Post #6

Debate on Development Aid & Assessment of SGDs Goals

In the debate on pros and cons of development aid with leading economists Jeffrey Sachs and William Easterly, I am on Easterly’s side. I agree with Easterly because he believes that we need to focus on sorting out the political process before we focus on good policies.

 

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William Easterly, professor of economics at New York University. Photo By: WilliamEasterly.org

Sachs sees corruption as a poverty trap and his suggestion to break the trap is for to give aid to the poor for malaria control, food production, sanitation and safe drinking water. “Raising living stands, Sachs argues, would empower civil society and governments to maintain the rule of law” (Banerjee & Duflo, p. 236). We’ve already seen how frivolously sending aid money to the poor doesn’t really help anything and the money could just get lost in the cracks to corrupt governments. I like the idea that we should empower poor people to learn how to help themselves. This can only increase the chances of ending poverty because it’s going right at the source. Easterly says, “There is no point to figuring out the best way to spend a dollar on schools, if 87 cents will never reach the school anyway…Without good politics, it is impossible to design or implement good policies” (Banerjee & Duflo, p. 236). Politics need to be taken care of first before we can think about helping the poor in other ways. Easterly says that more than $2.3 trillion has already been given to the developing world over the past 50 years so if aid money was truly a successful means of promotion development, then impoverished nations should have already eradicated extreme poverty (PovertyEducation.Org)

There are other arguments that could be made though because there are success stories of foreign aid. The U.S. donated $4 billion to Taiwan in the 1950s that allowed Taiwanese famers to buy large amounts of fertilizer to increase crop yields and it enabled farmers to produce more rice than almost any other country in Asia. This created a surplus of food in Taiwan, turning it into a major exporter. If the U.S. hadn’t supported their economy, it might not have been so successful. There is also South Korea and India who became better export countries and higher crop productivity due to subsidies from the U.S. government and bioengineering from the Rockefeller Foundation. (PovertyEducation.org). I think there will always be a few success stories, so it’s a little hard to believe in them when there are many more failure stories.

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“Sowing The Seeds.” Taiwan Today. (November, 2016).

When reflecting on the SDG goals #1 end poverty in all forms everywhere and goal #2 end hunger, achieve food security and improved nutrition and promote sustainable agriculture, I think Banerjee and Duflo address these issues sufficiently. The conclusion does a great job of summing up the policy measure that seem to work from the five lessons they have learned of how to improve the lives of the poor:

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SDGs Goals #1 & #2. Retrieved from: https://www.ericsson.com/about-us/sustainability-and-corporate-responsibility/sustainable-development-goals

  1. The poor often lack critical pieces of information and believe things that are not true. As of now, they are unsure about the benefits of good policy measures. They think there is little value in immunizing children or sending their kids to school, they don’t know the easiest way to get infected with HIV, they don’t know what politicians do when they are in office, etc. If we can educate the poor, many of these problems could be solved.
  2. The poor bear responsibility for too many aspects of their lives. Banerjee and Duflo suggest making it as easy as possible for the poor to do the right thing. This means making the salt fortified with iron and iodine cheap, savings accounts that are easy to put money in and costlier to take out and making chlorine available for clean water.
  3. There are no good reasons that some markets are missing for the poor, or that the poor face unfavorable prices in them. Giving away goods and services such as bed nets and visits to a preventive care center need to be put in place or even rewarding people for doing things that are good for them.
  4. Poor countries are not doomed to failure because they are poor, or because they    have had an unfortunate history. Banerjee and Duflo suggest inviting everyone to village meetings, monitoring government workers and holding them accountable for failures in performing duties, monitoring politicians at all levels and sharing this information with voters, etc.
  5. Expectations need to be changed- children have been giving up when their teachers say they’re not smart enough, fruit sellers don’t make the effort to repay their debt because they expect they’ll fail anyway, and nurses stop coming to work because nobody expects them to be there.

I love this quote from Banerjee and Duflo to sum the post up- “There is no reason to tolerate the waste of lives and talent that poverty brings with it.”

 

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