In "The White Man's Burden", William Easterly,
acclaimed author and former economist at the World Bank,
addresses these twin tragedies head on. While recognising
the energy and compassion behind the campaign to make poverty
history he argues urgently and powerfully that grand plans
and good intentions are a part of the problem not the solution.
Giving aid is not enough, we must ensure that it reaches
the people who need it most and the only way to make this
happens is through accountability and by learning from past
experiences.
Without claiming to have all the answers, William Easterly
chastises the complacent and patronising attitude of the
West that attempts to impose solutions from above. In this
book, which is by turns angry, moving, irreverent but always
rigorous, he calls on each and every one of us to take responsibility
- whether donors, aid workers or ordinary citizens - so
that more aid reaches the people it is supposed to help.
At this ODI & Oxford University Press launch event,
the author William Easterly will outline and discuss the
ideas contained in his book with Simon Maxwell and Bob Picciotto.
As usual, there will be the chance to ask questions and
to engage in discussion of these and related issues.
Product Details
Price: £16.99
Hardcover: 392 pages
Publisher: Oxford University Press (www.oup.com/uk)
Publication Date: 21 Sept 2006
Language English
ISBN: 0199210829
Specially discounted copies of the book will be on sale
at the event.
To order the book online please visit: www.oup.com/uk/catalogue/?ci=9780199210824
Meeting Report
1. William Easterly began by positioning his argument
as the polar opposite of Jeffrey Sachs' argument that 'success
in ending the poverty trap will be much easier than it appears'
(set out in 'The End of Poverty') and Bono's statement that
'it's up to us' in introduction to that book.
2. He agreed with a speech by Gordon Brown (UK Chancellor
of the Exchequer) that it is a tragedy that half of all
malaria deaths could be prevented with medicines that cost
12 cents. But he argued that the bigger tragedy is that
the West has already spent $2.3 trillion on foreign aid
in the last five decades and malaria victims are still not
getting 12-cent medicines. He said that when Sachs and others
argue that more should be spent on aid they are missing
a fundamental point: the real scandal is that the money
spent is not reaching the poor.
3. He questioned the logic of doubling aid spending (which
has happened in 1960, 1973, 1990 as well as 2005) and large-scale
plans arguing that these allow donor countries to avoid
the issue of how much money actually reaches the poor; and
so the tragedy continues.
4. He criticised large-scale plans such as the Millennium
Project Plan (with its 449 interventions), Millennium Development
Goals and Poverty Reduction Strategy Papers on the grounds
that they depend on poorly incentivised collective action;
they have too many indicators and goals; and their success
depends also on factors beyond the control of donors. Fundamentally,
nobody is responsible for any one result and without such
responsibility few achievements can be reached. He also
criticised big plans for being publicity stunts, popular
with politicians.
5. He characterised the problem in terms of lack of knowledge.
Top level planners do not and cannot have enough information
to plan out the end of world poverty. It goes back to an
old debate on central planning vs markets.
6. He outlined 4 elements in what is wrong with big plans.
There is:
Lack of 'customer' feedback from recipients of aid;
Lack of incentives in the collective action model
Lack of accountability in donors
Lack of omniscience - planners cannot have complete information
7. He posed the question: what are the alternatives to
large-scale plans? He argued that the free market has
good feedback mechanisms which create incentives and accountability.
A system of democratic accountability also manages to
create feedback mechanism. However, markets and democracy
are not a panacea. Historical evidence suggests they have
to be homegrown. Nevertheless, markets and democracy should
inspire the West to respond to what aid recipients need.
8. He presented evidence that 42 years of aid plans have
not ended poverty. The countries with the highest average
aid over this period have seen a mere 0.4% growth in income.
Research on aid and growth has failed to find any robust
result that aid raises growth. Structural Adjustment Loans
(SALs) have failed. 15 African countries received an average
of 24 SALs each and their average rate of income per head
growth has been negative: -0.4% per year.
9. He moved on to ask what the alternatives to SALs are.
He proposed that entrepreneurial people who work to change
things on the ground are the way forward. He gave the
examples of a Ghanaian expatriate who send up Ashesi University
in Accra; the Mexican government official who first started
a small scale programme to pay families to keep their
children in school which expanded nationwide into the
Oportunidades programme; and Mohammed Yunus, founder of
the Grameen Bank.
10. He concluded that lending for structural adjustment
should be discontinued, utopian large-scale plans should
be abandoned and there should be fewer task forces and
reports. Donors need to develop a way of working that
includes feedback, accountability, independent evaluation
of aid, incentives and cooperation with small scale initiatives.
11. Robert Picciotto began by pulling out five
main messages from the book:
Global poverty is a scandal
Aid can work
Aid quality matters more than aid quantity
Aid is most effective when it is innovative and provides
incentives for change
The aid industry must reform.
12. He stated that Easterly is right to debunk aid effectiveness
research built on cross country regressions; remind readers
about the perils of externally induced policy reforms;
describe development as a microeconomic phenomenon; and
puncture the exaggerated claims of aid advocates.
13. However, he criticised Easterly for providing comfort
to the miserly approach to development of most OECD countries;
perpetuating unhelpful myths about the development enterprise;
and keeping silent about the distorted non aid policies
of donors that help keep poor countries poor.
14. He argued that aid volumes are, in fact, not large:
$2.3 trillion in fifty years is less than $9 per capita
per year which works at about 4 cents per capita for the
3 billion poor living on less that $2 a day. As a comparison,
US military expenditure is 20 times more that the total
OECD aid budget.
15. He then moved on to cite achievements over the last
30 years: a reduction in poverty, an increase in life
expectancy, decrease in infant mortality, increase in
literacy, and decrease in chronic malnutrition. Although
aid did not do it all, it helped.
16. He responded to Easterly's criticism of celebrities
getting involved in the aid debate by arguing that there
is nothing wrong with making aid 'cool' again or dreaming
about 'a world free of poverty'. The MDGs capture universal
human aspirations.
17. He challenged the idea that government is always
the problem and the market is always the solution, raising
the issue of fragile states (where one third of the world's
poor live). He questioned the assumption that domestic
small scale voluntary initiatives are best, pointing out
that the voluntary sector is often less accountable than
government and the difficulty of scaling up small projects
without official aid support. He argued that development
results from a mixture of planning and grassroots programmes.
18. He concluded that his main criticism of the book
is what it omits: development is not just about aid; foreign
direct investment, merchandise exports and remittances
are all factors. We need to look at the overall framework
for development. The next step would be for Easterly would
be to 'move beyond his aid bashing phase and apply his
ferocious debating skills and his sharp analytical mind
to the non aid dimensions of the relations between rich
and poor countries. This is where the true challenge of
development cooperation lies in the 21st century'.
19. Easterly responded by disagreeing that aid
is more accountable than domestic programmes and clarified
that he did not mean to give the impression he was recommending
universal privatisation of aid; rather that aid workers
should try to think more in market terms.
21. Simon Maxwell gave comments from the point of
view of a consumer, an academic and a European.
22. As a consumer, he said the book is an excellent read
and entertainingly written.
23. As an academic, he said he had some quibbles; mainly
that Easterly is biased in his use of information to support
his position (despite criticising others for doing so).
He questioned Easterly's attempt to adopt a stance in
opposition to the mainstream discourse on aid, pointing
out the day to day thinking and work at ODI actually is
along the same lines as the arguments in the book. This
led him to a point about the responsibility of think tanks
to engage with politicians and offer solutions. He said
the danger of this book is that it will be seized by those
who want to reduce development aid and asked the audience
to consider if it is a good idea to argue for not increasing
aid. Taking a message to politicians that aid doesn't
work will simply result in them cutting it.
24. As a European, he pointed out that if the arguments
in the book can be characterised as conventional European
wisdom and Europe wants to be helpful in the development
debate, Europeans need to advance the conversation. He
criticised Easterly's list of small-scale projects as
insufficient to take the debate forward. He said the private
sector can only have a successful role if the infrastructure
and public goods that entrepreneurs require are in place.
He argued that there is a need for large-scale plans,
for example in a situation like Darfur.
25. He concluded that work in places like ODI does offer
policymakers options - not perfect ones, but it is better
to engage in solving the problem of global poverty than
take the Easterly line of turning our backs on it.
26. Easterly responded that support for aid is fragile
and that is will shatter when big promises are not kept.
The challenge is to redirect zeal to holding actors in
the aid system accountable in terms of whether the money
actually improves the lives of poor people. He emphasised
that the volume of money spent on aid is not a measure
of success.
27. The discussion covered the following points:
It is time that Africans were asked what they want
rather than being told what to do. Money from Africa to
the West outstrips the amount of aid going to the continent.
Giving more power to the private sector.
Somaliland is thriving without aid.
Skilled workers leaving African countries to work
abroad. How can the flow be stemmed and how can more training
be provided in African countries?
The conflation of development, aid and growth.
The 'aid industry' did not push the agenda far
enough in 2005.
How do ordinary people respond to this debate?
Should they give to development NGOs? How can NGOs prove
that the poor people really benefit from the money?
The need for less description and more analysis
of the problem.
The EU system of regional support.
The aid industry's real objective is to keep the
poor in that state.
Lack of incentives for the aid industry to respond to
critiques of its limited impact.
Presentation:
Bob Picciotto
Book review:
Simon
Maxwell
Audio:
introduction
William Easterly
(Part 1)
William Easterly
(Part 2)
William Easterly
(part3)
Robert Picciotto
Simon Maxwell
Discussion (part 1)
Discussion (part 2)
