Thursday, June 07, 2007

For God's Sake, Please Stop

Kenyan economist James Shikwati is interviewed in Der Spiegel. And he says what many people think about the development assistance and international NGO racket but are quite afraid to say.

SPIEGEL: Mr. Shikwati, the G8 summit at Gleneagles is about to beef up the development aid for Africa...

Shikwati: ... for God's sake, please just stop.

SPIEGEL: Stop? The industrialized nations of the West want to eliminate hunger and poverty.

Shikwati: Such intentions have been damaging our continent for the past 40 years. If the industrial nations really want to help the Africans, they should finally terminate this awful aid. The countries that have collected the most development aid are also the ones that are in the worst shape. Despite the billions that have poured in to Africa, the continent remains poor.

SPIEGEL: Do you have an explanation for this paradox?

Shikwati: Huge bureaucracies are financed (with the aid money), corruption and complacency are promoted, Africans are taught to be beggars and not to be independent. In addition, development aid weakens the local markets everywhere and dampens the spirit of entrepreneurship that we so desperately need. As absurd as it may sound: Development aid is one of the reasons for Africa's problems. If the West were to cancel these payments, normal Africans wouldn't even notice. Only the functionaries would be hard hit. Which is why they maintain that the world would stop turning without this development aid.

SPIEGEL: Even in a country like Kenya, people are starving to death each year. Someone has got to help them.

Shikwati: But it has to be the Kenyans themselves who help these people. When there's a drought in a region of Kenya, our corrupt politicians reflexively cry out for more help. This call then reaches the United Nations World Food Program -- which is a massive agency of apparatchiks who are in the absurd situation of, on the one hand, being dedicated to the fight against hunger while, on the other hand, being faced with unemployment were hunger actually eliminated. It's only natural that they willingly accept the plea for more help. And it's not uncommon that they demand a little more money than the respective African government originally requested. They then forward that request to their headquarters, and before long, several thousands tons of corn are shipped to Africa ...

SPIEGEL: ... corn that predominantly comes from highly-subsidized European and American farmers ...

Shikwati: ... and at some point, this corn ends up in the harbor of Mombasa. A portion of the corn often goes directly into the hands of unscrupulous politicians who then pass it on to their own tribe to boost their next election campaign. Another portion of the shipment ends up on the black market where the corn is dumped at extremely low prices. Local farmers may as well put down their hoes right away; no one can compete with the UN's World Food Program. And because the farmers go under in the face of this pressure, Kenya would have no reserves to draw on if there actually were a famine next year. It's a simple but fatal cycle.

SPIEGEL: If the World Food Program didn't do anything, the people would starve.

Shikwati: I don't think so. In such a case, the Kenyans, for a change, would be forced to initiate trade relations with Uganda or Tanzania, and buy their food there. This type of trade is vital for Africa. It would force us to improve our own infrastructure, while making national borders -- drawn by the Europeans by the way -- more permeable. It would also force us to establish laws favoring market economy.

SPIEGEL: Would Africa actually be able to solve these problems on its own?

Shikwati: Of course. Hunger should not be a problem in most of the countries south of the Sahara. In addition, there are vast natural resources: oil, gold, diamonds. Africa is always only portrayed as a continent of suffering, but most figures are vastly exaggerated. In the industrial nations, there's a sense that Africa would go under without development aid. But believe me, Africa existed before you Europeans came along. And we didn't do all that poorly either.

Read the whole thing. The first axiom to know about development aid is that it is about poor people in rich countries lining the pockets of rich people in poor countries. It is about taxes being funneled to corrupt elites in the Third world. The second thing to remember about development aid is that it is like an Alice in Wonderland looking-glass. On one side of the glass are the international aid bureaucrats. Mirroring them on the other side are their "official counterparts". Chiefs of aid missions deal with the Minister, those lower down deal with the Deputy Minister and so on. By the time you get to the field, you have locally hired NGO workers who deal with some town mayor or chief. All along this via dolorosa the corrupt elites will be taking their slice. Snip. Snip. Snip. The best international aid managers can find ways to cut the attrition, but they also understand that if they stop it completely the entire chain will simply freeze up. So they compromise and put the Minister's wife on salary, sponsor a scholarship for his children to the Sorbonne, write glowing letters of recommendation for the Deputy Minister's thuggish son who wants to attend the Charlie Chan Driving School in some European city where wine flows free and skirts are short.

Many people start off in the international aid bureaucracy idealistically. But by the 10th year of their careers, cynicism has typically eaten into their souls. One "technical expert" travelled the world making recommendations to any of the dozen ongoing projects of a certain type being funded at any one time. He had a pre-written report composed in Microsoft Word which he did for his first project. He simply did a search and replace change on his boilerplate report to suit each country, changing the name of the project and country on what was otherwise the identical report. He wasn't dishonest, at least not in his heart. "The Minister never reads the reports anyway," he said, "it's all window-dressing".

The two things First World countries can do to help the Third World are: a) lower trade barriers; b) keep Third World bureaucrats from relocating into the First World with their stolen loot. Many such officials buy investments or emigrate to the US, Australia or Europe with what they steal from their official coffers and from official aid. If all officials above the rank of Deputy Minister were told they had to voluntarily and legally undertake not to own any property in a First World country or emigrate to it, or possess any offshore account without publishing its details in an international newspaper of record, none but the honest would accept it. This requirement would force Third World government officials to share the fate of their people, rather like lashing a captain to the wheel of his ship.

The development aid world is a sad and cynical place. It is maintained, I think, as mode of bribery for Third World government officials and a mode of "outdoor relief" for university academics. But even there it fails. Third World bureaucrats know it has become so institutionalized that they will get their cut no matter what they do. The aid bureaucracy's reason for existence has become to simply pump out money. And pump it out it will, no matter how badly behaved the counterpart. Look at Gaza. Give me an al-Qaeda bagman with a sackful of money and he will beat the World Bank in terms of effective influence any time. Nor do I think the "development" world does academia much good, except insofar as it provides an incentive to mediocrity. Professor Shikwati is right. It ain't doing any good.


Blogger eggplant said...

Government and NGO aid to Africa has been a disaster. If you have any doubts, read Paul Theroux's "Dark Star Safari: Overland from Cairo to Capetown".

Tough love (leave them to sort out their own problems) is the best medicine for Africa.

6/07/2007 03:25:00 PM  
Blogger F said...

For 20 years I lived in Africa, working in American embassies, side-by-side with American technocrats (mostly from universities) whose job was to manage foreign assistance programs. The first point that came across to me is that an assistance bureaucrat is measured by the size of his budget, not its effectiveness. A poor manager with a $6 million budget was twice as important as a good manager with a $3 million budget. The next thing I noticed was that the director of the aid program usually lived in accommodations as grand as the ambassador's, his car was as large (but did not sport the American flag on the fender), and his office was usually as splendid. He frequently talked directly to the president, and if he didn't he certainly tried to do so whenever he could. The third thing I noticed is that the aid mission's reports were written in a way that someone without the magic decoding ring could never understand. That's when I began to look at the side effects of the assistance -- corruption, depression of local markets, and other things that don't make it into the reporting. I left Africa disillusioned with foreign assistance but understanding the constituency for continuing the program is African elites and inside-the-beltway types (both civil servants and contractors), all of whom have good contacts on Capitol Hill and thus can count on continuation of the program. On top of that there is a cadre of international elites who benefit from foreign aid (many of them work with the UNDP and other UN agencies and derive their very comfortable existence from foreign assistance programs. All of my experience in the third world (a total of 26 years) leads me to the same conclusion as the Kenyan economist: foreign assistance does not do what the taxpayers back home are told it is doing and it establishes some very undemocratic precedents, relationships and dependencies. Ending aid is not tough love as much as it is putting an end to the corrupting influence of gigantic wealth imbalances. F

6/07/2007 06:07:00 PM  
Blogger Ari Tai said...

+1 for Dark Star.

I don't know how the left can read these and other stories of how their uneducated good intentions have killed millions and wasted the lives of billions and not change their allegiance to the realists.

Even the Irish famine was caused by (English) government interference in the markets, and later well intentioned attempts to fix the original mistakes just made it worse.

I do hope a special place in hell is reserved for those so blind.

Perhaps it we just gave money. But things are now so bad that there's no civil society to protect the helpless if they found themselves in possession of same, and no hope of getting the individuals/masses the weapons they need to enforce civility themselves. If the poor and suffering could vote with their pocketbook this would all work its way out in short order.

A pity. I'd vote for someone who explained all of this and what they were going to do to fix this. Unfortunately you can't fix foreign aid without hurting the guilds and constituencies (and special interests) in our own country. So odds are small and nil of us contributing to their salvation.

Things are so bad that we now think that the inexpensive computer for every child by the ambassador's brother is actually a good thing.

What an upside down world we live in.

6/08/2007 01:25:00 AM  
Blogger LarryD said...

Ari tai, some percentage of the Left (I think it's rather high by now) don't really give a &@## about the consequences, as long as they can say "see how compassionate we are", it's all about what makes them feel good, don't bother us with reality.

6/08/2007 06:04:00 AM  
Blogger Yashmak said...

"I don't know how the left can read these and other stories of how their uneducated good intentions have killed millions and wasted the lives of billions and not change their allegiance to the realists. " - Ari Tai

They believe they already ARE the realists, so they don't bother reading these stories in the first place, I suspect.

That's part of the problem.

6/08/2007 07:56:00 AM  
Blogger Mr. Spog said...

This comment has been removed by the author.

6/08/2007 05:30:00 PM  
Blogger Mr. Spog said...

That's an interesting idea about "lashing the captains to their wheels" ... It might be a good idea in richer countries as well, in view of the elites' abandonment of national in favor of transnational loyalties. (But then where would we recruit our transnational bureaucrats?)

6/08/2007 05:31:00 PM  
Blogger Cosmo said...

This comment has been removed by the author.

6/08/2007 08:00:00 PM  
Blogger Cosmo said...

"Do you have an explanation for this paradox?"

I do. It's called subsidizing failure or, in the therapeutic jargon of the modern West, 'enabling'.

Anyone with a ne'er-do-well relative understands this. But, of course, our so-called leadership classes know better.

6/08/2007 08:01:00 PM  
Blogger USpace said...

Excellent piece. The NGOs will never stop, the Leaders of Africa would have to band to together and just say NO to any more aid. Fat chance...

absurd thought -
God of the Universe says
start a human rights group

enjoy tax-free status
hire friends earn a nice living

6/08/2007 10:05:00 PM  
Blogger said...


Many thanks for that post -- we would not have found that July 4, 2005 Der Spiegel piece otherwise. Evidently they put a series together, "Too Much of a Good Thing", in preparation for the 2005 G-8 conference. E.g., see this excellent survey article: Choking on Aid Money in Africa.

6/09/2007 09:25:00 AM  

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