Idiocy about foreign aid

The Foreign Secretary’s comments could prompt a row with the Liberal Democrats, who are attempting to force through legislation committing the Government to spending 0.7 per cent of GDP on foreign aid.

Standard political idiocy.

We don’t care, at all, how much we spend on foreign aid. We care, rather, about how much of the misery being suffered by our foreign bretheren we alleviate by spending upon foreign aid. Thus we shouldn’t be measuring the success or not by how much we’re spending.

They’re not only setting a target (tractor production!) they’re setting the wrong target (Tonnes of Tractors Produced!).

34 thoughts on “Idiocy about foreign aid”

  1. “We care, rather, about how much of the misery being suffered by our foreign bretheren we alleviate…”

    Nope! ‘We’ (meaning me & a lot of others) don’t care one jot, and would rather the money was spent on English things or better yet, not taken away from us in the first place!

  2. It’s just politics. Everybody involved knows 0.7 has no rational basis but it has a lot of political weight globally and serves as a mechanism to increase generosity. All you need to justify that is the belief that we are still on the segment where there is a positive relationship between aid and outcomes* And that’s getting easier to believe, absorption constraints are generally easing, if proxies by aid to GDP ratios. So not idiocy. Maybe even a good policy. Most estimates say global aid flows are still far below need.

    * of course you need to give a shit about your fellow human beings too. Fwiw a standard econ welfare max model in which we place a weight of one tenth on welfare of foriengers and include high levels of waste imply aid generosity far higher than 0.7 you really need to think aid is harmful or absorption constraints very severe, or really hardly care about poor foreigners to get down to 0.7

  3. So Much for Subtlety

    I think TW misunderstands the purpose of aid. It is not to help the dark and dusky. It is to provide job opportunities for nice middle class girls called things like Jacinta.

    If you cut the aid budget, they would have to cut their gap years short and get a real job. Outdoor relief for the upper middle class.

  4. bloke (not) in spain

    ” of course you need to give a shit about your fellow human beings too”
    “We care…”
    Foreign aid, like most charity has SFA to do with the recipients. Lot to do with the donors.
    Perfection comes when the donors get their rush but others pick up the tab. So foreign aid.

  5. According to Stephan Molyneux’s recent piece about Aid–close to a trillion dollars has gone to Africa in the last sixty years –the total effect has been to enrich and thus further empower the murdering scum who rule. Things are beginning to improve in parts at least but mostly due to African entrepreneurs and tech like mobiles . Fuck all to do with govt to govt handouts. No foreign aid at all outside of disaster aftermaths–earthquake, Tsunami etc.

  6. http://recom.wider.unu.edu/article/economic-aid-vs-democracy-aid-democratic-consolidation-africa

    Incumbent turnover happens when an election leads to an incumbent leaving office… Aid is found to have the following effects on the likelihood of incumbent turnover:

    Democracy aid is strongly associated with an increased likelihood of incumbent turnover.
    Economic aid is associated with a lower likelihood of political turnover when political opposition is weak, suggesting that economic aid may help keep incumbents in power when they dominate the legislature but that it unlikely to have this effect when the opposition has a strong legislative presence.

    So mixed picture. IMHO the risk that aid props up odious regimes is my top fear about aid, but evidence for that is mixed and donors can change how they go about doing things to mitigate that risk.

  7. I don’t get why they don’t just leave us the money and let us give to charities that we choose (or not, as we may decide), rather than having the government trading the promise of aid for god knows what…

  8. If the developed countries were genuinely interested in promoting economic development in the developing world, the best and possibly only way of doing this would be to remove tariffs and quotas on developing country exports.

    For the rest, it’s hard to dispute what Ron Paul says: “Foreign aid is taking money from poor people in rich countries and giving it to rich people in poor countries”.

  9. Foreign aid is taking money from poor people in rich countries and giving it to rich people in poor countries”.

    If you really think that taxation in rich countries is so highly regressive to make that true, let see you arguing for more progressive fiscal policy. Otherwise this is just a fake objection, you don’t really care about taxing the poor.

    Also it’s not as if we have no research about incidence of aid, of course there is elite capture, there has also been massive reductions in infant mortality amongst the poor, improvements in child nutrition etc, the data are there if you care to look, which Ron evidently does not feel the need to

  10. LE

    You’re right that that the first part of the Ron Paul quote is a bit tendentious so it’s more of a handy aphorism than an entirely serious argument. The money comes from general taxation, including that contributed by the least well off taxpayers.

    On the other hand, when you talk of “absorption constraints”, you drift into the register of linguistic nonsense favoured by aid ‘professionals’.

    It’s the development of private sector activity that gets countries moving rather than official development assistance. Paul Collier is perhaps a better guide than Ron Paul.

  11. It is not nonsense to think there are limits to the quantity of aid countries can use effectively. I was just chatting to a World Bank economist, they have more money than bankable projects. It may be nonsense to think aid to GDP ratios are informative about those constraints, but supposing there are no constraints is not an improvement

    Bauer backed up his claims with research that looked at effect of aid on consumption of the rich, I think contemporary replications of that on more recent data show more of an effect on poor household consumption. But I quite agree elite capture is a problem

  12. I agree with Tim that setting a target of 0.7% of GDP is meaningless posturing since any Anglican or Baptist who is taking it seriously will be giving at least 1% (10% of 10%) – it may be higher for Roman Catholics!
    The trouble with official aid through official channels is that there are great dangers of (i) capture by corrupt elites and (ii) it being used to generate sales for the “defence” industry rather than providing farmers with seedcorn. I far prefer private charity which is usually far better at relieving suffering.
    However if we are spending 30% of GDP on the welfare state in the UK, 0.7% on overseas aid is almost trivial. Julia M should complain about the amount of GDP that is wasted in incompetent administration of the welfare state which waste is a multiple of overseas aid. Abolition of income tax for all those deemed to be in need of “tax credits” or other means-tested welfare would be a start, as would IDS’ universal credit which should eliminate marginal tax rates of over 100% (unless Millionaireband wins the next election).
    I am largely sympathetic to Luis Enrique in this case: if you don’t think other people matter you won’t have a welfare state (or almshouses, or schools for orphans, or Friendly Societies, or hospices, or most of our hospitals – all of which pre-dated by far government intervention). If you do then overseas people matter as well. And if you are just concerned with your own convenience, making life in Africa a little better will decrease the flood of people fleeing Africa in unsafe boats to reach Italy and then queue up outside Calais seeking a way to smuggle themselves into England*.
    *the Channel Tunnel doesn’t go to Scotland or Wales

  13. Ah, overseas aid: keeping Mercedes dealerships in Nigeria busy since 1967. The Norwegian government once bought two air ambulance helicopters for one of the more inaccessible Nigerian states, after much pleading by that state’s governor. They didn’t do much air ambulancing, but did get used as the private transport of the governor and his wife/mates.

    Shell built a school in a local town in the delta once, which was immediately seized by the local head honcho who started charging school fees. In another town they built a clinic, which became the local leader’s house.

    Anyone who thinks sending money to African governments (at any level) is a good idea really ought to try living there for a while.

  14. Charity is great, but not so good at civil service reform, hydro power, piloting cash transfer programs, national maternal health reform, most things that need scale or government involvement. There are problems with undermining rather than supporting but plenty of poor countries rely on donor expertise to put together projects etc. I’m not saying govt to govt aid gets all this stuff right but there is a gap in the market, so to misspeak

  15. Bloke in Costa Rica

    The real problem seems to me to be a Catch 22 situation in that countries which have sufficiently robust and developed institutions as to be able to make use of aid money without diverting it all into waste and corruption are likely to be the ones least in need of it, since they can bootstrap their way out of poverty on their own. Therefore the sole focus of foreign development should the fostering of a political and social climate that makes mere simple-minded cash aid superfluous. Hernando de Soto in The Mystery of Capital made pretty much this argument. No doubt this sort of thing is condemned by the NGO mafia as cultural imperialism or some such rancid nonsense – whether from genuine Marxoid conviction or a fear of derailing the gravy train I cannot say.

  16. @ Luis Enrique
    “Practical action” does set up small hydro-electric plants to provide electricity to communities not served by the grid. The Baptist Missionary Society has built and is expanding the best maternity service in Chad (most of the mothers are, and remain, Muslims but are very grateful). Cash transfer systems to send money to Africa set up by private-sector banks like Barclays, have been torpedoed by regulations by a third-party government presided over (I was going to say “run”, but realised that was wrong) by a half-white-half African.
    You are right about civil service reform – not within the scope of charities.
    Medecins sans Frontieres (which I first heard of when a young stockbroker contact explained that he would be away for a year or two volunteering for them) is in the vanguard of the fight against Ebola (as it is in most crises); the daughter and son-in-law of one of my friends have both been allowed by their respective employers to take a fortnight’s holiday to work for a charity in Sierra Leone ….

  17. @john77: “Julia M should complain about the amount of GDP that is wasted in incompetent administration of the welfare state …”

    I do, I do!

  18. So Much for Subtlety

    john77 – “The trouble with official aid through official channels is that there are great dangers of (i) capture by corrupt elites and (ii) it being used to generate sales for the “defence” industry rather than providing farmers with seedcorn.”

    Sorry but why do you think farmers, who have been doing this farming thing for about 100,000 years, need someone to give them seed corn? We are all agreed aid is largely captured by corrupt elites, but let me defend the defense industry. Selling Western weapons to the Third World is about the best thing we can do with aid money. Look at Sri Lanka. We sent in the Norwegians who bullied the Sri Lankan government into being nice to the Tamil Tigers for a decade. Then they got sick of it and told them to f*ck off, got shiploads of Chinese weapons and solved the problem. The humanitarian response was not, actually, ours but China’s. We would have had the war drag out for another generation or two.

    “if you don’t think other people matter you won’t have a welfare state (or almshouses, or schools for orphans, or Friendly Societies, or hospices, or most of our hospitals – all of which pre-dated by far government intervention). If you do then overseas people matter as well.”

    If you take an absolutist line. Well, first, you can think that other people matter but the welfare state is absolutely not in their interests. Pretty much anyone with any sense knows that welfare makes people worse off. Genuine compassion involves teaching a man to fish, not giving him lunch. Second, people overseas may matter but they matter less than the people we are related to. Our first and main responsibilities are to our families, our neighbours, our fellow subjects. Only then to foreigners. DNA is a good measure of who we should and do care for.

    However even if we agree that Africans matter almost as much as feckless yobs in Glasgow, we can do something for the feckless yobs. We can’t for the poor in Nigeria. We can pretend we are doing something but no more. Real change would require legal and cultural changes. The sort of thing only Nigerians can do. We can strike a pose. No more.

    “And if you are just concerned with your own convenience, making life in Africa a little better will decrease the flood of people fleeing Africa in unsafe boats to reach Italy and then queue up outside Calais seeking a way to smuggle themselves into England*.”

    There is no reason to think that either. The first thing poor people will do is buy a TV set and discover how good life is in the West. But aid does nothing to make their lives better and may well do a lot to make it worse. It distorts the entire market. For instance, the rumour is the most popular major among Chinese students in Britain is engineering. The most popular major for African students? Social Work. Because they want to work for an NGO. Which do you think it better for the locals in the long run?

  19. @ SMFS
    Your illogic is awesome. As is your repudiation of hard facts and research.
    Not caring about people means no welfare state is NOT the same as caring about people means the horribly distorted welfare state now in operation.
    The Tamil Tigers were Leninist revolutionaries who murdered Rajiv Gandhi who was trying to improve India which would, as a side-effect, make it stronger rival to China and a threat to it. [Rajiv was the one decent member of his dynasty]
    And how many people buy a TV if there is no electricity in their village?
    I could spend half-an-hour and twenty paragraphs dissecting your deliberate ignorance but it is not worth it.

  20. So Much for Subtlety

    john77 – “Your illogic is awesome. As is your repudiation of hard facts and research.”

    Thank you. I do like a fan.

    “Not caring about people means no welfare state is NOT the same as caring about people means the horribly distorted welfare state now in operation.”

    Sure. You know, if you are going to criticise people for their views, it might help if you knew what they were. And in this case, you can hardly point to my objection to your conflation of all possible welfare states into one category as proof I was conflating all welfare states into one category. You over-simplified. Don’t blame me for pointing it out.

    “The Tamil Tigers were Leninist revolutionaries who murdered Rajiv Gandhi who was trying to improve India which would, as a side-effect, make it stronger rival to China and a threat to it. [Rajiv was the one decent member of his dynasty]”

    Such layers of wrongness I hardly know where to start. Perhaps first I could object to the Leninist claim? Naah. Given you did not read what I said or failed to understand it if you did. Or perhaps your comments are not entirely, wildly, off topic and irrelevant to what I did say? But are you seriously claiming that China backed the Sri Lankan government years after Gandhi’s death because they wanted to punish the Tigers for killing the man you think was going to make India a rival to China? I mean, really?

    “And how many people buy a TV if there is no electricity in their village?”

    That would be where UK aid comes in doesn’t it? Or are you claiming that aid projects and increasing wealth in the Third World would not lead to electricity supplies in African villages?

    “I could spend half-an-hour and twenty paragraphs dissecting your deliberate ignorance but it is not worth it.”

    How about thirty seconds? Is that too much to ask. Starting with actually reading what I said and understanding it.

  21. John 77

    You’re not entirely right about Sri Lanka, Rajiv Ghandi and the LTTE.

    One short paragraph for you and it was no trouble at all.

  22. Luis Enrique:
    It is not nonsense to think there are limits to the quantity of aid countries can use effectively.

    Quite right, foie gras producers have long known that there’s a limit to the amount of grain you can get down the gullet of a goose, even using a funnel. Terms like “absorption constraints” are part of the ridiculous jargon of aid ‘professionals’.

    I was just chatting to a World Bank economist
    I’m impressed, tell me more…

    they have more money than bankable projects
    you’d have to hope so, wouldn’t you, what with them being called a bank and stuff? But of course they are not a bank in the normal sense and can (as IBRD) raise money more easily on capital markets than other borrowers it’s just that their shareholders …(yawn)…

    It may be nonsense to think aid to GDP ratios are informative about those constraints, but supposing there are no constraints is not an improvement
    In this bout we have nonsense wrestling with inanity

    Bauer backed up his claims with research that looked at effect of aid on consumption of the rich, I think contemporary replications of that on more recent data show more of an effect on poor household consumption.
    This teeters on the edge of being quite compelling. (Just kiddng)

    But I quite agree elite capture is a problem.
    That’s big of you. Generally the wealthiest man in a developing country is the minister responsible for awarding aid-funded projects. Where this isn’t the case, there is an anti-corruption minister and he is, of course, wealthier still.

  23. MB

    Oh brilliant, another snarky wanker.

    Yes it is dreadful that people who work on a topic have a phrase to refer to an important real world phenomenon isn’t it

    And the WB really doesn’t have so much money, other dev banks are bigger, Tue fact they see constraints on the demand side is important and not inevitable.

    Maybe you want to think about not being such a twat towards people who engage with you and concede point when youvare right, eh?

  24. LE

    Yes it is dreadful that people who work on a topic have a phrase to refer to an important real world phenomenon isn’t it
    Jargon is what ‘experts’ resort to, in order to create an aura of mystique around their chosen subject and to hide their often meagre intellect.

    And the WB really doesn’t have so much money, other dev banks are bigger,
    In what way ‘bigger’ and please name some.

    Tue fact they see constraints on the demand side is important and not inevitable.
    More jargon. It’s always a good idea for a bank not to lend willy-nilly, particularly when it does not countenance defaults from borrowers.

    Maybe you want to think about not being such a twat towards people who engage with you and concede point when youvare right, eh?
    By the same token, you might consider leaving words like ‘wanker’ and ‘twat’ to one side when posting.

  25. @ SMFS
    It’s a bit rich accusing me of not reading and the saying I have conflated all welfare states into the one we have. I said “a welfare state” not “the welfare state”.
    “if you don’t think other people matter you won’t have a welfare state (or almshouses, or schools for orphans, or Friendly Societies, or hospices, or most of our hospitals – all of which pre-dated by far government intervention).”
    I have listed six examples of things that would not happen if people didn’t care about other people and you claim that must mean caring about people means one particular item in one of the six categories. NO fail F-.
    I oversimplified by only listing six examples. I am not blaming for that. I am blaming you for portraying as facts caricatures of TEA party propaganda, ignoring facts, sneering suggestio falsi, alleging I have commented on China’s motives when I never mentioned the country, for claiming that Nigerians cannot learn to fish (or dropping the metaphor learn how to grow hardy windbreaks and dig water traps to prevent desertification, that they cannot use mosquito nets, that drugs cannot cure them of river blindness, …)
    That’s rather more than the thirty seconds you asked for.

  26. MB

    listen fucko, you chose to be needlessly unpleasant. behave like a wanker, I’m going to call you a wanker.

    yes it’s quite clever of your to recognise that jargon is sometimes used to obfustcate, less clever of you to be unable to differentiate between that and legitimate use of jargon to say something quickly that would otherwise require a sentence.

    I am told the WB used to have more viable projects than available funds, but now it struggles to lend. There is even talk of it no longer having a purpose. This is demand side constraint, a real thing, not jargon, but well done for attempting a snide response rather than thinking about substance.

  27. @: Meissen Bison
    Jargon is necessary to save hours wasted in communicating between professionals when the English (or French, or German, or Russian, or Japanese, or Chinese, or …) language does not have succinct words and phrases to describe the concept under discussion. I myself frequently use jargon to the point where I sometimes fail to notice that I am doing so. Not being quite as stupid as I look I used to ask my wife (who has an Arts degree) to read stuff I wanted my colleagues to publish to check whether it was comprehensible to someone outside my profession. After she got too used to my jargon I asked my teenage (maybe I started when he was 11 or 12) son to help until he left home.
    You have got it wrong – jargon is usually used to clarify not to obfuscate. There are some ****s who deliberately misuse jargon to obfuscate but most of us use it to communicate with less misunderstanding.
    Since, on average, I disagree with Luis Enrique more than with you, I hope that you will accept this as an unbiased comment on the use of jargon. Yes, I too am guilty of using jargon, but it is not deliberate and with my son working over 100 miles away I cannot always spot when I have done so.

  28. @ MB
    One demonstration of the appalling nature of the EU bureaucracy was that I was designated a “Senior Expert”, so if an “expert” has a meagre intellect then a “senior expert” should have one GCSE – as I have (grade A in Russian).

  29. John77
    It’s perfectly true that jargon occurs naturally in every field and, rather like couch grass or ground elder, any attempt to eradicate it is praiseworthy but largely doomed to failure.

    My quibble was with that fountain of piffle, Luis Enrique, using aid-speak like absorption constraints here. Even regular chats with World Bank economists (and you can find them in drifts around H Street and Pennsylvania Avenue) are no excuse for this.

    It was and is valiant of you to enlist your family as jargon filters but hardly very kind. You must have great qualities for them to have put up with this though I’m afraid that the hundred miles that separate you from your son today might have been avoidable had his formative years not been blighted.

    Your solitary GCSE -congratulations- is doubtless a late acquisition, nestling on a welter of older and now quite faded certificates in a rarely opened drawer.

  30. @ MB
    If this was on-topic you would deserve a “win this thread”
    My “great qualities” comprised being sole family breadwinner while my wife cared for no 2 son (but working for a charity during school hours); no 1 son would have stayed at home if there was a job for a MMath within walking or commuting range – he moaned more about my grammar than weeding out jargon: he is remarkable tolerant while pointing out my errors to me (e.g. he is the only auditor to spot an error in my accounts), so while some may think my exposing him to jargon was cruel it was not enough to drive him away..

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