November 5, 2005
Aid generally called “development aid” enriches corrupt and repressive governments while the poor suffer at their hands. This kind of aid doesn’t protect the environment or ameliorate poverty.
We need more foreign aid for calamities such as the recent earthquake in Kashmir and the tsunami last year in the Indian Ocean. Foreign aid means the difference between life and death – without our aid, the unprecedented loss of life that we have seen in the wave of disasters would have been that much worse.
At the same time, we need to stop most of the foreign aid that goes to other non-emergency purposes – aid generally called “development aid.” This kind of aid enriches corrupt and repressive governments while the poor suffer at their hands. This kind of aid doesn’t protect the environment, it harms the environment by damming the world’s rivers, by flooding agricultural lands, by clear-cutting forests, and by excavating mines in tropical lands. This aid doesn’t ameliorate poverty, it causes poverty by forcibly resettling people in unfamiliar lands and by destroying the environments which they know and depend on for their survival.
Development aid doesn’t empower people, it disempowers them by financing dictators like Zimbabwe’s Mugabe who can keep their armies armed and their personal bank accounts flush with the monies intended for the poor.
Recent pleas from rock stars like Bono and Bob Geldof to – “make poverty history” – blindly call for more aid as if all aid is good. This notion is wrong and dangerous for the poor, just as it was in 1985, when Geldof’s Live Aid shone the spotlight on Africa’s plight.
All told, Africa has received $400 billion in foreign aid since 1960 – the equivalent of almost six Marshall Plans. The continent is much poorer today, millions of people are starving and the number of people suffering in extreme poverty – earning less than $1 per day – has increased from 90 to 234 million.
Back in the early 1980’s when we began our investigative work into the effects of Canada’s foreign aid projects, we saw how “development” projects could do great harm to peoples’ means of subsistence, to their environments and to the social and political fabric of their countries. This harm occurred almost everywhere – at the Akosombo dam in west Africa and the Three Gorges dam in China, in the tropical rainforests of Indonesia and the Amazon from human transmigration projects, in Asia’s irrigation schemes, in the Congo road projects, and on and on.
Though well intentioned, our generosity backfired when western governments gave Third World governments aid. Foreign aid lets Third World leaders be financially independent from their own people, freeing governments from having to tax their own citizens, to reveal their expenditures, to justify them, and to prove that the funds are spent effectively and economically.
Our aid means that Third World leaders don’t need to account to their people. This not only undermines the people’s efforts to secure peace and democracy, it also undermines the moral fabric of public administration in these countries and creates the perfect environment for corruption. Multinational corporations have powerful incentives to offer bribes in order to win the lucrative aid contracts and to secure cost overruns once they have won the contracts (as we saw when the Canadian engineering giant, Acres International, gave bribes to win contracts on a dam building scheme in Lesotho). The result is alarming: according to recent evidence before a U.S. Congressional Committee, as much as $100 billion in World Bank funds alone – or one in every four dollars lent by the World Bank – have been used corruptly. As a final insult, Third World citizens are expected to pay back the stolen money.
The views of Dr. George Ayittey, a Ghanaian and Distinguished Economist at American University, as told recently to the Canadian Senate Committee on Foreign Affairs, are especially insightful: “Naive Westerners think that the best way of helping the African people is by handing money over to their corrupt despots.” But “the entire Western aid process has been corrupted and perverted,” he argues. “It is now a circus, riddled with failure, dependency, fraud, and trenchant dishonesty on both the donor and recipient sides.” There are better ways of helping Africa, he says – “by empowering its people.” Dr. Ayittey told the Committee that increasing emphasis on the government-to-government aid relationship “is in the wrong direction.” Government, he said, “is the problem in Africa” and aid to the continent needs to bypass Africa’s “vampire states” – a term Africans use to describe governments that use the machinery of the state to suck the economic vitality out of the people to enrich themselves and their cronies – if it is going to succeed.
So what should Canadians do? We must distinguish between aid that helps and aid that hurts. Indiscriminately calling for “more” foreign aid won’t help. These are Probe International’s guiding principles for action.
1. Do no harm. Tell our government to stop funding the infrastructure projects that have done untold damage to the Third World’s environment and people. Our government’s aid should go only for emergencies, health care, and education. And it should never go to dictators.
2. Find your favourite charities to support. Canada has many foreign aid charities that deliver long-term development assistance and emergency aid. Find the ones that can respond quickly, have a good track record and will answer your questions, especially about how they will spend your money. Donations to these charities are usually tax deductible.
3. Demand justice. Instead of forgiving old foreign aid loans (and thereby expunging the evidence that the loans were not used in the interests of the people), Canadians should demand an immediate moratorium on repayment of those loans until public audits of all debts can be evaluated for their legitimacy. Legitimate debts spent in the interests of the people should be forgiven if countries are too poor to repay them. Illegitimate debts, stemming from foreign aid loans that were used for corrupt purposes, or to oppress the people, should be deemed “odious.” Funds diverted to corruption should be reclaimed from the guilty parties and officials in both lender and borrower countries responsible for white elephant projects should be held to account for criminal offences, professional negligence, or dereliction of duties.
4. Compensate foreign aid victims. Millions of Third World citizens were made poorer when their environments were destroyed in the name of progress, costing them their livelihoods and health. These citizens have not forgotten their losses – they await the day that they can claim compensation for these wrongs. The Canadian government should set aside a fund and establish a procedure for hearing such claims.
Since we began our work two decades ago, vast improvements in communication and the emergence of dedicated researchers and activists in Third World countries have helped educate Canadians about the utter failure of state-to-state development aid. Yet despite its dismal and tragic record, the institution maintains public support to this day because of the enduring and noble desire of Canadians and other citizens of wealthy countries to help those less fortunate than themselves. Those good instincts are not enough. We must act responsibly, examine the record of foreign aid, and make the necessary changes in our aid efforts to ensure that the poor really are better off as a result of our best intentions.
P.S. I would be pleased to send you Dr. Ayittey’s vivid and enlightening testimony before the Senate Standing Committee on Foreign Affairs, delivered this past May. Just e-mail me at PatriciaAdams@nextcity.com.
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