“Don’t do it” seems to be the message directed at aid agencies, western governments, transnational (Bretton Woods) organisations and NGOs—in respect of the majority of efforts to help the poor. While the first tragedy of the world’s poor is poverty itself, Easterly’s “second tragedy” is the failure of $2.3 trillion spent on foreign aid in fifty years to have delivered many obvious basics. By page 5 the author admits that no particular remedy will be forthcoming from this text either, since the book’s motto is at its simplest: “the big answer is that there is no big answer”.

Equally early on, the subject is framed as planners versus searchers being the bad and the good methods of helping development in desperately poor societies. In much of the text this boils down to top down (bad) versus bottom up (good), or imposed by the west (bad) versus passing market tests of responsiveness to feedback and accountability (good). Grand designs to end poverty (pace Messrs Sachs, Bono and most of the western politicians who chipped in on the subject in 2005), and doublings of aid, don’t work. Self-designed and voluntarily pursued on-the-ground baby steps do.

So much is non-controversial, though the two forms of development assistance are hardly substitutes. Micro-loans from Grameen bank, four dollar bug nets for malaria protection, or local construction of a sanitary water system are readily proven easy wins—and it is all the more depressing that things like this are occluded in the enthusiasm for a big push. But the author somewhat sidesteps the necessity for some action to be large-scale and co-ordinated, or else it won’t happen. The logical conclusion given the track record to date is presumably for any big push or attempt to “plan a market” not to be attempted. Certainly there are many failures in this regard where it is plausible to imagine the counterfactual of no action having worked out less badly.

To summarise Easterly’s problems with big-push intervention: the desiderata of good capitalism (property rights, contract enforcement, accountable governance) successfully germinate only so long as they accord to local customary arrangements, and only if they are ratified by a market-augmenting government in the first place. Not that local custom or the will of government needs to accord to a single western blueprint (which was not the case in China, India, Chile, Botswana . . . ). But it is not so simple that legislative norms can be handed to poor governments such that all is well. And the larger obstacle is absence of government legitimacy anyway. It is no surprise to the author—though a moral outrage—that aid and assistance is overwhelmingly channelled through bad governments such that its diversion to the interests of private elites is pretty much a no-brainer. Aid planners have never figured out how to deal with bad governments, but they do so anyway (to appease rich donors that something is being done). Yet aid to a bad government apparently makes it worse. (Russia, large swathes of Africa).

Except that this argument does not lead to a solution either. Bypassing rotten power can never get very far without morphing into something that quickly starts to look like regime change, invasion, and indefensible meddling in foreign sovereign territory. Here the author gets into a lengthy diatribe against decolonisation (ostensibly good but done badly in most cases like everything else), “postmodern imperialism”, proxy wars to back opponents of undesirable (to the west) regimes, and outright invasions. This reviewer found nothing good to be mentioned about any of this, making the “Hands off” recommendation of the book more powerful. Arguably this veers quite widely from the core subject of aid and development, but Easterly evidently does not fear to tread on ground that many economists would avoid, because “The US army [tries] to promote economic development” with its military interventions. So—fair game.

The bright light, if there is any, is in home-grown development. Aid that responds to feedback from its recipients, that passes bottom-up market tests, and (counterintuitively) that is not pre-planned to be sustainable. Models where searchers find what works, and that leave some level of choice—not unlimited choice—in the hands of the poor (such as aid vouchers), and where people are willing to experiment like crazy with market mechanisms are interspersed though the book as case studies. Aid donors should forget about sustainability because that cannot be reliably forecast, varies from one place to another and across time, and because it predestines a program to the risk of pouring aid down the drain for a long time without pulling the plug and deploying it sommewhere else. In a faint echo of Dani Rodrick, the secret to picking winners lies more in cutting losers before they get too deep. Easterly’s first approximation would be that the last fifty years—at least—have been a woefully protracted episode of losing strategies never being canned, with failure going unnoticed by blind eyes, deaf ears, and interests that have spent to long aligned with the aid givers, who weren’t supposed to be the ones this stuff was meant to be for.

Francesca

Development Economist, William Easterly provides a sobering evaluation of Western attempts to provide economic fixes for the third world in this secular assessment of humanitarian aid.

Named a Best Book of the Year by Economist, Financial Times, and Washington Post- this book, although full of data, historical and statistical truth, is very readable, humorous and loaded with great case studies that missional workers will find relevant.

As we consider issues of dependency and seek to determine how to utilize Kingdom resources in the shrewd manner Jesus recommends in Matthew 10:16, perhaps we should be transformed from what Easterly calls Planners to become Searchers. Planners tend to think they know the answers that will fix a nation or culture while Searchers are inclined to enter a culture as learners who will study reality in order to discover and implement more effective solutions.
I highly recommend this book to those who are doing holistic ministry and those who are utilizing humanitarian efforts in their mission strategies.

this book destroyed IMF and IGOs for their top down hierarchical top-knows-best methods to economic fixes. fits between a nest of other books. the new de-nationalization of economics has been served via these IGOs. meh. ( )

Lately, there have been a lot of fancy summits and conferences on AIDS, poverty, globalization, global warming... but it seems like most of those areas are in the midst of crisis rather than in recovery. The summits, the lofty goals, the thousand page manuals don't make people richer and healthier in and of themselves.

For generations, now, we westerners have assumed cultural superiority and attempted to impose our values and core institutions in all other parts of the world. Some chunk of that has been well-meaning -- a lot of us are honestly concerned about the health, safety and life expectancy of all global citizens. But even purely altruistic endeavors have failed to make life better for those we're supposedly helping. This has pretty much been completely baffling to me.

Reading Jeffrey Sach's The End of Poverty, it seems clear that the problem is just that western countries have been corrupt and lazy in their approach to aid and that if only everyone read the darn book and got excited about it Everything Would Be Fine. By 2015.

Easterly paints a much grimmer picture, but it seems a lot closer to my version of reality. He really helped me understand how it is that with billions of dollars spent on aid, conditions continue to worsen for a lot of people. His argument is essentially that failure of aid efforts can be attributed to leadership being far from those they are attempting to assist and looking primarily for politically helpful, high-visibility projects with no accountability to the poor. The aid industry is full of "Planners" who feel they know what's best for everyone and would rather have highly advertised meetings than to get someone to shovel shit out of a Lagos ditch.

The great thing about this book is that Easterly lays out a bunch of case studies of things that have worked. There are plenty of examples of "Searchers" who never set out to save the planet but simply worked their darnest to find a localized solution to a localized problem and succeeded. Little things can go a long way, he argues.

One of the reasons I love Seattle so much is that there are a lot of Searchers here trying to find ways to improve everyone's lives a little. I'm particularly impressed by the University District Service Provider Alliance (maybe just because I know them best). UDSPA loosely brings together a bunch of organizations providing different services for the homeless population. There's a shelter, there's a clinic, there's a meal program... each institution is highly specialized. The loose grouping brings an incredible amount of value to each individual service because they can easily refer patrons to each other and provide consistent information, staffing, safety... most importantly, I think, they can each focus energy on what they do best knowing that someone else is doing an equally good job in other areas. There's huge value to the Teen Feed program easily being able to alert all other organizations of a violence outbreak. If a shelter volunteer can specifically refer a guest he or she has known for a long time to an acquaintance at the 45th street clinic, the guest can be much more trusting that his/her cocaine habit won't be revealed to the cops as soon as s/he goes in for help regarding an infection of some sort. Since the education access group knows that they can refer people to local shelters and clinics, they don't have to worry about providing basic needs and can instead focus on education.

International aid tends to work in a highly centralized fashion. It's not working. Maybe something should change and maybe there's something to learn fro UDSPA's successes.

So. A friend told me this was required reading after The End of Poverty. I agree.

"There is now a regular cycle in the literature on foreign aid and growth. Someone will survey the evidence and find that foreign aid does not produce growth. There will be some to-and-fro in the literature, in the course of which a few studies will find a positive effect of aid on growth. Foreign aid agencies will then seize upon the positive effect, usually focusing on only one study, and will publicize it widely. Researchers will examine the one positive result more carefully and find that it is spurious."

"...any government that is powerful enough to protect citizens against predators is also powerful enough to be a predator itself."

"Rich-country politicians control the foreign aid agencies. [...] The big problem already noted is that the principal is the rich-country politician and not the real customers, the poor in poor countries. Voters in the rich country and their representatives are the ones who choose the actions of the foreign aid agency. They love the Big Plans, the promises of easy solutions, the utopian dreams, the side benefits for rich-country political or economic interests, all of which hands the aid agency impossible tasks."

"The military is even more insulated from the interests of the poor than aid agencies are. People don't give reliable feedback at gunpoint. Invading soldiers and covert destabilization are not great ways to ascertain local peoples' interests. The poor on the receiving end have few votes on whether they want the Americans to save them."

"Nor is self-reliance a magical panacea for poor people -- many unlucky poor people, no matter how hardworking, live in states run by gangsters or simply in complex societies that have not yet discovered the elusive path to development. Western assistance, suitably humbled and chastened by the experience of the past, can still play some role in alleviating the sufferings of the poor." ( )

In this book Easterly provides a very nice overview of current foreign aid policies of governments and international organizations, and why they have done so little to help the poor world. Lack of accountability, perverse incentives, and a "central planning" mindset has hurt, rather than helped, the poor world in Easterly's view.

The latter part of the book proves to be rather disappointing, however. Here, Easterly tries to prove that military interventions (peacekeeping, peace enforcement, and invasions) have not been very effective in bringing about peace and prosperity in the target countries. Easterly is probably right, but the evidence is lacking, and Easterly comes across rather emotional and, well, rather flippant in this part of the book.

Easterly is a brilliant development economist who has done much to press forward the debate on foreign aid and development practices. However, he is no national security expert, if one should judge by his chapters on military interventions....