Thursday, October 23, 2008

Easterly

Easterly’s book provides an interesting look at why present and past aid efforts have done so little for the poor. He argues that the West should discontinue big plans as these are unfeasible and distract from attainable goals. Such projects will focus on piecemeal improvements that can dramatically improve the lives of the poor- such as bringing about electricity, pipe water, high schools. His propositions are sensible, and his examples reaffirm the importance of market forces that bring about the best solutions at the lowest costs. Indeed, it was fascinating reading how supplementary items given out for free (such as mosquito nets) were less effective than those sold.

While aid programs can have negligible to no progress pursuing utopian plans, they can significantly affect the well being of people in the addressed country if they are focused. He points to examples where aid agencies have improved the conditions of the poor by addressing the poor infrastructure (roads and sewer systems), poor sanitation, and lacking water, medicinal, and food availability. He later brings forth evidence that big push aid can actually hinder the development of recipient countries. Overall, his argument is convincing and given the persistence of malnourishment, malaria, and other easily treated ailments it seems as if such solutions are best.

His recommendations include removing the West’s patronizing mind set, ending conditions placed on aid and IMF loans, ending military interventions, giving matching grants that increase the opportunities of individuals and searchers rather than coddle bad governments. He puts forth Singapore and Hong Kong as examples of countries that have attained the status of developed nations without the support of significant Western aid nor attention, either through IMF programs or military occupation and argues that more credit be given the poor. Most importantly, he reaffirms the importance of market forces to bring about the best solutions at the lowest cost. Indeed, he convinced me that giving out free

On the issue of corruption, Easterly critique the UN Millennium Project for claiming that it is the poverty trap and not bad government which best explains the low growth seen in those poor between 1985 and 2001. He makes the claim that politicians and planners purposefully neglect the impact corrupt governments can have on poverty to both make their end-all poverty goal seem attainable and to facilitate fund raising efforts, but doing so is near-sighted. As we’ve learned from previous authors, good government that protects markets and equal property rights lead to greater growth.

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