Post-Development Perspectives

The Post-Development Perspective became popular in the 1990s. Theorists from within this perspective are critical of Western models of development, arguing that development was always unjust, that it never worked, and that developing countries should find their own pathways to development.

Post-Development as a Rejection of the West
Post-Development as a Rejection of the West

Escobar (2008) criticised modernisation theory for being ethnocentric. He argued that it was only ever interested in making poor countries like rich countries and was dismissive of many ancient philosophies and traditions which had worked in poorer countries for thousands of years. According to Escobar this is both arrogant and disrespectful, and created the potential for opposition and conflict.

Escobar argued that the Western model of development justified itself by claiming to be rational and scientific, and therefor neutral and objective. However, in reality, modernisation theory was a top-down approach which treated people and cultures as abstract concepts and statistical figures to be moved up and down in the name of progress. Modernisation theory effectively denied people within developing countries the opportunity to make their own choices and decisions.

Sahlins (1997) argues that Western Aid agencies often incorrectly assume that people who lack material possessions are in poverty and are unhappy. However, he argued that people in developing world may have few possessions, but this does not necessarily mean they are poor. They may actually be happy because they belong to a supportive community and they have the love of their family. This idea has been practically applied in Bhutan where development is measured in terms of Gross National Happiness, rather than Gross National Product.

Other post-development thinkers argue that modernist explanations of underdevelopment have rarely sought contributions from sociologists and economists who actually live in the developing world. McKay argued that development strategies are too often in in the hands of western experts who fail to take account of local knowledge or skills and that development often has little to do with the desires of the target population.

Post-Development sociologists further argue that Western models of development have created a diverse set of problems for the populations of developing societies. Indigenous peoples have been forcibly removed from their homelands, grave environmental damage is being done to the rainforests, children’s labour is being exploited and aggressive marketing of unhealthy products is taking place all over the developing world, all in the name of achieving economic growth and the name of progress.

Some post development sociologists conclude that development is a hoax in that it was never really designed to deal with humanitarian problems, rather it was about helping the industrial world, especially the United States to maintain its economic and cultural dominance of the world.

Consequently, post-development thinkers argue we need alternative models of development rather than the industrial-capitalist model promoted by western countries.

Post-Development Perspectives – How should developing countries develop?

Korten (1995) argued that development needs to be more ‘people centred’ – which means given people more of a say in how their communities (and countries) develop and getting them to play more of a role in the process of development.

Similarly Amartya Sen (1987) argues, development needs to be about giving people independence so they have real power and choice over their day to day situations, it shouldn’t be ‘top down’ coming from the west, via governments and then trickling down to the people.
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People Centred Development theorists also have a much broader conception of what ‘development’ could actually mean. They don’t believe that development has to mean them becoming more like the West and development shouldn’t be seen in narrow terms such as industrialising and bringing about economic growth, development projects should be much smaller scale, much more diverse, and much more coming from the people living in developing countries.

Because of its support for diversity, there are many different paths to development within the Post Development/ People Centred Development perspective. Examples include:

  • Socialist models of development – where governments control most aspects of economic life – such as in Cuba
  •  The Islamic model of development – adopted by Iran – where ‘development’ means applying Islamic principles to as many aspects of social life as possible, rather than focussing on economic growth as the primary goal.
  • Indigenous peoples maintain traditional lifestyles, effectively rejecting most of what the west has to offer is also something post-development perspectives support, as in the example of Bhutan

gross-national-happiness

Appropriate Development

Post-development perspectives aren’t against charities or western governments giving aid, but they want aid to be ‘appropriate’ to local communities where development is taking place. Thus this perspective generally supports the thousands of small scale fair trade and micro finance projects around the world are good examples of PCD style projects embedded in a global network.

Criticisms of Post-Development Perspectives

All the other theories argue that, eventually, if a poor country really wants to improve the lives of its people en masse in the long term, it needs money, this can only come from industrialisation and trade, is it really possible to improve standards of living through small scale projects?

Focussing solely on small scale development projects still leaves local communities in developing countries relatively poor compared to us in the West, is this really social justice?

In a globalising world it simply isn’t realistic to expect developing countries (such as Bhutan or groups living in the Rain Forest) to be able to tackle future problems if they remain underdeveloped – eventually population growth or climate change or refugees or drugs or loggers are going to infiltrate their boarders, and it is much easier to respond to these problems if a country has a lot of money a well functioning state and a high level of technology.

Post-Development perspectives are too relativistic – is it really the case that all cultures have equal value and diverse definitions and paths to development should be accepted? Do we really just accept that patriarchy and FGM are OK in places like Saudi Arabia and Somalia because that’s what their populations have ‘chosen’?

Related Posts

‘People Centred Development’ is closely related term to Post-Development – for the purposes of A level sociology, you can effectively treat them as the same thing!

Modernisation Theory was one of the main theories of development which Post-Development perspectives criticise:

Further Reading

Arturo Escobar – a post-development thinker to be reckoned with (Guardian Article)

This is a useful blog post on post-development perspectives

Sources

This post was mainly written using the following source:

Aiken D, and Moore, C (2016) AQA A Level Sociology Student Book 2, Collins.

 

 

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Dambisa Moyo’s Dead Aid – A Summary and Criticism

Dambisa MoyoIn this blog post I summarise Dambisa Moyo’s views on the problems with Aid as a strategy for development – she is talking about Official Development Aid rather than Emergency relief aid.

I’m mainly drawing from her writing at the end of chapter 3 and the whole of chapter 4 – and I offer up a few criticisms all the way through – before you read this through – please note my main criticism of Moyo’s work –

The main criticism I have of Moyo is that she uses statistics that show correlations between a high level of aid receipts and poor economic growth and then attempts to imply causality (aid causing poor growth) by using emotive, highly selective, anecdotal and even hypothetical (she invents a country – Dongo) ‘evidence’ to back up her case.

I say ‘imply causality’ because she never actually uses the word ‘cause’ – but the reader is left with the impression that this is what she is driving at. The end result for the less well informed reader is that they are stuck with a number of ‘easy to understand memorable case studies’ which imply that aid causes poverty – even though Moyo never actually says as much.

Anyway, here is my interpretation of the criticisms Moyo makes about the role of aid in development and a few criticisms that some people might make of Moyo’s work.

Criticism 1 – Aid does not bring about economic growth

At the end of chapter 3 – Aid is not working, Moyo starts to outline her basic criticism of Aid – This basic criticism being that aid has not effectively promote economic growth in Africa – Over 1 trillion dollars has been pumped into Africa over the past 60 years and there is little to show for it. In fact, according to Moyo, aid is malignant, it is the problem!

Moyo explains this through the following hypothetical example

 ‘There’s a mosquito net maker in Africa. He manufactures around 500 nets a week. He employs 10 people, who each have to support upwards of 15 relatives. However hard they work, they cannot make enough nets to combat the malaria-carrying mosquito.

Enter vociferous Hollywood movie star who rallies the masses, and goads Western governments to collect and send 100, 000 mosquito nets to the affected region, at a cost of $1 million, the nets arrive, the nets are distributed and a good deed is done.

With the market flooded with foreign nets, however, our mosquito net maker is promptly out of business. His ten workers can no longer support their dependents. 

Now think of what happens 5 years down the line when the mosquito nets are torn and beyond repair, we have now mosquito nets, and no local industry to build any more. The long term effect of the ‘aid injection’ has been to decimate the local economy and make the local population dependent on foreign aid from abroad.’

Backing this up with some stats, Moyo goes on to point out that ‘even the most cursory look at the data suggests that as aid has increased over time, Africa’s growth has decreased with an accompanying higher incidence of poverty. Over the past thirty years, the most aid-dependent countries have exhibited growth rates averaging minus 0.2 % per annum.

Moyo also argues that a direct consequence of aid-driven interventions has been a dramatic descent into poverty – citing Zambia as an example, and the fact that when aid flows were at their peak between 1970 and 1998 – poverty in Africa rose to a staggering 66%.

The problem Moyo has here is that she fails to present sufficient evidence to make her case – it’s well known that the later part of the period above was a time of global economic slowdown compared to the previous 20 years, which itself could play a major role in Africa’s poverty, as could be the case with the debt crisis. One could also simply cite Botswana and Ghana as case studies of aid-recipient countries that have grown to counter her one example of Zambia.

Criticism 2 – Aid Encourages Corruption, which in turn retards growth

Unlike the previous section, Moyo does use a reasonable amount of statistical (drawn mainly from Transparency International) and case study evidence in this section…

According to Moyo – If the world has one image of African statesmen, it is one of rank corruption on a stupendous scale. One of the best examples of this is Mobutu, who is estimated to have looted Zaire to the tune of $5 billion. He is also famous for leasing Concorde to fly his daughter to her wedding in the Ivory Coast shortly after negotiating a lucrative aid deal with Ronald Reagan in the 1980s.

Having provided a couple more examples of ‘classic African Dictators’, Moyo then cites that classic statement made in n 2004 by the British envoy to Kenya, Sir Edward Clay,  who complained about rampant corruption in the country, commenting that Kenya’s corrupt ministers were ‘eating like gluttons’ and vomiting on the shoes of foreign donors. In February 2005 (prodded to make a public apology), he apologised, saying he was sorry for the ‘moderation’ of his language, for underestimating the scale of the looting and for failing to speak out earlier.

Moyo further argues that at least 25% of World Bank Aid is misused. One of the worst examples is in Uganda in the 1990s – where it is estimated that only 20% of government spending on education actually made it to local primary schools.

According to Moyo, while it is not the only cause ‘aid is one of the greatest aides to corruption’ – arguing (Actually it might be more accurate to say ‘asserting’ given the lack of evidence in this section of her book) that ‘with aid’s help, corruption fosters corruption, nations quickly descend into a vicious cycle of aid’.

However, Moyo now drifts from the data and starts implying causality by asserting that growth cannot occur in an environment where corruption is rife, citing the following (un-evidenced) reasons (among others).

  • Corruption leads to worse development projects – corrupt government officials award contracts to those who collude in corruption rather than the best people for the job. This results in lower-quality infrastructure projects.
  • Foreign companies will not invest in countries where corrupt officials might siphon off investment money for themselves rather than actually investing that money in the country’s future.
  • Aid is corrosive in that it encourages exceptionally talented people to become unprincipled – putting their efforts into attracting and siphoning off aid rather than focusing on being good politicians or entrepreneurs.

Criticism 3 – Aid Corrupts Civil Society

Dambisa Moyo: Spreader of Neoliberal Hegemony?

OFFERING NO CONCRETE EXAMPLES OR EVIDENCE TO SUPPORT HER POINT, in this section Moyo asserts that Africa needs a middle class which trusts each other in order for development to occur. The problems is that in an aid environment, governments are more interested in lining their own pockets rather than encouraging entrepreneurs, meaning that the middle class cannot expand until it reaches that ‘critical mass’ which leads to sustained growth.

Criticism 4 – Aid undermines social capital

ONCE AGAIN OFFERING NO CONCRETE EXAMPLES OR EVIDENCE TO SUPPORT HER POINT, here Moyo argues that… In an aid dependent environment, there is no need for you to trust your neighbour and no need for your neighbour to trust you… Foreign aid weakens social capital by thwarting accountability mechanisms, encouraging rent-seeking behaviour, siphoning off scarce talent from employment positions and removing pressures to reform inefficient policies and institutions.

On the above two points it is also worth noting that these criticisms are really just fusions of the previous two criticisms of aid – that it prevents economic growth and breeds corruption.

Criticism 5 – Aid and Civil War

Moyo points out that there are three fundamental truths about conflicts today: they are mostly born out of competition for control of resources; they are predominantly a feature of poorer economies; and they are increasingly internal conflicts.

She then goes on to say that ‘this is why foreign aid foments conflict. The prospect of seizing power and gaining access to unlimited aid wealth is irresistible’. Unlike in the previous two sections, here she offers up one example to support her argument (Sierra Leone) before reminding us that aid also causes conflict more indirectly by reducing the prospects for economic growth.

The Economic Limitations of Aid

Having outlined five downsides of aid, Moyo then outlines its economic limitations – suggesting that there are four – once again lacking examples

  • Aid reduces savings and investment – assertion, no examples
  • Aid can be inflationary – assertion no examples
  • Aid chokes off the export sector (Dutch Disease) – cites unreferenced IMF studies
  • Aid causes bottlenecks due to low absorption capacity – Uses Uganda as an example

Aid and Aid Dependency

The end result of all the above is that aid leads to Aid Dependency – to the extent that aid makes up 13% of the average African country’s GDP. According to Moyo, this throws up the following problems

  • It makes Africans lazy
  • It leads to low tax revenues (no need to tax the citizenry if money is flooding in from outside!)
  • Citing Boone (1996) – it leads to bloated inefficient public sectors.
  • Finally, it leads to Western donors being able to call the shots.

In the final section of the chapter, Moyo pays homage to Peter Bauer, and briefly mentions that both William Easterly and Paul Collier disagree with the ‘one size fits all’ aid approach to development – before introducing the next sections of the book which are devoted to explaining why Africa should adopt free market (encouraging FDI/ Issuing bonds etc.)  rather than aid driven solutions to underdevelopment.

Criticisms of Moyo

Really, I’d just like to go back to what I said at the beginning and say that…

The main criticism I have of Moyo is that she uses statistics that show correlations between a high level of aid receipts and poor economic growth and then attempts to imply causality (aid causing poor growth) by using emotive, highly selective, anecdotal and even hypothetical (she invents a country – Dongo) ‘evidence’ to back up her assertions.

I say ‘imply causality’ because she never actually uses the word ‘cause’ – but the reader is left with the impression that this is what she is driving at. The end result for the less well informed reader is that they are stuck with a number of ‘easy to understand memorable case studies’ that imply aid causes poverty – even though Moyo never actually says as much – possibly because she might think that, really, there is insufficient evidence to make the case which she alludes to.

One has to reflect on why Moyo is so selective – I think it unlikely that an Oxford and Harvard Graduate has failed to read widely enough for this to be innocent – Especially when the author has 8 years at Goldman Sachs under her belt….so could it be that this is simply an overt attempt to promote a neoliberal anti aid agenda?

The End of Poverty by Jeffrey Sachs – A Summary of Chapters 1-4

 

NB –  You might also like this summary of Chapter 8 – Which focuses on AIDs and malaria in Africa and ‘Jeffrey Sach’s case for International Development Aid, a summary of chapters 12-16

It would be useful for students of Global Development to develop a critical understanding of this book because Sachs has been one the most influential economic advisers  to both Nation States and global financial institutions such as the IMF over the last three decades. Jeffrey Sachs is well known popularly because of his links with Bono and his championing of the role of Western Aid and Philanthropy in helping to solve development problems.  

Sachs is critical of ‘grand theories of development’- such as ’70s Dependency Theory and the Neoliberal approach of the World Bank/ IMF in the 80s and 90s – but  he is still optimistic that if we can engage in what he calls ‘clinical economics’ and uncover the country specific barriers there are to development in individual countries, we can develop effective strategies to end poverty- both the extreme poverty faced by the world’s billion poorest, and also the moderate poverty faced by another 1.6 billion.

While development strategies need to be specific to each country, Sachs sees international co-operation crucial to ending extreme poverty and so Western Official Development Aid, good governance on the part of developing nation states, Transnational Corporations, and The United Nations all have a crucial role to play in bringing about development. Technological innovation, and Trade (including changing the rules of trade so they don’t unfairly benefit developed nations) are seen as key universal strategies to be adopted to bring about development.

Sachs is also a champion of the United Nation’s 8 Millennium Development Goals – not as ends in themselves but because lack of development in each of the 8 areas other than economic well being can be a barrier to economic development, which in Sach’s mind is correlated with all other development goals, and economic growth, measured by rising GDP per capita, to be achieved through the integration of countries into the global economy through trade remains the ultimate goal of development according to Sachs.

Students can use Sachs to all the popular theories of development from the preceding six decades – Modernisation Theory, Dependency Theory and Neo-liberalism. Below is a summary of selected chapters of Sach’s The End of Poverty, with some criticisms.

 

Chapter 1: A Global Family Portrait

Sachs outlines elements of life in four countries – Malawi, Bangladesh, India and China which broadly correspond to four ‘stages’ of development –

  • Malawi – caught in ‘the perfect storm’ is portrayed as a Malaria and AIDS infested rural backwater, largely cut off from international trade – represents the four billion people trapped in extreme  poverty – living on less than $1 a day
  • Bangladesh – ‘on the ladder of development is ‘ integrated into the international economy but at the bottom end of it, and characterized by ‘sweatshop’ labour but also increasing amounts of micro-financed businesses which offer hope for more independent economic development – represents the poor – or the 1.5 billion people living on between $1-$2/ day
  • India – at the centre of an export services revolution – is provided as an example of a country that is increasingly populated with people on ‘middle incomes’ – with increasing numbers of city dwellers working for Transnational Companies and related home-grown business earning $250 -$400 a month – although India is a country of extremes – with many in rural areas living on $1-2 a day
  • China – is characterized by rising affluence – again like India there are millions who live in poverty, but parts of China are increasingly coming to resemble the West. Sachs in fact tells of how he first saw cell phones with cameras in Beijing, not America.

Who are the poor?

Poverty is not uniformly distributed across the globe – i.e. there are rich and poor people in every country, although most of the poor live in three regions – South and East Asia and Sub Saharan Africa. Where extreme poverty was concerned Sachs notes that the figures were as follows – (NB these are 2001 figures!) – (Updates to follow)

  • South Asia – 400 million (30% of the population)
  • East Asia – 250 million (15% of the population)
  • Sub Saharan Africa – 300 million (40% of the population )

Sachs also notes that there is hope – because the numbers of those in extreme poverty in East and South Asia have fallen by 2/5ths and 1/3rd respectively since 1981, although numbers grew slightly in Africa.He then goes on to state what should be the four development goals of our age

  • To meet the MDGs by 2015
  • To end extreme poverty by 2025
  • To ensure that by 2025 all the worlds poor have an opportunity to climb the ladder of economic development
  • To accomplish this with modest financial help from the rich countries.

 

Chapter 2 – The Spread of Economic Prosperity

According to the economic historian Angus Maddison, 1820 was the year when ‘The Great Transformation’ began. 1820 was the year when the Modern World Economy ‘took off’. The previous 800 years had seen no significant increase in world population growth or income, but from 1820, population and economic growth began to grow rapidly. Referring to this rapid period of post 1820s growth, Sachs notes that –

  • All regions on earth experience economic growth
  • Some regions grew much more rapidly than others.

To illustrate this, in 1820, the income of the average European was only 90% that of the average African and the average life expectancy was very similar, around 40 years of age. Focusing on GDP/capita, the UK was only four times richer than Africa, by 1998 this had rise to 20 times greater (factoring in PPP). We can roughly break down this inequality as follows –

  • 1/6th of the world’s population lives in extreme poverty
  • 2/3rds experience middle income lifestyles
  • 1/6th experience high income

Why did some countries grow so rapidly from the 1820s?

Sachs now looks at the United Kingdom as the country that, from 1820, developed more rapidly than any other and asks – why? – He points to the following features –

  1. British Society was relatively open- there was scope for social mobility and hierarchies were less rigid than in most of the rest of Europe
  2. Britain guaranteed certain individual freedoms (individualism) – it had a tradition of free speech and protection of private property
  3. 3.    (and critically) It was one of the leading centres of scientific revolution. In particular, Newton laid the groundings for the industrial revolution. NB Sach’s argues that technological innovation is the critical element in bringing about development
  4. Geographical advantages – It was an Island close to Europe with inland navigable waterways
  5. Britain faced less risk of invasion compared with its neighbours in Europe
  6. Britain had coal – the energy source that fueled the great industrial revolution.

The Combination of new industrial technologies, coal power and market forces created the industrial revolution – and this meant that economies could grow beyond long-accustomed bounds without hitting the biological constraints of food and timber production. The industrial revolution in turn lead to economic growth and these two things changed the way people lived in Britain in every fundamental sense. They lead to what Sachs calls the Great Transformation – in which British society and culture were transformed, laying the foundations for yet more growth and prosperity[1]

Sachs also mentions that Colonialism was key to Britain, and Europe’s development – which involved the use of military force to press-gang Asia and Africa to the service of Western Development – Although Sach’s argues that its not as simple as the West’s development coming at the expense of India and Africa, in the long run, the West’s expansion into these regions helped bring about some, albeit extremely limited, economic growth. Colonialism and exploitation of the developing world did occur, but these are not sufficient reasons to explain why certain countries, and indeed most of Sub Saharan Africa failed to develop – which is the topic Sachs turns to in chapter 3.

Chapter 3 – Why some countries fail to achieve economic growth

In this chapter Sachs suggests eight things that can prevent a country developing

  1. The Poverty Trap – Poverty itself as a cause of economic stagnation – The key problem for the poorest countries is that poverty itself can be a trap. When poverty is very extreme, the poor do not have the ability – by themselves – to get out of the mess. This is because, when people are utterly destitute, all energy goes into survival and there is no capacity to save anything for the future.
  2. Physical geography – Being landlocked or ‘hemmed in’ by mountainous terrain can prevent access to trade networks that bring about development – this is the case with Bolivia (mountains) and Ethiopia (landlocked and poor transport networks). Also Sub-Saharan Africa has an ideal climate that allows malarial mosquitoes to breed, which has decimated much of the population in recent decades.
  3. Fiscal trap – the government may lack the resources to pay for the infrastructure, on which economic growth depends – such as health care, roads, ports, education. There are three reasons for this – firstly, the population may be too poor to tax, secondly it may be inept or corrupt and finally it may be debt burdened.
  4. Governance failures – governments have a crucial role to play in development – not only through developing infrastructure but also through resolving conflicts and ensuring peace and stability. At the extremes, poor governance can result in failed states which can often lead to economic deterioration.
  5. Cultural Barriers – The two main ones are patriarchal countries which deny women equal rights with men – not only does this bar half the population from the opportunity of being economically active, keeping women in a child-rearing role is linked to higher fertility rates, and greater poverty, and also religious and ethnic differences can lead to tensions and even genocide.
  6. Trade Barriers – Some countries economies are crippled by unfair trade rules, for example The Four West African countries whose primary export is cotton are held back economically because of the USA’s subsidies to its own domestic cotton farmers.
  7. Lack of Innovation – The ‘innovation cycle’ (aka endogenous growth) is one of the main factors responsible for the West’s and now Asia’s rapid economic growth – New products being produced and consumed lead to more innovations as people develop more products related to them – (E.G. Now we have Smart Phones – people innovate and develop new applications) – Where people are so poor they have nothing, there is no scope for innovation!
  8. The demographic trap – Poverty leads to higher fertility rates (families choosing to have more children) Economic growth leads to fewer children. Women in the poorest countries have on average 4-6 children – simply put it is harder to feed so many children, and impossible to send all of them to school – resulting in a cycle of poor health, low education and yet more poverty.

Why some poor countries grew and others declined

To cut a medium length section short – the most important factor Sachs points to not covered above is food productivity – quite simply, the reason why Asia has grown more rapidly than Sub Saharan Africa in the last 30 years is that they have experience a ‘green revolution’ – they are capable of producing twice as much food per hectare because of better irrigation and selection of more modern species of crop. He also mentions the fact that ‘natural shocks’ have prevented some countries from developing. He then gives a few examples of different countries that have experienced a selection of the problems above in the years since WW2.

 

The greatest challenge: overcoming the poverty trap

The end of chapter 3 (P73) is where Sachs outlines his classic statement of development – to quote

“The main object of economic development is for the poorest countries is to help these countries gain a foothold on the ladder: The rich countries do not have to invest enough in the poorest countries to make them rich: they need to invest enough so that these countries can get their foot on the ladder. After that, the tremendous dynamism of self-sustaining economic growth can take hold.”

 

Chapter 4 – Clinical Economics

Sachs has developed a new sub-discipline called clinical economics. Each failed conomy is unique and its ailments must be carefully diagnosed before a prescription suited to the condition can be written. Sachs includes helpful checklists to diagnose the causes of economic decline and formulate a cure for the malady. We need to look at the following aspects of a country, and its relationship to the wider world in order to assess what assistance is needed to enable it to progress further up the ladder of development:

  1. The Nature and distribution of poverty and its ultimate causes/ potential risk factors – including commodity price fluctuations and ‘climate shocks’
  2. Government policies and capacity to invest in infrastructure
  3. Physical Geography – including transport conditions, agronomy, population density and the disease landscape
  4. Governance Patterns and failures – civil rights, corruption
  5. Cultural Barriers – Gender and ethnic divisions
  6. Geopolitics – Cross boarder threats (wars/ refugees) and also trade relations.

So, at the end of the day, by 2005, this was the bottom line of development theory – it maybe flippant to say this about one man’s life work – but it don’t sound like rocket science to me! Of course I am aware of the fact that doing the analysis and implantation is an extremely time consuming task.  

If I get time I may post the rest of the summary laters! (No promises)

 

Criticisms of the End of Poverty

Firstly a few of my own –

  1. He puts too much emphasis on economic growth as a goal in itself – It is quite clear that economic growth does not yield uniform increases in quality of life across all countries – take Saudia Arabia, and possibly Nigeria as examples of countries you probably don’t want to live – but they have either a high GDP or a rapidly growing economy.
  2. I have a problem with idea of economic growth being ‘self sustaining’ – although you might say I’m saying this with the hindsight of the 2008 financial crash, this is actually coming from basic Marxist economics – a system cannot keep on growing at the rate of 2-3%, let alone at 7-8% for ever – because the bigger you get, the harder the harder it is to maintain economic growth rates. (8% of $500 billion output is much more than 8% of $50 billion!)
  3. He hardly mentions sustainable development, or the idea of “limits to growth’’
  4. ‘Clinical Economics’ maybe just sounds like an excuse to employ thousands of more ‘development experts’ to diagnose developing countries specific problems.

And criticisms from others

This is a brilliantly scathing critique! – among the criticisms

  • He is not critical enough of Corporations and their role in pulling the strings of Western Governments – who create trade policies that benefit Western Corporations rather than developing countries
  • Even though he is critical of the IMF and neoliberalisation – he still argues that ‘Trade’ is ultimately the solution to developing world problems
  • Related to the above point – this is still a Eurocentric theory – it is up to us to help them
  • Sachs also fails to acknowledge the work of developing world economists who came up with many of the ideas he seems to present as his own in The End of Poverty.

This post by John Vidal is also pretty scathing – among his point he argues that ‘Sachs seems to be suffering a dose of advanced consultivitis – symptoms include a swollen ego and a fervent belief that you can change the world. In a work littered with tales of meetings with presidents and global dignitaries, he plays the moral economist who goes from country to country handing out pills and mopping the fevered brows of administrations in economic crisis’.

This blog offers up some nice criticisms of Sach’s work – among them

  • He puts too much faith in the power of economic growth to solve all social problems – citing the example Saudi Arabia as a country that has a high GDP per capita but still a massive birth rate (and thus an eventual tendency to overpopulation
  • Another problem of econmic growth is that labour is mobile – so if you invest in education as part of a growth strategy, once people are educated – they tend to leave for more developed countries where they are better paid (known as the ‘brain drain’)
  • Even though he suggests (eventually) that aid can be an effective means of lifting a country out of poverty – he fails to give any examples of where aid has actually been effective at helping a poor country ‘take off’ successfully.
You might also like….

My summary of ‘Why Nations Fail’


[1] – The list of changes that Industrialisation and economic growth lead to is eerily evocative of Modernisation Theory from the 1940s… Sachs notes 5 aspects of the ‘Great Transformation’

  1. First and foremost Urbanisation
  2. A revolution in social mobility
  3. Changing gender roles
  4. New family structures (lower birth rates)
  5. An increasingly complex Division of labour with people getting more skilled

Arguments for International Development Aid

Jeffry Sachs in ‘The End of Poverty’ (2005) makes the case for increasing spending on aid to developing countries. Taken mainly from chapters 12-16

(1) Why is Aid needed?

Sachs argues that injections of aid are needed to break the poverty trap –because there is no where else money is going to come from when there is insufficient income to tax or save.

Sachs uses a description of a visit to Sauri village in Western Kenya to describe the poverty trap – the villagers face a range of poverty related problems including poor food yields due to lack of fertilisers and nitrogen-fixing trees, the fallout from diseases such as AIDS and malaria and the fact that children cannot concentrate in school because of malnutrition. All energies and money are basically spent on combating disease and staying alive.

As a result of the poverty trap the village faces under investment in the following five areas

  1. Agriculture
  2. Health
  3. Education
  4. Power, transport and communications infrastructure
  5. Sanitation and water.

Aid needs to be spent boosting whichever of these areas are undeveloped (and all of them, all at once, if necessary) because a weakness in one can mean money is wasted on another (it’s pointless spending billions on education if disease means kids can’t concentrate in school, or lack of roads means they can’t get to school.). This should be based on what Sachs calls a ‘clinical diagnoses‘ of a countries requirements.

(2) How much aid is needed?

There’s a number of ways of looking at this

$70 per person per year for at least 5 years would being sufficient to provide suitable investment in these five areas for the poorest regions on earth (basically the bottom billion who are stuck in the poverty trap). After an initial 5 year period, Sachs believes that this figure should reduce considerably and that 10 years should be sufficient for a country to be self-sustaining financially.

Looked at globally The World Bank estimates that meeting basic needs costs $1.08 per person per day – 1.1 billion people lived below this with an average income of 77 cents. Making up the short fall would mean $124bn/ year, or 0.7% of rich world GNP.

(3) Arguements for providing International Development Aid

Firstly, using aid to eradicate poverty will make the world a more secure place

The US spends 30 times as much on its military as it does on aid (for the UK it’s about 8 times as much, 2002 figures), but spending money on military solutions is not going to make an insecure world more secure.

A CIA task force examined 113 cases of state failure between 1957 and 1994 and found that three explanatory variables are the most common:

  1. High infant mortality rates (which indicate low levels of material well-being)
  2. Openeness of the economy – the more open, the less stable
  3. Democracy – the more democratic, the more stable.

Sachs rounds off by listing 25 countries which America has intervened in following State Failure since 1962. His point is that state failure typically leads to US intervention, which is more costly than the price of providing aid which would prevent such interventions.

Secondly, Official Development Aid  is crucial to provide health, education and infrastructure, and because it makes up a significant part of the total income of many countries.

Thirdly,The  public will support a massive increase in aid if there’s leadership on the issue – nearly 90% of the US public support food aid (it depends how you frame the question). Also, broad support was garnered for The Marshall Plan, The Jubilee Drop the Debt Campaign and The Emergency AIDS campaign.

Fourthly – There is evidence that Aid can work:

Besides the usual green revolution and eradication of smallpox examples Sachs also cites…

  • The Global Alliance for Vaccines and Immunisation
  • The Campaign against Malaria
  • The Eradication of Polio
  • The spread of family planning
  • Export Processing Zones in East Asia
  • The Mobile Phone Revolution in Bangladesh

Five – the West can easily afford it 

Sachs points out that the richest 400 individuals incomes stand at just under $70 billion dollars, and the first two years of the Iraq War, which was an unexpected cost, was $60 bn a year, so basically yes. He also recommends a 10% additional tax on the richest for the purposes of development.

(4) Sach’s view of why Aid Doesn’t Always Work – Poor Countries Aren’t Getting Enough Aid! (**This can be used to criticise Dambisa Moyo”s views on aid. )

Poor countries are receiving no where need enough aid to make a difference to development – To demonstrate this he uses the West African Water initiative as an example – Worth $4.4 million over 3 years, but this only worked out at less than a penny per person per year, no where near enough to make a difference.

He also cites the case of Ethiopia – in 2003 it would have needed approx $70 billion to kick start development – half for health and most of the rest split between food productivity and infrastructure. It was then receiving $14 per head per year which was well short of the money needed. At the time the IMF acknowledged in private that this was not sufficient but in public made no mention of this.

Another way of outlining how limited current ODA is lies in the following:

in 2002 of $76 billion total assistance….only $12 billion amounted to what might be called development support to the poorest countries (most of the rest was emergency aid, with $6 billion being debt relief and $16 billion going to middle income countries.

As a result of this countries often don’t get anywhere near what they need – Sachs cites Ghana as an example – it requested $8 billion over 5 years in 2002 and got $2 billion. His point is that $2 billion is no where near enough to kick-start development.

(5)) Myths about why aid doesn’t work (**these could be used to criticise Dambisa Moyo)

He actually lists 10, but I’ve only included the first three!

Myth One – Giving aid is ‘money down the drain’

It is common to hear Americans bemoaning the fact that there is nothing to show for the amount of aid given to Africa. This is, however, unsurprising. The total amount of aid per Africa works out at $30 per head, but of this $5 goes to consultants, $4 was for food aid, $4 went to servicing debts and $5 for debt relief, leaving $12 per African.

Of the $3 of US aid to Africa, approximately 6 cents makes it on the ground African projects.

Myth Two – Aid programmes would fail in Africa because of backward cultural norms

Sachs points out that he frequently encounters prejudiced views based on African stereotypes even among those in senior positions in the aid industry – Such as the idea that Africans don’t understand western concepts of time. He dispels this by simply drawing on his own experiences telling him different things.

Myth 3 – Aid won’t work because of corruption

Nearly all low income level countries have poor levels of governance. However, corruption is not a reason to not invest in a country because the causal relationship runs in the direction of wealth reduces corruption. This is because when incomes increase people have more of an interest in keeping governments in check and there is more money to invest in good governance through better communication systems and a more educated civil service for example.

Looking at cross national comparisons reveals two things – Firstly that African countries governance levels are similar to similarly poor countries. That is to say that governance is not especially poor in Africa, and secondly there must be something else going which results in poverty other than poor governance – there are still some very poor countries in Africa with good governance yet high poverty, he cites Ghana as one such example.

Statistical indicators reveal that African countries grew at 3% percentage points slower than countries with similar levels of governance and income between 1980 and 2000. The reason for their low growth is geography and poorly developed infrastructure.

(6) A more ambitious approach to Development Aid

Ultimately Sachs believes we should be spending more on aid rather than less!

Sachs outlines ‘a needs assessment approach’ to development which basically involves identifying a package of basic needs, figuring out the investments required,, figuring out what poor countries can pay and then working out the finance gap which is what rich countries should meet. The list of basic needs includes such things as:

  • Primary education for all children, including teacher pupil ratios
  • universal access to antimalarial bednets
  • I kilometre of paved road per person
  • nutrition programmes for all vulnerable populations
  • access to modern cooking fuels
  • Access to clean water and sanitation.

To establish these poor countries would need $110 per person per year for 10 years (calculated by the UN for five countries – Bangladesh, Ghana, Cambodia, Tanzania and Uganda.

Of this Sachs believes that households and poor country governments could pay $10 and $35 dollars respectively meaning that $65 per person per year is the finance gap

Who should pay? Basically it breaks down like this…

USA – 50%
Japan – 20%
UK, Germany, France, Italy – 20%.

How to End Poverty in 15 years

In this hour long programme Hans Rosling asks how we can eradicate extreme poverty in 15 years, which is goal number 1.1 of the United Nations 2030 Agenda for Sustainable Development, to which 193 nations signed up to in September 2015, in New York.

While recognising that relative poverty exists within rich and poor countries alike, the programme focuses on extreme poverty, defined as people living on less than $1 a day, a level at which daily life involves a struggle to get enough food to eat.

Hans (he’s so accessible I’m sure he wouldn’t mind first name terms) starts by putting poverty in historical context, by looking at how wealth (measured by GDP per capita) has changed over the last 200 years. To do this, Hans converts the GDP figures into the amount each person earns per day, ranging from those who live on $1 a day (as many do in Malawi) to those who live on $100 a day (as most people in Sweden do). As shown in the still below – only about 12% of the world’s population today live in extreme poverty.

Poverty infographic rosling

The story of the last 200 years is that we’ve basically moved from a global situation characterised by extremes of wealth and poverty (broadly speaking 1800-1970) to one in which most people world now live in ‘the middle’ in terms of global wealth distribution. In the video clip below, Hans tells this story.

The biggest shift has occurred in the last 50 years – in the 1970s, 50% of the worlds population lived in absolute poverty (2 billion amongst a 4 billion global population). In 2015, even with world population growing by 3 million to 7+ billion, only 1 billion, or 12.5% of the world’s population live in poverty.

So the best-fit picture of today’s global population isn’t one of a massive divide between the rich and the poor, but one of the expanding or ‘big middle’** – Most people in the world today earn between $1 to $10 a day, and many of these have transitioned out of absolute poverty within the last few decades.

Dollar Street – A Global Family Portrait.

To illustrate the differences in living standards around the globe, Hans draws on a number of case studies.

$1/ day – Malawi – Here the focus is on a couple with eleven children. They are basically subsistence farmers and have a small field of maize which they rely on for their basic food. The field is so small they have to endure a hunger season, during which they only eat once a day, and the children fall sick because of lack of food. In a poor season (As shown later in the video), when the rains are irregular, the food may only last for half the year, so the hungry season is long!)

The children go to school, but there are no school meals, so there’s no food until bed time on some school days. The family struggle to pay for the ‘hidden costs’ of education such as school uniforms and books.

There are no jobs in the area, but the families keep grafting – the father turns old bits of tin into watering cans and the mother makes dumplings, two products which are sold to neighbours. However, local people are too poor to be anything other than occasional customers.

In the household there is no electricity or running water and everyone sleeps on the floor, no mattresses. The house is built from perishable materials and once a week the mother has to spread fresh mud on the walls and ceiling to stop the house falling apart. The husband is gradually building a brick house, but it will take him four years to complete it.

These people are literally struggling to build their future bit by bit.

Countries in which significant numbers of people live on less than $1 a day include Burundi and Malawi.

The Big Middle – Up to $10 a day

To illustrate where the majority of the world’s population now live in income terms, we go to Cambodia to focus on some new arrivals to the ‘big middle’ – We focus on a family who live about an hour away from the capital Phnom Penh, but are still close enough to feel the benefits of its development.

Their house is made from more durable material – bricks and plastic/ iron sheets, they have clean water, bicycles, a little car, beds with mattresses, radios, TVs, and electricity.

The Family’s living conditions are far from easy but there is no hungry season like in Malawi, and they have earned enough to buy various life-changing technologies – such as a water pump so is there more time to devote to paid work.

The nearby capital city Phnom Penh is at the heart of an economic boom, mainly thanks to textile exports, and the benefits reach a long way into rural areas.

The father in this family has benefited from this – migration to the city has meant there are fewer farmers, so he now makes $300 a month from growing and selling grass which people feed to their cattle, and he has bought a small bike so he can deliver more efficiently.

However, the mother is currently pregnant with twins, and one of them is upside down…they want a cesarean and this will cost them $500 which will mean they need to borrow money, a price which could put them back into dire poverty for years to come as they struggle to pay it back.

The crucial thing which prevents this from happening is that the family qualify for Cambodia’s recently introduced free health care, available for free for the poorest families only. This is assessed by means of a ‘Poor Card’ – people are asked a number of questions about their standard of living (which is checked later) and if they score below a certain amount of points they qualify for free health care for the whole family, which ensures that complications in childbirth do not result in financial catastrophe.

Among the many countries included in the ‘big middle’ are The Philippines, Columbia, Rwanda, and Bangladesh. However, there are obviously differences, and if you look carefully, these are not all ‘equally poor’ (but this isn’t expanded on).
How to eradicate extreme Poverty

It’s amazing how much life is improving for s many people in so many ways – this is the greatest story in human history, and if we want to lift the remaining billion people out of extreme poverty we need to learn from the lessons of the majority of countries which have lifted themselves out of poverty in the last century.

The basic lesson is that all of these countries have invested in human welfare, in such things as public health care systems and education, which has reduced the child mortality rate, and the birth rate, and altogether this has resulted in economic growth.

Hans demonstrated this by looking at the historical relationship between the child mortality rate and GDP per Capita from 1800-2015. (The child mortality rate depends on many things, such as improved health, education and gender empowerment, so it acts as a proxy indicator for these other aspects of human progress).

The general trend is that in many countries, the child mortality rate goes down first, which is followed by sustained economic growth for many years. It seems that once the Child Mortality rate gets to about 10%, this is when economic take off occurs. This happened in at least the following countries:

  • Britain
  • China
  • South Korea
  • Ethiopia.
  • In short, the lesson of how to end poverty in 15 years – invest in human progress even when resources are limited.

    The video rounds off with going back to Malawi to demonstrate that all is needed to lift many farmers out of poverty is investment in small scale irrigation systems, so crops can be easily watered when rains are irregular. A dam would transform the lives of small farmers in remote areas by allowing them to grow not only more staple food, but also a greater diversity of crops which could be sold.

    The investment required is relatively little, but who will pay? The private sector won’t, because there is no profit, and governments in poor countries are still too poor, so the third option is International Development Aid.

    However, Development aid needs to be refocused away from the richer developing countries – Currently, countries such as India and China receive aid equivalent to $300 per person, but the poorest countries, mostly in Sub-Saharan Africa, receive only $100 per person. In short, aid is going to the wrong places.

    Poverty Infographic Hans Rosling

    Hans argues that we should perceive aid to end poverty not as charity, but as an investment. There are three basic arguments for this:

    1. Extreme poverty breeds problems such as war and conflict.
    2. If we lift people out of extreme poverty, they will become the customers of tomorrow, and possibly the entrepreneurs of tomorrow.
    3. It is the most effective way of combating population growth – below $1 a day, the average number of babies per woman is five, above, it the average is 2 or less.

    In conclusion, Hans suggests we would be mad not to end poverty in 15 years, and that compared to the other two problems the world faces: climate change and war and conflict, this goal is actually easy to achieve.

    _

    **Another way in which Hans illustrates the growth of the ‘big middle’ is by pointing out the following statistics:

    80% of people have electricity at home? (the audience thought 40%)

    83% have have got vaccinated against measles? (the audience thought 30% )

    90% of girls out of ten go to primary school (in that age group) (the audience thought 40%).

Jeffry Sachs – Summary of The End of Poverty, Chapters 12-16

This is a brief summary of the case Jeffry Sachs made for International Development Aid in his 2005 book ‘The End of Poverty’. Taken mainly from chapters 12-16

(1) Why is Aid needed?

Sachs argues that injections of aid are needed to break the poverty trap –because there is no where else money is going to come from when there is insufficient income to tax or save.

Sachs uses a description of a visit to Sauri village in Western Kenya to describe the poverty trap – the villagers face a range of poverty related problems including poor food yields due to lack of fertilisers and nitrogen-fixing trees, the fallout from diseases such as AIDS and malaria and the fact that children cannot concentrate in school because of malnutrition. All energies and money are basically spent on combating disease and staying alive.

As a result of the poverty trap the village faces under investment in the following five areas

  1. Agriculture
  2. Health
  3. Education
  4. Power, transport and communications infrastructure
  5. Sanitation and water.

Aid needs to be spent boosting whichever of these areas are undeveloped (and all of them, all at once, if necessary) because a weakness in one can mean money is wasted on another (it’s pointless spending billions on education if disease means kids can’t concentrate in school, or lack of roads means they can’t get to school.). This should be based on what Sachs calls a ‘clinical diagnoses‘ of a countries requirements.

(2) How much aid is needed?

There’s a number of ways of looking at this>

$70 per person per year for at least 5 years would being sufficient to provide suitable investment in these five areas for the poorest regions on earth (basically the bottom billion who are stuck in the poverty trap). After an initial 5 year period, Sachs believes that this figure should reduce considerably and that 10 years should be sufficient for a country to be self-sustaining financially.

Looked at globally The World Bank estimates that meeting basic needs costs $1.08 per person per day – 1.1 billion people lived below this with an average income of 77 cents. Making up the short fall would mean $124bn/ year, or 0.7% of rich world GNP.

(3) Arguements for providing International Development Aid

Firstly, using aid to eradicate poverty will make the world a more secure place

The US spends 30 times as much on its military as it does on aid (for the UK it’s about 8 times as much, 2002 figures), but spending money on military solutions is not going to make an insecure world more secure.

A CIA task force examined 113 cases of state failure between 1957 and 1994 and found that three explanatory variables are the most common:

  1. High infant mortality rates (which indicate low levels of material well-being)
  2. Openeness of the economy – the more open, the less stable
  3. Democracy – the more democratic, the more stable.

Sachs rounds off by listing 25 countries which America has intervened in following State Failure since 1962. His point is that state failure typically leads to US intervention, which is more costly than the price of providing aid which would prevent such interventions.

Secondly, Official Development Aid  is crucial to provide health, education and infrastructure, and because it makes up a significant part of the total income of many countries.

Thirdly,The  public will support a massive increase in aid if there’s leadership on the issue – nearly 90% of the US public support food aid (it depends how you frame the question). Also, broad support was garnered for The Marshall Plan, The Jubilee Drop the Debt Campaign and The Emergency AIDS campaign.

Fourthly – There is evidence that Aid can work:

Besides the usual green revolution and eradication of smallpox examples Sachs also cites…

  • The Global Alliance for Vaccines and Immunisation
  • The Campaign against Malaria
  • The Eradication of Polio
  • The spread of family planning
  • Export Processing Zones in East Asia
  • The Mobile Phone Revolution in Bangladesh

Five – the West can easily afford it 

Sachs points out that the richest 400 individuals incomes stand at just under $70 billion dollars, and the first two years of the Iraq War, which was an unexpected cost, was $60 bn a year, so basically yes. He also recommends a 10% additional tax on the richest for the purposes of development.

(4) Sach’s view of why Aid Doesn’t Always Work – Poor Countries Aren’t Getting Enough Aid! (**This can be used to criticise Dambisa Moyo”s views on aid. )

Poor countries are receiving no where need enough aid to make a difference to development – To demonstrate this he uses the West African Water initiative as an example – Worth $4.4 million over 3 years, but this only worked out at less than a penny per person per year, no where near enough to make a difference.

He also cites the case of Ethiopia – in 2003 it would have needed approx $70 billion to kick start development – half for health and most of the rest split between food productivity and infrastructure. It was then receiving $14 per head per year which was well short of the money needed. At the time the IMF acknowledged in private that this was not sufficient but in public made no mention of this.

Another way of outlining how limited current ODA is lies in the following:

in 2002 of $76 billion total assistance….only $12 billion amounted to what might be called development support to the poorest countries (most of the rest was emergency aid, with $6 billion being debt relief and $16 billion going to middle income countries.

As a result of this countries often don’t get anywhere near what they need – Sachs cites Ghana as an example – it requested $8 billion over 5 years in 2002 and got $2 billion. His point is that $2 billion is no where near enough to kick-start development.

(5)) Myths about why aid doesn’t work (**these could be used to criticise Dambisa Moyo)

He actually lists 10, but I’ve only included the first three!

Myth One – Giving aid is ‘money down the drain’

It is common to hear Americans bemoaning the fact that there is nothing to show for the amount of aid given to Africa. This is, however, unsurprising. The total amount of aid per Africa works out at $30 per head, but of this $5 goes to consultants, $4 was for food aid, $4 went to servicing debts and $5 for debt relief, leaving $12 per African.

Of the $3 of US aid to Africa, approximately 6 cents makes it on the ground African projects.

Myth Two – Aid programmes would fail in Africa because of backward cultural norms

Sachs points out that he frequently encounters prejudiced views based on African stereotypes even among those in senior positions in the aid industry – Such as the idea that Africans don’t understand western concepts of time. He dispels this by simply drawing on his own experiences telling him different things.

Myth 3 – Aid won’t work because of corruption

Nearly all low income level countries have poor levels of governance. However, corruption is not a reason to not invest in a country because the causal relationship runs in the direction of wealth reduces corruption. This is because when incomes increase people have more of an interest in keeping governments in check and there is more money to invest in good governance through better communication systems and a more educated civil service for example.

Looking at cross national comparisons reveals two things – Firstly that African countries governance levels are similar to similarly poor countries. That is to say that governance is not especially poor in Africa, and secondly there must be something else going which results in poverty other than poor governance – there are still some very poor countries in Africa with good governance yet high poverty, he cites Ghana as one such example.

Statistical indicators reveal that African countries grew at 3% percentage points slower than countries with similar levels of governance and income between 1980 and 2000. The reason for their low growth is geography and poorly developed infrastructure.

(6) A more ambitious approach to Development Aid

Ultimately Sachs believes we should be spending more on aid rather than less!

Sachs outlines ‘a needs assessment approach’ to development which basically involves identifying a package of basic needs, figuring out the investments required,, figuring out what poor countries can pay and then working out the finance gap which is what rich countries should meet. The list of basic needs includes such things as:

  • Primary education for all children, including teacher pupil ratios
  • universal access to antimalarial bednets
  • I kilometre of paved road per person
  • nutrition programmes for all vulnerable populations
  • access to modern cooking fuels
  • Access to clean water and sanitation.

To establish these poor countries would need $110 per person per year for 10 years (calculated by the UN for five countries – Bangladesh, Ghana, Cambodia, Tanzania and Uganda.

Of this Sachs believes that households and poor country governments could pay $10 and $35 dollars respectively meaning that $65 per person per year is the finance gap

Who should pay? Basically it breaks down like this…

USA – 50%
Japan – 20%
UK, Germany, France, Italy – 20%.

The Bottom Billion – Paul Collier – A Summary

Global poverty has been falling for decades, but a few countries which are caught in four distinct traps (such as the resource curse) are falling behind and falling apart. Aid does not work well in these places but there are things we can and should do because neglect will pose a security nightmare for the world of our children.

Paul Collier’s Bottom Billion Theory can be used to criticise all previous grand-theories of development – modernisation theory, dependency theory and neoliberalism.

The Four Traps

Trap 1- The Conflict Trap

73% of people in the bottom billion countries are in a civil war or have recently been through one. Civil war reduces income and low income increases the risk of civil war. Low income means poverty and low growth means hopelessness and available young men. When the economy is weak the state is weak and rebellion is easier. Sometimes rebel movements get finances from resource exporters in return for future deals.

“Rebels usually have something to complain about, and if they don’t they make it up. All too often the really disadvantaged are in no position to rebel: they just suffer quietly.” Little relationship has been found between the risk of civil war and political repression or intergroup hatreds or income inequality or colonial history. There is some relationship to particular patterns of ethnic diversity.

A civil war doubles the risk of another civil war. “Civil war is development in reverse.” “Both economic losses and disease are highly persistent: they do not stop once the fighting stops.” Usually there is a further deterioration in political rights. “A rebellion is an extremely unreliable way of bringing about positive change.” “The foot soldiers of rebellion, often do not have much choice about joining the rebel movement.” “Gradually the composition of the rebel group will shift from idealists to opportunists and sadists.” The kind of people most likely to engage in political violence are the young, the uneducated, and those without dependents.

95% of global production of hard drugs comes from conflict countries. Conflict provides territory outside government control for illegal activities to operate.

Three economic characteristics make a country prone to civil war: low income, slow growth, and dependence upon primary commodity exports. “Civil war leaves a legacy of organized killing that is hard to live down. Violence and extortion have proved profitable for the perpetrators. Killing is the only way they know to earn a living. And what else to do with all those guns?”

Trap 2 – The Natural Resource Trap

Paradoxically, the discovery of valuable natural resources in the context of poverty constitutes a trap. It often results in misuse of its opportunities in ways that make it fail to grow and results in stagnation.

Societies at the bottom are frequently in resource-rich poverty. “The heart of the resource curse is that resource rents [rents = excess of revenues over all costs] make democracy malfunction.” “Oil and other surpluses from natural resources are particularly unsuited to the pressures generated by electoral competition.” In the presence of large surpluses from natural resources autocracies produce much more growth than do democracies. When there is plenty of money, leaders tend to embezzle funds, spend on large, pet projects and buy votes through contracts. The corrupt win the elections. Resources reduce the need to tax, undercut public scrutiny, erode checks and balances, and leave electoral competition unconstrained where parties compete for votes by patronage. Alternatively restraints raise the return on investment.

Autocracies work with little ethnic diversity. Diversity tends to narrow the support base of the autocrat and requires greater income distribution to the autocrat’s group. “Becoming reliant upon the bottom billion for natural resources sounds to me like Middle East 2.”

Trap 3 – Landlocked with Bad Neighbours

Geography matters. Landlocked countries must export to neighbouring countries or through their infrastructures to the coast. Uganda is poor and Switzerland is rich because they are dependent upon their neighbours. All countries benefit from the growth of their neighbours but resource-scarce landlocked countries must depend on their neighbours for growth. This includes about 30% of Africa.

Trap 4 – Bad Governance in a Small Country

Terrible governance and policies can destroy an economy with alarming speed. Note President Robert Mugabe. Governance matters, conditional upon opportunities. Differences in opportunities can make a big difference. Countries who have done better since 1980 have generally exported labour-intensive manufactures and services. The government simply has to avoid doing harm. Exporters need an environment of moderate taxation, macroeconomic stability, and a few transport facilities.

Why is bad governance sometimes so persistent? Because some benefit. The leaders of many of the poorest countries in the world are themselves among the global superrich. They like it that way. Many of them are simply villains. But beyond villainy, there is a shortage of people with the requisite knowledge, brave reformers get overwhelmed by the resistance, and there is often not much popular enthusiasm for reforms.

Recent failing states include Angola, the Central African Republic, Haiti, Liberia, Sudan, the Solomon Islands, Somalia, and Zimbabwe. The Democratic Republic of the Congo is borderline. Turnarounds are rare because reformers are often suppressed and in danger.

Three characteristics encourage a turnaround: larger populations, higher proportion of people with a secondary education, and recent emergence from a civil war. Whether the state was a democracy or granted political rights did not seem to matter. The impetus for change must come from the heroes in the society. The probability for a turnaround in any given year is 1.6%, so they are likely to stay as failing states for a long time.

 

Sustainable Development

This post defines sustainable development, summarises the environmental challenges we face and contrasts technocentric and ecocentric views on the relationship between economic growth and sustainability.

There are many definitions of sustainable development, including this landmark one which first appeared in 1987:

“Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

The above definition comes from a landmark report called ‘Our Common Future’ (Oxford University Press, 1987) which was authored by the World Commission on Environment and Development and represents the first serious attempt to assess the impact human development has had on the natural world at a global level.

The Concept of Sustainable Development has two elements –

Firstly, the ‘development’ part recognises that people have basic needs and that there is a need for further economic development because there are still hundreds of millions of people who lack access to sufficient food, water, sanitation and social services for example.

Secondly, the ‘Sustainable’ aspect recognises that there are ‘limits to growth’ – the earth has finite resources and a limited capacity to soak up the waste and pollution associated with economic growth.

These ‘limits to growth’ are manifest in a number of environmental problems – namely

1. The burning of fossil of fuels which leads to global warming and sea level rise

2. Deforestation

3. Desertification

4. Toxic Pollution and waste

5. Resource Depletion

6. Species Extinction

One outcome of the above report was the first Earth Summit, held in 1992 in Rio de Janeiro (known as the Rio Summit). At the time this was the largest meeting of world leaders in history, attended by 172 governments under the auspices of the United Nations. Various earth summits have led to various global agreements to tackle environmental problems –

  • Agenda 21 – in which signatories agreed in principal to the concept of sustainable development – finding ways to combat poverty and develop without depleting resources or harming the environment
  • The 1993 Convention on Biological Diversity which commits nations to finding ways to develop which avoid destroying natural ecosystems
  • The 1997 Kyoto Protocol, in which 192 nations eventually committed to reducing greenhouse gas emissions on the basis that global warming was man made and the burning of fossil fuels was the main cause.
  • In 2015 – The Sustainable Development Goals – A set of 17 goals which look forward to 2030, approximately half of which are explicitly to do with sustainability, a much stronger commitment than the previous Millennium Development Goals.

However, whether or not these commitments are met remains to be seen.

Criticisms of International Agreements on Climate Change

Many environmentalists suggest that the above global agreements on Climate Change are too little too late because…

1. Many of the treaties above are voluntary – Agenda 21 for example. There are very few legally binding agreements about climate change which come attached with sanctions.

2. Two of the world’s biggest polluters – China and India were not required to sign up to reducing CO2 emissions (globally we emit more now than we did in 1992).

3. Greenpeace suggests that big oil companies have played a role in PREVENTING a global move towards more sustainable energy sources such as solar and wind power.

 

Competing Ideas about what to do about environmental decline 

Although 97% of the world’s climate scientists agree that human activity is changing the planet (the other 3% work for the oil industry) there is little agreement over what we should actually do about this, and so many different ideas about what ‘sustainable development’ looks like. There are numerous reasons for this: firstly we are in uncharted territory: we’ve never faced climate change before, we have little prior knowledge about what effects human activity has on the planet, secondly, climate science is complex – think how difficult it is to predict the weather tomorrow, let alone global warming trends over 10 years or more, and finally, new technologies are evolving all the time which may enable us to offset some of the problems of climate change and environmental decline.

It is these uncertainties that allow for different ideas about how we should relate to the earth. Timothy O’Riordan suggests that there are different theories as to how humans should relate to the earth, some of which he says place ecological laws at the centre of their approach and identify that humans are subject to these laws (he classifies these approaches as ‘eco-centric’) and others which place humans and their capacity to adapt the world to their needs at the centre of the approach (he classifies these as ‘technocentric’).

NB What’s below only summarises aspects of these two approaches to sustainable development.

A Technocentric Approach to Development and Environmental Decline 

The Technocentric ‘solution’ to climate change is associated with neoliberalism, and is a view that many leaders of big business subscribe to. It is popular amongst 10-30% of the population. Technocentrics basically believe that economic growth is the primary goal and that efforts to combat climate change should not compromise economic development.

Technocentric thinkers believe that humans have the right to exploit the earth’s resources and that the earth is generally robust enough to be able to handle resource extraction and a degree of pollution. They believe that when resources (such as oil for example) become scarce, the laws of supply and demand will kick in, prices will go up, and so demand will be reduced.

The resulting scarcity of resources will create a market-niche, and new business will be set up in order to meet demand. For example, as oil runs out, it will become more profitable for businesses to innovate and invest in renewable technologies such as solar, wind and nuclear power.

Technocentrics believe that there is no need to change the current neoliberal economic system – solutions to the current environmental crisis can be found within the system.

Some Technocentric Solutions to Climate Change

Technocentric thinkers tend to emphasise market-solutions, and rely on a fusion of science, engineering and big business to manage environmental problems. Below we consider just two of these – Carbon Trading Schemes and Geo-Engineering Projects

Carbon Trading

Carbon Trading works around an exchange of credits between nations designed to reduce emissions of carbon dioxide. The carbon trade allows countries that have higher carbon emissions to purchase the right to release more carbon dioxide into the atmosphere from countries that have lower carbon emissions. The carbon trade originated with the 1997 Kyoto Protocol and is intended to reduce overall carbon dioxide emissions to 5% below 1990 levels between 2008 and 2012.

Geo-engineering

Geo-engineering refers to artificial efforts to mitigate global warming by manipulating weather patterns, oceans, currents, soils and atmosphere to reduce the amount of greenhouses gases –

According to a recent Guardian article – ‘The range of techno-fix ideas is growing by the month. They include absorbing plankton, growing artificial trees, firing silver iodide into clouds to produce rain, genetically engineering crops to be paler in colour to reflect sunlight back to space, fertilising the ocean with iron nanoparticles to increase phytoplankton, blasting sulphate-based aerosols into the stratosphere to deflect sunlight, covering the desert with white plastic to reflect sunlight and painting cities and roads white.

There are serious proposals to launch a fleet of unmanned ships to spray seawater into the atmosphere to thicken clouds and thus reflect more radiation from Earth. Most controversial of all is an idea to fire trillions of tiny mirrors into space to form a 100,000-mile “sunshade” for Earth.

Most are unlikely to be seriously considered but some are being pushed hard by entrepreneurs and businessmen attracted by the potential to make billions of dollars in an emerging system of UN global carbon credits. Research by ETC, the Canadian-based watchdog, shows at least 27 patents have been granted to inventors and assignees including Bill Gates, Dupont, the US government and various corporations.’

From the UK, everyone’s favourite bearded billionaire Richard Branson is a big fan of geo-engineering, so much so that he set up a £25 million prize fund for the best scalable technological solution which could remove CO2 from the atmosphere. Check out the The Virgin Earth Challenge for more details.

An Ecocentric Approach to Climate Change 

To my mind Naomi Klein’s latest book can be characterised as an Eco-Communalist approach to climate change, which comes under the broad umbrella of ecocentrism 

In her recent (2014) book ‘This Changes Everything’ Naomi Klein argues that Neoliberalism is responsible for Climate Change, and that Nation States the world over need to gain control over Big Oil and Energy companies and the World Trade Organisation in order to achieve sustainable development. (NB she is effectively arguing that Neoliberal Development has caused climate change.) She also argues that we need to develop localised control over our energy supply and resource use in order to deal with climate change. All in all – this is a good example of an eco-communalist approach to sustainable development.

Klein argues that the three policy pillars of the neoliberal age (1989 – present day) which are:

* privatisation of the public sphere

* deregulation of the corporate sector, and

* lowering of income and corporate taxes, paid for with cuts to public spending

are each incompatible with many of the actions we must take to bring our emissions to safe levels and bring climate change under control.

These neoliberal ideas lie at the heart of the World Trade Organisation, and many of its policies are incompatible with a sustainable future. Specifically Klein says there are three contradictions between the (neoliberal) goals of the WTO and what’s needed to control climate change. Klein offers the following reasons for this:

* Firstly, the WTO encourages more international trade which has meant a huge increase in fossil fuel burning container ships and lorries. Reduced carbon emissions would require less trade or more local trade.

* Secondly, the WTO gave TNCs the rights to sue national governments for preventing them to make a profit out of mining/ burning fossil fuels (I KNOW – It sounds crazy, but it’s true!). Whereas to protect the environment, governments would need to be able pass laws to protect the environment (kind of an obvious point I know!).

* Thirdly, the WTO has given western companies stronger patent rights over their technologies – whereas if renewable technologies are to be transferred to the developing world, they would need to make their own cheap copies of those technologies (because they would not be able to afford to buy them).

To illustrate the lunacy of the current Capitalist System Klein outlines how TNCs use the WTO to sue governments who try to subsidise renewable energy.

(Firstly some context) Fossil fuel companies lie firmly at the heart of the global capitalist system, and presently receive $775 billion to $1 trillion in annual global subsidies, but they pay nothing for the privilege of treating our shared atmosphere as free waste dump.

In order to cope with these distortions (which the WTO has made no attempt to correct), governments need to take a range of aggressive steps – such as price guarantees to straight subsidies so that green energy has a shot at competing.

However, green energy programmes which have been instigated under nation states are increasingly being challenged under World Trade Organisation rules. For example:

In 2010 the United States challenged China’s wind powered subsidy programs on the grounds that it contained supports for local industry considered protectionist. China in turn filed a complaint in 2012 targeting various renewable energy programmes in mainly Italy and Greece.

In short, the WTO encourages nation states to tear down each others windmills while encouraging them to subsidise coal burning power stations.

The sad thing is, when governments subsidise green energy – it works – Denmark has the most successful renewable energy programs in the world, with 40% of its energy coming from renewables, mostly wind, but its programme was rolled out in the 1980s, with most installations being subsidised at 30%, before the WTO was established. Now such subsidies are illegal under WTO rules because it’s ‘unfair’ to fossil fuel companies.

Solutions to Climate Change : Ground-Up Social Democracy Is The Most Effective Way to Combat Climate Change

Klein notes that much has been written about Germany’s renewable energy transition – It is currently undergoing a ‘transition to green’ – with 25% of its energy coming from renewables. This is up from only 6% in 2000.

Though rarely talked about there is a clear and compelling relationship between public ownership and the ability of communities to get off dirty energy.

In Germany, this has taken the form of local citizens groups taking control of their own energy supplies from multinational corporations. There are about 200 of these in Germany, and they take the form of locally controlled energy companies which are concerned with public interests, not profit, which was democratically

controlled by citizens, with money earned being returned to the city, rather than lost to shareholders of some multinational.

This movement is actually more widespread than Germany (there are even some cities in America have done this, such as Boulder in Colorado which have gone down this route), and is most prevalent in the Netherlands, Austria, and Norway, and these are the countries with the highest commitment to coming off fossil fuels and pursuing green energy alternatives.

Two further case studies of countries which practice small-scale environmentalism are Cuba, which was forced to adopt organic gardening with the collapse of communism in the 1990s, and protection of the environment also forms a cornerstone of the Gross National Happiness strategy of Bhutan.

Extreme ‘Eco-Communalism’ in the UK – The case of Tinkers Bubble.

There are a handful of people (less than 1% of the population) who believe that nothing less than radical lifestyle change is required to tackle climate change. One example of this in the UK is Tinkers Bubble.

Tinkers Bubble is a small woodland community which uses environmentally sound methods of working the land without fossil fuels. They make their monetary incomes mainly through forestry, apple work and gardening. As a result they are money poor but otherwise rich.

They manage about 28 acres of woodland using horses, two person saws, and a wood-fired steam-powered sawmill. Their pastures, orchards, and gardens are organically certified, and no-dig, and they press apple juice for sale, grow most of their own vegetables, keep chickens and bees, and sell their produce at farmers markets.

They rely on off-grid solar powered 12v electricity, have their own natural spring water, use compost toilets. and burn wood for cooking, heating, and for hot water. Most people wash their clothes by hand and life is lived mostly outdoors, so it’s cold in the winter.

 

Criticisms of Neoliberalism

The three country case studies below all suggest that although neoliberal policies might promote economic development in the long run, in the case of Chile at least, there are some significant negative consequences of this pathway to development.

  • Chile in the 1970s
  • Boliva in the the 1990s
  • India – Contemporary

NB – If you’re here for a blog post about Neoliberalism in India – please click here (I moved it!)

Chile 

The following clip from ‘The Shock Doctrine’ outlines the ‘neoliberal experiment in Chile from 1973 onwards, the very first neoliberal experiment in development.

Following the overthrow Salvador Allende, the democratically elected but Socialist President, the American backed Dicator Augusto Pinochet implemented neoliberal economic reforms.

These were written for him by by a group of American economists known as ‘The Chicago school’, headed by Milton Freedman.

Examples of neoliberal policies reforms included the cutting of taxes on imports to 10% (previously Chile had the second most protected economy in the world) and the privatisation of state owned companies.

In the short term – the policies increased unemployment and inflation and inequality and human misery which led to massive social unrest which Pinochet oppressed violently killing tens of thousands of people.

However, 40 years later… Chile is one of Latin America’s leading economies.

Neoliberals might argue tens of thousands of lives is a price worth paying for rapid wealth creation

Neoliberalism in Bolivia 

This video clip from ‘The Corporation’ summarizes the case study of water privatization in Bolivia in the 1990s.

  • In the early 1990s, one local administrative area within Bolivia was forced to privatise the previously state owned water supply as part of a ‘Structural Adjustment Programme’
  • A Multinational took over running the water supply for a profit
  • The poorest people couldn’t afford to pay for water.
  • This led to massive protests which the government violently suppressed.
  • In this case the government eventually renationalised the water supply due to popular demand.
  • Did neoliberalism help development?
  • If you define progress as the right to clean water then no.
  • If you define it as increasing profit for European Transnationals then yes.

Neoliberalism in India 

Arundhati Roy notes that  ‘Trickle down hasn’t worked in India, but gush up certainly has’

 

She notes the following three ways in which the Elite in India Benefit from Neoliberal Policies

  • Corrupt government officials sign a ‘Memorandum of Understanding’ (MoU) with a Corporation which privatises a chunk of publicly owned land, giving that corporation the right to use that land to establish a business – this either takes the form of mining the raw materials from under the land, or establishing a range of other projects such as Agribusinesses, Special Economic Zones, Dams, and even Formula One racing circuits.
  • Taxes are typically kept very low in these deals – often sow low in that local people see little of the financial benefit of the new business. This is especially true were mining is concerned. In 2005, for example, the state governments of Chhattisgarh, Orissa, and Jharkhand signed hundreds of memorandums of understanding with private corporations, turning over trillions of dollars of bauxite, iron ore and other minerals for a pittance – royalties (effectively taxes) ranged from 0.5% to 7%, with the companies allowed to keep up to 99% of the revenue gained from these resources. (Allowing people like Ambanni to build their 27 story houses, rather than the money being used for food for the majority of the Indian population.)
  • In a third strand of Neoliberal policy, companies are subjected to very little regulation. It seems that they are allowed to develop their projects without protecting the environment or paying any compensation to people who are negatively affected by these projects.

 

People Centered Development

This post provides a brief summary of people centered development approaches to social development, including the work of Vandana Shiva.

Why are developing countries underdeveloped?

People Centered Development Theorists generally agree with Dependency Theory about why some countries are underdeveloped – because of a history of exploitation and extraction by western Nation States and TNCs.

PCD theorists are also very critical of the role of large institutions in development – international institutions such as the World Bank and IMF and both western nation states and developing nation states. They argue that big development projects aimed at macro level goals such as increasing GDP and neoliberal strategies of deregulation often do not improve the lives of people ‘on the ground’. In this sense, as Amartya Sen argues, development needs to be about giving people independence so they have real power and choice over their day to day situations, it shouldn’t be ‘top down’ coming from the west, via governments and then trickling down to the people.

People Centered Development theorists also have a much broader conception of what ‘development’ could actually mean. They don’t believe that development has to mean them becoming more like the West and development shouldn’t be seen in narrow terms such as industrialising and bringing about economic growth, development projects should be much smaller scale, much more diverse, and much more coming from the people living in developing countries.

Finally, PCD theorists reject Western Definitions of ‘underdevelopment’ – just because some cultures are rural, non-industrialised, and not trading, doesn’t mean they are inferior.

Doctor Vandana Shiva
Doctor Vandana Shiva

Vandana Shiva

Vandana Shiva is a good example of a theorist who comes under the umbrella of a People Centred Development approach to development.

She has spent much of her life in the defence and celebration of biodiversity and indigenous knowledge.  Seed freedom is central to the idea of Shiva’s work (the rejection of corporate patents on seeds, and protecting the rights of local peoples to save their own seed).

Vandana Shiva has also played a major role in the global Ecofeminist movement. According to her 2004 article Empowering Women, Shiva suggests that a more sustainable and productive approach to agriculture can be achieved through reinstating a system of farming in India that is more centered on engaging women. She advocates against the prevalent “patriarchal logic of exclusion.”

How should developing countries develop?

  1. People centred development means ‘ground up development’ – empowering local communities. Because of this, there are potentially thousands of pathways to development
  • The thousands of small scale fair trade and micro finance projects around the world are good examples of PCD style projects embedded in a global network.
  • Bhutan is a good country level example of PCD principles – globalising on their own terms.
  • Indigenous peoples living traditional lifestyles, effectively rejecting most of what the west has to offer is another good example.
  1. At a global level, PCD theorists believe that any development projects embarked upon should embody three core principles –
    • Social Justice – they shouldn’t be based around exploitation (like tied aid is)
    • Inclusivity – they should be democratic, bottom up, not top down – they should be designed with communities living in developing countries, not by western experts.
    • Sustainable – Projects shouldn’t degrade local environments

Criticisms of People Centred Development

  • All the other theories argue that, eventually, if a poor country really wants to improve the lives of its people en masse in the long term, it needs money, this can only come from industrialisation and trade, is it really possible to improve standards of living through small scale projects?

  • Focussing solely on small scale development projects still leaves local communities in developing countries relatively poor compared to us in the West, is this really social justice?

  • In a globalising world it simply isn’t realistic to expect developing countries (such as Bhutan or groups living in the Rain Forest) to be able to tackle future problems if they remain underdeveloped – eventually population growth or climate change or refugees or drugs or loggers are going to infiltrate their boarders, and it is much easier to respond to these problems if a country has a lot of money a well functioning state and a high level of technology.

  • PCD is too relativistic – is it really the case that all cultures have equal value and diverse definitions and paths to development should be accepted? Do we really just accept that patriarchy and FGM are OK in places like Saudi Arabia and Somalia because that’s what their populations have ‘chosen’?