We also know that there is no country -- anywhere in the world -- that has meaningfully reduced poverty and spurred significant and sustainable levels of economic growth by relying on aid. If anything, history has shown us that by encouraging corruption, creating dependency, fueling inflation, creating debt burdens and disenfranchising Africans (to name a few), an aid-based strategy hurts more that it helps.
It is true that interventions such as the Marshall plan in Europe and the Green Revolution in India played vital roles in economic (re)construction. However, the key and (often ignored) difference between such aid interventions and those plaguing Africa today is that the former were short, sharp and finite, whereas the latter are open-ended commitments with no end in sight. The problem with an open-ended system is, of course, that African governments have no incentive to look for other, better, ways of financing their development.
Mr Sachs knows this; how do I know? He taught me while I was studying at Harvard, during which he propounded the view that the path to long-term development would only be achieved through private sector involvement and free market solutions.
Perhaps what I had not gleaned at that time was that Mr. Sachs' development approach was made for countries such as Russia, Poland and Bolivia, whereas the aid- dependency approach, with no accompanying job creation, was reserved for Africa.
Mr. Sachs chooses to ignore that relying on aid at a time when the United States is facing 10 percent unemployment rate and Germany (another leading donor) could contract by as much as 6 percent, is a fool hardy strategy. The aid interventions that Mr. Sachs lauds as evidence of success are merely band aid solutions that do nothing to lift Africa out of the mire -- leaving the continent alive but half drowning, still unable to climb out on its own.
Yes an aid-funded scholarship will send a girl to school, but we ought not to delude ourselves that such largesse will make her country grow at the requisite growth rates to meaningfully put a dent in poverty. No surprise, then, that Africa is on the whole worse off today than it was 40 years ago. For example in the 1970's less that 10 percent of Africa's population lived in dire poverty -- today over 70 percent of sub-Saharan Africa lives on less than US$2 a day.
There is a more fundamental point -- what kind of African society are we building when virtually all public goods -- education, healthcare, infrastructure and even security -- are paid for by Western taxpayers? Under the all encompassing aid system too many places in Africa continue to flounder under inept, corrupt and despotic regimes, who spend their time courting and catering to the demands of the army of aid organizations.
Like everywhere else, Africans have the political leadership that we have paid for. Thanks to aid, a distressing number of African leaders care little about what their citizens want or need -- after all it's the reverse of the Boston tea-party -- no representation without taxation.
Tuesday, May 26, 2009
In today's Huffington Post, Dambisa Moyo obliquely accuses Jeffrey Sachs of racism in his approach to African aid: