Aid and the well being of Africa are so inextricably linked in today’s culture that to question the value of the former seems utterly sacrilegious. However, this is exactly what Dambisa Moyo PhD discussed on April 1 over lunch with the Great Issues Scholars. Born and raised in Zambia, Moyo received her BA and MBA at American University in Washington, D.C., her Masters at Harvard and her Ph.D in economics at Oxford. She went to work at the World Bank in D.C. and now has worked for eight years at Goldman Sachs in debt capital markets, hedge fund coverage and in global macroeconomics. She signed copies of her book Dead Aid for the scholars. Her book expounds on the controversial topic of her talk in Moore Hall.

The simple truth is that Western aid doesn’t help; it actually hurts.

There are three things that everyone can agree on whether one is pro-aid or not. The first is that someday Africa should not need aid. Second, everyone knows that in order for Africa to climb out of poverty, African governments need to be motivated to help their people. Third, everyone knows that aid contributes to Africa’s problems, whether they believe aid should be curtailed or not.

It is important to distinguish which aid is hurting Africa. There are three kinds of aid: emergency or humanitarian aid, charity aid sponsored by NGOs, and government-to-government aid. Moyo argues that emergency and charity aid are not the problem. Rather, government-to-government aid, Moyo claims, is holding Africa back and perpetuating the need for aid in the first place.

Government-to-government aid has been so ineffective that since 1970, Africa as a continent has actually become poorer. Today seventy percent of a billion people—a sixth of the world’s population—live on less than a dollar a day. Yet despite the massive failure that government-to-government aid has incurred, the initiative had noble intentions. In the middle of the twentieth century, government-to-government aid seemed like it would work — the Keynesian model illustrated that savings created from aid would lead to investment which would lead to growth for an Africa newly-emerged from colonialism. In 1944, the Bretton Woods Conference lead to the creation of the International Monetary Fund, which oversaw the transactions of huge loans to help nations ravaged by World War II and Africa get back on their feet. For Europe, and much later, India, short but effective aid projects such as the Marshall Plan and the Green Revolution, respectively, helped jump-start economies. However, a continual stream of government-to-government aid to Africa has actually allowed growth to stagnate and poverty to rise. Today, Africa needs to grow its GDP a whopping seven percent per year (almost China’s rate of development) in order to even put a dent into the poverty it has sunk into. At this point, aid is not even scratching the surface.

One reason large scale aid has been allowed to continue for so long is because it’s virtually impossible to have logical discussion about aid. Many of those who staunchly back aid do so for reasons steeped in emotion. Seven African presidents, people elected to represent the interests of the African people, have stated that their nations to do not need this continual stream of aid. However, no one cares about what these elected officials have to say. Instead, it is celebrities like Bono who actually represent Africa in the eyes of the global community. According to the emotional appeals of celebrities, Africa needs aid. Isn’t it odd that the international community doesn’t hold elected leaders responsible for their counties, but it turns to non-Africans for counsel on African interests? Would Americans like it if a foreign pop star represented our interests in the international sphere?
Exactly why does aid not work? Most people think that aid does not work because its effects are stymied by corruption. It’s true; African governments no longer have to be held accountable for their people’s needs and interests. Those in power concern themselves only with holding on to power; aid money doesn’t reach people because it is being stolen by people who will continue to receive aid and remain in power even if they are not providing basic goods and services to the people they claim to serve.

Aid also doesn’t work because it leads to inflation. Too many dollars clogging a small economy make goods and services excessively expensive for ordinary people. People lose their jobs and can’t afford to obtain the basic necessities. Coupled with Dutch disease, the exploitation of natural resources and depressed manufacturing, inflation is the major economic reason for why aid, in the long run, fails. However, an imagined moral duty reminiscent of a modern-day White Man’s Burden continues to prevail.

The problem of dependency also prohibits development since African governments abdicate their responsibility to the people who pay taxes. The governments that depend on aid neglect budgeting and allotting tax money for basic public goods such as healthcare, national security, and infrastructure. This is especially evident when governments don’t lift a finger while waiting on the West to do everything for them. Now the West provides adequate services and billions of dollars in aid. But most of the aid money is squandered on personal gain by aforementioned corrupt officials or is lost in bureaucracy. Western governments are not African governments nor the African people. We cannot be called upon to know an African nation’s needs or do the African government’s jobs for them.

Despite this, the West insists on giving aid to complacent, even corrupt African governments. We maintain an embassy in Zimbabwe and still send aid to Zimbabwe’s government even while we express outrage over the corruption and oppression of Mugabe’s regime. In following our hearts rather than our minds, we are hurting those we intend to help. Africa has the youngest population in the world, but with economic stagnation in many of the continent’s countries there are few job opportunities for these nations’ youth. There is little impetus for these young adults to pursue a degree beyond high school. Disenfranchised unemployed, and uneducated, these youth have little where to turn but to crime and delinquency. Many youths start families early and remain in poverty, in a country with few opportunities and very little economic mobility. Aid has created a continent without a future.

In most African countries there is virtually no middle class—only a huge gap between the rich and the poor. As a result, there are constantly coups in African countries, as different groups of people revolt and try to seize the Presidency and their only chance at a decent life. The high political uncertainty and instability engendered by the economic problem of aid is not just a domestic problem, but an international problem. Restless and unemployed—or worse, underemployed—youth will not only turn to crime and rebellion but will become pirates and terrorists. The hijacking of cruises of the coast of Somalia or the Ugandan underwear bomber is just the beginning. We will only see more of these cases if the question of systematic poverty and negligence resulting from problems that aid engenders is not addressed.

Yet such aid continues to be wasted for reasons not easily grappled with. The international community simply does not expect Africans and black people in general to be able to fend for themselves. There is a quotation from President George W. Bush which (believe it or not) adequately describes this notion: “Beware the soft bigotry of low expectations.” India and China, both with populations larger than a billion, each have a greater percentage poor people than that of the African continent. Yet, we do not see charities trying to entice donors to give money using pictures or videos of Chinese or Indian children on the internet or the television, as neither the Chinese nor the Indian government will allow this, and for good reason.

African children are the poster kids for aid even though that aid probably will not improve their futures. There is obviously a double standard similar to the outright paternalism and racism of old. We need to beware the pity that hides the smug smile of superiority. We cannot feel we are doing our best with the band-aid of aid. We cannot be so comfortable with a perpetually impoverished black continent. And yet, there would be a huge political backlash to any political candidate who suggested ending aid. The West should take a stand and let African nations know that over the next ten or twenty years, aid will gradually decrease and finally come to an end. If people are paid, they should be paid to innovate and thrive, not merely survive. Most importantly, if Africa begins to clean up its act we should reward it economically, not in aid, but in further investments, so that African economies can continue to grow.

There are already hints of an economic overhaul in the making. Kenya and Tanzania have already entered the global market, obtaining budding credit reports. More impressively, under the charismatic leadership of President Kagame, Rwanda has rebounded from the horrific genocide the nation experienced in 1994. Most Westerners only know Rwanda as seen in the film Hotel Rwanda. Yet Kagame’s Rwanda has jumped 63 places in the world economy since 1994. This drastic improvement is the result of a few big changes catalyzed by a simple motivation.

If aid is greatly reduced and Africa is allowed to succeed, the whole world will be better off. No longer will Africa be the ‘sick man’ of the global economy. No longer will we have an entire continent with GDPs lagging behind everybody else’s. Africa not only has great potential for investments and new capital, but also the many intellectuals who could be brought out of poverty and obscurity in order to give back to the global community. All it takes is a belief in the African people, a belief that they are people just like any other people, a people looking for economic and social opportunities for themselves and their children.[cap