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foreign aid Archive

Thursday

22

August 2013

0

COMMENTS

Bono Stumbles On Truth About Poverty

Written by , Posted in Economics & the Economy, Foreign Affairs & Policy, Free Markets

I’ve always liked Bono. Not only does he make good music, but unlike so many in Hollywood he actually seems to care about his chosen causes. Rather than strut and preen for the cameras or play partisan political games, he just goes about his business trying to help in the way he judges best. That’s respectable regardless of whether I share his policy approach, and I rarely do.

But now I have even more reason to like him.

Speaking at Georgetown University about the state of economic reality in Africa, Bono had this to say about poverty:

“Aid is just a stopgap. Commerce [and] entrepreneurial capitalism take more people out of poverty than aid. Of course we know that.”

Sadly, many of the college students present likely do not know that. And while we can ask ourselves why it matters what some musician says about economics and policy, the fact that it is coming out of Bono’s mouth will do more to get them to challenge their own assumptions than it would from someone like me. Culture, even of the popular sort, matters.

Though what was most likely a shocking realization for Bono after decades of experience with impoverished peoples is rather pedestrian for those of us in the free market movement. The failure of aid  has been well covered by folks like Dambisa Moyo. She points out the perversion international aid system, whereby holding on to power in developing countries is a function of pleasing foreign aid givers, rather than their citizens. It is disincentive, in other words, for political accountability. Keeping the aid spigot open is more beneficial for those who desire power than improving that lot of the people.

Nor is how to improve the lot of the people a great mystery. Though it is hard. Essentially, it requires neoliberal institutions to provide the legal and political frameworks necessary to enforce basic rights – with property rights being among the most critical in terms of encouraging economic growth. Hernando de Soto did a great job examining the importance of property rights and access to honest and efficient legal system to encouraging wealth creation.

And let’s be clear about this point. Wealth is created. It is not the natural state of mankind. It is not something that absence of which is explained by some civilizational theft, exploitation, or the spread of capitalism, as it is fashionable to believe in certain circles. To paraphrase Tom Palmer, who delivered the most cogent argument on poverty I have yet heard, poverty does not need explanation. It is the natural state of mankind. The vast majority of humans that have ever existed have lived in grinding poverty. Wealth requires explanation. Only in very recent times in a historical sense have regular people had any wealth to speak of. And it hasn’t grown slowly, it as exploded. Explaining that is much more interesting than explaining poverty.

Wednesday

4

May 2011

0

COMMENTS

Even Facts Can ‘Lie’

Written by , Posted in Foreign Affairs & Policy

I stumbled across an info graphic comparing military expenditures versus that of foreign aid, making the argument that people drastically overestimate how much is spent on foreign aid. But before I get to that, here’s the infographic:

It’s hard to read at this size (full image here), but I think you can get the drift. The U.S. spends less than other nations on “aid” and more on the “military” (used interchangably with defense) both in real terms and as a percentage of GDP.

All of the information presented here is factual. But this is an excellent illustration of how facts, without correct understanding and context, can be misleading. For instance, the image explains that U.S. foreign aid spending includes “disaster relief, long term poverty reduction, hunger prevention, and human rights programs.” That’s all well and good, but our foreign aid spending also includes one very important category not mentioned: military spending. That’s right, much of what we spend on the military is actually foreign aid, as it is spent on the defense of other countries.

The reason France, the UK, Japan, and Germany, among others, can spend so much less on defense is because we are spending it for them. Those troops we keep in their countries aren’t defending our borders, they are defending theirs. Sure, we get some marginal benefits (sometimes), but they get to take what they would spend on defense and spend it on social welfare. We are subsidizing their welfare states with our defense spending. If that isn’t foreign aid then I don’t know what is.

I think many Americans asked how much we spend on foreign aid take this fact into account. They understand that, yes, defending countries for them is aiding them. Don’t get me wrong, even if the graphic was adjusted to account for military spending that is actually aid and not primarily defensive, it’s probably still true that the public grossly overestimates what we spend on foreign aid. It would also still be true that reducing foreign aid would have little fiscal impact compared to the growing entitlement problem. But there are other good reasons to rethink foreign aid, such as whether or not most of it is even effective. It’s also a good reason to rethink our allocation of military spending and  whether it is being put to good use, or in some cases could even be done without.

Sunday

24

January 2010

0

COMMENTS

Damned If We Do

Written by , Posted in Foreign Affairs & Policy

More (previous here) on why it’s so difficult to be the world’s savior:

Fidel Castro is questioning why the U.S. and other countries sent soldiers to quake-ravaged Haiti, saying military presence hindered international cooperation.

The former Cuban president writes that “without anyone knowing how or why,” Washington dispatched troops “to occupy Haitian territory,” and other nations followed suit.

In an opinion column Sunday in state-controlled media, Castro said neither the U.N nor the U.S. “has offered an explanation to the people of the world.”

Castro noted that several governments complained that the troops kept them from landing aid flights and called on the U.N. to investigate.

Bolivian President Evo Morales, a Castro ally, is seeking a U.N. condemnation of what he called the U.S. occupation of Haiti.

Tuesday

19

January 2010

0

COMMENTS

Just To Illustrate The Point

Written by , Posted in Foreign Affairs & Policy

While the difficulties continue to mount in Haiti, tough policy choices will have to be made.  Do we send in more troops to create order?  No matter what we do, it’s clear some will never be pleased:

The United States is using the humanitarian crisis in Haiti as an excuse to occupy the earthquake-hit island nation, two of Washington’s most vocal leftist critics in Latin America implied at the weekend.

“What is happening in Haiti seriously concerns me as U.S. troops have already taken control of the airport,” Nicaraguan President Daniel Ortega said late Friday.

Did Obama’s betrayal of democracy in Honduras buy us nothing with these dictators? Sheesh.

Even our real allies are complaining about a supposed “occupation.”  This just goes to show that in the international arena, no good Americandeed goes unpunished.

Monday

18

January 2010

1

COMMENTS

Rethinking Aid

Written by , Posted in Foreign Affairs & Policy

It’s rare that I find a David Brooks column that I enjoy, but the New York Times’ faux conservative recently took a well-informed look at understanding why Haiti is poor and just what development aid can do different to help.

This is not a natural disaster story. This is a poverty story. It’s a story about poorly constructed buildings, bad infrastructure and terrible public services. On Thursday, President Obama told the people of Haiti: “You will not be forsaken; you will not be forgotten.” If he is going to remain faithful to that vow then he is going to have to use this tragedy as an occasion to rethink our approach to global poverty. He’s going to have to acknowledge a few difficult truths.

The first of those truths is that we don’t know how to use aid to reduce poverty. Over the past few decades, the world has spent trillions of dollars to generate growth in the developing world. The countries that have not received much aid, like China, have seen tremendous growth and tremendous poverty reductions. The countries that have received aid, like Haiti, have not.

The rest is worth reading.

For some possible answers, I’d recommend Dambisa Moyo’s Dead Aid and Hernando de Soto’s The Mystery of Capital.

Saturday

16

January 2010

1

COMMENTS

Haiti And The Responsibility To Aid

Written by , Posted in Foreign Affairs & Policy

As news reports continue to show just how grim the situation is in Haiti, American marines are landing to help the shaken nation.  While the world has responded with an outpouring of support and donations, the earthquake and its aftermath raises important questions about just what moral obligations exist to provide support for disaster-stricken locations, as well as how much and for how long.

From a moral standpoint, Haiti is – at least for the moment – a simple case.  We should provide timely supplies and labor to help free victims, offer medical assistance and protect the population from anarchy.  This appears to be what we are doing.  But from a policy standpoint the questions raised by such disasters can be trickier.

Haiti is also an extrHAITI_Earthquake_48_170614seme case, and I think most will agree that the moral aspect outweighs other considerations.  But what about disasters that are a bit less severe, in nations that are a bit less poor?  By responding forcefully to disasters like this one in Haiti, do we raise an expectation in other cases that we will provide similar aid?  Being the world’s savior seems like it should make you popular, but no one blames other countries for not helping the way they blame us.  That’s because we have given them reason to expect our help, so if it’s ever not provided, we’re bad guys for withholding it.

We also have to figure out just what it is we are obliged, or ought, to do for Haiti.  If we get them just back to where they were, then they are still the poorest country in the world.  Do we rebuild them to better than they were before?  What about the political and social problems that have hampered their development?  Do we establish some sort of government to handle things since theirs, such that it was, has been virtually wiped out?  How do we distinguish that from occupation, and all the problems that go along with it?

These are not easy questions, and I do not have all – or really any – of the answers.  I can only hope that someone, somewhere is at least considering these questions.

Friday

13

March 2009

0

COMMENTS

Geithner Takes Moral Hazard International

Written by , Posted in Economics & the Economy, Foreign Affairs & Policy

Not content with spending the US economy into oblivion, Secretary Geithner is imploring the rest of the world to also destroy themselves in the name of “stimulus.”

Treasury Secretary Timothy F. Geithner yesterday unveiled a sweeping plan that calls on the United States and other nations to offer billions more to bail out economies in crisis and prods a reluctant Europe to prop up the reeling world economy with more aggressive government spending.

But the campaign is triggering controversy on both sides of the Atlantic. In Europe, some officials doubt the wisdom of falling deeply into debt to create jobs and halt the plunge in consumer demand, as the United States is doing. On Capitol Hill, members of Congress have grown wary of approving still more money.

Geithner said the administration will ask Congress to make $100 billion more available — nearly doubling the current U.S. commitment — to the International Monetary Fund to aid struggling nations. U.S. lawmakers said yesterday that they are already bracing for the administration to request hundreds of billions of dollars in more rescue funds for U.S. financial firms, and possibly a second massive economic stimulus package as well.

The IMF is pushing for more aid to Africa.  The problem is, aid to Africa has never worked.  But Geithener wasn’t done.

Geithner said he plans to press his counterparts from major economies to boost their fiscal stimulus and to sustain that spending for as long as the downturn lasts. “Forceful” actions by the world’s leading economies are needed because “the global recession is deepening,” Geithner said.

What was it Albert Einstein said about insanity? Oh, right:

“Insanity: doing the same thing over and over again and expecting different results.”

If “the global recession is deepening” despite all the “forceful” big government plans so far put into action, it may be time to start committing those who call for ever more.

Einstein also had another saying relevant to our current mess:

“We can’t solve problems by using the same kind of thinking we used when we created them.”

Tell that to the big government interventionists.

Thursday

19

October 2006

0

COMMENTS

Lil’ Kim Attacks UNSC “Resolution”

Written by , Posted in Foreign Affairs & Policy

This is too funny.

The successful nuclear test in the DPRK was an exercise of its independent and legitimate right as a sovereign state as it was a positive defensive countermeasure to protect the sovereignty of the country and life and security of the people from the U.S. escalated nuclear war threat and sanctions and pressure.

The “life and security of the people”? You mean the ones that are starving? Yes, we can all see how much you are concerned about their life and security, lil’ Kim. That’s why you spend all their wealth on weapons; makes perfect sense.

The DPRK was compelled to legitimately pull out of the NPT according to its relevant provision and manufactured nuclear weapons after undergoing the most fair and aboveboard and transparent processes as the U.S. seriously encroached upon the supreme security of the DPRK and the fundamental interests of the Korean nation under the pretext of the nuclear issue.

Woah woah woah woah woah. Back this trolley on up. North Korea pulled out of the NPT in 1994? So…that means…it isn’t all Bush’s fault? This isn’t “Bush’s bomb” as Al Gore called it? North Korea became enraged in the 90’s? That can’t be, surely it was because of Iraq!

…The adoption of this “resolution” made it impossible for the UNSC to evade the historic responsibility for having patronized and connived at the U.S. which caused the division of Korea, the root cause of all misfortunes of the Korean nation, in violation of the UN Charter the cornerstone of which is the principle of sovereignty, equality and self-determination and has systematically perpetrated undisguised moves to “bring down the system” in the DPRK.

This is all laughably absurd. The U.S. has given $1.1 billion to North Korea over the last decade in the form of energy and food aid. The only reason they stand up and spittle out this nonsense is because they know damn well we won’t do anything about it. In fact, we’ll keep paying them off!

Enough is enough. Cut them off. Only when their people are dying – and not because we won’t give them aid as some will undoubtedly whine, but rather because their “leader” blows up 40 years of GDP while throwing an international hissy fit – will the North Koreans have to face the hard choice of whether they want to rattle their sword or support their populace. As long as we keep propping them up they don’t have to make that choice.

These appeasement policies under the guise of “humanitarian aid” have got to stop, they do nothing but backfire. Yes, it’s unfortunate that North Koreans don’t have food, but they won’t ever be able to support themselves as long as they have a psycho in power spending all their wealth on international stunts. The more we prolong his domestic failure the longer he remains in power.

Saturday

4

March 2006

0

COMMENTS

Time For Tough Love With Palestine?

Written by , Posted in Foreign Affairs & Policy

By now we’ve all heard the January 25th results of the Palestinian elections. Hamas, recognized by the U.S. government as a terrorist organization, declares itself committed to the destruction of Israel and has now achieved electoral victory in Palestine. It’s time that we look at how our policies might have helped contribute to this outcome.

The United States has already donated almost $2 billion dollars to the Palestinian people, mostly through either the United Nations or various other international organizations. House Representative Henry Hyde, chairman of the Committee on International Relations, believes that “without question, continued assistance from the U.S. and other donors is essential to meeting basic human needs and avoiding a worsening of conditions in general.” That is without question, but what we should be questioning is whether or not it’s a good idea for us to be meeting their needs.

We do not believe a welfare state is good for America. The overwhelming support for welfare reform in the mid-nineties illustrated that Americans believe too big a safety net will result in individuals deciding they don’t have to try and better themselves. Why do we expect a different result in Palestine? But this is about more than just the Palestinian people; it’s also about their government, which is currently a terrorist organization.

Mr. Hyde hopes “that the leaders of Hamas will combine their new mandate with wisdom and compassion for their own people and avoid the exhilarating temptations of apocalyptic visions.” Why should they? Why waste energy trying to help Palestinians when there are countless caring international bodies ready to do it for them? We didn’t prop up Russia’s failed society in the midst of the Cold War, nor should we have as it would have allowed their dangerous government to hold on to power that much longer. Most Russian citizens weren’t involved in that government, they weren’t threatening our country. How come we weren’t as compassionate then and why didn’t we give them financial support? We didn’t because we recognized that to do so would have negative long term consequences. For just the same reason that a welfare state has  negative long term economic and social impact. Why, then, are we propping up terrorist societies in the midst of our so-called war on terror?

Every parent, rather I should say every good parent, knows there is a time when a leeching child must be cut loose for their own good. It might feel more compassionate to give them everything they need, but to do so means they will never learn to support themselves. The Palestinian government has learned they don’t have to support their citizens, as we will compassionately do it for them, allowing them plenty of time to work on their other goals – like the destruction of Israel.