Dead Aid: What's Wrong With International Aid?

The focus of this short essay is a review of Dambisa Moyo’s book Dead Aid, written in June 2009. Moyo’s main thrust throughout her thought-provoking book is criticism against foreign aid to Africa. What makes her book standout is that these are thoughts from a native African. As a citizen of Zambia and a trained economist, one must consider her thoughts and consider them honestly. Moyo represents a new force, which is a rising intellectual body that is reexamining the state of Africa and the issues that affect its people. However, instead of tackling the plethora of ills that affects African society, she levels forceful criticism against aid and the policies and attitudes that come with it from the various agencies and international bodies.

Striking to the reader is the particular claim made by Moyo that most of the aid and policies that come with it, has harmed Africans rather than helped them. She accomplishes this point by use of moral outrage. Secondly, Moyo charges that aid agencies have incorporated African heads of state as business administrators (when they are actually included) in a kind of neocorporatist relationship. Additionally to that point is the “public discourse became a public disco,” which she means Western leaders consulting with pop-stars and Hollywood actors, giving them equal status to African government leaders. Thirdly, Moyo insists that the policies created a paternal relationship between the West and the Africans. Instead, she argues, more entrepreneurial initiatives would do far more to “teach the man to fish.”

These failures have caused African governments from implementing bottom-up reform, and instead they have relied on aid as an end in itself. Moreover, it has reinforced the stubborn stereotype that Africans cannot improve their societies without billions of dollars in help and oversight. Nor can they learn the economic principles of capitalism, so the West assumes a patronizing position that Africans cannot survive without financial aid.

Forcefully delivered and passionately written is Moyo’s point of view on the West’s authoritarian paternalism towards Africans today. Moyo says the attitude that is associated with development aid to Africa is similar to the outlook that fueled colonialism, albeit without the racial overtones or dictatorial policies. Only in its place, Moto charges, is a kind of authoritarian paternalism if not in name, at least in practice. How Moyo defines authoritative paternalism is not foreign to the reader’s ears. She points out vividly and the reader cannot help but here her screams of anger from the page where she describes President George W. Bush’s consultation with pop-singer icon, Steve Bono. Presumably, Bono and other celebrities (Bob Geldof) understand the interests of Africans better than Africans who have been left at the mercy of “musicians who reside outside of Africa” (Moyo, 2009, p. 27).

What is clear from Moyo’s indictment is that this is not unusual, and is in fact standard practice from colonial initiatives from the last century. Giving others, celebrities even, equal status to African government comes from a fundamental belief, whether it is admitted openly or not, that Africans cannot “improve their own lot in life without foreign guidance and help” (Moyo, 2009, p. 31). Africans, in the eyes of the West, are viewed as children, which are unable to produce and develop on their own. A child’s existence without parental help and guidance would live a short life. This is the crux of her criticism in that the aid-dependency has retarded development, “the trouble with the aid-dependency model is, of course, that Africa is fundamentally kept in its perpetual child-like state” (Moyo, 2009, p. 32).

The second point of Moyo’s critique is the harmful political effects aid has had on Africa. Moyo spares private aid and humanitarian disaster relief and instead focuses on aid from rich states governments and international organizations. On her second point, Moyo is highly critical of the paternalistic nature that wealthy states possess which excludes from its policy the need for political liberty and social capital in poor states. In other words, the wealthy states do not discriminate between democratic and authoritarian governments. In Moyo’s view this undermines democracy and stifles any movement for political reform. This unfairly removes the people of poor states from the democratic process by not allowing them the right to determine how the money should be spent, and ways in which to hold their governments accountable. What is more, the donors and the ruling regimes, which are often authoritarian, wield more influence than should be allowed. Moreover, “African governments view aid as a permanent, reliable, consistent source of income and have no reason to believe that flows won’t continue” (Moyo, 2009, p. 36).

Moyo’s main charge on this point is that the people of the poor states are not allowed access to government, nor are they a part of the political process. Even in thoroughly, multi-party systems, government is unaccountable to the people, and no mechanism is in place for the people to approve or disapprove of policy. Furthermore, sometimes democracy hampers growth due to its political process. Moyo suggests, “democracy is not a prerequisite for economic growth” rather “economic growth is the prerequisite for democracy” (2009, p. 43). It would seem that intuition suggest that aid increases corruption and decreases democracy. The aid serves as personal bank accounts for the ruling regimes, which allows votes to be bought and special interests financed. The negative effects from aid make corruption rampant and put limits on political opposition.

The third major point of criticism made by Moyo is the fact aid slows, and in some cases, prevents economic growth. The large amount of dollars funneled through weak economies unfairly drives up local prices for an already impoverished populace. The few that do own businesses are often at a disadvantage struggling with low profit returns. The large budgets from aid dollars drive up the costs of materials and pull the human resources such as laborers and professionals. The unfair competition causes businesses to struggle and drives many out of business. Many of the African professionals wind up working for the aid agencies or go into business themselves by establishing non-governmental organizations for aid contracts. The last point is important for further consideration. What sort of drain is this having on an indigenous African economy? Might these professionals be of better use starting up businesses that can produce exports, employ the local population, and produce tax revenue for their governments?

Indeed, those are the proper ingredients to industrialization and modernization for an economy. Instead of starting up businesses that could provide for a light-manufacturing sector, these professionals are finding it easier to make a living from aid, instead of using it to ride the economy up out of poverty. An additional reason Moyo points out is that doing business in Africa is a nightmare: “It’s not only red-tape. It’s also the opacity. Investors don’t know where to go, or who to ask” (2009, p. 100). Consequently, the world does not see images of manufacturing, construction, cities and high-rise commercial buildings. Instead the world sees images of poverty and disease. The response is to increase the aid and to not take too much trouble differentiating the relationship between corrupt and poor countries. These points make up Dambisa Moyo’s main thrust in the second half of her book. And presumably what gave her the idea for the title of it, Dead Aid.

Dambisa Moyo released Dead Aid at an unfortunate time. At the time of its release, the world economy was staggering mightily from international capital and finance was in crisis. Since reviewing here work, however, the bad timing does not take away from her three major points that has been discussed. Moyo gave good detail and attention to the mindset after the Great Depression at the beginning of her book that encouraged the paternalistic strain attached with aid. With perfect hindsight, should the crisis be allowed to recreate past development disasters? Moyo clearly argues for the long-run benefits that free market reforms could have for Africa. Instead of relying on state planning and aid, Moyo argues for an anti-paternalistic approach that evokes an entrepreneurial spirit to lift Africa up out of poverty. Moyo (2009) ends her large criticism as clearly as she started, “and one thing is for sure, depending on aid has not worked. Make the cycle stop” (p.154).

Moyo, D. (2009). Dead Aid. New York, NY: Farrar, Straus, and Giroux.

Uh, the good intentions are usually stopped by the head cheese of the country we are sending our tax dollars to so they can prop up regimes that hate us for having the ability to send them aid. HUH? No more foreign aid no more u.n. Humanitarian aid? Didn’t we send a “hole” lot of money to the Carribean not to long ago with nearly negative results?

“Foreign aid might be defined as a transfer of money from poor people in rich countries to rich people in poor countries.” - Douglas Casey

4 posted on 07/27/2013 11:02:48 AM PDT by E. Pluribus Unum (Who knew that one day professional wrestling would be less fake than professional journalism?)

Yes. What you say and the fact that there are places in this country that could use correctly applied assistance.

I am in no way interested in rehabilitating Niger, Algeria, Botswana, Rwanda, or any other place where the earth provides such abundant resources even a fool couldn’t take advantage of with the right intentions.

I’m not interested in feeding greed, avarice, corruption or genocide anywhere. We have enough of that going on here.

There was a guy recently who begged the US ‘No more welfare. You are killing Africans.” When I worked in RHODESIA (yes Rhodesia, Heaven in Afica) EVERY single dollar we gave for aid went to arming the rebels. Look at it now.

Foreign aid is the best scheme ever developed fo take the money out of a working man’s pocket and to put it into a rich man’s pocket in another country.

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