Foreign Aid: cruel act or kind charity?

Kindness and charity. Two words that we are programmed to believe go hand in hand, in reality this is not always the case. As westerners, we are often plagued by a sense of guilt that stems from the fact that we were born into a life of opportunity, comfort and commodity. At one point in each of our lives we become aware of this and in most cases, hopefully, it makes us uncomfortable. As a child we heard things like “Eat your vegetables, there are kids in Africa starving.” These phrases, it seems, have become somewhat of a norm to say to anyone who is unsatisfied with anything in their lives to remind them of their good fortune. As we become accustomed to this concept, most of us feel a sense of responsibility.

So, we give Aid. Charities and humanitarians ask and most of us give because after all, we can and we should. Or should we?

Angus Deaton, got his Nobel Prize in economics after decades of studying how poverty-stricken people save and spend their money at the World Bank. He provoked controversy after arguing that the rich may be crippling any chance of development in poverty stricken countries by stunting their growth. He and many other economists believe that the majority of the $135 billion given by rich nations as foreign aid in 2015 has actually maimed the poor. Deaton may not have been the first economist to challenge the assumption that we should give aid. However, his understanding on this topic has surpassed that of any economist before him. Daron Acemoglu, a prestigious economist, spoke on the matter saying “I think his understanding of how the world worked at the micro level made him extremely suspicious of these get-rich-quick schemes that some people peddled at the development level.” Deaton’s study indicated that the assertions of charities were often not substantiated. During the 1980’s and 1990’s the aid community was pouring funds into Africa at very high volume. However, African economies were suffering more than they ever had.

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The rut didn’t stop with Africa, the further downfall of poverty stricken countries was observed by economists, many who noticed that inflowing foreign aid was not producing growth for the economises intended. Instead, they noticed that the more foreign aid that was pouring into a nation the more its economy would contract. No one could pin point the problem, but Deaton along with other economists contended that the two main problems were that aid weakens relationships between local governments and its people once foreign money was involved. Foreign aid, Deaton argues, leaves governments less responsible to its people. The other problem with aid is that it renders local jobs useless, such as that of farmers and distributors because the population is essentially being fed by foreigners.

Deaton also believes that the most common misconception  when it comes to aid is our belief that we should be swooping in and saving everyone. He contends that what works in Sudan might not work in Vietnam. Furthermore, this condescending attitude bares many similarities to the ideas of colonialism. Colonialism stood very similar ground as it defended its actions in the name of ‘helping people’. He highlights the fact that while the world has made immense strides in lowering poverty in recent decades, a very low percentage of these victories have been due to aid. He points out that many advancements made towards reducing poverty in third world countries has been as a result of development in countries like China who have received very little aid as a proportion of gross domestic product and have “had to work it out for themselves”.

However, he does recognise that not all types of foreign aid are bad. Particularly health aid saying that vaccinations and their development as cheap but effectual drugs to treat poverty-prone diseases have been exceedingly advantageous to Third World countries. Nonetheless, we cannot pretend to be unaffected by these facts. We must find a more effective, less harmful way of helping the development of poverty stricken countries if we wish to really fix the existing socio-economic discrepancies between the Developed and Developing world.

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