Video Interview Dr. Dambisa Moyo
video Interview Dambisa Moya
http://www.charlierose.com/view/interview/10175
BobSample 07/08/2009 12:05 AM Report
Thanks for this fascinating interview, Charlie. Dr. Moyo shows a deep understanding of the economies in her native Africa, but I believe her critique of foreign aid does not recognize the good that has been accomplished along with the harm.
I have not yet read Dr. Moyo’s book, so I will not comment on her proposed solutions beyond the observation that “free market” approaches such as “liberalization” of imports and exports, focus on cash crops in agriculture, strict control of government spending, especially on education and healthcare, privatization of ports and airports, postal systems, water systems, and more do not have a very good track record. Such policies were imposed by the World Bank and IMF as a condition of loans and are widely credited with contributing to the decline of African economies in the 1990s.
Dr. Moyo is lumping all development assistance in the same basket and condemning it unnecessarily. For example, it is somewhat disingenuous of conservatives to criticize foreign aid for failing to create growth in African economies in recent years and to alleviate poverty, when for 40 years of the Cold War, the true purpose of foreign aid, as espoused by conservatives, was to buy the allegiance of governments, usually dictatorial governments, in the global fight against the Soviet Union. During the entire period of the Cold War, scant attention was paid to grassroots development issues that would benefit the poor. And where development “projects” were entertained, they usually involved massive amounts of dollars and huge construction projects that were designed to curry favor with the elites of a country and which almost never responded to any needs of the poorest people at the bottom of most “Third World” societies. So most of the $1 trillion dollars in aid mentioned by Dr. Moyo was never intended to end poverty or help struggling economies to become independent. To criticize foreign aid over the last 60 years without admitting this major issue is deceptive at best, downright dishonest at worst.
For a somewhat more sinister version of this thesis, see Confessions of an Economic Hit Man by John Perkins, who makes the point that the additional purpose of aid was to create dependency, supported by massive debt, in order to guarantee allegiance of poor-country governments during the Cold War.
As a development advocate favoring cost-effective approaches that work, I assert that a small part of “foreign aid” has worked very well. It is less that 20% of the overall Foreign Aid budget on any given year. I am referring to expenditures in particular on global health, sustainable agriculture, microfinance, and more recently, education for all.
In the 1980s and 1990s, for a pittance in money, with U.S. leadership and funding, the world succeeded at immunizing over 80% of the world’s children against major childhood diseases such as measles, whooping cough, tetanus, and polio, while mounting child survival campaigns that educated families on the use of simple salt and sugar solutions to avoid diarrheal dehydration and bed nets to avoid malaria. UNICEF estimates that over 3 million children’s lives are saved each year from these measures, and the overall infant mortality rate from preventable poverty-related causes has plunged from 40,000 per day 25 years ago to about 28,000 per day today.
The Global Fund to Fight AIDS, TB, and Malaria has become, in 7 short years, the major provider of prevention, treatment, and cure for these three conjoined pandemics of poverty. The U.S. has spent a few billion over the lifespan of the organization, which has been matched 2 for 1 by other donor countries. The Global Fund’s approach is a whole new way of conducting multilateral foreign aid – national plans must be developed by requesting countries and all levels of society, from the government to the grassroots, and representatives of all stakeholders, including patients and local doctors, must be involved in the planning, the application, the management of programs, the expenditure of funds, and the monitoring of progress on a regular basis. During these past few years, as a result of Global Fund efforts and a few other aligned efforts, we have seen the substantial slowing of the AIDS pandemic, the dramatic reduction of the TB pandemic, and the substantial reduction of malaria deaths worldwide. Millions of people are now alive, including millions of children, as a result of this relatively modest expenditure of foreign aid funds.
There have been a growing number of aid efforts aimed at supporting sustainable agriculture and many other basic sustainable approaches that have resulted in a massive amount of sustainable economic activity among the poor and the poorest of the poor around the world. The major approach that has led to sustainability for millions is microfinance, arguably the most successful and cost effective development approach of all time. The U.S. has made a modest contribution of $200 million per year over the past few years as an effort to jumpstarting and help with expansion of microfinance programs. These funds are constantly recycled since much of their use is for loan funds that are loaned out and repaid at interest and then loaned out again and again. In New York, in February of this year, the Microcredit Summit Campaign hosted a celebration to acknowledge the achievement of the 10-year goal to reach 100 million of the world’s poorest families with microcredit (see www.microcreditsummit.org). Millions of families in Africa, Asia, Latin America and throughout the world have now moved above the $1 per day poverty level. While, this does not mean they have reached the middle class, they can now can afford basic housing and sanitation, basic clothing, sufficient food to maintain a healthy life, and access to healthcare so that babies don’t die from every preventable cause and mothers don’t die in childbirth.
Finally, in recent years, modest amounts of U.S. foreign aid have been spent on the growing movement to have all the world’s children in school by the year 2015. A “fast tracks” effort, similar to the Global Fund approach, has been mounted in many countries that requires comprehensive planning, citizen involvement, and accountability. In fact, there is now a movement to create a multi-lateral Global Fund for Education modeled after the Global Fund to Fight AIDS, TB, and Malaria. Education for All campaigns are coupled with efforts to do away with the World Bank and IMF requirements for loan recipient countries to charge school fees in a misguided effort to fund educational institutions by making the families of students, even extremely impoverished families, pay for their children’s education. In Kenya, when school fees were eliminated recently, over 1 million children swamped the schools. Subsequently, education support from targeted foreign aid has helped Kenya to train and hire thousands of new teachers.
Knowledgeable readers will recognize that the successful foreign aid approaches above are aimed at achieving Millenium Development Goals #1 – to cut absolute poverty in half by 2015, #2 – to have all children in school by 2015, and #6 – to cut AIDS and other infectious diseases in half by 2015. These goals, while a huge stretch, are achievable with a combination of foreign aid funding, host government funding, corporate funding, and private donor funding, along with a concerted effort on the part of those affected to help themselves.
Few people believe that foreign aid is a panacea. Far from it. In many ways, much of U.S.foreign aid is either spent on non-development approaches such as military equipment or security training, or frankly wasted on big capital intensive projects that have almost universally failed, or tied to U.S. consultants, U.S. products and services, or U.S. transportation that end up getting the majority of the funds.
Dr. Moyo is right that much foreign aid of the past, especially during the Cold War, created dependency and stifled initiative and creativity. In fact, it was frequently designed to do so.
The U.S. foreign assistance approach needs to be dramatically reformed, not eliminated. Priority should be placed first and foremost on poverty elimination and creating growth in local economies. Additional goals should be to enhance self-sufficiency among the poorest recipients, and to provide services and support that is cost-effectiveness, accountable, and transparent.
Bob Sample
Denver, Colorado
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