The Guardian development blog is running a series of end of year reflections on development, including one by me. Many of the articles are upbeat about progress in developing countries, but pessimistic about the short term economic prospects for the industrialised world and for global cooperation to tackle shared global problems.
The series so far includes:
- Duncan Green from Oxfam, who contrasts progress in developing countries over the last year with the gloom of the ‘formerly rich’ countries of the G-8.
- Calestous Juma from Harvard, who identifies regional integration and better links with the diaspora as key drivers of Africa’s growth.
- Shanta Devarajan from the World Bank, who is cautiously optimistic, especially in the light of increased demand by Africans for their governments to be accountable.
- Linda Raftree from Plan, who also emphasizes progress towards more inclusive and open societies.
- Kevin Watkins from Brookings and UNESCO, calling for “a properly financed global fund for education like those that have delivered such striking results in the health sector“.
- Jonathan Glennie from ODI and the Guardian, who is pessimistic about the prospects for international cooperation in the face of rising protectionism and nationalism as a result of poor economic prospects in the US and Europe.
- and my contribution, reproduced below, which gives a positive account of progress in many countries in Africa over the past year, and emphasizes the importance for developing countries of better global decision-making.
Primary school close to our house in Addis Ababa
Living in Ethiopia for the last three years, I saw aid working every day. I saw children going to school, health workers in rural villages, and food or cash preventing hunger for the poorest people. The academic debates about aid effectiveness seem surreal when you are surrounded by tangible, visible evidence of the huge difference aid makes to people’s lives.
But on the whole the sceptics are not disputing that kids are going to school because of aid. They are asking what effect that has on the country as a whole. Does it lead to economic growth? Does it drive up the exchange rate and so damage competitiveness? Do governments become dependent on donors and so less accountable to their own citizens? Does aid keep the bad guys in power?
It is possible that aid is effective in terms providing people with basic services, and at the same time that it is not effective at increasing economic growth. It is even possible that aid simultaneously does short-run good (better services) and long-run harm (worse institutions).
It was this difference between perspectives which made me want to respond to the call for evidence in an investigation into aid by the Economic Affairs Select Committee of the British House of Lords. This committee, which includes some well-known economists and other public figures, is examining the ‘Economic Impact and Effectiveness of Development Aid’.
My written submission is here. It is just six pages long. ( I’m very grateful to Stephanie Majerowicz for her help putting this together.)
The submission begins by trying to address the question of what aid is for, which seems to be the source of much of the confusion about whether aid works. Aid is often regarded as having two purposes: humanitarian aid to alleviate suffering usually in an emergency, and development aid to promote economic growth and sustained prosperity. But this is a false dichotomy: most aid falls into neither category. About two thirds of British bilateral aid is spent on improving services such as education, health, water and sanitation. This aid is not a temporary humanitarian response to an emergency, but a long-term contribution to the provision of key services and an investment in the institutions needed to provide them in the future. The success of this aid is not best measured by whether it leads to growth in the short or medium term, but by the improvements it brings about in the quality of people’s lives.
The submission then reviews the evidence about whether aid leads to economic growth (answer: we don’t know) and whether aid improves people’s lives (answer: yes it often does). The more interesting question is not whether aid works, but which aid works.
But there are also possible adverse effects of aid, and these are potentially serious. The submission suggests that these may be mainly a consequence of how aid is given and that they can largely be eliminated if donors give better aid. But that requires donors to overcome domestic political obstacles to reform of aid.
The evidence finishes with ten suggestions for how to make aid work better. They are:
- Spend more through the multilateral system
- Make aid more predictable
- Make aid transparent, accountable and traceable
- Build the accountability of governments to their parliaments and citizens
- Focus on results and use this to simplify aid
- Invest more in global public goods, especially new technologies
- Focus aid on people in chronic poverty, and on women and girls
- Leverage the private sector
- Use innovative finance to increase the productivity of aid
- Learn more and fail safely
It is a good discipline to be concise, but it is not possible to do full justice in six pages to the nuances of these issues. I have tried address the big questions with what I hope are balanced and dispassionate judgments. I hope you will let me know in the comments if you think I’ve got these right.
Read the full submission here.
This blog post was also published on CGD Views from the Center.
A new edition of the Development Drums podcast is now available online. Malini Mehra from the Center for Social Markets and Alex Evans from the Center on International Cooperation at NYU take a step back and look at the broad sweep of the big development challenges of the 21st century.
Malini Mehra and Alex Evans discuss the big development challenges of the 21st Century in Development Drums 25
Alex Evans and I recently took part in a discussion of the big development issues with a committee of Members of Parliament in the British House of Commons. Alex kicked off that meeting with a magisterial and somewhat pessimistic presentation which set out ten key issues for development, and we took his presentation as our agenda for this discussion on Development Drums.
Malina and Alex are interesting and knowledgeable on a dauntingly wide range of issues, and the podcast covers a lot of ground: the changing distribution of global poverty; demographic change; the financial crisis; oil prices; food prices; feeding the 9 billion; climate change; trade; the changing face of conflict; the global governance deficit; and the implications for UK development policy. Each of these issues really needs an entire episode of Development Drums to be discussed properly, but I thought it was interesting to bring them all together to draw out common issues and ideas.
The following thoughts struck me from the discussion:
First – the importance of resilience which cropped up again and again in the discussion. I think this is possibly the Next Big Thing in development thinking (as if we need more Big Things). The idea is that we should be helping to develop the institutions and assets that ensures that people are resilient to shocks, of which there seem to be likely to be more.
Second – treating shocks as opportunities as well as risks. As Alex points out in the podcast, there was a narrow window after the collapse of Lehman Brothers during which we could have remade the global financial system: but nobody had a plan ready to go. There are going to be more shocks: will the progressive development community be ready to seize the opportunities these represent?
Third – the almost complete failure of global governance. All the issues we discuss relate in some way to the failure to put in place effective global processes and institutions to solve collective action problems such as on trade, climate change, or food supply. As Malini says, we are living in an era not of the G-8 but of G-0. Alex provides an interesting analysis of the problems in the podcast: on the face of it, to my mind, the problems don’t sound insurmountable.
Fourth – the optimism and energy coming from emerging countries such as India and China. Malina both describes and embodies this. But it’s also clear that on many issues – notably trade and climate change – the interests of these increasingly powerful countries are now diverging from those of the less developed countries, and we need to think hard about ensure the interests of the poorest countries are not left behind a grand bargain between the old and new rich countries.
Fifth – development policy isn’t mainly about aid. In a discussion which surveys the big development challenges confronting us, aid hardly gets a mention. Yet most of the development agencies in the world spend most of their time thinking about aid.
How to listen to development drums
You can listen to Development Drums on your computer straight from the website (http://developmentdrums.org) or download any episode (from here) to your MP3 player or computer. Alternatively, you can subscribe to Development Drums on iTunes free of charge (search for “Development Drums” in the iTunes store).
As is the Development Drums custom, the podcast plays out with a slightly relevant song. See if you can guess before you get to the end what it’s going to be (there’s a clue hidden in the title of the podcast, Episode 25: Global Development Challenges).
Other development podcasts
I find podcasts a convenient way to keep up to date, especially when I’ve got long plane flights or trips by road; and lots of people listen to them when running on the treadmill in the gym or during their commute.
If you enjoy Development Drums, you may also enjoy the Center for Global Development’s Global Prosperity Wonkcasts, which are a bit shorter than Development Drums. As with Development Drums, you can listen online, subscribe to the feed or subscribe free on iTunes.
The Guardian has also recently started a monthly development podcast. The most recent editions are about “securitisation of aid” (that is, greater focus of aid on fragile states) and on so-called “Land Grabs“. Again, you can subscribe to the feed directly, or get it free on iTunes.
Here’s a complete list of development podcasts:
- Development Drums
- The Center for Global Development Prosperity Wonkcast
- The Guardian Focus Podcast
- Think Before You Give
- BBC Africa Today
- Peterson Perspectives
- PRI: Global Health and Development
- The World Bank Podcasts
- Philanthropy This Week
- PRI: The Changing World
Other economics podcasts
Tim Harford (author, and FT leader writer) has just compiled a list of the best economics podcasts.
I don’t think it is possible to determine statistically whether aid makes a lot of difference to how quickly a country develops. But there is a very good case for aid on different grounds: that it enables people to live better lives in the meantime.
Though the effects of aid on development are uncertain, there is a huge amount that industrialised countries can do – or not do – which affects how quickly countries develop. The policies of rich countries on trade, investment, migration, the environment, security and technology can make a huge impact on how quickly poor countries are able to develop.
Yet we tend to judge industrialized countries too much according to how much aid they give, and too little to how they behave in all these other ways.
The Center for Global Development provides an essential service by ranking the rich each year so we can see how we are doing. They use a series of quantitative measures on all these dimensions to create a composite picture of how a country’s policies affect development. The 2010 results are now in.
The overall rankings in the 2010 Commitment to Development Index
For people in the UK who feel smug about the UK’s approach to development, the Commitment to Development Index makes pretty sobering reading. The UK is in 16th place, out of 22 countries in the index.
The UK has fallen ten places since 2005, when it was in joint fifth place, after only Denmark, Sweden, Netherlands and Norway.
The UK is one of only three countries to have got worse rather than better since the index began in 2003. (The other two are Denmark – which started at the very top, and Switzerland.) And this isn’t a point about the change of government: Britain was 16th last year too.
Given that the UK has a relatively generous and effective aid programme, why does it come so far down the league of overall impact on development?
In short: arms exports.
The Commitment to Development Index uses three measures of a country’s security policy. It tallies the financial and personnel contributions to internationally mandated peacekeeping operations and humanitarian interventions. It rewards countries that base naval fleets where they can secure sea lanes vital to international trade. And it penalizes arms exports to undemocratic nations, on the grounds that putting weapons in the hands of despots can increase repression at home and the temptation to launch military adventures abroad.
The UK is by far the worst of the the 22 nations in the index on selling arms to poor and undemocratic governments. UK arms exports, weighted for undemocratic and unaccountable states, are four times worse, as a share of GDP, than the next worst arms exporter, the United States.
The bars shows the scores from 2003 to 2010in each of the 7 dimensions
As well as being stand-out bottom of the pack on arms exports, the UK does badly on migration policy, because it takes too few unskilled immigrants and students for its size; and technology policy both because Government R&D spending is unduly focused on defence, and because the UK tends to pursue intellectual property rights policies that are not in the interests of poor countries, such as allowing patents on plant varieties, and pushing to incorporate into bilateral free trade agreements “TRIPS-Plus” measures that restrict the flow of innovations to developing countries.
Critics of aid often argue that we should focus more on helping countries to develop, rather than what they call ”handouts’ to poor countries. In that context, they usually mention the need for more open trade with developing countries. That is certainly important. The Commitment to Development Index suggests that they should also be advocating changes in UK policy to: reduce arms sales to undemocratic countries, accept more unskilled immigrants, increase the number of foreign students, remove patents on plant varieties and stop arguing for TRIPS-plus.
The UK gets credit for its environmental policies, mainly because it has done relatively well on limiting carbon emissions and because of high petrol taxes. Global warming has a disproportionately negative impact on developing countries, so these measures have an important impact on developing countries.
Many British people are proud of the UK’s commitment to reducing poverty in developing nations, and Britain’s model of an independent development agency within Government led by a separate Cabinet Minister is widely admired. But is it working? Judging by the scores in the 2010 Commitment to Development Index, the UK is doing a better job at securing and spending a rising aid budget than it is at getting the rest of government to pursue development-friendly policies.
I’ve now seen the same annoying elementary (but quite common) mistake twice in two days, and I’d like to knock it on the head before it gets repeated.
According to a blog post yesterday by Malaka Gharib at ONE, Daniel Yohannes, the CEO of the U.S. government’s Millennium Challenge Corporation, believes this:
If Africa captured captured only a small percentage of global trade, it would make a big difference. In fact, in 2008, 1 percent of global trade was worth $195 billion, more than five times the development assistance sub-Saharan Africa received that same year.
And Ali Hewson and her husband Bono use a similar statistic in this short video (which Chris Blattman posted yesterday):
I support the basic point that is being made: trade is good for developing countries. I can’t recall ever meeting anyone from Africa who would not prefer more trade to aid. I agree with Bill Easterly’s argument in the FT that rich countries should be more focused on reducing trade barriers.
But the video and remarks by Mr Yohannes grossly overstate the benefits of exports.
Before we get on to the economics, let’s try to get the numbers right.
The total value of world trade is about $16,000 billion a year (measured as the total value of exports of goods and services). Exports from sub-Saharan Africa are about $380 billion a year, so they constitute a bit more than 2 percent of world trade, as Ms Hewson rightly says. And aid to sub-Saharan Africa from OECD countries is about $40 billion a year, roughly as Mr Yohannes implies.
So that means:
- If Africa’s share of world trade grew by one percentage point, its export earnings would grow by about $160 billion a year. So the figures quoted by Ms Hewson’s $(70 billion) and Mr Yohannes ($195 billion) are in the right ballpark. (They may get different numbers because they are using different years for their estimates of world trade.)
- One percent of the value of world trade ($160 billion) is about four times aid to sub Saharan Africa ($40 billion). On this, Mr Yohannes is roughly right (he says five times, but he is using older figures).
- If exports from sub-Saharan Africa increased by 1%, as Bono puts it in the video, the increase in Africa’s export earnings would be about $4 billion a year. This is only about a tenth of aid to Africa. For Africa to secure a one percentage point increase in world trade would require a 40% increase in Africa’s exports.
So it’s true that if sub-Saharan Africa could increase its share of world trade by 1 percentage point, its export earnings would grow by about $160 billion a year, and that’s about four times what it gets in aid.
But the net benefit to Africa of increasing its exports is not the same as the increase in its export earnings. That is the same mistake as equating a firm’s turnover with its profit.
Put another way, Mr and Ms Hewson and Mr Yohannes are all making the fundamental error of mercantilism, which is the idea that the prosperity of a nation is increased by the accumulation of bullion obtained from overseas.
They seem to have forgotten that exports have a cost. You have to put labour, land, energy and other inputs into making the thing you are going to export – inputs which could be used for something else. You have to grow tea, dig diamonds out of the ground, or make the shoes or silicon chips. You may have to transport the goods. There may be workers on the factory line, and the firm will need administrative staff, drivers and security guards. You may have to make or buy machines, tractors or lorries. All this is a cost. Even oil has costs of exploration, extraction, refining, transportation and damage to the environment.
These may well be costs worth bearing. When you export those goods and services, you get foreign currency in return. This foreign currency enables you to buy more imports. (That’s the point of exports.) But they are costs nonetheless.
Nations benefit from trade in other ways too, in addition to the extra imports that they can buy. Trading nations tend learn from abroad; their firms are forced to be more competitive and so more productive; and the imports can be of machines or technologies that help the economy to be more productive. So being an open, trading nation may help a country to grow faster.
So if the value of increasing exports is not the increase in export earnings, what is it?
The value to a firm of a new contract is not the price on the contract, its the profit it will make meeting it. In the same way, the value to Africa of exports is the difference between the cost of making what it has exported, and the value of what it can import as a result.
Of course, we don’t really know what those exports cost, or what the imports are really worth, so we don’t know the true net benefit to Africa of increased exports. But the value added is more likely to be about 10% of the turnover than 100% of it. If that’s a reasonable estimate, an increase in Africa’s share of world trade by one percentage point would be worth $16 billion a year. This is, as it happens, less than half of what it currently receives each year in aid.
And remember that increasing Africa’s share of world trade by one percentage point would be no mean feat – it would require a 40 percent increase in Africa’s exports.
It is true that nations benefit from exports (or, to be more precise, they benefit from the imports that exports enable them to buy). But you can’t measure the benefit to a nation of exports by the value of its export earnings, any more than you can measure the profitability of a firm by its turnover. Getting this right is important because, as Paul Krugman pointed out in Peddling Prosperity, if you lose sight of the fundamental economics you get drawn into stupid policy prescriptions such as export subsidies or import tariffs. For example, if you make it a policy goal to increase export earnings, you may subsidise exports, and so start to export goods that cost the nation more to make than someone abroad is willing to pay for them. Though export earnings have gone up, the nation is worse off, not better off, because the exports have cost the nation more than it earns from them.
Exports are good for development. There are almost no examples of successful development that have not been built on export-led growth. We should support reductions in trade barriers; and we should support investments that help developing countries to be more productive and so export more at lower cost to themselves. Developing nations would rather have trade than aid, and most taxpayers in donor nations would agree.
But let’s not overstate the case by claiming that the net benefit of exports is the same as the value of turnover. Even if Africa could increase its exports by 40%, which is a lot, and so achieve the (more modest-sounding) increase of 1 percentage point of world trade that Mr and Mrs Hewson, Mr Yohannes, and indeed all right-thinking people would like to see, the benefit to the continent could still be quite a bit less than it presently receives each year in aid.
The development policy debate focuses too much on aid. Aid policies may help to improve the living conditions of people in developing countries, but it is development policies that will result in lasting transformation. If we are serious about promoting long-term change, we should talk less about aid, and more about the other rich-world policies and behaviours that affect developing countries.
Rich countries have many reasons for wanting to help poor countries. The main three British political parties speak in their manifestos of Britain’s obligations to the developing world (Lib Dems); moral duty, common interest and poverty emergency (Lab); and enlightened self interest and commitment (Cons). The combination of motives – moral concern for others and self-interest – is a strength of the development cause, not a handicap.
These motives translate into two broad classes of objectives for development policy:
- One view is that development assistance should help to accelerate economic and institutional change in developing countries. The idea is that temporary support from outside can be a catalyst for permanent changes in developing countries. As economic growth takes off, developing countries will no longer need our help. This view is attractive both to donors, who do not want to go on giving aid for ever, and for recipient countries who do not want to continue to be aid dependent. For shorthand we will call this the transformation objective of development assistance.
- Another view is that development assistance can improve people’s lives today. This is most obvious in the case of humanitarian relief, for which the objective is to provide food and shelter; but more generally a lot of aid is used to send children to school or provide basic health care. On this view, the development process is long and hard, and one role for outsiders is to enable people to live better lives while this process is happening in their country. Let’s call this the solidarity objective of development assistance.
It is entirely reasonable for countries, organizations and individuals to care deeply about both the transformation and the solidarity objective, and they can coherently pursue both objectives at the same time.
From time to time, people try to make connections between these objectives, positive and negative.
The claim of a positive connection is the idea that spending money on health and education is an investment in the human capital of a country, and that this will, in time, lead to faster economic growth. Some point to significant investments in education in fast-growing Asian economies as evidence that education spending will promote growth. Others say that improving health will lead to a demographic transition, in which falling infant mortality leads to smaller family sizes and greater investment in each child. Both of these stories are appealing, though unfortunately neither is very well supported by the evidence.
The possibility of a negative connection is that the things that donors do to support people in developing countries as a matter of solidarity may actually slow down the political, social, institutional and economic changes that the country needs for transformation. It may sustain unaccountable governments in power; undermine the social contract between citizen and state; hollow out fragile government institutions; cause appreciation of the real exchange rate and so choke off exports; or create a culture of dependency that dims demand for social change. Again, the empirical evidence for these (quite plausible) ideas is pretty thin (pace the claims of Dambisa Moyo).
Are we using the right tools to pursue our two types of objective: tying to catalyze transformation, and at the same time to help people live better lives? I think we are focusing too much on aid and not enough on development policies.
It is quite straightforward to see that aid can help meet solidarity objectives. It is used to provide clean water and food, and to finance public services such as health and education. There is quite good evidence that it is effective, though there is much more to learn about how to do it better.
It is much less clear that aid achieves our transformation objectives. The statistical evidence linking aid to economic growth is, at best, uncertain (see The Anarchy of Numbers by David Roodman). This does not mean that there is no relationship – it is much harder to demonstrate a statistical connection when there are few countries to observe, and so many factors as well as aid that are likely to affect whether a country achieves economic lift-off. We can think of aid being to growth what venture capital is to start-ups: many investments will fail, but the huge benefits from the few that succeed may make the losses worthwhile.
I personally have my doubts that aid makes much difference to the prospects for economic and social transformation. Countries change from within, through long, slow, organic processes, and it is hard to see how money and advice from outside can make much of a difference to that. Consider our own history, and the decades and centuries that it has taken us so far to construct our social and political institutions.
If we are serious about promoting transformation, we need to look beyond aid to how we can change the environment in which developing countries are struggling to change their economic, social and political institutions. Transformation is much likely to take root if we create conditions in which it is likely to succeed.
What are the development policies that might contribute to this?
- Trade policy – As well as duty-free, quote-free access for all developing countries to our markets, we have to dismantle the complex rules – such as rules of origin and phyto-sanitary standards – which make exports complicated.
- Agriculture policy – We have to stop dumping subsidized agricultural over production abroad, especially as our aid conditions prevent developing countries from competing with us. We also have to stop using food aid as a welfare system for European and American farmers.
- Climate change – If anthropogenic global warming is a reality, as is the consensus among scientists, then the harm we are doing to developing countries through climate change will become one of the most important obstacles to development. Probably the most important thing we can do to accelerate development is to stop our own carbon emissions.
- Conflict – We make and sell the guns that are used in conflicts in developing countries. We buy the oil and minerals over which groups are fighting. We sustain the unaccountable leaders in pursuit of our geo-strategic interests. If we were serious about development, we would by now have stopped the Lord’s Resistance Army in Uganda – it would be a simple matter for a well-resourced army.
- Immigration – In the 18th Century, a third of Europeans moved to America, to the benefit of both continents. In the 20th and 21st century we have introduced historically unprecedented restrictions on the movement of people – notwithstanding our rhetoric about globalization. These restrictions may be the single most important factor which explains why poor countries have not been able to converge on rich countries.
- Intellectual property – Another constraint on the ability of developing countries to close the gap is that there are historically unprecedented constraints on their ability to appropriate technologies. For centuries, new agricultural techniques such as crop rotation spread through word of mouth. During the industrial revolution, America and Europe were able to use technologies from Britain. When Henry Ford invented the assembly line, the idea was rapidly adopted everywhere. But today’s technologies – from business software to pharmaceuticals and biotechnology – are protected by patents that make it impossible for other countries to adopt.
- Corruption – We often think of corruption as a problem of developing countries, but this ignores the fact that the money for corruption comes from, and often returns to, industrialised countries. Rich western companies pay bribes, in return for access to contracts or minerals. To his eternal credit, President Jimmy Carter introduced the Foreign Corrupt Practises Act, which made it harder for American companies to pay bribes abroad. But there is much more we could do, if we were prepared to take on the vested interests of our own multinational companies, to reduce corruption in developing countries.
- International governance – In our own nations, we have long ago dropped the property qualification for representation; but internationally we do not think that it is strange that representation in our main institutions is based on wealth and power. This matters because again and again, the interests of developing nations are ignored, or treated only as a footnote. From banking secrecy to internet peering arrangement, the rules of the game are set by the wealthy in their own interests. Changes to these practices which would be irrelevant to most of us, but could make a huge difference to the prospects for development, are resisted by powerful vested interests from industrialized countries.
It is entirely reasonable that industrialized countries want both to promote transformation in developing countries, and to help people there to live better lives while that process is taking place. Aid has been proven to be an effective instrument for meeting our solidarity objective, but it is far less clear that it is a significant driver of transformative change. Our political rhetoric focuses on the idea that development policies should promote transformation. Yet it seems unlikely that aid is the most useful tool we have for achieving this. If we are serious about transformation we should invest more time and effort in creating the global environment in which economic and social change are more likely to succeed, by changing our policies and behaviours on issues like trade, agricultural policies and immigration.
Many people who work in development are directly or indirectly dependent on aid. Government development agencies gain their bureaucratic position from the size of their budget. International NGOs get a lot of their money from aid budgets or from private charitable giving. Partly as a result, the debate about development too often shifts to aid: whether it works, how much is given and by what means. These are important questions, but primarily for the important goal of helping people in developing countries to live better lives while they are waiting for, and helping to build, a more prosperous and fair society. If we are serious about accelerating the transformation, it is our development policies, not aid policy, that we should be discussing.
One of my favourite scorecards is the Commitment to Development Index produced each year by the Center for Global Development. The 2009 index was published on Thursday.
What I especially like is that this analysis does not focus only on aid. Too often, we measure the extent of our international solidarity by the amount of aid we give, and not by all the other important things that rich countries do (or don’t do) which affect developing countries at least as much as – probably much more than – giving them money.
Apologies for parochialism, but I was struck that the UK has fallen this year from 6th place to 12th place, out of 22 countries. David Roodman, the uber-geek (and I mean that in a good way) who designed and runs the index, said this:
“The U.K.’s aid giving slowed in 2007, the latest year for which complete data are available, while its exports of arms to undemocratic regimes such as Pakistan and Saudi Arabia ticked upward.”
The UK scores in the Commitment to Development Index are depressed by the index’s judgement that there is insufficient rigor in tackling corruption by UK firms operating overseas, a high level of arms exports to undemocratic and poor countries, high agricultural subsidies, tight controls on immigration from the poorest countries, and restrictive intellectual property laws on plant types and data.
Officials from other countries sometimes think the UK is a little too pleased with itself about development. I wonder if they will think that, now that UK finds itself in the bottom half of the league table, having been overtaken by six countries (New Zealand, Spain, Australia, Austria, Finland and Canada), the UK should focus a little more on how its own policies affect the developing world.
My day job is leading the aidinfo team working to improve the transparency of international aid. Why? Because we think that when aid is more transparent it will be more effectively used and it will help people in developing countries to hold their governments to account. We also believe that if taxpayers can see where aid is really going, and see what a difference it makes, they will support more of it.
So I was dead pleased to see this by David Cameron in today’s Guardian
Transparency tears down the hiding places for sleaze, overspending and corruption. Soon enough all MPs’ expenses are going to be published online for everyone to see: I and the rest of the shadow cabinet are already doing it. And if we win the next election, we’re going to do the same for all other public servants earning over £150,000. Just imagine the effect that an army of armchair auditors is going to have on those expense claims.
Indeed, the promise of public scrutiny is going to have a powerful effect on over-spending of any variety. A Conservative government will put all national spending over £25,000 online for everyone to see, so citizens can hold the government to account for how their tax money is being spent. And we will extend this principle of transparency to every nook and cranny of politics and public life, because it’s one of the quickest and easiest ways to transfer power to the powerless and prevent waste, exploitation and abuse.
Yes, yes, and thrice yes, as Mark Kermode would say.
What’s more, with current technologies, we can do this quite easily, and unleash the creative power not only of armchair auditors, but of millions of people who are not in armchairs but are directly experiencing the effects of that spending and who can help us to understand what is working and how it can be made to work better.
If we can’t get an agreement on cutting food tarriffs and limiting market-distorting agricultural subsidies now, while food prices are surging (see graph), then when we will ever?
You must read this article by Naomi Wolf in the Guardian
From Hitler to Pinochet and beyond, history shows there are certain steps that any would-be dictator must take to destroy constitutional freedoms. And, argues Naomi Wolf, George Bush and his administration seem to be taking them all
Not according to Blake Lambert and Wendy Glauser who write about Canadian NGOs:
Part of the reason NGOs have difficulty meeting their overall goals is that they often end up measuring day-to-day results rather than long-term progress. As Andrew Mwenda, a Ugandan journalist and political economist who’s currently on fellowship at Stanford University, puts it, they measure “inputs rather than outputs.” If an NGO is planning to free up women’s time from domestic labour, for example, instead of measuring how much time they are spending cooking and cleaning, they might typically count how many women attended their last job-training session. “An NGO will say it’s trained 50 farmers in agricultural techniques,” Mwenda says, “but it won’t say whether that has led to an increase in production.”
I don’t think this is a problem confined to NGOs. The problem that many NGOs share with us in government is that there is no feedback loop from those whom we are supposed to be helping. Our accountability is to our donors (or taxpayers) who do not have first hand knowledge of whether we are delivering what we should.
More at Blake Lambert’s blog.
The Government has consistently refused to set up a statutory inquiry into the way that many thousands of haemophiliacs were put at risk by the supply of contaminated blood products. (The new inquiry by Lord Archer of Sandwell is an independent inquiry, not a government inquiry, and has no powers to subpoena witnesses or evidence.)
But it announced yesterday that there will be an official inquiry into the alleged removal of human tissues from the bodies of former Sellafield employees.
I just don’t understand this obsession with the treatment of dead bodies. Dead bodies don’t have rights. I really don’t care if human organs are taken out of dead bodies. What’s more, if these body parts can be used to identify causes of and cures for disease, then I think we should encourage scientists to use them.
How can we possibly think it is more important to investigate what happened to dead bodies than to find out whether somebody has negligently infected living people?
I have just learned from DFID’s Chief Economist, Tony Venables, that the grain required to fill a 25-gallon SUV gas tank with ethanol will feed one person for a year.
Ed Prescott, the joint winner of the 2004 Nobel Prize in Economics, writes in the Wall Street Journal today (behind paywall):
Of all the thankless jobs that economists set for themselves when it comes to educating people about economics, the notion that society is better off if some industries are allowed to wither, their workers lose their jobs, and investors lose their capital — all in the name of the greater glory of globalization — surely ranks near the top. This is counterintuitive to many people (politicians among them), because they view it the government's economic responsibility to protect U.S. industry, employment and wealth against the forces of foreign competition. …
Protectionism is seductive, but countries that succumb to its allure will soon have their economic hearts broken. Conversely, countries that commit to competitive borders will ensure a brighter economic future… This lesson should not be lost on the U.S., the paragon of competitive growth, where politicians and policy makers are contemplating whether to construct more protective barriers. It is openness that gives people the opportunity to use their entrepreneurial talents to create social surplus, rather than using those talents to protect what they already have (or to protect rents, as economists like to say). Social surplus begets a rising standard of living, which begets growth, which begets social surplus, and so on. Rent protection stops growth cold and keeps people poor.
(Prescott also wrote a book, Barriers to Riches, which argues that the main cause of difference of income between countries are barriers to the adoption and transfer of technology.)
A man called Roy Jenkins, who calls himself "Right Reverend", was given an uncontested platform on The Today Programme this morning to peddle his wicked superstitions. He said that Kelly Taylor, the brave, terminally ill woman who is fighting for her right to die in dignity, should instead die a painful, lingering suffering death. The reason he gave was that we do not have rights over our lives because we were created by God and that ending our own lives, or anyone else's, would defeat the purpose for which we were created. He opined that Kelly Taylor's 'pupose' was to inspire us by her bravery and suffering.
My thoughts about this are:
- it is astonishing that anyone in the 21st Century could subscribe to mediaeval superstitions which suggest that people are 'created' by somebody who has a 'purpose' for each of us; these views are both irrational and wicked;
- we do have rights over our lives; if Mr Jenkins chooses not to exercise his that is fine by me, but he has no business preventing Ms Taylor from exercising hers;
- the BBC, as a public service broadcaster, has no business giving this kind of cruel superstition air time in the middle of their flagship current affairs programme. They would not invite astrologers, or flat-earthers, or paedophiles, to lecture us uninterrupted; so why should Methodists or Moslems be any different?
Lord Nigel Crisp – who is also currently working on a review of DFID’s leadership capability – has called for a new system to help global health systems:
His report calls for an NHS scholarship scheme to help with training and recommends a set amount of aid funds to be set aside for health workers. It also says there should be a Global Health Partnership Centre to act as a “one-stop shop” offering information to individuals and organisations wanting to help global health systems.
I am not so sure. What developing governments need is systematic, long term investment in health systems. Capacity building should be based on a serious strategy for institutional development. These volunteer schemes are sticking plasters, which risk diverting attention from addressing the underlying needs of the systems.
The Ideal Government blog comments on Gordon Brown's call for Government to make better use of the internet to have an open debate about globalisation and trade. The Times quotes Mr Brown:
“We have not had these debates successfully. Why are we so much on the defensive on globalisation, why have we failed on the trade debate, why haven’t we persuaded people of the wisdom of what is being done on Iraq?”
Mr Brown said that the positive aspects of globalisation were not being communicated because voices on the internet focused on job losses and other downsides. It was a similar story on world trade, he added.
“One of the failures on trade is that we have not had the debate and on globalisation that we have not been prepared to have the debate,” Mr Brown said
There is not much incentive for government officials to use the internet to engage in these debates – and plenty of downside risks if we overstep the mark. I wonder whether Mr Brown will do more to encourage it.
One of the most important and cost effective ways that rich countries can help poor countries is to invest more in R&D, especially in products that would benefit the poor (such as a malaria vaccine, cheap solar panels, or a cassava plant resistant to mosaic virus). We do have large research programmes; and I took part yesterday in an interesting discussion about whether we should fund such research by paying the researchers directly, or whether we should create financial incentives for the private sector to invest its own money in looking for solutions.
My conclusion is that we need a judicious combination of "push" funding (e.g. subsidies to research institutes) and "pull" funding (e.g. guaranteed markets, or prizes). Push funding is especially useful for R&D that produces basic science of general value which cannot be mainly appropriated by a firm through the sale of products; pull mechanisms are more efficient for R&D that is specific to a particular product.
David Wessell has an interesting article in the Wall Street Journal on January 25th the use of prizes to spur innovation. I thought this was particularly interesting:
One surprise: The further the problem was from a solver's expertise, the more likely he or she was to solve it. It turns out that outsiders look through a completely different lens. Toxicologists were stumped by the significance of pathology observed in a study; within weeks after broadcasting it, a Ph.D. in crystallography offered a solution that hadn't occurred to them.
One of the merits of prizes over government-directed research is that they encourage engagement by a more diverse range of investigators than would be likely to be supported by cautious and risk averse bureaucrats. This finding suggests that might be rather important.
Full text of WSJ article below the fold.
The UK Government is going to consult more widely on its proposals for data sharing within government.
A national identity register that allows data sharing across government could be the technological underpinning of a huge improvement in the provision of government services. (It is important that the technology will not transform the services: it is a platform on which government processes can change).
Those of us who understand the technology and care about our civil liberties should not adopt a luddite stance of opposition: we should send a clear, consistent and simple message about the safeguards we need so that we get the benefits of joined up services without the risks to our freedoms.
I propose the following five, readily understandable safeguards. The government should commit itself to each of these, or offer an extremely good reason why not:
- government data should be stored in decentralized databases that can communicate with each other on a need to know basis, not in shared data warehouses;
- citizens should have access to all data held about them by government
- citizens should be able to see a complete log of every access to their personal data by all public servants
- an independent information security ombudsman should police the systems
- there should be no identity cards and no collection of biometric data
I mentioned earlier this year the need to be rational about "food miles" – that is, the pressure to buy locally produced food.
Interesting to see this article in the Metro today:
Too much attention is being paid to how vegetables and flowers imported by air from Africa cause greenhouse gas emissions, said Bill Vorley, of the International Institute for Environment and Development.
Cutting this trade could have an overall negative impact on African development, he explained. …
'Air freight of fresh fruit and vegetables from Africa accounts for less than 0.1 per cent of total British carbon emissions.
'Climate change is going to affect the poor in Africa harder than anyone else. These are the people who have done least to cause the problem. They should not be made to pay the cost of fixing it too.
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