The Failure of Foreign Aid

The Wall Street Journal has an interesting article on the negative effects of aid in Africa. Certainly this view is not new, nor is it a consensus among experts; certainly Jeffrey Sachs will tell you something different. But it is certainly an interesting read. Below some of what Moyo explains:

“Yet evidence overwhelmingly demonstrates that aid to Africa has made the poor poorer, and the growth slower. The insidious aid culture has left African countries more debt-laden, more inflation-prone, more vulnerable to the vagaries of the currency markets and more unattractive to higher-quality investment… Over the past 60 years at least $1 trillion of development-related aid has been transferred from rich countries to Africa. Yet real per-capita income today is lower than it was in the 1970s, and more than 50% of the population — over 350 million people — live on less than a dollar a day, a figure that has nearly doubled in two decades“.

The article paints a pretty tragic picture, which seems accurate and well supported, but also I can testify from some empirical evidence on my own. When I was a volunteer in Bhutan, I saw UN money being casually wasted on nothing. In the highlands of Peru, you can see hundreds of failed projects scattering the landscape. While Moyo attributes the cause to a lack of a solid economic trajectory, I think the causes go deeper. As I posted a few weeks ago, I think this has to do with a problem we face in the West. It’s a problem of the materially rich, and morally and spiritually poor. What we do is a reflection of who we are. The Pope nails it here:

[Western Aid] ‘purely technically and materially based… has left God out of the picture [and] has driven men away from God’ is in fact responsible for the situation of disparity turning the ‘“third world” into what we mean today by the term. It has thrust aside indigenous religious, ethical and social structures and filled the resulting vacuum with its technocratic mindset. The issue is the primacy of God’.

‘…the peoples of Africa, lying robbed and plundered, matter to us. Then we see how deeply they are our neighbors; that our lifestyle , the history in which we are involved, has plundered them and continues to do so… Instead of giving them God, the God who has come close to us in Christ, which would have integrated and brought to completion all that is precious and great in their own traditions, we have given them a cynicism of a world without God in which all that counts is power and profit, a world that destroys moral standards so that corruption and unscrupulous will to power are taken for granted. And that applies not only to Africa.’”

8 thoughts on “The Failure of Foreign Aid

  1. It should be no surprise that foreign aid has such an abysmal record. The same could be said for most government based welfare/aid programs. I think it is because God is left out of the equation. Government is the least effective and faith based relief organizations do it best.
    Throughout history, Church based initiatives such as Catholic charities, Catholic Relief Services and the Salvation Army set the standard. The recent Katrina disaster demonstrated this. Given this “track record” for delivering services to meet human needs should we expect any difference in governments’ ability to deliver services to meet environmental needs? I think not. Faith based efforts have the charge and the will to “build the kingdom” in a manner that reflects the needs of the human person within the context of stewardship of God’s creation.

  2. This is a very interesting perspective to bring forward and the criticism of secular foreign aid illuminates the fundamental problem that is being faced. However, acknowledging the struggle is one thing, but to discover real solutions may require us to delve deeper into the issue at hand. Would delivering foreign aid under the banner of Christianity present the fundamental difference necessary in order to bring forth the desired economic and social development? Or does the change need to be in what we are investing our foreign aid in rather than who is providing the aid. This is where I think the truth of the Pope’s statement lies; in that our foreign aid is “purely technically and materially based”. The shift in our aid therefore may be in a change from one based on material provisions to one that seeks to develop self-provision of material needs through empowerment derived from the development of the human person. This may seem like a rather crass suggestion to give to a people living through material struggles beyond most westerners comprehension, however to truly address the problem we should seek to treat the disease, rather than the symptom. Therefore, our aid should seek to invest in the totality of the persons involved, recognizing all the needs of the human person, rather than simply addressing their material insufficiency. All material things are finite, therefore all investments in such will only perpetuate further investment. Technology may have the capacity to drive development, but if it precedes the people involved it will only create reliance. This technological reliance can cripple a culture, as it one can argue it is doing throughout the U.S. and Europe. Furthermore, since the progression of this technology is not driven from within the culture, it will perpetuate further dependence on foreign aid, instead of cultural or geographic independence. The change should be in order, not composition. The priority should be the empowerment and independence of the people to whom we seek to give aid. The human person is an infinite being, investing in the persons of these regions would empower, thus allowing the investment of foreign aid to self-perpetuate as they sought to drive their own development. Admitidly, this still leaves many gaps to be addressed in order to fully analyze the situation and I look forward to other perspectives on the issue.

    1. Thanks for the post. I think you offer a balanced and well rounded proposal.

      I am not sure if I follow the opposition you suggest with the questions: “Would delivering foreign aid under the banner of Christianity present the fundamental difference necessary in order to bring forth the desired economic and social development? Or does the change need to be in what we are investing our foreign aid in rather than who is providing the aid.”

      In the end, I see no opposition here. What you propose, and integral human development, is very much in line with Caritas in Veritate and the Pope’s entire approach to development. The way we do things reflects who we are. So i think that the way we invest our aid and development reflects who the aid giver is. The ‘Christian banner’ I think is the least essential of the matters, as long as the ‘heart’ of the matter (see a similar approach in The Question of Salvation post) is shared rather than only an external core. A Catholic development must be an integral development.

      So I don’t disagree with your point, rather I just wanted to show that I don’t see an opposition in the question of who gives and how he gives.

      1. To clarify, the point I was making in that section is that an organizational change alone would not successfully counter the issues at hand; rather a compositional change in the foreign aid is what is needed. A Christian or other faith based organization would be no more successful than a secular program if they were administering and working with similar methods. I am suggesting that the change needs to go deeper, but do not mean to imply that there is any opposition present. I hope this clarifies my stance on the issue.

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