yes, the good news is that there are many proven ways of enlisting the family's participation in the fight against poverty. 

So we are the only ones that I know that do not talk about poverty alleviation. We do not talk about poverty reduction. We talk about poverty elimination and elimination is just to be green in everything. And we have not found a family who wants to get out of poverty and can't. ⁓ We're still searching and we're learning a lot, but the abundance of positive energy that is available in the world to get rid of poverty is enormous. 

In contrast, there was a report recently that I read that the World Bank said that at this rate of economic growth in the world, it's going to take us 100 years to reduce poverty. And I said, come on, give me a break, you know, because the World Bank still thinks that the only way to overcome poverty is for there to be economic growth at certain rates. ⁓

Everything that they do is so that they don't have to actively listen to the voices of the poor. The policy of the bank is just, let's work with governments. Let's work with census data and let's only promote economic growth. And then let's cross our fingers. No, no, no, no, no. Let's work with families. Let's listen to the families. And let's, just like Desmond Tutu, that Archbishop of South Africa said, the only way of eating an elephant is one bite at a time. So let's disaggregate, disaggregate poverty into small, achievable and actionable indicators. 

And ⁓ what we are seeing, Todd, is that poverty is finite. For example, of the 540,000 families that we're working with, 100,000 are in Paraguay. We're working on getting those 100,000 families out of poverty in the next five years. There are only 50,731 savings accounts that we have to open. We can do that. There are only 4,000 need proper toilets. We can do that. There are only 3,000 of them that don't have IDs. Either they lost them or they don't, you know. We can work with the authorities to reissue them. 

So poverty is finite. That is beautiful. And it is actionable by the poor and achievable by the so excited because, we can enlist the power of the poor, the abundance that they bring to the table. So it's fun, it's challenging, it's difficult, but there are so many people, you know, all over the world who have the same dream.

Todd Manwaring - I think for people listening who are working at a nonprofit, we tend not to know our customers very well. And just as you were describing, ⁓ we have a hundred thousand people we're working with in Paraguay. You can tell. We need 4,000 people to have a better toilet situation because you have that information on those 100,000 people. We know this many people need an ID. We know this many people are struggling with ⁓ violence in the home or all of these different aspects. 

So, A, the family has a better understanding of where they're at. And then the organization itself, a much clearer understanding about who are our customers and what's going on in their lives more than you ever do. Because we tend to, as an organization, be a bit more superficial. Yeah, we've talked to people, we understand what's going on, but you dig into these 50 indicators, you understand their lives a lot more deeply.

Martin Burt - They, the families dig into their, they are the ones who go into. 

Todd Manwaring - Yeah, thank you. Thank you.

Martin Burt - But I'll tell you one example. I work with a global food banking network. It's a beautiful organization that brings together all the food banks in the world. And I'm talking to my fellow board members there in coming up with a graduation approach to food banks. I mean, the work is not only to dish out the dish, this is a food, the challenge is, how do you get this woman not to come to the food bank anymore because she no longer needs it? 

So take the opportunity of listening to the woman who comes to the food pantry. How are you doing ma'am? What's going on? Do you have five minutes? Why don't you sit down and why don't you fill out with this tablet? And why don't you select, you know, how are you doing? 

And so, no, they do not come to the food banks because they don't have food. They come to the food bank because they may not have money or they may not have public transportation or they may not have anywhere to leave the children or they may have other issues. The good news is that those issues are all addressable and solvable. 

I was working with the Salvation Army in Southern California a few years ago, and I talked to a case worker who I asked her to do the same stoplight that she was asked having her homeless person doing, and she said, my gosh, the person I am working with, she doesn't have a house, she sleeps in her car, but she swears that she sleeps eight hours.

I have an apartment, I'm married to an idiot, and I don't sleep eight hours because my husband spends all our money buying a stupid boat that we do not need, we cannot afford. And so I have a salary and I can't sleep at night. And this other woman doesn't have a house, but she sleeps all night. So, you know, there are thousands, thousands stories. We're all unique.

Todd Manwaring - Yeah going back to that quote where we have deficiencies in different ways and we're similar in many ways.

Martin Burt - Exactly. And that is good news because that means that your next door neighbor or your colleague at work may have addressed an issue where you and I haven't. So the solutions are right there.

Todd Manwaring - As we wrap up here, Martine, I'd like to cover two things. And my first one is really ⁓ taking you back, looking back at your life. What was the primary reason you became involved in becoming a social entrepreneur? What was it that occurred in your life? What experience did you have or did you read something that kind of triggered the, yeah, this is something I'm going to need to do? What was that?

Martin Burt - Thank you for asking, both. I was inspired by my family. My parents and my grandparents were freedom fighters, ⁓ very concerned about human rights and democracy and ⁓ preventing communism and fascism to come to Paraguay. ⁓ I went to the Jesuit school in Paraguay. And I was also inspired by the Catholic Church's social doctrine.

My parents, my parents were a great influence on me. We have to give back, and there is more power in giving than in receiving. And so I have always had that kind of support.

Todd Manwaring - Great. Right. That's a great perspective here. Lastly, for many of the people listening, some of them are already engaged. Others are looking at ways to connect. Do you have a suggestion for those people on a book you should read? I know you just came out with a book ⁓ a couple years ago, a movie or an article or a Ted Talk, something that you would suggest, boy, yeah, here's something you ought to focus on and it might help you in your journey.

Martin Burt - Well, yes, thank you. Well, I wrote this book, Who Owns Poverty, that people can access, but I would like to suggest this book by Joseph Grany called Influencer. And ⁓ if they go into the Schwab Foundation for Social Entrepreneurship website, as well as the Skoll Foundation website, they're going to see hundreds of social entrepreneurs who have cracked the code of poverty.

Some are involved in agriculture, some are involved in mental health, some are involved in housing, but there are social entrepreneurs all over the United States and the world who are doing awesome work. I mean, these are geniuses who ⁓ have dedicated their lives to alleviate unnecessary suffering in a sustainable and scalable way.

So yes, those two books, are a good way to get started and to challenge everybody is working on complex problems while at the same time have fun in life.

Hang out with your tribe. ⁓ Spend time with your family. Don't kill yourself for work only. It has to be a balanced life because it's a journey more than a destination. ⁓ so I think that's very important to find the love of your life, find your tribe with whom you can work together. Be humble because you're going to be socked in the nose and in the eye all the time by mistakes one invariably makes. But at the same time, life is beautiful and our job is to flourish and to have fun.

Todd Manwaring - Well, thanks, Martin. This has been a wonderful time hearing about some of your work. We didn't spend hardly any time talking about things other than the poverty stoplight. People can ⁓ look up Martin on LinkedIn. Also find him at those two sites that you mentioned listed as a social entrepreneur at the Skoll website and also the Schwab website. I think those are great ways to dig in and find out what other people are up to and how the world is becoming a better place. Thank you for spending time with us today.

Martin Burt - Thank you very much, Todd.

Jaxson Thomas - This is the Impact Inbox. In this segment, we feature one question from one of our members. This week's question after listening to last month's podcast, “I really liked what Joseph Graney mentioned about the real way to elicit change is to change behavior. What does that look like at the Other Side Academy? And is this true for all organizations and social problems?”

Thanks for this question.

This idea that real change comes from behavioral change isn't just a theory. It's a core part of everything that they do at The Other Side Academy. Every aspect of the Other Side Academy, whether it's the businesses that they run, how they conduct themselves the academy, or how the students treat each other, all comes back to changing behavior. Joseph Grenny says it best when he says, to have a different life, means to start living a different life or change their behavior today. 

At The Other Side Academy, there is zero tolerance for bad behavior. Being sneaky, being promiscuous, stealing, lying, they don't tolerate any of it. And it's reinforced by the fellow students, not by the administration, which makes it even more powerful and effective. In my own personal experience, I've had the opportunity to go to the Other Side Academy and interact with some of the students. Let me tell you, they are all incredible.

I've had the opportunity to interact with the students firsthand at the Other Side Academy and I've seen this theory play out. When the students first arrive, they're quiet, a little more introverted.

But within just a few weeks and months, these students truly transform. Speaking with individuals or students at the Academy, you would have no idea the paths that they have gone through. They're truly changing, and that's because they're changing their behavior day after day. The outcomes that they're experiencing are incredibly impactful because the behavioral changes are happening every single day.

Shifting to the second part of this question, most social problems are trying to change a behavior. It may not look like this on the surface because organizations highlight more often than not what they do, not the outcomes that they're looking for. But to give an example, if a group is trying to improve health, they're going to go about it by changing perceptions about medicine, helping people change the way they behave, to eat better, brush their teeth, drink clean water, go to the doctor, embrace modern medicine or vaccines. These are all behavioral changes that will lead to better health. 

These changes will lead individuals to have a more dignified life and a variety of other positive outcomes will come as well. But it all ties back to changing the behavior day to day.

Tanner Mills - This is your co-host Tanner Mills with this month's Impact Opportunity. Today we're highlighting PivotWorks, a nonprofit working in Madagascar to transform one of the world's most under-resourced public health systems. In Madagascar, access to healthcare is extremely limited, especially in remote districts. In these areas, nearly 90% of people live in poverty.

When seeking medical support, these people walk for hours just to reach the nearest clinic. When they arrive, they often face medicine shortages, untrained staff, or fees they can't afford. Most global health efforts focus on one disease or campaign at a time. Few take on the full challenge of building a full functional health system from the ground up. PivotWorks was founded to accomplish just this.

Rather than creating an entirely new system, PivotWorks works with Madagascar's Ministry of Health to strengthen the existing healthcare system at all levels of care.

They renovate broken clinics, hire and train local nurses, restock medicines, pay community health workers, and make sure that care is free at the point of use. We are highlighting Pivot because of their scalable approach and laser focus on data-driven approach to outcomes. Not only are they supporting hundreds of thousands of patients each year and employing hundreds of clinical personnel,

They are measurably moving the needle on dozens of health outcomes, including safer pregnancies, reduced maternal mortality, reduced death and suffering from preventable infectious diseases, improved child health and nutrition in rural communities, among many others. The Pivot team actively monitors more than 800 health-related indicators. They partner with Madagascar's National Statistics Office and lead cutting-edge research on barriers to care, disease dynamics and program effectiveness. Their work is not only improving lives in Madagascar, it is establishing a model for data-driven rural health systems worldwide. 

If you would like to support their mission, learn more by reaching out at impact@uicharitable.org and we'll help you support this amazing outcomes focused initiative.

Thank you for joining us for the Impact Innovations podcast. We hope that today's conversation inspires you to approach philanthropy with greater intention, strategy, and effectiveness. Please subscribe and leave a review on Apple Podcasts or Spotify. It helps our podcast grow. To continue the conversation and access additional resources, visit our website at iig.uicharitable.org or get in touch with us at impact@uicharitable.org.

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