Owen abroad

Development advocates have to make the case for aid and development policy. They are right to say that development is in the national interest of the donor, but it may be a mistake to put this at the centre of the argument. Most people don’t need to be convinced that development is desirable; they need to be convinced that aid works.

Development is in our national interest

It is increasingly the conventional wisdom that it is in the national interest of industrialised countries to promote development in the rest of the world. US Secretary of State Hillary Clinton made a speech saying so a year ago at the Center for Global Development:

… development was once the province of humanitarians, charities, and governments looking to gain allies in global struggles. Today it is a strategic, economic, and moral imperative – as central to advancing American interests and solving global problems as diplomacy and defense.

The UK Foreign Secretary, William Hague, also argues that development is a key part of Britain’s strategic and security interests (for example, here and here).

We’ve come a long way over the last twenty years. In January 1991 my father, then a British High Commissioner, sent a despatch to the then Foreign Secretary in London to mark the end of his last post in Africa, arguing that it was in the UK’s national interest to pay more attention to Africa’s development.  His despatch said:

There is an overwhelming case on financial grounds alone for acting sooner rather than later, collectively, to provide the resources required for removing most of the debt burden from African countries (provided that they are committed to active economic reform), for arresting environmental degradation, and for restoring the physical and human infrastructure sufficiently to permit diversification of economic effort and its re-direction into areas that will eventually become self-financing – as well, incidentally, as making a more positive contribution to world economic activity.

At that time, the foreign policy establishment was very suspicious of any argument based on ethical or moral imperatives: it believed that foreign policy should be based on narrowly-defined national interests.  In 1980 the Brandt Report had argued that it was in our “mutual interest” to pay attention to development and inequality, but in the decade that followed Britain’s aid programme, and our attention to developing countries, had declined.  Twenty years ago, when my father was making a case for paying more attention to development based on our national interest as well as our values and moral obligations, his view was regarded as so subversive that the foreign office limited the circulation of the despatch. Today it is received wisdom which is regularly the basis of speeches by the US Secretary of State and the British Foreign Secretary.

We should celebrate the fact that there is, belatedly, recognition among policymakers that promoting development is in our national interest, as well as being the right thing to do.  But I am concerned that we are letting the pendulum swing too far, by placing this argument at the centre of the public case for aid.  We should use every argument at our disposal for doing the right thing, of course; but if we focus too much on aid being in our national interest, we are danger of undermining the effectiveness of aid and of failing to address the real concerns of sceptical citizens.

The nature of public doubts about aid

If I had a nickel for every time someone said to me, “I don’t think we should spend money helping starving people because I don’t give a toss about them,” I wouldn’t have any nickels at all.

The foreign policy establishment may have been sceptical about focusing on the ethical dimension of foreign policy, but the public never was.  Neither the British nor the American people lack compassion for their fellow human beings.  My father’s prescient efforts to awaken policymakers’ interest in development were made several years after Live Aid, which had showed that the public needs no lessons in generosity.

I readily concede that the public is often sceptical about aid. I have witnessed focus group discussions which anybody who is interested in development would find alarming, anyway at first. In such a discussion, the person who says “charity begins at home” will initially get lots of support. But as the discussion goes deeper, it turns out that they are sceptical not because of any indifference to the plight of others, but because they are not convinced that aid works. In many such groups you’ll hear Bauer’s famous remark that aid is “poor people from rich countries giving money to rich people from poor countries.” Many people are worried that aid ends up in the Swiss bank accounts of despots and dictators, or of corrupt consulting and construction firms.  Yet when the same focus groups are given evidence of the benefits of particular aid programmes, their mood changes sharply, and they soon ask: “Why don’t we give more aid like that?”

The idea that “charity begins at home” clearly resonates with many people.  In part the phrase expresses the idea that we have stronger social ties and obligations to people who live in our neighbourhood than we do to people on the other side of the world.  But few people really believe, on reflection, that we should pay no heed to people dying of hunger or for lack of medical facilities just because they are far away.  Perhaps “charity begins at home” resonates for another reason: we can observe at first hand whether the effort we make to help our family and neighbours is actually working, whereas with foreign aid we can’t, and we have a sneaking suspicion that this means that it isn’t.

The most popular critique of aid in recent years, Dead Aid by Dambisa Moyo, does not challenge aid on the grounds that the plight of the poor is not our concern. It is a poorly argued book in many other respects, but it would be wrong to accuse Dr Moyo of callous indifference. Indeed, all the famous aid sceptics, from P. T. Bauer to Bill Easterly, explicitly accept development as the objective: they simply question whether foreign aid is a good way to achieve it.

The dangers of relying on national interest

So perhaps the public does not need to be persuaded that development matters, but needs instead to be convinced that aid makes a difference.  Even so, it seems reasonable to say that we should use every argument at our disposal for aid: we should appeal to the public’s self-interest as well as their moral values, and we should at the same time set out the evidence that aid works.

But there are two big risks to this approach which should lead us to think carefully about the balance of how we make the argument.

First, if we promote aid principally on the grounds that it supports our security and commercial interests, we should not be surprised when people expect that this is how aid should be used.

In the long term our national interest coincides with our moral urge to promote development and to reduce poverty.  But in the short term there is often a trade-off between development and poverty reduction on the one hand, and our commercial, security and strategic interests on the other.

During the Cold War a huge amount of aid was wasted currying favour with despots for geo-strategic reasons and accordingly propping up failing industries and businesses.  Even today, less than 40% of aid is spent in the poorest countries.  This makes a kind of sense if your aim is to increase your influence in emerging economies and in fragile states like Pakistan and Iraq.  There are many poor people in these countries, but all the evidence suggests that these are not the places in which aid is most needed and can do the most good.  A significant portion of aid (though none of the UK’s aid) is still tied to firms in donor nations. This makes sense if the aim is to support the donor’s commercial interests but not if the aim is to have the greatest possible impact on the reduction of poverty.  It is legitimate and proper for donors to want credit for their aid, to enhance both their international reputation and their image and influence in the recipient country. But this goal leads donors to give too much aid through bilateral aid programmes, on which their national flag can be stamped, and too little through more efficient multilateral institutions and other shared funds, resulting in unnecessary duplication, overheads and transaction costs.

We do not have institutions that can protect our long-term national interest in development and poverty reduction from the pressures to use aid to pursue these short-term strategic, security and commercial interests.  In a world of short time horizons, our immediate interests tend to prevail over our longer-term goals.  So the more we justify aid chiefly on the grounds of national interest, the greater the danger that our short-term national interest will dictate the way aid is used, with negative consequences for the effectiveness of aid and for our longer-term interest in poverty reduction.

If the public were unsure whether they cared enough about global development to give aid, then it might be worth deploying aid in ways which are most obviously in the national interest, even if that required sacrificing some of its effectiveness.  (For many years, the Danish government justified tying aid to Danish suppliers on precisely these grounds.)  But if the public is already convinced that development is important, and their doubt is primarily about whether aid is effective, then it makes no sense to use aid in less effective ways in an effort to win greater public approval.

The second reason why we should be cautious about focusing too much on our national interest when justifying aid is that we are in danger of setting ourselves up to fail.

Take an example which is, literally, close to home for me. School enrolment here in Ethiopia has risen from a quarter of all children fifteen years ago to more than four fifths of children today. About a third of Ethiopian children – 8 million boys and girls – are at school as a direct result of foreign aid.  My house in Addis Ababa is a few hundred metres from the local primary school, so I see boys and girls going past my window to school every day.

If the British public could see as I do how their aid money is being used, they would, like me, be encouraged and touched by the good that aid does.  This is a direct, demonstrable benefit of aid, and one which appeals to the British sense of justice and empathy for our fellow human beings.   It would soften the heart of the hardest sceptic.

Kids going to school near my house in Addis Ababa. A third of Ethiopia's education system is financed by aid.

Why then is there such widespread doubt that aid works?  In part it is because people at home cannot look out of their window and see it working.  But it is also because we have made extravagant claims about what aid will do. Even if it is true that aid leads to faster economic development, and that it thereby reduces the risk of global health contagions, organised crime and drug smuggling, this would be impossible to demonstrate statistically.  (It would be like trying to show that the EU has prevented war in Western Europe since 1945: plausible, very probably true, but unprovable.)

People are right to be doubtful about the validity of some of the more grandiose claims for what aid can achieve.  Perhaps it seems too modest to say that we pay for millions of children to go to school, and for people to have access to clean water and basic health care. But this is a reality which we can prove beyond any doubt; and for most taxpayers it will seem well worth the modest amount of money we spend on it.  And it is probable, even if unprovable, that all this works in favour of our own long-term interests as well.

The public and the politicians who represent them will inevitably devote only a modest amount of time to thinking about development.  If we use up scarce bandwidth making an argument with which few disagree – that poverty matters – we waste the opportunity to make the argument of which they are yet to be convinced: that development policy and aid can and do make an important difference to the lives of the poor.

The aid that was used to prop up Mobutu in Zaire during the Cold War may have served a foreign policy interest, but it did little or nothing to reduce poverty and raise living standards in that country.   Money used today to buy food aid may be a convenient subsidy for American and European farmers but if we bought the food locally we could feed twice as many people with the same money and at the same time support the growth of sustainable agriculture in developing countries. The more we use aid to support our strategic and commercial interests, the less effective that aid is likely to be in the fight against global poverty, in which we have an important long-term interest.

It is in our national interest to see faster development and the end of global poverty, and we should not be shy about saying so.   But we should think twice before using this as the central plank of the case for more effective development policies and more aid.  People do not need to be persuaded to care about global poverty: they do need to be convinced that there is something we can do about it.  Just reminding them that it is in our national interest to promote development fundamentally misses the point.  The more we defend aid mainly on the basis that it is in our national interest, the more likely it is to be bent to our short-term commercial and strategic interests, the more ineffectively it will be used, the harder it will be to demonstrate its benefits, and the greater the justification for public scepticism.  Give the public some credit: they don’t need to be persuaded to care about poverty.  Aid does work:  and the first and most pressing task is to demonstrate to the public with persuasive evidence that this is so.