The latest Ideas Matter update from Max Borders includes an item on William Easterly, the economist who has shed light on the problems associated with traditional foreign aid:
Easterly has his own of messages, which I will paraphrase crudely:
* You cannot view resources as a fertilizer than can simply be dropped from the sky. When you do, all you end up with is a desert full of s–t. [Kokai’s edit.]
* If Aid organizations have a role, it’s to help countries develop institutions in which their basic markets can flourish.
* Prosperity (and complexity) emerges from the bottom up. But emergence can’t happen unless countries get the institutions right.
* Rain money on bad institutions and you get bigger, more formidable bad institutions.
* Rain money on corrupt people and you get more powerful, more corrupt people.
* Rain money on a bureaucracy and you get a bigger, less flexible bureaucracy.
* Rain money on technical assitants and you’ll get more technical assistance — despite the fact that their knowledge is seldom local, and their presence is often artificial (thus ineffective).
I think Easterly would agree with my favorite socio-economic metaphor: the ecosystem. You can’t fix or design an ecosystem like a machine. You can’t grow an ecosystem like a garden. And you can’t treat an ecosystem like a hive. And, indeed, as much as we ache for poor people in far-off places, societies are not families either. Families, hives, gardens and machines are all bad metaphors used by the Aid community. And we need to scrap them.
