Jeffrey Sachs Defending the Foreign Aid Budget, and Bush

8 Oct

Not a huge fan of the aid heals all wounds school, but Sachs helps sets the record straight on the egregious misconceptions, in Congress and among Americans broadly, that surround foreign aid.

There are three types of confusion.

First, in the public’s mind, foreign aid is associated with the scandals seen in Afghanistan and Pakistan, not the successes seen throughout Africa in disease control. We should of course end the corrupt kind of aid while bolstering the successful and practical variety.

Second, the public vastly overestimates the actual amount of aid, roughly by a factor of 30 times. The public knows that the U.S. spends a fortune abroad, and thinks that much or all of that money is foreign aid. Actually the true fortune is spent on the military, not on aid. Our military spending is around $700 billion per year, while our spending on aid for the poorest countries is $25 billion maximum. If we cut $200 billion in the annual military budget, and raised spending on the poor by $25 billion, we would double aid to these countries; save $175 billion per year; and achieve hugely improved national security as the poorest countries began to stabilize economically and in terms of disease and hunger.

Third, the public believes that aid to poor countries is a permanent “trap” for the U.S. budget. This too, thankfully, is a misunderstanding. Poor countries “grow up” and stop needing aid. We use the term “aid graduation” for this process. As an example, we no longer need to give aid to Brazil or Mexico or other middle-income countries. They have long since graduated from this need. In this sense, help for the poor is temporary, as it promotes economic growth and graduation. Successful aid, in short, drives itself out of business.

The short story for American security is that we are wasting a fortune on wars when a small fraction of that would and should enhance our national security by helping poor and unstable countries to control disease, boost food production, and protect the natural environment. Specifically, the U.S. should: (1) cut military spending by $200 billion per year and use just an eighth of that, $25 billion per year, to double our existing help for the poor and hungry nations; (2) invest in practical, targeted, and scientifically oriented programs like the Global Fund to Fight AIDS, TB, and Malaria, and a similar program to help poor farmers to grow more food; and (3) focus aid on closely monitored and highly practical programs, rather than on financial transfers to crony U.S. businesses and (other) corrupt governments.

Check out the full article, and the defense of GWB here.


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