"Aid, Growth, and Counterinsurgency"
I think David Brooks’ column on combatting global poverty is in some respects too pessimistic* but fundamentally I’m in agreement with him about this:
The first of those truths is that we don’t know how to use aid to reduce poverty. Over the past few decades, the world has spent trillions of dollars to generate growth in the developing world. The countries that have not received much aid, like China, have seen tremendous growth and tremendous poverty reductions. The countries that have received aid, like Haiti, have not.
In the recent anthology “What Works in Development?,” a group of economists try to sort out what we’ve learned. The picture is grim. There are no policy levers that consistently correlate to increased growth. There is nearly zero correlation between how a developing economy does one decade and how it does the next. There is no consistently proven way to reduce corruption. Even improving governing institutions doesn’t seem to produce the expected results.
The thing is that I wish conservatives, especially conservatives with a neoconnish inclination, would do a better job of remembering the stuff they say about wooly-headed liberal foreign aid projects when they start thinking about tough-minded counterinsurgency projects. These are, after all, substantially the same thing! Back in late September he was bullish on transforming Afghanistan:
The record suggests what Gen. Stanley McChrystal clearly understands — that only the full counterinsurgency doctrine offers a chance of success. This is a doctrine, as General McChrystal wrote in his remarkable report, that puts population protection at the center of the Afghanistan mission, that acknowledges that insurgencies can only be defeated when local communities and military forces work together.
To put it concretely, this is a doctrine in which small groups of American men and women are outside the wire in dangerous places in remote valleys, providing security, gathering intelligence, helping to establish courts and building schools and roads.
These aren’t directly contradictory ideas. If you go into a town, and start building roads and schools for the local population, this will probably earn you good will. It will also provide jobs via a short-term injection of economic activity into the area. That will also earn you good will. And that good will can be useful for serving tactical and strategic military objectives. Still, if we’re skeptical about the ability of foreign aid projects to deliver sustainable economic growth, then that same skepticism needs to apply when we call the foreign aid project “counterinsurgency.” And if our counterinsurgency projects aren’t providing a sustainable foundation for an improved quality of life, then they’re of somewhat limited value.
Another point to make is that questions can be raised about the extent to which past development aid has genuinely been undertaken primarily for the purpose of boosting foreign economic growth. During the Cold War, for example, the US and USSR tended to throw aid money around as a more-or-less transparent bribe to get third world dictators to join one team or another. Whatever the merits of that policy as a means of conducting superpower rivalry, we shouldn’t be surprised to learn that it didn’t promote growth. It does seem significant to me that the biggest anti-poverty gains have come not from the countries that we did the most to help, but from the countries (China and India) whose scale gave them the most ability to tell foreigners to get lost.
* Too pessimistic because there’s more to life than growth. Foreign aid has performed a lot of vitally important humanitarian work. Reducing the number of people who die of smallpox has genuine human value, even if it doesn’t turn out to do a lot, as such, to raise per capita GDP. A lot of aid work in the developing world is genuinely life and death stuff.