Fogo Island, population about 2,800, is off the northeast coast of Newfoundland and Labrador. It’s a remote and beautiful place. The island has been a fishing community for 300 years, but its inhabitants have almost always been on the brink of poverty. Fogo Island was plunged into a particularly severe economic crisis when the cod fishery collapsed in the early 1990s.

The Fogo Island economy has recently been revived – to some extent – in an unusual way. The change is the work of a charitable foundation that has a luxury hotel as its centrepiece. The Fogo Island Inn, which opened in 2013, quickly became one of the world’s most acclaimed hostelries, housed in a superb building. (Architect Todd Saunders is a Canadian who lives in Norway.) The inn offers 29 rooms of comfort and elegance, and a dining room of international standard. There is helicopter service for those who can’t face the long drive and ferry from Gander Airport. The inn is also hugely expensive. It lies in stark contrast to its surroundings and Fogo’s history.

The inn is owned by the Shorefast Foundation, a charity created by Zita Cobb. Cobb is a wealthy, retired high-tech entrepreneur originally from Fogo Island. Her father was an illiterate fisherman. Shorefast describes itself as “a social enterprise” using business-minded ways to achieve social ends and prosperity. The foundation’s creation is an implicit political and economic statement, with strong paternalistic overtones, about the merits of commerce and the relationship between the rich and the poor. The foundation advocates “a world that is built on a healthy balance between sacred capital (natural, social, cultural) and financial capital.”

Cobb has become an international celebrity of sorts, a sought-after speaker and a powerful physical and philosophical presence on Fogo (where she lives some of the time). The Fogo Island Inn has a movie theatre showing films about her life and work. When I stayed at the inn, I could see her through the dining room window in the evening, a distant figure in a small rowboat a mile or so off the coast, backlit by the setting sun, training for the annual Great Fogo Island Punt Race, which requires rowing for seven miles on the open sea.

It’s too soon to know what the Shorefast Foundation and the Fogo Island Inn will do for Fogo Island. Will social experimentation lead to a new and prosperous future for the islanders? Will the inn destroy an historic and valuable way of life? Can Shorefast and the inn provide better prospects for islanders while preserving precious traditions? Or is the idea of protecting tradition just nonsense, a romantic notion of wealthy “come from aways,” a self-indulgent idea that costs them nothing but could be costly to those who live on Fogo?

Great disparity of wealth has often been viewed as a dangerous social evil. The luxurious Fogo Island Inn, looming over the tiny village of Joe Batt’s Arm, where the median annual income is less than $20,000, calls this disparity to mind. Should those staying at the inn feel uncomfortable with their lot in life? Should Fogo’s islanders be grateful for any help they get?

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