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Tuesday, March 28, 2006

Jeffrey Sachs: Depoliticize Development Aid

Jefferey Sachs argues that development aid and political goals should be separated, aid should not be contingent upon the attainment of political objectives set by donor countries:

Development Aid for Development’s Sake, by Jeffrey D. Sachs, Project Syndicate: Almost daily, the United States and Europe brandish threats to impose economic sanctions or cut off development assistance unless some vulnerable government accepts their political strictures. The most recent threats are towards the new Hamas-led government in Palestine. Other recent examples include threats vis-à-vis Chad, Ethiopia, Haiti, Kenya, Bolivia, Uganda, and long-standing sanctions against Myanmar.

To understand why requires taking a long-term view of geopolitics, particularly the gradual decline of US and European global domination. Technology and economic development are proliferating across ... the developing world, while the spread of literacy and political awareness ... made national self-determination by far the dominant ideology of our age... Nationalism continues to produce powerful political “antibodies” to American and European meddling in other countries’ internal affairs.

The failure to understand this lies behind repeated US foreign policy debacles in the Middle East... The US naively continues to view the Middle East as an object of manipulation, whether for oil or for other purposes. In the Middle East, the Iraq war is widely interpreted as a war for US control of Persian Gulf oil – a rather plausible view... Only incredible hubris and naiveté could bring US (and UK) leaders to believe that Western troops would be greeted as liberators rather than as occupiers.

The politicization of foreign aid reflects the same hubris. Even as the US rhetorically champions democracy in the Middle East, its first response to Hamas’s victory was to demand that the newly elected government return $50 million in US aid. Hamas’s doctrines are indeed unacceptable for long-term peace... But cutting aid is likely to increase turmoil rather than leading to an acceptable long-term compromise between Israel and Palestine. ... An aid cutoff should be a policy of last resort, not a first strike.

Aid cutoffs regularly fail to produce desired political results for at least two reasons. First, neither the US nor European countries have much standing as legitimate arbiters of “good governance.” Rich countries have long meddled, often with their own corruption and incompetence, in the internal affairs of the countries that they now lecture. The US preaches “good governance” in the shadow of an unprovoked war, congressional bribery scandals, and windfalls for politically connected companies like Halliburton.

Second, US and European threats to cut off aid or impose sanctions are in any case far too weak to accomplish much besides undermining already unstable and impoverished countries. Consider the recent threats to cut Ethiopia’s aid, which is on the order of $15 per Ethiopian per year – much of it actually paid to US and European consultants. It is sheer fantasy to believe that the threat of an aid cutoff would enable the US and Europe to influence the course of Ethiopia’s complex internal politics. ...

Indeed, the track record of on-again-off-again aid is miserable. Stop-and-go aid has left Haiti in an unmitigated downward spiral. The decade-long sanctions against Myanmar have not restored Aung San Suu Kyi to power, but have deepened the disease burden and extreme poverty... None of this is to suggest that the US and Europe should abide every move by every corrupt dictator. But realism in international economic affairs requires accepting that ... most reliable path to stable democracy is robust and equitable economic progress over an ample period of time.

The overwhelming standard for supplying official development assistance should therefore be whether official assistance actually promotes economic development. ... Can the aid be monitored and measured? Is it being stolen? Is it supporting real development needs, such as growing more food, fighting disease, or building transport, energy, and communications infrastructure?

If development aid can be directed to real needs, then it should be given to poor and unstable countries, knowing that it will save lives, improve economic performance, and thus also improve the long-term prospects for democracy and good governance.

    Posted by on Tuesday, March 28, 2006 at 12:06 AM in Economics, Policy | Permalink  TrackBack (0)  Comments (12)


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