International Economics

Foreign Aid Hokey Pokey in Kenya

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kenya

I recently returned from a trip to East Africa. I spent most of my time in Kenya in areas unaffected by the post-election violence, and saw no demonstrations or looting. Even if I had been in the thick of things, I'm not sure I would have had much to say besides the commentary most outsiders have offered: Man, this totally sucks.

(For great, well-informed, in-country, ant's-eye-view commentary, check out Alex Halperin's blog)

What I did see on my trip was a little political graffiti–and a lot of evidence of the impact of foreign aid on the region. The single decent road I drove on in Tanzania, for example, was a gift from Japan. Everything else was broken gravel at best.

As Kenya, previously held up as a model of stability and relative prosperity in Africa, falls apart, the U.S. and other nations that contribute aid dollars are threatening a tug on the purse strings if the government fails to act. The Kenyan government isn't taking it well:

Kenya's government also brushed aside threats by its major international donors, including the United States, to review foreign aid.

"Our budget is not dependent on foreign funding," said Alfred Mutua, a government spokesman. "The government cannot be blackmailed. "You are here as our development partners, you are not here to blackmail and threaten us," he said referring to foreign donors. "We have said our government will continue as always. They should not try to threaten us."

Fourteen of Kenya's leading donors, including the United States, issued a statement this week warning the Kenyan government that they were reviewing foreign aid in light of the crisis. The United States gives the country more than $600 million in aid each year.

There's a certain amount of foreign aid hokey pokey going on in the region: You take the foreign aid out/ you put the emergency aid in/ you take the aid workers out/ and you shake it all about.

Of course, it matters who is administering the money. We're taking money from the hands of the government, which is part of the problem, and putting it into the hands of independent aid efforts. But still, this kind of aid dollars switcheroo doesn't seem to be making much of an impact.

This seems to be a classic case of "do-somethings." But is there a better option than my response (reminder: "Man, this sucks") or just rearranging deck chairs on the Titanic? 

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  1. Author of old Ron Paul newsletters revealed!

    http://www.nolanchart.com/article1114.html

    unbelieveable!

  2. We’re taking money from the hands of the government, which is part of the problem, and putting it into the hands of independent aid efforts.

    Oookay. So who is running these independent aid efforts? The UN? NGOs?

  3. These countries operated so much better when white people ruled them.

  4. So, am I now disqualified from runnning for president as a libertarian?

  5. I had such high hopes for Kenyas development, both politically and economically. Less so now. It seems that in fledgling democracies it is more difficult lose gracefully. Maybe after it’s been done a few times it is then too embarrassing to try to hang on after the voters tell you to go.

  6. There’s a certain amount of foreign aid hokey pokey going on in the region: You take the foreign aid out/ you put the emergency aid in/ you take the aid workers out/ and you shake it all about.

    Of course, it matters who is administering the money.

    yes – that’s what it’s all about.

  7. How much of that aid money is actually spent in Kenya?

    If I, the supreme dictator for life of the U.S. were to hire a U.S. engineering firm to design a a road, a German firm to supply the asphalt, a Korean firm to build the road, in the end, the Kenyans will get a bright shiny road that nobody locally knows how to maintain, that facilitates little trade, and millions of dollars have been transferred from my treasury to those of the firms doing the construction.

  8. Joe Allen-The first post is a bit early for a threadjack. Besides that, your link doesn’t work.

  9. If I, the supreme dictator for life of the U.S. were to hire a U.S. engineering firm to design a road, a German firm to supply the asphalt, a Korean firm to build the road, in the end, the Kenyans will get a bright shiny road that nobody locally knows how to maintain, that facilitates little trade, and millions of dollars have been transferred from my treasury to those of the firms doing the construction.

    So if I give you a gift, I’m also supposed to pay you for it?

    In this case I doubt a German company is going to haul asphalt from Germany to Kenya if they can subcontract it locally. Ditto the Koreans, who will most likely hire locals for the labor.

    The Kenyans do get the road. At least it’s something the Kenyan government can’t confiscate.

  10. Now this, people, is what it looks like when an elected president turns his back on democracy, cheats, and tries to remain in office as a dictator.

    How many people can even tell me the name of the Kenyan president without looking at the article?

  11. The Kenyans do get the road. At least it’s something the Kenyan government can’t confiscate.

    I’ll bet it’s been done before. Maybe not Kenya, but Kim Il-Sung or his evil dwarf offspring?

  12. How many people can even tell me the name of the Kenyan president without looking at the article?

    I couldn’t. But I’m honest. Heck, I looked it up once and his name is similar to Kabuki is all I remember. Kibiki?

  13. Don’t ask me, dude.

    Maybe once I’ve seen his name on the news, and that was only after he actually did something that undermined the democratic legitimacy of his government and brought force to bear against Kenya’s people to keep himself in power.

  14. I was taught that the hokey pokey was about sex, and thus fit to be shunt. I mean, the whole sticking things in, pulling them out, turning yourself around…it’s pretty deplorable that we expose kids to that garbage.

  15. The single decent road I drove on in Tanzania, for example, was a gift from Japan. Everything else was broken gravel at best.

    And in five years that road will be broken gravel as well because no one will maintain it.

    The problem with the 3rd world isn’t that they lack the hardware of prosperity i.e. money, materials, land etc but that they lack the software i.e. democracy, rule of law, accounting, banking etc. Most 3rd world areas functioned better under colonialism precisely because they benefited from relatively advanced software of the colonial nations. Without that software, all the aid in the world is just pouring water onto sand.

    What we really need to do is to find a way to export our institutions to the 3rd world. People there need reliable banks, reliable accountants, a free press, free elections etc.

  16. Those are very rare flowers, Shannon, and need the the soil, air and water to be just right.

    And they don’t travel well, they have to be homegrown.

    It’s tough to think about a free press when you’re hungry, or reliable banks when you’re trembling from malaria. Basics like sanitation, medicine, tools, food if there’s a drought (ideally, bought from poor Africans in countries that aren’t in a drought) can, maybe, make it possible for the institutions you’re talking about to take root.

  17. What we really need to do is to find a way to export our institutions to the 3rd world. People there need reliable banks, reliable accountants, a free press, free elections etc.

    Indeed. It almost makes me want to credit the dictators/oligarchies of Taiwan and South Korea. Yes, they were self serving, corrupt rulers, yet their nations have somehow transitioned to stable democratic societies. So many other developing nations haven’t.

  18. It’s like a chicken-egg problem. If chickens also went through a larval an pupal stage, then turned into chickens, then eagles, then back into eggs.

  19. joe, nice imitation of Chauncey Gardener there.

  20. This seems to be a classic case of “do-somethings.” But is there a better option than my response (reminder: “Man, this sucks”) or just rearranging deck chairs on the Titanic?

    “For God’s Sake, Please Stop the Aid!”:

    SPIEGEL: Mr. Shikwati, the G8 summit at Gleneagles is about to beef up the development aid for Africa…

    Shikwati: … for God’s sake, please just stop.

    SPIEGEL: Stop? The industrialized nations of the West want to eliminate hunger and poverty.

    Shikwati: Such intentions have been damaging our continent for the past 40 years. If the industrial nations really want to help the Africans, they should finally terminate this awful aid. The countries that have collected the most development aid are also the ones that are in the worst shape. Despite the billions that have poured in to Africa, the continent remains poor.

    SPIEGEL: Do you have an explanation for this paradox?

    Shikwati: Huge bureaucracies are financed (with the aid money), corruption and complacency are promoted, Africans are taught to be beggars and not to be independent. In addition, development aid weakens the local markets everywhere and dampens the spirit of entrepreneurship that we so desperately need. As absurd as it may sound: Development aid is one of the reasons for Africa’s problems. If the West were to cancel these payments, normal Africans wouldn’t even notice. Only the functionaries would be hard hit.

  21. Goldwater Girl,

    EXACTLY! Giving money to the drunkard in the alley doesn’t exactly help him.

    Soon-to-be-drunkard-in-an-alley,

    Pistoffnick

  22. I’m happy you enjoyed Africa. I have found that my academic life taught me next to nothing about Africa, even though I had seminars on pretty much every other part of the world. I’m just finishing Martin Meredith’s fantastic The Fate of Africa, and I’m proud to say that I finally understand contemporary Africa.

    Basically, every nation (except Botswana) has suffered from at least one – and oftentimes several – of the following maladies since independence: genocide, 1 man cult of personality rule, secret police / terror state, insane socialist experiments, famine, apartheid, ridiculous palaces/cannibalism/over the top absurdity straight out of Greek mythology, extraordinary and unparalled corruption by the ruling cadre, preposterous global/regional ambitions by the dictator at the expense of the nation, insane crop purchasing bureaucracy that screws the farmers and enriches the elite, vicious civil wars that killed hundreds of thousands, etc.

    Why has virtually every African nation suffered these terrible plights? Afterall, we all know that for a developing nation to get rich, all they need to do is focus on exporting about 5 products, invite in the foreign multinationals to train them to run textile factories, and have relative security.

    I think there’s a few factors at work. First off, Africa was ill-prepared to exist independently in 1960. They probably shouldn’t have, but the anti-imperialist viewpoint of the 2 superpowers at the time supported an elite set of revolutionaries – about 1/2 of whom trained in Moscow – to foment revolution. Britain and France in 1960 were not Britain and France in 1880 – they were basically charities at this point, yet Africa turned down their help. Most of these first generation revolutionaries soon died in coups of some sort, and normally the scheming chief of staff took over. Most of these leaders had pathetic educations, and none had any clue how to run a country. Second, the colonial imprint did not help matters, and really particularly hurt in the former Belgian colonies like Congo and Rwanda. Third, Africa was essentially a set of tribes in 1960. There was no national ethos at all anywhere, which resulted in genocides and civil wars. Fourth, the ideologies hurt. Socialism was disastrous, and the economic development theories that prevailed at the time (Arthus Lewis’ “big push”) were abject failures. Fifth, the people of Africa were by and large utterly uneducated. In most of these nations, only a handful had post-secondary education. Running a country is hard, and it’s a lot harder when you have no education. Sixth, the Cold War clearly distorted African growth. The US had its dictators like Mobutu who were not helpful towards African development, and the USSR had Tanzania, Angola, etc. Moreover, Castro kept sending troops to Congo, Libya, Angola, and this just made matters worse.

    What do we do now? We let Bill Gates inoculate for diseases, we try and provide clean drinking water, and we provide help for countries that are competently run like Botswana. Other than that, we mind our own business and try not to make matters worse.

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