Friday, December 25, 2009

How Effective Is Foreign Aid in Ending Extreme Global Poverty?

This segment from ABC's 20/20 questions the effectiveness of direct aid toward ending global poverty. Many today question the wisdom of continuing to give foreign aid in the same ways that we have in the past, given that strategy's poor performance.

The video raises many of the same questions considered in Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa by Dambisa Moyo. Publisher's Weekly says, "In this important analysis of the past fifty years of international (largely American) aid to Africa, economist and former World Bank consultant Moyo, a native of Zambia, prescribes a tough dose of medicine: stopping the tide of money that, however well-intentioned, only promotes corruption in government and dependence in citizens. With a global perspective and on-the-ground details, Moyo reveals that aid is often diverted to the coffers of cruel despotisms, and occasionally conflicts outright with the interests of citizens-free mosquito nets, for instance, killing the market for the native who sells them. In its place, Moyo advocates a smarter, though admittedly more difficult, policy of investment . . . . "

This is quite a different vision than that of Bono and economist Jeffrey Sachs, who think that we are all now smart enough to avoid our terrible aid mistakes in Africa during the last half-century. In The End of Poverty: Economic Possibilities for Our Time, Sachs argues that what Africa needs now more than ever is even more foreign aid, because we are now wiser than we have been about what to do with it.

The video segment begs to differ, and you will get to see Sachs defend his position in a rather contentious interview.

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