Trumped-up Aid and the Challenge of Global Poverty

This new book is to be published by Tony Vaux in 2017.

Aims

  • Focus attention on the continuing problem of extreme poverty and distress
  • Assess the ability of the aid system to address this issue
  • Point towards future possibilities in the light of the current geo-political context

Argument

The assertion of principle and creation of global institutions that followed World War II has been supported by Western countries using the aid system. But the momentum has been gradually lost because of the increasing dominance of Western political, security and trading interests together with the growing institutionalisation of the aid system. The notion of ‘Western’ aid is becoming increasingly inappropriate especially with the rise of self-interest and nationalism in Western states, most notably the USA. Although much has been done in the last three decades to reduce extreme poverty, the big advances have come from China, which has received very little aid. Solving the remaining problems of extreme poverty will be more difficult. The remaining poverty is closely associated with violence and instability.

To address these challenges it is time to move beyond the notion of aid to the task of creating the global means to ensure minimum incomes for all. The aid system is too much dominated by extraneous interests, notably Western security and trade, and by its own self-preserving interests (‘Trumped-up aid’). Instead nation states must take the lead and poor people must have a free choice what to do with the cash that will be put into their hands.

This book draws heavily on the author’s experience for over forty years working with a leading international charity and as an independent consultant on aid and conflict issues.

Contents

Introduction

Setting out the aims and the author’s experience and approach

Chapter One: Global Security since World War II

The end of World War II created an unusual degree of international unity and moral commitment, leading to far-sighted and idealistic international commitments. The normative framework of treaties and conventions has so far escaped serious modification but today’s inward-looking politics of nationalism and self-interest put these arrangements under increasing threat. Western leadership is increasingly discredited and the only option for advance is through nation states.

Chapter Two: Poverty Reduction since World War II

The end of World War II also led to the creation of institutions concerned with economic development but aid efforts have been embroiled with neo-liberalism, taking the initiative away from national governments and causing serious negative effects, including violent conflict, in some cases. The success of the Marshall Plan in Europe led to unrealistic expectations for the role of aid and the rise of a massive aid system which is now self-perpetuating but ineffective.

Chapter Three: The Atrophy of Charity

Charities generally arise from the idealistic efforts of individuals and may initially focus on challenging authority and achieving fundamental change in the institutions of states. But over time they become inward-looking and concerned with running their own institutions rather than taking risks in challenging authority. In the final phases, as demonstrated by international charities today, the institution becomes dependent on the authorities that they should rightly be challenging.

Chapter Four: Does Aid Work?

It is impossible to answer this question because there are many different views about the purposes for aid, including not only poverty reduction but also Western security, trade and reduction in migration to Western countries. The literature is inconclusive on the question but draws attention to many fundamental risks and failures. Evaluation does not help because it is easily manipulated by aid agencies. The bottom line is that there is no correlation between levels of aid and levels of poverty reduction. The greatest advances have been in China and India which receive very little aid. National governments and local NGOs have become increasingly impatient with the aid system and now look to take the lead on issues of poverty and insecurity.

Chapter Five: Patronage, Poverty and Violence

Governments in poorer countries tend to reflect The reality of governance in poorer countries is often based on patronage systems. These have positive and negative aspects but have generally been ignored or bypassed by the aid system with disastrous results. Aid is not a sensitive enough instrument to cope with the difficulties of parallel patronage and formal governance systems. It cannot change because political pressures and resource flows make it a top-down process. In particular the pressure to reduce overhead costs has made aid a dangerous instrument in tense and unstable situations. In a number of important examples, aid has caused or exacerbated violence.

Chapter Six: Can Aid Work? A Case Study from Nepal

This Chapter focuses on a case study of Nepal where conditions for aid were unusually favourable in the decade after 2000. Programmes were largely free from pressures relating to the Global War on Terror and Western trade interests. DFID staff were experienced and committed. But global targets, pressure to spend funds and the rigidity of large scale contracts greatly undermined the success of programmes. DFID was unable to position itself during the war in a way that reflected a poverty perspective but instead had to follow the UK’s geopolitical stance. At the end of the day, little has been done to reduce poverty or alter the system of oppression that makes people poor.

Chapter Seven: Humanity at War –case studies from Somalia and South Sudan

The US government was able to focus Western aid responses to the 2010-11 Somalia famine around US security concerns relating to Islamists rather than famine relief. Withdrawal of US food aid was a major cause of the famine. The aid system proved unable to assert an independent principled role. In Somaliland the top down policies of aid agencies led to an inappropriate response to the problems faced by pastoralists. In South Sudan, lack of concern by the US and others has allowed an unnecessary war to continue, resulting in famine. The aid system is now a vested interest focused on humanitarian relief and can divert attention from the Responsibility to Protect.

Chapter Eight: ‘Natural’ Disasters

The aid system has no method for matching disaster funding with needs. Much depends on the role of the media and uninformed sympathies of the public. Some disasters attract more money than is needed and others are neglected. Even in cases of apparent ‘natural’ disaster, there are likely to be crucial political dimensions but these are often overlooked because of pressure to spend funds fast and achieve profile for the aid agencies. As a result, disaster responses leave little behind and fail to reduce future vulnerability. They may undermine national government and increase security risks.

Chapter Nine: Poverty Reduction without Aid

In responding to the 2001 Gujarat earthquake, an organisation of poor working women (SEWA) identified support for livelihoods as its immediate priority and invited support from aid agencies but, when nothing was offered, organised its own massive programme making and selling goods from the earthquake area. Its experience not only demonstrates the broken link between the aid system and local organisations but shows that such organisations work in a different way both in disasters and development. Essentially, their perspectives are very much longer. Unable to attract support from Western agencies on its own terms, this hugely successful Indian organisation has adopted a policy of self-reliance.

Chapter Ten: Freedom from Fear

Although violent conflict increases poverty it is not usually the case that poverty causes or increases violence. The Global War on Terror has focused attention and resources on poverty as a source of conflict and terrorism. Poverty is perceived as a threat to Western security but it is more likely to be a result of ruthless exploitation by powerful interests including the global superpowers. Instability, weak governance, inequality and poverty are the common results of elite rivalries at different levels including superpower level. The point is explored through examples from US involvement with Pakistan and Afghanistan, and from Russian resurgence in the ‘near abroad’. Only the most independent actors, such as the Soros Open Society Institute can play a positive role in these cases. The use of aid to transform social and political structures is now counterproductive because of suspicions that the real target is Islam and national identity. On the issue of ‘freedom from fear’ the aid system has done better in relation to disaster risk reduction but the current challenge is to link together this type of risk reduction with a strong focus on poverty.                   

Chapter Eleven: Where have we got to?

The close connection between extreme poverty and the risk of violence is reflected in the notion of Human Security: ‘freedom from want’ and ‘freedom from fear’. Although this concept has been distorted by the Western Security agenda, it allows poor people to define what the problem is and implies a responsibility on national governments to provide it. The aid system has undermined and muddled the issue of poverty by picking out different parts and by making national NGOs into contractors. Exaggerated claims by the aid system hide the need for more radical action such as military and political action. The fundamental problem of aid is that it operates top-down without any framework of responsibilities. The main advances in relation to extreme poverty have been made in China and India without any significant role for aid. Economic growth provides the means to eliminate poverty but the results are patchy because of the role played by elite groups in co-opting the benefits of growth. The direct distribution of cash to poor people has emerged as an effective way forward but the aid system has been extremely slow in acknowledging it. The interests of the aid system in controlling processes of poverty reduction are now a major obstacle to progress.

Chapter Twelve: Where do we go from here?

As a political economy study, this book focuses on predictions based on interests rather than recommendations based on hopes. Cash distributions managed by governments will take over from aid even in times of disaster. Because these mechanisms may be prone to interference by elite groups it may be necessary to provide payments for everyone, as in the case of Universal Basic Income (UBI). In order to enhance the security of poor and vulnerable people, mobile phones can be made freely available. There may continue to be a special role for Western states in underwriting such programmes but the aid system as it is today, with its thousands of projects and priorities, will not be necessary. In extreme cases of persistent poverty and violence, the Responsibility to Protect gives every nation a responsibility for others. The failures of Afghanistan and Iraq should not deter states from taking up that responsibility when necessary. The interests of the aid system now lie contrary to future trends. They will stand in the way but may not prevent progress. For observers taking the perspective of Humanity, it may be better not to start off with the question ‘what is the role for aid?’ and instead ask ‘what needs to happen globally to abolish extreme poverty and distress?’