Thursday, December 6, 2007

The new aid giants (7)

I thought Molly Tumusiime's message deserved a careful answer. This is my effort to answer the various points that she raised. MT indicates Molly Tumusiime's words ... PB is my response.

"Dear Colleagues

Most of the time, the feedback I get from Africa is relatively positive, and my colleagues in North America, Europe, etc are a little uncomfortable. This time Molly Tumusiime (MT) from Uganda is challenging me, and I owe her a decent response.

MT said: "I agree with the foregone concerns about accountability and transparency, they a good theoretical analogues that sometimes mask us from looking at real issues. Please don't take me wrong I love it if all factors are constant."

PB response: OK ... no disagreement up to this point

MT said: "Africa in particular has had a share of blame and counter blame over corruption and embezzlement of funds because the world does not see the continent look like the first world, but I always wonder if people try to weigh the magnitude of Africa's needs against the aid that is put in? "

PB response: There are two important issues here.

1 .... corruption and embezzlement is a serious source of poor performance in the relief and development context in Africa, but I would make the case that there is too much of this behavior everywhere in the world. The "buying" of favors in both the political world and in the business world is a global epidemic, and thought there is TALK about transparency and accountability to address the problem, the WALK is almost entirely missing EVERYWHERE. Accountability to the public is not something the establishment wants at all.

2 .... what exactly is Africa's need for aid? I have done my fair share of development planning in various parts of Africa and it is abundantly clear that there are huge resources in Africa, both natural and human ... and an absolutely ridiculous process of exploiting these resources so that Africa gets almost nothing from them. So then we find that ordinary Africans are poor, the governments are almost bankrupt and there is a huge need to get aid. The problem is that there is a very strong system in place that impoverishes ordinary Africans while others get wealthy. It is not a just arrangement ... and it needs work.

MT said: "Does the world ever sit to analyze and see how much ,even of that trillion my colleague is talking about below goes back to its owners in terms of technical assistance, posh cars, expensive hotels they sleep in while in Africa, boosting economies at hope by supporting the buying of things made in their countries, to the extent that when the technocrats go back home the cost of maintaining such things is a burden and subsequent waste."

PB's response: There have been a good number of books on this subject written over the past 20 years or so going back to Hansen's "Lord's of Poverty" in the 1980s. I have been outspoken on this issue for as long as I can remember ... I wrote some very critical material as long ago as 1979 on relief and development performance ... about a lot of overhead and not much results. My consulting career with the World Bank and the UN ended abruptly when I started following the money and asking about real results as opposed to merely real disbursements and costs.

PB more: I did some academic economics in the Keynesian model as a student, and I am disgusted at the World Bank and IMF thinking about how economics works in the African context. In my view, they have it about as wrong as they can. As I see it, Africa is a (real) market economy in the main, and NOT a monetary economy.

MT said: "May I suggest that Peter Burgess takes time off to scan through the moralistic side of Africa's aid before he fights how Africa should not get aid."

PB's response: I never suggested that Africa should not get more aid ... merely that it is more important for aid that is available and flowing to be used in Africa for work that benefits Africans and not to support the huge and growing overhead of the international relief and development system, and all the support organizations that are in a boom as donor disbursements expand.

PB more: The performance metric I want to see is community progress ... real people getting real value ... with modest amounts of external aid. When you look at how many people need aid, the number is huge and the aggregate anount of assistance needed is very large indeed. But more money merely for aid overhead is not my idea of a sensible strategy.

MT said: Let him conduct his research about the two questions he has raised (Meanwhile, there is little or no questioning of why it is that the previous $3 trillion (an imprecise number) has done so little, and how it is that these funds were ineffective.)

PB response: I think MT and I are not too far apart on our analysis of the situation. If anything, I might be even more aggressive for change. It is to be expected that we will differ on the detail ... but I don't think we are far apart on the basics.

MT said: I shall be interested to read his findings.

PB response: I hope this is sufficiently responsive.


Peter Burgess
Peter Burgess
The Transparency and Accountability Network: Tr-Ac-Net in New York
IMMC - The Integrated Malaria Management Consortium Inc.
917 432 1191 or 212 772 6918