Forum 6

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T H E B L O G 06/26/2009 05:12 am ET | Updated May 25, 2011

Aid Ironies: A Response to Jeffrey Sachs By Dambisa Moyo

Ahead of the publication of my book Dead Aid, an author friend of mine cautioned me about responding to opponents

who found it necessary to color their criticism with personal attacks. This, he argued, is a tried and tested way of side-

stepping the issues and providing a smoke screen when faced with a valid argument.

Jeffrey Sachs’s latest posting is just the latest example of using this tactic to obfuscate the facts and avoid addressing

the fundamental issues regarding aid’s manifest failure to deliver on its promise of generating growth and alleviating

poverty in Africa.

And though I am responding here in order to refute his arguments, as a fellow economist, I intend to rely on logic and

evidence to make my argument and show Mr. Sachs the professional courtesy that he has failed to show to me.

Development is not that hard. We now have over 300 years of evidence of what works (and what doesn’t) in

increasing growth, alleviating poverty and suffering. For example, we know that countries that finance development

and create jobs through trade and encouraging foreign (and domestic) investment thrive.

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.

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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.

In conclusion let me respond to four of Mr. Sachs’ specific points:

1) Regarding Rwanda: It is absolutely true that Rwanda depends on substantial amounts of foreign aid. The point is

that President Paul Kagame is working tirelessly to wean his county off of aid dependency (which is precisely the

approach to exiting aid that I have been arguing for). To focus on the point that Rwanda relies on aid is to miss the

more interesting point: Here in a country where over 70 percent of the government budget is aid supported, the

leadership is pushing for less, not more aid — what is it Mr. Sachs that President Kagame sees that you do not see?

Let’s face it, the leadership could guilt-trip us all into giving it even more aid after the international community turned

its back on the country at its time of need during the 1994 genocide, yet it does not.

2) Mr. Sachs claims that I, alongside the compassionate Bill Easterly, lump all kinds of [aid] programs in one

undifferentiated mass. I would point Mr. Sachs to page 7 of my book which explicitly makes a delineation between

different types of aid.

3) Regarding the “countless” examples in which countries have benefited from aid then graduated: Here I would

point Mr. Sachs to page 37 of my book to a discussion of these countries; The difference again with these success

stories is that they did not rely on aid to the degree and length that African countries do today. Moreover, they very

quickly adopted the market-based, job-creating strategies outlined in my book, for which Mr. Sachs seems to have an

apparent aversion, in favour of the status quo.

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4) Finally, with respect to Mr. Sachs’ remark that I would see nothing wrong with denying US$10 in aid to an African

child for an anti-malarial bed net — even labeling me as cruel; I say, if working towards a sustainable solution where

Africans can make their own anti-malaria bed-nets (thereby creating jobs for Africans and a real chance for continents

economic prospects) rather than encouraging all and sundry to dump malaria nets across the continent (which

incidentally, put Africans out of business), then I am guilty as charged. Don’t forget that the over 60 percent of Africans

that are under the age of 24 need jobs not sympathy.

As a final plea, I urge Mr. Sachs to heed the words of his former boss, Mr. Kofi Annan when he says “The determination

of Africans, and genuine partnership between Africa and the rest of the world, is the basis for growth and

development.”

Dambisa Moyo is the author of Dead Aid: Why Aid is Not Working and How There is a Better Way for Africa (Farrar

Straus & Giroux); www.dambisamoyo.com

Dambisa Moyo

Author, ‘Dead Aid: Why Aid is Not Working and How There is a Better Way for Africa’

M O R E :

Dead Aid Jeffrey Sachs Aid To Africa Dambisa Moyo Africa

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