Dead Aid Bandwagon

If you are a development nerd, you have probably read ad nauseam about Dambisa Moyo's new book, Dead Aid. In the last few months, there has been an interesting debate happening between different schools of thought. Essentially, Moyo argues that foreign aid to African countries is one of the preeminent root causes of Africa's underdevelopment (for lack of a better word), and that instead of throwing billions of (wasted) dollars into the hands of dicators, African governments should instead be given access to more private finance. 

Having worked at the World Bank and Goldman Sachs, Moyo - who hails from Zambia - offers a refreshing perspective on the aid debate (which is typically dominated by white males... no surprises there, right?)

Her book unleashed an outpouring of commentary - some condemning her views, others wholeheartedly agreeing, and everything in between. I have been tempted to throw in my two cents, but the more I read about it, the more convinced I am that a) everything that could be said, has been said and, b) the debate over whether aid should be stopped or not is such a macro discussion that, ultimately, we're getting stuck at the "50,000 foot" view - and that doesn't really help move the debate forward constructively. Because, as we all know, foreign aid will NOT end - even if you were able to show by a+b=c that aid caused most of Africa's problems, Official Development Aid (ODA) is still a critical foreign policy tool, and to call for its halt is unrealistic.

Anyway.  

Most recently, Francis Fukuyama voiced his opinion on the matter in Slate. He compares Moyo's argument with another prominent African scholar's views, Wangari Maatai. His piece, I thought, actually touches on a couple of really key issues, which most commentary on "Dead Aid" have failed to focus on. Excerpt:

Both women see sub-Saharan Africa's fundamental problem not as one of resources, human or natural, or as a matter of geography, but, rather, as one of bad government. Far too many regimes in Africa have become patronage machines in which political power is sought by "big men" for the sole purpose of acquiring resources—resources that are funneled either back to the networks of supporters who helped a particular leader come to power or else into the proverbial Swiss bank account. There is no concept of public good; politics has devolved instead into a zero-sum struggle to appropriate the state and whatever assets it can control.

This view actually echoes what one of the most prominent French African scholars, Jean Francois Bayart, writes in his book "L'Etat en Afrique: La politique du ventre". In this book, he writes that the "politics of the belly" - which is to say the political culture that is prevalent in Africa whereby rulers seek to accumulate power and possessions -  is not only the fundamental issue that has been plaguing the continent, but also a product of its very particular social, political and economic history. In his book (which I unfortunately don't think has been translated into English), he describes how complex social and political networks arose in the context of colonial and post colonial sub-Saharan Africa, and how the polity that emerged is defined by an intricate interplay between foreign dependency, reliance on local (and often socially constructed) tribal or ethnic identities and leaders' destructive desire to selfishly accumulate resources. 

Of course, given that we're talking about a whole continent, generalizations are very hard to make - so while one can certainly find counter points to Bayart and Fukuyama's argument, there is an element of truth to it, which to me captures the most powerful criticism of Moyo's book: it's not aid per se that's the problem - it's what's being done with it, and how it's being managed. And of course, Moyo knows this. But, as Owen Barder notes:

It seems to me that Dambisa Moyo has set up a false dichotomy between aid and entrepreneurship. Many of the things Moyo would like to see - better access to financial services, a better business environment, lower tariffs - can be (and are) supported by aid. 

It's been frustrating to read Bono's response to Moyo, as well as the reactions from a lot of people "shocked" that Moyo would call for an end to foreign aid. But, if (like me...) you subscribe to the Easterly school of thought that holds that most ODA ends up being horribly wasted and that an entirely new ODA regime needs to come about, then her argument, while virulent and, frankly, aggressive, makes sense. 

Just recently, from (of all places) USA Today:

Two United Nations agencies spent millions in U.S. money on substandard Afghanistan construction projects, including a central bank without electricity and a bridge at risk of "life threatening" collapse. 

In the current context, I think it's great to debate the virtues (or lack thereof) of ODA - however, focusing on that macro question shouldn't be a reason to turn our focus away from the real issue: today, there are millions of aid dollars at work - how do we actually make them work, with a view to incrementally decrease countries' dependence on foreign assistance? 

Oh, aid effectiveness... You are hella elusive.