What rich countries should do

Tim Worstall worries that he will get stick from me and Jim about his latest post, in which he draw attention to a piece by Jeff Sachs. Sachs says:

If the United States and a united Europe will honour their long-standing – and long-neglected – pledge of 0.7% of GNP, then Africans and other impoverished people on the planet will roll up their sleeves and get to work saving themselves and their families, and ultimately helping to save all of the rest of us as well.

You will get no stick from me on the need to do economically rational things, like putting in place markets and improving the institutional structure necessary for them to operate. Nor will you get any stick from me on the view that these are as, important as giving more aid, and in some cases more so. But I don’t understand Tim’s near pathological desire to suggest that the need to do these things is any reason not give more aid as well. Furthermore, that doesn’t seem to be what Jeff Sachs is saying either. I suspect my difference with Tim is emphasis. I think that we (ie the rich countries) should focus mainly on the things that are our responsibility and which we can fix, such as liberalising the trade rules, stopping being corrupt, selling fewer arms, being more consistent in our willingness to step in to conflicts and humanitarian disasters like Rwanda and Darfur, contributing less to global warming and desertification, having more rational migration policies, and giving more and better aid; and – at least until we have done what we ought – we should spend rather less time lecturing others on what we think they should do.

1 thought on “What rich countries should do”

  1. When you put it like that it’s difficult to disagree. However, I do have two points.
    1) I think we have found certain immutable truths about how a society needs to be organised in order for it to become and stay wealthy. De Soto and Sen along with those you would more readily associate with my ideology, like Hayek and Friedman. If we do not insist that legal structures, etc etc accord with those discovered truths, then we are failing in our moral duty to aid the poor in development (and yes, for all my rhetoric, I do think we have such a moral duty). Thus it is important that we do lecture others on what we think they should do.
    2)I want this to come before the aid. Yes, Zimbabwe is an extreme case but aid (other than immediate food and medical aid, and even then Mugabe is using that to consolidate power) would not help there at all, the other problems being so great. But that’s the thing. I regard Zimbabwe as being extreme but many if not most of those countries likely to receive aid as having the same internal problems that make the aid either ineffective or less so than it should be.
    What really worries me is that without the structural reforms necessary (and yes, this does include telling people to privatise telephone systems, issue multiple licences for mobiles, make power generation a free market (although perhaps not the grid), charge rational prices for water, blah blah blah) we’ll send in aid and not much will happen, leading people to conclude in a decade that the problem is unsolveable.
    I think we’ll only get one chance at motivating people to take this seriously, so I want it to be done right. Fix the systems first, with aid if need be, then pump prime them.

    Otherwise I’m all in agreement. Liberalising trade rules, for example, will simply make us richer, and who could argue against that?

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