Last week an annual letter from the Bill & Melinda Gates Foundation sparked a passionate debate over that question between Jeffrey Sachs and William Easterly in the pages of Foreign Policy. From the Gates letter:
The lifesaving power of aid is so obvious that even aid critics acknowledge it. In the middle of his book White Man’s Burden, William Easterly (one of the best-known aid critics) lists several global health successes that were funded by aid. Here are a few highlights:
- “A vaccination campaign in southern Africa virtually eliminated measles as a killer of children.”
- “An international effort eradicated smallpox worldwide.”
- “A program to control tuberculosis in China cut the number of cases by 40 percent between 1990 and 2000.”
- “A regional program to eliminate polio in Latin America after 1985 has eliminated it as a public health threat in the Americas.”
The last point is worth expanding on. Today there are only three countries left that have never been polio-free: Afghanistan, Pakistan, and Nigeria.
Recent Dish on polio here. Fareed is on board with Gates:
Savings people’s lives, making them healthy and ensuring that they get an education is not simply and deeply a moral thing to do – it has practical benefits as well. These people now work, earn a living, and help make their countries less reliant on aid. Many countries that received large amounts of foreign aid from the West are now developed enough that they don’t need it anymore: among them, China, Mexico, Brazil, Malaysia, Singapore, South Korea, Morocco, Peru. In fact, China is now a big donor of foreign aid.
But Easterly dissents (paywalled), arguing that the public health revolution “is a story of many actors rather than conspicuous heroes”:
The contribution made by philanthropists and politicians should not be overplayed. Yet, if aid is a feeble instrument of economic progress, it is nonetheless a powerful tool of self-aggrandizement for the western elite. “We” are important because we are the rich people giving aid, the political leaders of the poor countries that receive it and the experts who broker the exchange.
True, some aid programs have targeted sickness with triumphant success. Mass vaccination campaigns kept millions of children from dying of measles and smallpox. Unicef promoted oral rehydration therapy to fight diarrheal diseases that used to cause far more deaths. But even if health aid has been a success, it does not follow that most progress on health is due to aid.
Gideon Rachman, who interviewed Gates at Davos, pushes back:
Gates does not argue “most progress” on health is down to aid. He simply argues that in certain cases, with certain diseases, aid can be really important. And if it does indeed keep millions of children from dying – surely it is worth doing? The alleged vanity of Gates or his audience in Davos seems a small price to pay for that.
Development economist Chris Blattman cautions:
Plenty of aid projects have huge impact. There’s a paradox, though: even though so many projects work, aid in total doesn’t have the association with growth or development we’d expect to see. Some of the finest minds in development (like Angus Deaton) think aid is fundamentally flawed, with good reasons. The evidence that aid projects are associated with growth is amazingly absent. This is frustrating for those of us (including me) who believe in aid. My guess is that we throw a lot of good money after bad, and most aid is much more wasteful than it needs to be. But I think aid basically works and can do better.
Jeff Bloem zooms out:
The aid debate currently just asks the question “does aid work?” Perhaps we should be asking questions like: “Under what conditions does aid make a difference?” “What can we do to increase the efficacy of aid?” and “What kinds of aid should we continue and what kinds should we abolish all together?” … Economists have been debating the big questions for decades. See J.M. Keynes vs. F.A. Hayek. While these debates make for some great YouTube videos (Keynes vs Hayek Part 1 and part 2) they don’t really teach us anything substantive about how the world works.
The debate between Sachs and Easterly should probably be over, but not because either “won the debate.” The topic just needs to focus on smaller (more specific rather than bigger and more general) and better debates.
The Dish 