Saturday, June 18, 2005

Relief

Foreign aid is a problem that is increasingly troublesome to the industrialized world. On the one hand, we feel as if we have some sort of brotherly obligation to help them out in their time of need, and yet we still continue to take their payments for debts incurred years ago. This isn't a bad thing, but when was the last time you heard a friend who you owed money to telling you "sure, I'll give you some money to help you out, but you still gotta pay me back."

Of course, Johan Norberg does tell us that foreign countries pull in twice as much in aid as they must pay out. This aid must, then, not be reaching areas where it helps, or it is not being used effectively were it does.

Last year the United States spent over $300 million just to staff the centers for aid distribution (reported by the Anchorage Daily News, article offline). That's $300 million in purely administrative costs, and that's only the cost to meet their staffing needs. I realize, of course, that $300 million is a relatively small chunk of the total aid we're paying out over there, yet the number itself is pretty staggering.

It is clear that for all our aid countries in sub-Saharan Africa have not developed at all. This isn't just a matter of limited development, this is a matter of NO development.

I'm generally ignorant as to why this is, but I can take a few guesses: tyrannical governments, corrupt aid distributors, and disorganized populaces. The first seems to be historically true; most of the aid racked up by African countries was accrued under a tyrant who spent money like it was going out of style before being knocked out of office, leaving impoverished and economically depressed nations.

When we're looking at debt relief and foreign aid, we have to be cognizant of what our actions say, as well as what changes they will effect. For instance, canceling debt tells African countries, and even the world at large, that one doesn't have to pay off on debts and that contracts are just silly words on paper. Increasing aid dollars to African countries tells Africa that we will continue to give money to an ineffective cause, simply because the cause is still "worthy." Cutting subsidies, while the right thing to do, will give the immediate result of showing the world that America doesn't care about foreign problems, as purchasing power will decrease and revenue from exports will plummet, putting Africa into even more trouble.

It is a sticky situation, and one that cannot be remedied easily. My first inclination is to simply say that we should forgive all debt, throw one massive hunk of cash at Africa, and then never attempt to help them again (excepting, of course, private charity). Then, I realize the that largely ineffectual governments of these African nations will probably do little to utilize the money wisely, and will eventually become poor again, without recourse to US loans, and will seek loans elsewhere. Problem not solved.

Second thought suggests that perhaps we could forgive most of their debt, say 75%, and continue to send aid money over, while resolving to never loan again. Still, this doesn't solve any problem, as the aid will not be spent where it makes a difference.

The problem, it seems, stems not from the amount of aid that we are or are not sending to Africa, but rather how it gets used (or not used). The only way for foreign aid to make any difference in sub-Saharan Africa is for the money to be put to use where it helps to develop the country, to industrialize it, to educate it. The best way I see to effect this change, is to put a non-tyrannical government in place, to install a democracy. And then I remember Iraq, and I'm instantly soured against it. Invading an African country with the hope of sowing the seeks of democracy is, as history has told us, a very bad idea.

Then we're stuck. We can't just cancel debt, and our aid dollars aren't helping. We can't just invade and take over, but without a better government in place nothing is going to help at all. The only solace I have is that I'm over here in beautiful rich America, and not over there.

My solution? Put Bill Clinton in charge, who seems to be making huge strides in organizing the Southeast Asian Tsunami relief effort.

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