Foreign Aid Solutions

[davidI]

I just finished reading "Dead Aid" by Dambisa Moyo and thought it was an excellent, eye-opening read.

A quote from her:

“You essentially have a problem whereby African governments are getting aid because they, the donors, are worried about the levels of poverty in those countries. But that aid then tends to spew out a lot of corruption, it creates a lot of bureaucracy, it kills off entrepreneurship, and it disenfranchises voters in those countries.”

Basically, she contends that aid does more harm than good. I drew a lot of parallels with how the handouts to Natives in Canada haven't really helped them at all.

A couple quick reads I found online:
Solutions for the Economy - Stop Foreign Aid -
http://www.jbs.org/jbs-news-feed/3722

http://articles.cnn.com/2010-08-12/opinion/africa.aid.calderisi_1_foreign-aid-government-budgets-african-governments?_s=PM:OPINION


So the question becomes: how do we, as voters of an aid-giving developed country reform our policies so that Africa (and other developing nations) grow their own economies? We all want to give because we think it will help, but from what I've read, not giving would help more!

[davidI]

More reading:

http://www.newsweek.com/2009/03/20/thanks-bono-but-no-thanks.html

This is an excellent summary of many of the "Dead Aid" arguments:
http://www.spiegel.de/international/spiegel/0,1518,363663,00.html


Huge bureaucracies are financed (with the aid money), corruption and complacency are promoted, Africans are taught to be beggars and not to be independent. In addition, development aid weakens the local markets everywhere and dampens the spirit of entrepreneurship that we so desperately need. As absurd as it may sound: Development aid is one of the reasons for Africa's problems. If the West were to cancel these payments, normal Africans wouldn't even notice. Only the functionaries would be hard hit. Which is why they maintain that the world would stop turning without this development aid.

http://blogs.reuters.com/africanews/2009/02/05/time-to-stop-aid-for-africa/

http://www.nrc.nl/international/Features/article2172883.ece/Stop_giving_aid_to_Africa._Its_just_not_working



So why do Western countries keep on giving if it doesn't help?

"The cynical answer is: because it distracts attention from the trade barriers they have erected in order to protect employment in the West. These trade barriers cost Africa an estimated 500 billion dollars every year. That's ten times the amount Africa is given in development aid. And because they secretly don't believe that Africa is ever going to pull it together. They feel sorry for the Africans. So they buy themselves a conscience.

[davidI]

On the opposite side of the fence, How Aid CAN Work

http://www.nybooks.com/articles/archives/2006/dec/21/how-aid-can-work/

http://www.huffingtonpost.com/jeffrey-sachs/aid-ironies_b_207181.html

[CUG]

Isn't that brutal. People pour hundreds of millions into Africa every year, I'm sure of it.

How I thought aid worked when I was a kid:

-I send $5
-It costs $0.50 to get there
-Some kid gets enough money to buy a some milk and cereal.

How I believe it works today:
-Millions are collected
-80% gets tied up in frivolous and unnecessary administrative costs
-The money gets intercepted by the African governments
-King Kuol gets a new golden throne.
-The people who matter are left behind.
-Charities scream for more

I'd send a boat full of big-mac meals over there if they'd survive the trip, and actually get to the people who need to eat them.

[kaput]

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[1barA4]

This is why rich folks like Gates and all like to skip the charities and control the aid money they send directly (by creating their own foundation that is transparent and accountable). It's not perfect, no solution is, but it's better.

[Xtrema]

I notices recently there are a lot of charities in town that I have never heard of. Fighting various causes. While they all claim non-profit, I know operators draw salaries from them to leave their day jobs.

But on the flip side, if someone dedicate 100% of their time to it, you really can't expected them to work for free.

[davidI]

Originally posted by kaput
This is exactly why I don't donate any money to charity. People call me cheap, selfish, greedy, you name it, any time there is a charitable donation box.

The problem is that we all end up "donating" through our taxes. We as tax payers should stand-up and make sure government aid is actually being used. Cutting useless / harmful aid would help our budget deficit. Obviously, it's an optics issue with politics as people tend to assume that aid is good.


Originally posted by Xtrema
I notices recently there are a lot of charities in town that I have never heard of. Fighting various causes. While they all claim non-profit, I know operators draw salaries from them to leave their day jobs.


Donating is like investing - you really need to do your research to know what organizations are actually doing good work. Some charities will spend $2 to raise $3 (Galas, Events, Advertising etc.)


I'd just like to see my tax $ go to use!

[davidI]

http://www.nationalpost.com/news/harper+defend+canada+foreign+next+week/3530892/story.html

Looks like Canada has budgeted over $5 billion for development aid next year. Divided by the population of ~33.5 million that's over $150/person. That means your typical family of 4 is giving $600 this year.