Download to read offline
![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.](https://image.slidesharecdn.com/172019realizeitcontentdeliveryhttpsapus-221224050958-771ddeaa/75/172019-Realizeit-ContentDeliveryhttpsapus-realizeitho-docx-13-2048.jpg)
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172019 Realizeit ContentDeliveryhttpsapus.realizeitho.docx
- 1. 1/7/2019 Realizeit ContentDelivery https://apus.realizeithome.com/RealizeitApp/ContentDelivery.as px?Token=%2bsMFLZSXaJhmeXwREbE%2bGmTZYbwg0rvqrh Y3cYTtFuJXpr1mlyU…1/6 LESSON 6: NEW FORCES Introduction In this lesson we will look at opportunities and challenges to development. We will gain a different understanding and perspective of this topic based on experts’ views. The assigned readings will provide further explanation and you will come to understand how different their views on development are. New Forces in Development How do bad leaders, corruption, bad institutions and policies, and even rich nations exacerbate problems through high barriers to trade? What are possible solutions? Some solutions might include forgiving debt (but we should recognize that this is not the complete solution), as well as removing barriers to global integration, encouraging local regional trade, eliminating tariffs and quotas for highly indebted nations, and fostering economic freedom /reforms. The Global Policy Forum website summarizes many of these factors, and posts articles that focus on many important issues in development, as summarized in the image below. Please click on the link in the Reading and Resources folder to access the Global Policy Forum website
- 2. section on Povertyand Development in Africa in preparation for our discussion this week. back to top Finish and record javascript:void(0) 1/7/2019 Realizeit ContentDelivery https://apus.realizeithome.com/RealizeitApp/ContentDelivery.as px?Token=%2bsMFLZSXaJhmeXwREbE%2bGmTZYbwg0rvqrh Y3cYTtFuJXpr1mlyU… 2/6 In making our assessment of economics and the international system, we must also recognize the impact of culture on economic performance. Culture includes the peculiarities of local history, social structure, psychology, religion, norms, and politics. While the apostles of globalization contend that market forces overwhelm everything else, others such as Paul Krugman and Jeffrey Sachs powerfully counter-argue that geography is itself a limit to globalization. Just think of what it means to be a landlocked country, and how much extra it costs to bring goods to ports for trade in an open, competitive system. Add to these complications of physical geography other factors such as climate, tropical location, local traditions, and the picture becomes complicated quickly. If we include the dynamics of culture and geography, we begin to understand why traditional macro-economic measures may have less of an impact than many previously assumed they would in the international system.
- 3. What are theeffects of economic globalization on poor countries? Since the backlash demonstrations against globalization at the ministerial meetings in Seattle and Genoa in the late 1990s, this question has entered public debate. Neither globalization nor protests, however, are new. Indeed, throughout the history of development economics, attention to the implications of international integration has been of prime interest, especially regarding whether foreign trade and investment reduce or increase inequality. Now international financial “crises” and issues of global economic governance also pervade the debate. 1/3 Culture, Globalization, and Development ‹ › The Role of Foreign Aid Dr. Moyo, in her own words, has called aid to Africa a "disaster" (Moyo, n.d.). In an interview with Forbes magazine, Dr. Moyo discussed how she envisions the aid industry changing in the years ahead. She states, "Fundamentally, an aid model hurts incentives and discourages people from doing the right thing. And that is clearly what has happened across Africa. Am I sanguine that the model is somehow going to change? No, because there are so many vested interests in keeping things as they are today" (Pereira 2011). back to top Finish and record
- 4. javascript:void(0) 1/7/2019 Realizeit ContentDelivery https://apus.realizeithome.com/RealizeitApp/ContentDelivery.as px?Token=%2bsMFLZSXaJhmeXwREbE%2bGmTZYbwg0rvqrh Y3cYTtFuJXpr1mlyU…3/6 1 2 The advanced industrial states, including Europe and the United States, are facing difficult choices about how much aid to allocate in light of increasingly pressing domestic issues. Dr. Moyo believes that as governments prioritize domestic issues, such as education, pension reform, infrastructure, etc., that few resources will be left to allocate to development. As a result, African governments will have to look for other means of development assistance beyond aid. At the same time, however, Dr. Moyo has publicly stated that she remains optimistic that change will eventually take hold. Her reasons for optimism center on two primary factors: These arguments can be put into greater perspective by examining where most foreign aid is currently allocated. When we look at data from the Organization for Economic Cooperation and Development (OECD), we see that only one-quarter of all official development assistance goes to the world's poorest countries (see charts below). The biggest share goes to low-middle income countries, not the world's poorest states, as one might assume.
- 5. back to top Finishand record javascript:void(0) 1/7/2019 Realizeit ContentDelivery https://apus.realizeithome.com/RealizeitApp/ContentDelivery.as px?Token=%2bsMFLZSXaJhmeXwREbE%2bGmTZYbwg0rvqrh Y3cYTtFuJXpr1mlyU… 4/6 Knowledge Check Question 1 When we look at data from the Organization for Economic Cooperation and Development (OECD), how much of all official development assistance goes to the world's poorest countries? 1 back to top Finish and record https://apus.realizeithome.com/RealizeitApp/ContentDelivery.as px?Token=%2bsMFLZSXaJhmeXwREbE%2bGmTZYbwg0rvqrh Y3cYTtFuJXpr1mlyUE%2brhp76JU5GD5HKJ4m1i8dT%2buHP S%2fRtkM%2bTy5eTj46%2b0O%2bBYTc%2f3gH%2bsv23FW MeB0MbKIhudu69CQQc0gd7jMmhT8eNHbMxz4uUgeyiywF9a Fvr7j8UjqKJ%2fD4zhBzlto%2bwE3GymXWAsNw6Gz7rolCYQ 3BI95QAW2XScpyDsq%2bfwn3w8sPb1il9eu6fpJx%2fZEibYbK
- 6. 8y0RPFt7uJtjq3eIIHVZEJ5Yxu2YUkkJZNn5TlXtDobnG66qQV 9U9etxFafYB5zCluVYYWnsi8NRYjsF5fJgzStY5rOXWlRkPTQ YTpmJBOYm3DKfW2rmppX76p6DFXOMcrFYXmtV3sAlKDslr X8%2bm9bMl9nO4QKNYX9T1yBexYHg0rfVDxuCLn%2f2mC8 d2Q2S0AT89P9LUnfin%2fI%2bela2kUAeotJnZENZzHd8BCer0 kGwqBKxOc%3d javascript:void(0) 1/7/2019 Realizeit ContentDelivery https://apus.realizeithome.com/RealizeitApp/ContentDelivery.as px?Token=%2bsMFLZSXaJhmeXwREbE%2bGmTZYbwg0rvqrh Y3cYTtFuJXpr1mlyU…5/6 I don't know One attempt You answered 0 out of 0 correctly. Asking up to 2. One-quarter Three-quarters Half Submit answer Conclusion In conclusion, we begin this section with less theory and more conjecture than we have used in previous weeks. We will discuss Dr. Moyo's position, along with the positions of Dr. Jeffrey Sachs and Dr. William Easterly, in the forum this week. The reading will shed light on how divergent their views on development are. Whose argument do you find the most persuasive and why?
- 7. Does each economistadequately account for the complexities in the process of development? Do they adequately account for country-specific factors that might vary across Africa? These are some questions to ask yourselves as you complete the reading this week on the development debate. back to top Finish and record javascript:void(0) 1/7/2019 Realizeit ContentDelivery https://apus.realizeithome.com/RealizeitApp/ContentDelivery.as px?Token=%2bsMFLZSXaJhmeXwREbE%2bGmTZYbwg0rvqrh Y3cYTtFuJXpr1mlyU… 6/6 References Moyo, Dambisa. N.D. “Aid Ironies: A Response to Jeffrey Sachs.” The World Post. Pereira, Eva. 2011. “Dambisa Moyo: An Economist with a Vision.” Forbes, April 19. Image Citations "Chart that shows Average Portion of ODA Received between 1970-2012" by Globalissues.org. "Chart that shows Share of ODA Aid Over Time" by Globalissues.org.
- 8. back to top Finishand record javascript:void(0) 1/7/2019 Aid Ironies: A Response to Jeffrey Sachs | HuffPost https://www.huffingtonpost.com/dambisa-moyo/aid-ironies-a- response-to_b_207772.html 1/4 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.
- 9. And though Iam 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
- 10. is, of course,that African governments have no incentive to look for other, better, ways of financing their development. https://pr.ybp.yahoo.com/cj/cd/3_U- dlV3o9fQZPUENksyVmiyI75JP205sHLgcVwjLtT9sDTnCZ61B Dlomb36g-- CWWxwMzIbRrba36qZi6gtJwe2H6E620svos5lJc45sbL6Xb5GN rI_yZzl-wElW-vRQAR- JWrEYqk3c76eHEgTAZM3Lx_RegCT1zpWIMvuQbQ/rurl/https ://adclick.g.doubleclick.net/pcs/click?xai=AKAOjsu5PVXgy2ny Ys8LYqankpaWUk4aK4Tx5qeg5XaaL- sf2Bz7JTujCL5xeqA15QNxc3SPUlY- sKi3zNTIGDUQI4p0d5Edt9CSzbh4usJ0XyFEMKjIzh7lDSRmH ed_X2fBynCsOlG7dn8c&sai=AMfl-YRG- 9JRzr05GrPiUCNKXqVz1OXnYACXCw7lamZWziTpmT3AOsi bi1iL71gdDb9f- 6GnW8pveHhuxMv0rRAIDuTBQUxXgVry0WXcElI9rd2t&sig= Cg0ArKJSzDhFHZrFEYBmEAE&urlfix=1&adurl=https://d.agkn .com/pixel/2389/%3Fche%3D2398844422%26col%3D20630519, 1166222,221861043,412381987,97227995%26l1%3Dhttps://ww w.potterybarn.com/shop/rugs-windows/custom- rugs/%3Fbnrid%3D3350601%26cm_ven%3Dtrgtddsplay%26cm _cat%3DN7140.8578.YAHOOINC%26cm_pla%3Dplacement%2 6cm_ite%3D221861043 https://www.huffingtonpost.com/author/dambisa-moyo http://www.huffingtonpost.com/jeffrey-sachs/aid- ironies_b_207181.html https://www.huffingtonpost.com/author/dambisa-moyo http://adinfo.aol.com/ https://www.huffingtonpost.com/
- 11. https://facebook.com/share.php?u=https://www.huffingtonpost.c om/dambisa-moyo/aid-ironies-a-response-to_b_207772.html https://twitter.com/share?text=Aid+Ironies%3A+A+Response+t o+Jeffrey+Sachs&url=https://www.huffingtonpost.com/dambisa -moyo/aid-ironies-a-response- to_b_207772.html&via=theworldpost&hashtags= mailto:?subject=Aid%20Ironies:%20A%20Response%20to%20J effrey%20Sachs&body=Article:%20https://www.huffingtonpost. com/dambisa-moyo/aid-ironies-a-response-to_b_207772.html 1/7/2019 Aid Ironies:A Response to Jeffrey Sachs | HuffPost https://www.huffingtonpost.com/dambisa-moyo/aid-ironies-a- response-to_b_207772.html 2/4 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
- 12. much as 6percent, 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
- 13. need — afterall 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.
- 14. 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. https://facebook.com/share.php?u=https://www.huffingtonpost.c om/dambisa-moyo/aid-ironies-a-response-to_b_207772.html https://twitter.com/share?text=Aid+Ironies%3A+A+Response+t o+Jeffrey+Sachs&url=https://www.huffingtonpost.com/dambisa -moyo/aid-ironies-a-response- to_b_207772.html&via=theworldpost&hashtags= mailto:?subject=Aid%20Ironies:%20A%20Response%20to%20J effrey%20Sachs&body=Article:%20https://www.huffingtonpost. com/dambisa-moyo/aid-ironies-a-response-to_b_207772.html 1/7/2019 Aid Ironies: A Response to Jeffrey Sachs | HuffPost https://www.huffingtonpost.com/dambisa-moyo/aid-ironies-a- response-to_b_207772.html 3/4 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
- 15. say, if workingtowards 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
- 16. You May Likeby TaboolaSponsored Links HoneyHoney Wise BreadWise Bread Popdust for HelloFreshPopdust for HelloFresh SmileDirectClubSmileDirectClub College AveCollege Ave Total Battle - Online Strategy GameTotal Battle - Online Strategy Game You're Probably Overpaying at Amazon – This Genius Trick Will Fix ThatYou're Probably Overpaying at Amazon – This Genius Trick Will Fix That The Highest Paying Cashback Card Has Hit The MarketThe Highest Paying Cashback Card Has Hit The Market I Tried HelloFresh: Here's Why I'm Never Going BackI Tried HelloFresh: Here's Why I'm Never Going Back Haven't Considered Invisible Aligners Yet? Here's Why You ShouldHaven't Considered Invisible Aligners Yet? Here's Why You Should 3 Minutes To Figure Out Your Best Options For a Student Loan3 Minutes To Figure Out Your Best Options For a Student Loan Play This Strategy For 3 Minutes And See Why Everyone Is AddictedPlay This Strategy For 3 Minutes And See Why
- 17.
- 18.
- 19. com/dambisa-moyo/aid-ironies-a-response-to_b_207772.html 1/7/2019 Aid Ironies| HuffPost https://www.huffingtonpost.com/jeffrey-sachs/aid- ironies_b_207181.html 1/6 T H E B L O G 06/24/2009 05:12 am ET | Updated May 25, 2011 Aid Ironies By Jeffrey Sachs The debate about foreign aid has become farcical. The big opponents of aid today are Dambisa Moyo, an African-born economist who reportedly received scholarships so that she could go to Harvard and Oxford but sees nothing wrong with denying $10 in aid to an African child for an anti-malaria bed net. Her colleague in opposing aid, Bill Easterly, received large-scale government support from the National Science Foundation for his own graduate training. I certainly don’t begrudge any of them the help that they got. Far from it. I believe in this kind of help. And I’d find Moyo’s views cruel and mistaken even she
- 20. did not getthe scholarships that have been reported (Easterly mentioned his receipt of NSF support in the same book in which he denounces aid). I begrudge them trying to pull up the ladder for those still left behind. Before peddling their simplistic concoction of free markets and self-help, they and we should think about the realities of life, in which all of us need help at some time or other and in countless ways, and even more importantly we should think about the life-and-death consequences for impoverished people who are denied that help. Nine million children die each year of extreme poverty and disease conditions which are almost all preventable or treatable or both. Impoverished countries, with impoverished governments, can’t solve these problems on their own. Yet with help they can. The Global Fund to Fight AIDS, TB, and Malaria, and the Global Alliance on Vaccines and Immunizations are both saving lives by the millions, and at remarkably low cost. Goldman Sachs, Ms. Moyo’s former employer, gives out more in annual bonuses to its workers than the entire rich
- 21. https://www.huffingtonpost.com/author/jeffrey-sachs https://www.huffingtonpost.com/author/jeffrey-sachs http://adinfo.aol.com/ https://www.huffingtonpost.com/ https://facebook.com/share.php?u=https://www.huffingtonpost.c om/jeffrey-sachs/aid-ironies_b_207181.html https://twitter.com/share?text=Aid+Ironies&url=https://www.hu ffingtonpost.com/jeffrey-sachs/aid- ironies_b_207181.html&via=theworldpost&hashtags= mailto:?subject=Aid%20Ironies&body=Article:%20https://www. huffingtonpost.com/jeffrey-sachs/aid-ironies_b_207181.html 1/7/2019 Aid Ironies| HuffPost https://www.huffingtonpost.com/jeffrey-sachs/aid- ironies_b_207181.html 2/6 world gives to the Global Fund each year to help save the lives of poor children. And when Goldman Sachs got into financial trouble it got bailed-out by the US Government. Rich people have an uncanny ability to oppose aid for everybody but themselves. Recently Paul Kagame, President of Rwanda, wrote an op-ed for the Financial Times praising Moyo’s fresh thinking. This is extraordinary. His government
- 22. has depended onaid for more than a decade. Nearly half the budget revenues currently come from aid. Rwanda currently imports around $800 million of merchandise each year, but only earns $250 million or so in exports. So how does it do it? Aid, of course, helped to pay for around $450 million of the imports. Without foreign aid, Rwanda’s pathbreaking public health successes and strong current economic growth would collapse. Kagame’s op-ed did not help FT readers to understand this. Americans are predisposed to like the anti-aid message. They believe that the poor have only themselves (or perhaps their governments) to blame. They overestimate the actual aid from the US by around thirty times, so they imagine that vast sums are flowing to Africa that are then squandered. Many believe, typically in private, that by saving African children we would be creating a population explosion, so better to let the kids die now rather than grow up hungry. (I’m asked about this constantly, usually in whispers, after lectures). They don’t
- 23. understand the mostbasic point of worldwide experience: when children survive rather than die in large numbers, households choose to have many fewer children, in fact more than compensating for the decline in child mortality. Africa’s high child mortality is ironically a core reason why Africa’s population is continuing to soar rather than stabilize as in other parts of the world. Of course, most Americans know little about the many crucially successful aid efforts, because Moyo, Easterly, and others lump all kinds of programs - the good and the bad - into one big undifferentiated mass, rather than helping people to understand what is working and how it can be expanded, and what is not working, and should therefore be cut back. Nor do Americans hear that many poor countries graduate from the need for aid over time, precisely because aid programs help to spur economic growth and successfully prepare countries to tackle future priorities. US aid to India for increased food production in the
- 24. 1960s paved theway for India’s growth takeoff afterwards. There are countless other examples in which countries have benefited from aid and then graduated, including Korea, Malaysia, Taiwan, Israel, and others. Egypt is on that path today, and Rwanda, Tanzania, Ghana, and others will be as well if both donors and recipients carry forward with a sensible assistance strategies. https://facebook.com/share.php?u=https://www.huffingtonpost.c om/jeffrey-sachs/aid-ironies_b_207181.html https://twitter.com/share?text=Aid+Ironies&url=https://www.hu ffingtonpost.com/jeffrey-sachs/aid- ironies_b_207181.html&via=theworldpost&hashtags= mailto:?subject=Aid%20Ironies&body=Article:%20https://www. huffingtonpost.com/jeffrey-sachs/aid-ironies_b_207181.html 1/7/2019 Aid Ironies | HuffPost https://www.huffingtonpost.com/jeffrey-sachs/aid- ironies_b_207181.html 3/6 Here are some of the most effective kinds of aid efforts: support for peasant farmers to help them grow more food, childhood vaccines, malaria control with bed nets and medicines, de- worming, mid-day school meals, training and salaries for
- 25. community health workers,all- weather roads, electricity supplies, safe drinking water, treadle pumps for small-scale irrigation, directly observed therapy for tuberculosis, antiretroviral medicines for AIDS sufferers, clean low-cost cook stoves to prevent respiratory disease of young children. Shipment of food from the US is a kind of aid that should be cut back, with more attention on growing local food in Africa. Out of every $100 of US national income, our government currently provides the grand sum of 5 cents in aid to all of Africa. Out of that same $100, we have found around $10 for the stimulus package and bank bailouts and another $5 for the military. It is not wonderful that what has caught the public’s eye are proposals to cut today’s 5 cents to 4 or 3 cents or perhaps zero. Follow Jeffrey Sachs on Twitter: www.twitter.com/JeffDSachs Director, Center for Sustainable Development and Sustainable Development
- 26. Solution s Network M OR E : Malaria Foreign Aid Wealth Dambisa Moyo Africa This Blogger’s Books and Other Items from... The Price of Civilizatio n: Reawake ning American
- 27. Virtue and Prosperit y The Price ofCivilization: Reawakening American Virtue and Prosperity by Jeffrey D. Sachs https://www.twitter.com/JeffDSachs https://www.huffingtonpost.com/author/jeffrey-sachs https://www.twitter.com/JeffDSachs https://www.huffingtonpost.com/author/jeffrey-sachs https://www.huffingtonpost.com/topic/malaria https://www.huffingtonpost.com/topic/foreign-aid https://www.huffingtonpost.com/topic/wealth https://www.huffingtonpost.com/topic/dambisa-moyo https://www.huffingtonpost.com/topic/africa
- 28. https://www.amazon.com/ https://www.indiebound.org/?aff=HuffingtonPost http://www.amazon.com/The-Price-Civilization-Reawakening- Prosperity/dp/140006841X?SubscriptionId=0JJEH4PKQM4ZHS 8QY102&tag=thehuffingtop- 20&linkCode=xm2&camp=2025&creative=165953&creativeASI N=140006841X https://facebook.com/share.php?u=https://www.huffingtonpost.c om/jeffrey-sachs/aid-ironies_b_207181.html https://twitter.com/share?text=Aid+Ironies&url=https://www.hu ffingtonpost.com/jeffrey-sachs/aid- ironies_b_207181.html&via=theworldpost&hashtags= mailto:?subject=Aid%20Ironies&body=Article:%20https://www. huffingtonpost.com/jeffrey-sachs/aid-ironies_b_207181.html 1/7/2019 Back toSachs: Astrology, Despotism, and Africa | HuffPost https://www.huffingtonpost.com/william-easterly/back-to-sachs- astrology-d_b_209989.html 1/4 T H E B L O G 07/03/2009 05:12 am ET | Updated May 25, 2011
- 29. Back to Sachs:Astrology, Despotism, and Africa By William Easterly Sachs Debate, Day Eight. Surprised that Sachs did not understand the point about Occam”s Razor — that a theory should be as simple as possible but no simpler. African poverty is complex, but our theories about it should not have so many complex Buts, Ors, and Excepts that they are impossible to disprove. Ignoring Occam’s Razor is how astrologists stay in business. An astrologer might say: “Watch out for strangers, especially those that are short, or dark, or fat.” You are likely to have a number of bad encounters with strangers (especially in New York!), and being short or dark or fat covers such a large share of the population that you will likely encounter one such bad stranger sooner or later. Explaining poverty with a flexible theory of geography when
- 30. you already knowthe outcome is similarly easy. First, you notice that Africa had the worst poverty in the world. Second, you notice that Africa also was the only region that had a particular mosquito species, had a lot of landlocked countries, had a particular soil type, had a large share of continent in the tropics, and did not have snowmelt-irrigated agriculture. Third, you define the worst geography as consisting of exactly these mosquitoes, landlocked locations, soil types, tropical locations, and non-snowmelt-irrigated fields. Fourth, presto, you have proven that the worst geography causes the worst poverty! (Some of the above are bad, but there are many bad things in the world, and only such a four-step exercise guarantees that you will predict rightly in hindsight. Try this at home to impress your friends! If they object that you are just using hindsight, tell them they don’t understand “complex systems.”)
- 31. The more generalargument why geography is not destiny is what economists call comparative advantage — you can export what your geography gives you an advantage at, and import what you geography makes you bad at. Rainy countries (Thailand) could export rice (a thirsty crop) and import minerals, and desert countries could export their minerals (Chad) or maybe tourism (Dubai), and import rice. Landlocked countries can always export high value to weight items by air (Swiss watches, Botswana’s diamonds). Other geographic problems have their own human adaptations. Sachs contradicts his own geographic determinism by arguing how easy it would be to solve these https://www.huffingtonpost.com/author/william-easterly http://www.huffingtonpost.com/jeffrey-sachs/no-need-to-
- 32. oversimplify-p_b_209720.html http://www.huffingtonpost.com/william-easterly/geography- lessons-correct_b_208879.html https://www.huffingtonpost.com/author/william-easterly http://adinfo.aol.com/ https://www.huffingtonpost.com/ https://facebook.com/share.php?u=https://www.huffingtonpost.c om/william-easterly/back-to-sachs-astrology-d_b_209989.html https://twitter.com/share?text=Back+to+Sachs%3A+Astrology% 2C+Despotism%2C+and+Africa&url=https://www.huffingtonpo st.com/william-easterly/back-to-sachs-astrology- d_b_209989.html&via=theworldpost&hashtags= mailto:?subject=Back%20to%20Sachs:%20Astrology,%20Despo tism,%20and%20Africa&body=Article:%20https://www.huffingt onpost.com/william-easterly/back-to-sachs-astrology- d_b_209989.html 1/7/2019 Back toSachs: Astrology, Despotism, and Africa | HuffPost https://www.huffingtonpost.com/william-easterly/back-to-sachs- astrology-d_b_209989.html 2/4 problems (like bed nets and medicines for malaria). When such
- 33. adaptation to ageographic problem fails, there is usually some kind of social barrier to problem-solving. One such social barrier is a bad government — like a government that fails to deliver the bed nets and malaria medicines — a factor that Sachs still refuses to do justice. Sachs’ admission that Zimbabwe has a bad government is not exactly revolutionary. This continues his longtime reluctance to admit there is bad government in any except a handful of extreme despots. In his UN Millennium Project in 2005, he only named four bad governments: Belarus, Myanmar, North Korea, and Zimbabwe. At the time, he listed 63 poor countries that are “potentially well governed” (a phrase equivalent to calling Paris Hilton “potentially a virgin.”) Sachs’ list included 5 out of the 7 countries singled out by Transparency International at the time as the most corrupt in the world, and fifteen governments that Freedom
- 34. House classifies as“not free.” Even a despot like the late Saparmurat Niyazov of Turkmenistan, who so terrorized his country that he renamed the months of the year after himself and his mother, couldn’t get into Sachs’ bad government club at the time. Meles Zenawi of Ethiopia is inexplicably a Sachs darling despite rigging elections, jailing opposition politicians, shooting demonstrators, fielding an army accused of atrocities in the Ogaden, and fomenting corrupt practices that give Ethiopia a ranking on Transparency International of 138th out of 179 countries. So Sachs’ re-admission that Zimbabwe has a bad government does not get us very far. Unlike Sachs’ flexible theory of bad geography, the bad government theory is inflexible enough that it is not rigged to pass in advance — but it does pass this test according to studies by three different and independent groups of economists published in prominent economics journals. All science is essentially about testing one
- 35. thing — likebad government — at a time, but nobody thinks that such testing implies only one thing matters. The bottom line remains the same — bad government is a serious obstacle to development, and ignoring bad government is a formula for the same kind of bad aid policy that gave us decades of failure. Isn’t it time for a change? Even cash transfers directly to poor people are demonstrably better than cash transfers to poor governments. Follow William Easterly on Twitter: www.twitter.com/bill_easterly Professor of Economics, New York University, author “White Man’s Burden” M O R E : Corruption Jeffrey Sachs Geography Poverty Economics You May Like by TaboolaSponsored Links
- 36. Fortune BuildersFortune Builders HoneyHoney WiseBreadWise Bread Free Real Estate Event In Houston 1/8-1/12Free Real Estate Event In Houston 1/8-1/12 You're Probably Overpaying at Amazon – This Genius Trick Will Fix ThatYou're Probably Overpaying at Amazon – This Genius Trick Will Fix That The Highest Paying Cashback Card Has Hit The MarketThe Highest Paying Cashback Card Has Hit The Market http://blogs.nyu.edu/fas/dri/aidwatch/2009/05/how_to_help_the _poor_have_more.html https://www.twitter.com/bill_easterly https://www.huffingtonpost.com/author/william-easterly https://www.twitter.com/bill_easterly https://www.huffingtonpost.com/author/william-easterly
- 37.
- 38.
- 39. om/william-easterly/back-to-sachs-astrology-d_b_209989.html https://twitter.com/share?text=Back+to+Sachs%3A+Astrology% 2C+Despotism%2C+and+Africa&url=https://www.huffingtonpo st.com/william-easterly/back-to-sachs-astrology- d_b_209989.html&via=theworldpost&hashtags= mailto:?subject=Back%20to%20Sachs:%20Astrology,%20Despo tism,%20and%20Africa&body=Article:%20https://www.huffingt onpost.com/william-easterly/back-to-sachs-astrology- d_b_209989.html 1/7/2019 Geography Lessons:Correcting Sachs on African Economic Development | HuffPost https://www.huffingtonpost.com/william-easterly/geography- lessons-correct_b_208879.html 1/4 T H E B L O G 06/29/2009 05:12 am ET | Updated May 25, 2011 Geography Lessons: Correcting Sachs on African Economic Development By William Easterly
- 40. Professor Jeffrey Sachscontinues the debate on aid to Africa originally prompted by Dambisa Moyo’s book Dead Aid. As usual, I will of course let Dr. Moyo defend herself against specific criticisms made by Sachs and his co-author John McArthur. But Sachs unveils such a strange geographic theory of Africa’s poverty, with strong implications for aid policy, that I am forced to respond. It’s nice to move back to doing what professors are supposed to do — examine other professors’ ideas on their own merits, not attack their persons. Sachs is an inspirational and hard-working intellectual, just one whose ideas on Africa happen to be sometimes totally wrong, and other times only seriously wrong.
- 41. A good rulefor all theories, including theories of global poverty, is Occam’s Razor — make the theory as simple as possible, but no simpler. Another way to put it is beware of explanations with too many Ifs, Buts and Excepts in them. Sachs’ geographic theory of Africa’s poverty has gotten few takers among other economists, perhaps because it fails Occam’s Razor. Sachs starts off by saying that being in the tropics is bad for development (he gave a very terse summary here, I am drawing from his articles to articulate more fully his geographic story). Isn’t rapidly growing India also in the tropics? Yes, but they have snowmelt-fed irrigation instead of rain-fed agriculture. Isn’t rich Singapore also in the tropics?
- 42. Yes, but theyare coastal instead of landlocked. Don’t Latin America and Asia also have https://adclick.g.doubleclick.net/pcs/click?xai=AKAOjsstHmHx SwEJFAMgOS7L5C6ffNKXitknXZj5PXKarlJKXqHjbBN97htF8 KsVfcsa2hRxCyH5nLYet6TAKIVif7_D_gWRzTnwmk9SP63rG 0XwVqeIOl44y7iqQ0jhihUaja2-1MPNrg&sai=AMfl- YSWSTr4zimnX0A4ujEFB1Of0Y1uiowdEsGSx9hCQVHJI13W Ylh5bTgtcC9DE5b9h-Se6CH- px0BtKH6TzwIkr_c9CBX4SPtZTtmti_OFIMe&sig=Cg0ArKJSz Cwoiyih1HNk&urlfix=1&adurl=http://a.rfihub.com/acs/b/c3Q9a HRtbCZhYT00MTUwOTQxLDExNTU0ODI5NSwxNzI2MjMzL DEwMzExNjAzNywxNDQwMzMsMTE1NzU3Myw2ZmU3OTV mOGVhMTI1MjM1NDQzZDg3NGExYzk4MzgyOCxwLDM0NT c0LDQ1OTA2MywzNjQ3NzM3MywzODM5MzMsOTUwNTI3J m10PTEmcmI9MjI0JnJlPTMzNjg3JmhjaT02NzYwMDI4NDczO DgxODczODYyJnV1aWQ9OTY5NzUxNjc2Njg2MTU4NzQ0Jm RpPSZkYz0zJmRpc3JjPTAmYmlwPTI2MDE6MmM2OjRhODA 6NGU2MTpkY2UxOmU5MmQ6M2Q6ODdmMCZkaWQ9dGlkX zExNTc1NzN8bWVkX3JlZ3VsYXI./aHR0cDovL2NsaWNrdHJh Y2sucHVibWF0aWMuY29tL0FkU2VydmVyL0FkRGlzcGxheVR
- 43.
- 44. s%20on%20African%20Economic%20Development&body=Artic le:%20https://www.huffingtonpost.com/william- easterly/geography-lessons-correct_b_208879.html 1/7/2019 Geography Lessons:Correcting Sachs on African Economic Development | HuffPost https://www.huffingtonpost.com/william-easterly/geography- lessons-correct_b_208879.html 2/4 tropical diseases like malaria, just like Africa? Yes, but they have a better kind of mosquito. So a region will be poor if they are tropical, if rainfed, if landlocked, and if they have the wrong mosquitoes — which, yes, fits many African countries. The reason for Occam’s Razor is that with enough Ifs, Buts, and Excepts you can fit any theory to any set of facts. If I am a balding, grey-bearded, bespectacled, white male economic development professor residing
- 45. in Greenwich Village,I will write a post on Occam’s Razor — yes, that theory also fits the facts. The consensus among most academic economists is that destructive governments rather than destructive geography explains the poverty of nations. Robert Mugabe was a lot worse for Zimbabwe than Anopheles mosquito. Corruption is more fatal for oil-rich Nigeria and Angola than latitude. Health is determined more by public actions against disease than by species of parasite. Other factors that Sachs mentions such as illiteracy and poor infrastructure are also symptoms of bad government services. Geography may have had some influence on history, but through institutions — good
- 46. government spread alonglines of migration and communication through most temperate regions more easily than it did to tropical regions. The latter were also victims of colonialism (and in Africa’s case, the slave trade as well, which goes some way to explain bad government in Africa today). Of course, it is a lot easier to justify giving a lot of aid to African governments if they are helpless victims of geography rather than (mostly) just being — bad governments. Is this why Sachs offers a bizarre geographic theory of Africa’s poverty and is oblivious to the bad governments that many courageous African dissenters have fought at great sacrifice? I don’t have enough evidence to test any one theory of Sachs, but I know it makes for bad aid
- 47. policy. Make surethat aid reaches poor people, which usually means it should not go to poor governments. Follow William Easterly on Twitter: www.twitter.com/bill_easterly Professor of Economics, New York University, author “White Man’s Burden” M O R E : Jeffrey Sachs Foreign Aid Africa Dambisa Moyo Third World Countries https://www.twitter.com/bill_easterly https://www.huffingtonpost.com/author/william-easterly https://www.twitter.com/bill_easterly https://www.huffingtonpost.com/author/william-easterly https://www.huffingtonpost.com/topic/jeffrey-sachs
- 48.
- 49. correct_b_208879.html&via=theworldpost&hashtags= mailto:?subject=Geography%20Lessons:%20Correcting%20Sach s%20on%20African%20Economic%20Development&body=Artic le:%20https://www.huffingtonpost.com/william- easterly/geography-lessons-correct_b_208879.html 1/7/2019 Moyo's ConfusedAttack on Aid for Africa | HuffPost https://www.huffingtonpost.com/jeffrey-sachs/moyos-confused- attack-on_b_208222.html 1/5 T H E B L O G Moyo’s Confused Attack on Aid for Africa By Jeffrey Sachs and John W. McArthur 05/27/2009 04:16 pm ET | Updated May 25, 2011 Ms. Dambisa Moyo’s recent Huffington Post article exposes the confusions that underlie her slashing attacks on aid. Most importantly, she seems to believe that sub-Saharan Africa was economically prosperous and then was pushed
- 50. into poverty byaid. She makes the following statement: “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 than 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.” Let’s parse that statement for a moment. World Bank researchers Shaohua Chen and Martin Ravallion prepare the benchmark under-$2-a-day historical headcount data going back to 1981. According to their figures, headcount poverty under $2 a day was 74 percent of the population in sub- Saharan Africa in 1981 and 73 percent in 2005. Other prominent estimates that go back to 1950 or 1970 also contradict Moyo’s statement, by showing high and persistent poverty. All of the macroeconomic time series by Maddison, Summers and Heston, and others tell the same story: the
- 51. majority of Africa’spopulation started out impoverished at the time of national independence in the 1960s and 1970s, and a majority remains impoverished till today. If we move beyond the GNP and income measures, the enormity of Africa’s long-term poverty challenges become even more apparent. As we have documented elsewhere, Africa’s literacy, agricultural productivity and urbanization rates were very low in 1970. Rural poverty was pervasive. Africa’s road coverage, electrification, rail network, and other infrastructure were sparse at best and typically non-existent in rural areas. Aid did not kill Africa. Despite the persistence of poverty, many conditions in Africa have in fact improved in recent decades. Child mortality has declined from 229 per 1,000 births in 1970 to 146 per 1,000 births in 2007. Adult literacy has increased from around 27 percent in 1970 to around 62 percent in 2007. Primary school net enrolments have increased from around
- 52. 53 percent in1991 to around 70 percent in 2007. Aid has played a helpful role in this. Yet aid was very limited, averaging around $35 per African per year since 1960. Aid has never been properly resourced or targeted for a focused period to end the poverty trap and thereby to break the dependency on aid. https://pr.ybp.yahoo.com/cj/cd/WoEal8WqmKvaQ_lAs9tIMaaIU znXtjzxZDURuRFBEWCQEt_KkNK_SKlIYwxrm8VPEjKJCoSg TloUeRyDs97sVZy1idy0izTvlkhkQIZb_35fk9jQoKNCkDQLnZ K1htV- iFRFV8frGMcJRj0w_baJWF9dUGB0ysC4SC7_4fOu1VM/rurl/h ttps://adclick.g.doubleclick.net/pcs/click?xai=AKAOjst1dZYdO 0YbdrnazptNHh8pIIo4guMXMtIfMN6FK7yQo409AEzUpnvQI4 JjGMLPSpIaJJaYLbOL3To9p2Jrtmd4mlm4jn9z9gNefeq2vdU2G 461LEIb9tvvLFWqIP7TtGwNN3YIgHQ&sai=AMfl- YSNQCAtyQO_ioXtHC9ia8VQpb4M_1zdJz49fyd1YMavVVmea 6NDPYd9lhTeH-
- 53.
- 54. https://www.huffingtonpost.com/jeffrey-sachs/moyos-confused- attack-on_b_208222.html 2/5 Africa’s differenceswith other regions lie not in aid, but in circumstances and history. Unlike South Asia, for example, Africa has not yet had a Green Revolution of higher food yields, the formative event of India’s economic takeoff from the late 1960s. India is a civilization of great river systems and large-scale irrigation, thanks to the Himalayan snowmelt and glacier melt and the annual monsoon rains. Africa is a continent of rain-fed (non-irrigation) agriculture. The original Green Revolution, in which India’s food output per land area rose markedly, came in the irrigated systems of Asia, not the rain-fed systems of Africa. US aid heavily subsidized India’s Green Revolution while World Bank opposition to aid for African agriculture from the 1980s until recently played an opposite and adverse role, holding back a similar breakthrough for Africa. It was the
- 55. absence of aidfor African agriculture rather than its presence that cost Africa mightily. And one can go on. Africa’s tropical disease burden, heavy concentration of landlocked countries, decline of aid for infrastructure during the 1980s and 1990s, and misguided attempts by Africa’s creditors to collect debt servicing under “structural adjustment programs” during the 1980s and 1990s all played their part. Moyo now campaigns against the kinds of aid that can keep millions of African children from dying or being maimed for a lifetime through the consequences of serious episodes of disease. She advocates cutting the aid that has allowed more than 2 million Africans access to life-saving AIDS treatment, since governments are involved. Almost unimaginably, she opposes the distribution of anti-malaria bed nets for Africa’s hundreds of millions of young people on the alleged grounds that it has put bed net producers in
- 56. Africa out ofbusiness. In her own words: “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.” The confusion underlying this remark is staggering. There are hundreds of millions of Africans at risk of a killer disease, around two hundred million cases of the disease, and around 1 million preventable deaths per year, yet Moyo
- 57. is opposed tourgent help if nets are not produced in Africa. She seems both unmoved by the massive suffering and unaware that Africa has gone from producing exactly zero long- lasting insecticidal nets (LLINs) a few years ago to several million per year now, with thousands of jobs in the local industry, as a result of the demand for nets created by aid for malaria control. She takes no note of the fact that global aid for malaria control is also training tens of thousands and soon hundred of thousands of rural Africans as community health workers; and seems to be unaware that unchecked malaria has long devastated Africa’s economy while malaria control is finally emptying the hospitals, putting mothers and fathers back to work and children back to school, and contributing to the boost in Africa’s productivity and economic growth of recent years. She says that if her position against aid for LLINs is deemed to be cruel, then yes, she is “guilty as
- 58. charged.” Moyo is notoffering a reasoned or evidence-based position on aid. Everybody that deals with aid wants to promote financial transparency and market-led growth, not aid dependency. We and others have recommended many successful mechanisms to limit corruption and ensure that aid reaches the recipients, as is happening in the disease- control programs. The purpose of aid should indeed be to break the poverty trap through targeted investments in an African Green Revolution; disease control; children’s education; core infrastructure of roads, power, safe drinking https://facebook.com/share.php?u=https://www.huffingtonpost.c om/jeffrey-sachs/moyos-confused-attack-on_b_208222.html https://twitter.com/share?text=Moyo%27s+Confused+Attack+on +Aid+for+Africa&url=https://www.huffingtonpost.com/jeffrey- sachs/moyos-confused-attack-
- 59. on_b_208222.html&via=theworldpost&hashtags= mailto:?subject=Moyo%27s%20Confused%20Attack%20on%20 Aid%20for%20Africa&body=Article:%20https://www.huffingto npost.com/jeffrey-sachs/moyos-confused-attack- on_b_208222.html 1/7/2019 Moyo's ConfusedAttack on Aid for Africa | HuffPost https://www.huffingtonpost.com/jeffrey-sachs/moyos-confused- attack-on_b_208222.html 3/5 water and sanitation, and broadband; and business development, including microfinance and rural diversification among impoverished smallholder farmers. Moyo wants to cut aid off dramatically, even if that leaves millions to die. African leaders - like President Ellen Johnson Sirleaf of Liberia, Dr. Awa Coll-Seck of Roll Back Malaria, and Ministers Charity Ngilu and Beth Mugo of Kenya - have fought for Africa’s poor and have used aid to save lives and help economies to prosper. These leaders disagree
- 60. fundamentally and urgentlywith Moyo’s attacks. They recommend more aid, fully accountable and properly targeted, to meet urgent needs. Since the record shows that Africa has long been struggling with rural poverty, tropical diseases, illiteracy, and lack of infrastructure, the right solution is to help address these critical needs through transparent and targeted public and private investments. This includes both more aid and more market financing. That combination will indeed ensure that private markets and African entrepreneurship can succeed. Follow Jeffrey Sachs on Twitter: www.twitter.com/JeffDSachs Follow John W. McArthur on Twitter: www.twitter.com/mcarthur Director, Center for Sustainable Development and Sustainable Development