Jacob A. Clere

A Few Thoughts On An Aid Antagonist: Dambisa Moyo

Wednesday evening Dambisa Moyo regaled the Washington, D.C. intelligentsia with a chat about her new book How the West Was Lost. She was reliably controversial, verbally dexterous, and painfully pessimistic. Ultimately, though, I feel most people seriously misunderstand Dr. Moyo. While she does make grandiose predictions and sweeping statements about the decline of the West and about aid’s acrimonious outcomes, her role is not that of problem solver or expert analyzer. Her role is best viewed as conversation pusher, agenda setter, and question inducer. Many of her suggestions are said with a mischievous twinkle in her eye, and more still are explicitly clarified (by her) as being a bit facetious. Let’s consider one of her arguments from her last book, Dead Aid.

In Dead Aid, Moyo suggested that the aid tap to Africa should be completely shut off with five years warning. She did not say this because she literally thinks that a blanket solution like completely shutting off all aid to all of Africa in five years is the best solution to Africa’s development woes. No, she provides it merely as a poignant point to highlight what aid is supposed to be and what it is not supposed to be. The Marshall Plan was a plan (I’m not going to argue here about its efficacy). Under the Marshall Plan, the goals and agenda were very actionable and time-aware. However, most major aid organizations, like USAID and the World Bank, are very much embedded institutions. It is healthy to talk about when the aid tap will shut off, to at least create such expectations. The UK is apparently ending aid to 16 countries in its new budget. It is important for this to be the expectation. It is important for the aid industry to look to examples where international aid has not been a mainstay for development, like in China, Singapore, perhaps Somaliland - there are various examples to look to. Moyo suggests in Dead Aid that she is not against all aid, just most aid and permanent aid. That’s a conversation worth having.

Moyo seemed to most aggravate the audience when she offered advice to decrease governmental interventions into industries and markets, and to increase governmental interventions into industries and markets. Indeed, such advice seems totally contradictory and befuddling. Her claim, as I understood it, is that there is little to no role for government subsidies and a much greater role for sorts of “organizing” regulations. Yes, I cannot say that I am convinced by such arguments. Essentially, she offers advice that is far from actionable. However, her basic point is that the U.S. and Western Europe would benefit from having more farsighted policymakers. Political myopia causes the U.S. to fail at aiming for long-term goals. Indeed, one specific suggestion she offers is longer election cycles. Perhaps, 6 year terms for U.S. presidents and anything longer than 2 years for representatives. It’s not a bad point, but it’s almost as useless as saying that there should be less money in political campaigns. We all know this to be true, but how we accomplish such a thing remains elusive.

Ultimately, I think Moyo tends too much towards populist psychobabble. However, her desire for book sales controversy means that she raises points many establishment types are wary of bringing up. So yes, value Moyo’s controversy insofar as it encourages interesting conversations, but don’t expect her to offer clear solutions.

Aid's Peculiar Paradoxes

My first intellectual engagement with foreign aid came when I was a university sophomore. I was in a development anthropology course. My professor had once spent 6 or so years in Papua New Guinea during the 1970s, undertaking ethnographic research for his dissertation and sometimes doing a bit of consulting work with a World Bank development project. The experience left him frustrated and jaded. From his perspective, the World Bank’s work was largely run by “tourist economists.” My professor believed that thoughtful, long-term, context-specific study was needed before any development prescriptions should even be considered. However, such was not how the project unfolded. To be sure, the World Bank is a very different animal from what it was in the 1970s. Still, I often reflect on many of my professor’s highly contextualized observations. I’d like to share one particular story.

Historically, in the highlands of Papua New Guinea, when an unexpected frost devastated a necessary food supply, a community would be compelled to seek assistance from a neighboring tribe. While these tribes often contested land boundaries, and occasionally raided each other, they still adhered to a long-standing, tacitly accepted relationship that they would not let each other starve. And, because everyone understood the benefits of this arrangement, small skirmishes rarely led to truly bloody conflicts of conquest. The benefits of maintaining a basic peace were simply too great.

Fast-forward to the 1960s and 70s. The World Food Program begins observing that occasional frosts have devastating effects on food supplies in many remote PNG communities. They decide to ease the suffering by flying in helicopters loaded with rice. The villagers are happy because with all the rice they don’t have to bother with neighbor begging. And, after a few years of these rice distributions, many remote communities come to depend upon the WFP as their lifeline during hard times. Their neighboring tribe no longer has any major usefulness. Indeed, because land is ever a scarce resource, their neighbor is now viewed only as an inconvenient encroacher. Armed conflicts begin to increase both in frequency and intensity.

So, what should we learn from this? The World Food Program, despite undertaking activities that appeared necessary and productive, actually provoked tribal conflicts and incentivized paternalistic attitudes. Whoops. Should they have known better? This brings me to my key point - one stated countless times before, but also a point that can never be emphasized enough: context matters.

In order for aid to be effective it must be both economically sensible and context-aware. Contextual specificity is always celebrated, but less often realized. Read the “classic” literature in development studies. Author after author, for decades running, disparage the failure of aid to be context-specific enough. There are many reasons this failure persists. I suppose one involves the opportunity costs of researchers. The most celebrated academics are given constant incentives to generalize, to extrapolate, to promise grand solutions, and to participate in academic “tourism” rather than rigorous local engagement. Some more than others, but consider - would Jeff Sachs be so famous if he had focused his career around becoming an expert on the economics of international aid to Bolivia?

All of that said, I do perceive a substantive shift in our approach to aid. New communications technologies make possible long-distance engagements with projects never before possible. Also, the existence of a cottage industry focused on criticizing aid is forcing aid agencies to more rigorously evaluate their approaches. Aid agencies that aren’t vigilant end-up embarrassed. Also, even some prominent economists, such as Dani Rodrik, emphasize the importance of context. Rodrik’s methodology stipulates “diagnostics before prescription.”

That’s it. That’s my spiel for the day, and my introduction to a new blog focused on mulling over situations where aid produces paradoxical, undesirable, or simply perverse results. Aid can be done well, but it is often done badly. The alchemists of old never succeeded in turning lead into gold, but their foibles eventually produced the science of chemistry. There is a lesson there for the world’s aid alchemists.