Cruel To be Kind?

On a slightly belated note, last week Jude Wanniski wrote this piece on the G-8 and African aid. He recommended reading this Der Spiegel interview with Kenyan economist James Shikwati titled "For God's Sake, Please Stop The Aid!" It's interesting stuff. Excerpt:

And at some point, this corn ends up in the harbor of Mombasa. A portion of the corn often goes directly into the hands of unscrupulous politicians who then pass it on to their own tribe to boost their next election campaign. Another portion of the shipment ends up on the black market where the corn is dumped at extremely low prices. Local farmers may as well put down their hoes right away; no one can compete with the UN's World Food Program. And because the farmers go under in the face of this pressure, Kenya would have no reserves to draw on if there actually were a famine next year. It's a simple but fatal cycle.

And this:

Why do we get these mountains of clothes? No one is freezing here. Instead, our tailors lose their livelihoods. They're in the same position as our farmers. No one in the low-wage world of Africa can be cost-efficient enough to keep pace with donated products. In 1997, 137,000 workers were employed in Nigeria's textile industry. By 2003, the figure had dropped to 57,000. The results are the same in all other areas where overwhelming helpfulness and fragile African markets collide.

I'm no expert on Africa or U.N./NGO aid. In the past year or so, however, much of my leisure reading has been about the parts of Africa that don't get a lot of Western press---places like the Democratic Republic of the Congo, Liberia, and the Central African Republic. There is some excellent and fascinating coverage of "back-alley" Africa by outfits like the BBC; predictably, the mainsteam media in the U.S. is missing-in-action on this part of the world. Part of my interest is purely historical---the history of the West in some of these places is truly sordid---but, looking forward, it is based in finance and geopolitics as well. Africa's natural resources are staggering; parts of the continent are swimming in copper, cobalt, diamonds, gold, uranium and coltan. Some of these resources are crucial to products we consider essential like cell phones and laptops. Not surprisingly, China realizes this; it has been ramping up its presence and alliances all over the continent, particularly in unstable but emerging places like the DRC (a nation recovering from a civil war in which millions died, that suffers from a permanent state of tenuously-controlled turmoil, and has a working nuclear reactor from which fuel rods have disappeared in the past). Part of me is slightly saddened at the inevitability of modernization and its effects---there are not a lot of cities left on the planet with millions of people and no McDonald's, and Africa has just about all of them---but I also find the dynamic of development in these places fascinating.

An important part of that development is Western aid, thus my interest in the G-8 meeting as well as articles like the one above. The argument that this aid is essentially a type of insidious, self-perpetuating welfare is not new. But it does make sense from a broader perspective, particularly when seen in the context of African success stories like Ghana and Botswana. Of course, the broader perspective becomes irrelevant when people are starving and simply need help as quickly as possible. And from what I've read, the Bush administration's efforts in the fight against AIDS have been nothing less than fantastic. But if aid to Africa is to be anything more than a band-aid that undercuts local development and benefits mostly middlemen and corrupt leaders, I agree with Wanniski's long-standing argument that we need to think beyond the headlines of food and AIDS and address the harder stuff like banking systems, interest rates and taxation. Certainly not easy, and on the totem pole of what's happening in the world right now, not a priority. But in the long run we have an important humanistic as well as geopolitical stake in this.

If there are any readers with a personal or professional interest in this, perhaps someone with U.N. or NGO experience, I'd be interested in reading your take.