Dead Aid by Dambisa Moyo
Assessing the Costs of the West’s African Pity Party
Why Aid Is Not Working and How There Is a Better Way for Africa
by Dambisa Moyo
Farrar, Straus & Giroux, 208 pages, $24.00
The political scientist Benedict Anderson once observed that Africa functioned as a kind of continental Rorschach blot for intellectuals, who tended to project onto it their grand ideas about economics and government. From the beginning of the European encounter with the African continent, it was seen mainly as a place of barbarism (the “Dark Continent”), and it was on this basis that the imperial powers carved up its territories at the 1884 Berlin conference. Following World War II and the decolonization of European empires around the globe, Africa became the repository of the dreams of Fabian socialists, who taught a generation of African bureaucrats about the wonders of central planning. During the Cold War, both the U.S. and the Soviet Union vigorously courted opportunistic African leaders, depicting them as virtuous, forward-looking statesmen genuinely committed to their side in the struggle between Communism and democratic capitalism.
Now that colonialism and Communism have been relegated to the dustbin, another vision has evolved: Africa as beneficiary of our collective pity. And indeed, there seems to be no end to pitiable circumstances, whether it is the ongoing genocide in Darfur, perpetual war in Somalia, or endemic poverty, disease, and political instability in virtually all of Sub-Saharan Africa. The tragedy is compounded by the fact that so much effort has been expended to alleviate these problems.
Over the past 50 years, wealthy countries have sent over $2 trillion to Africa. Rock stars like Bono and Bob Geldof hold massive concerts to raise money and preach to Western governments about the moral obligation of debt relief. Angelina Jolie and Madonna make periodic visits to the continent to adopt children. The economist-activist Jeffrey Sachs has spelled out the precise dollar amount it would cost the West to “end poverty.” It is only a lack of will on our part, these advocates tell us, that prevents Africa from achieving its full potential.
This narrative is flattering for what it says about our reach, but as critics have pointed out, it tends to slight deeper problems plaguing Africa, problems that money alone cannot fix in the absence of major cultural transformations. More skeptical critics have suggested that forking over massive sums of money to corrupt and wasteful African governments is more poison than cure, and still others have suggested that the foreign-aid gospel is merely a way for conscientious Westerners to make a big show of their generosity. Dambisa Moyo, a Zambian-born, Oxford- and Harvard-educated woman in her thirties, explicitly articulates the first two criticisms and comes close to embracing the third in her new book, Dead Aid.
“Aid,” she writes, “has become a cultural commodity.” Her radical solution: do away with it. As an economist and Africa specialist for Goldman Sachs and the World Bank, Moyo observed how aid would induce bad behavior instead of lifting Africans out of poverty. Most foreign assistance to Africa, she notes, comes with few benchmarks attached—no timeline for a program’s implementation and little incentive for governments to run a tighter ship. Although she never makes the explicit comparison, Moyo portrays aid to Africa as similar to the American welfare system prior to the reforms of the 1990s: “The more it infiltrates, the more it erodes, the greater the culture of aid-dependency.”
It has become cliché for politicians to pledge a “Marshall Plan” to fix whatever problem has drawn the public’s attention, and African poverty has been no exception. Moyo demonstrates why the comparison makes no sense. The most important distinction is that the Marshall Plan was finite. “The U.S. had a goal, countries accepted the terms, signed on the dotted line, money flowed in, and at the end of five years the money stopped,” she writes. Moreover, even though the European recipients of funding were devastated by World War II, their nations had civil-service cultures that were already equipped to deal with the cash infusions. African governments lack such capacities, and their growth is only retarded by the corruptive influence of easy money. Finally, the Marshall Plan was devoted to the construction of lasting infrastructural projects that facilitated other forms of economic activity. Western aid to Africa, by contrast, is largely dedicated to poverty alleviation, which may temporarily elevate the quality of everyday life but does little to support long-term modernization.
What, then, to do? The crux of Moyo’s proposed solution lies in a fundamental restructuring of how African governments raise capital. Rather than beg wealthy nations for grants or interest-free loans, African states should instead enter the international bond market like any municipality in the developed world. Not only would this dramatic policy change move Africans away from dependency, it would encourage responsible economic behavior and stimulate growth. A prerequisite to entering the bond market is the acquisition of a rating to attract investors. This compels governments to spend within their means, work to eliminate corruption, and create incentives for entrepreneurship. In order to pay back their creditors, governments must also have effective ways to raise revenue from citizens and businesses. This forces them to create effective tax-collecting systems, which in turn makes them more beholden to their citizenries. If smaller African nations find it difficult to meet the standards required by the capital markets, Moyo suggests that they join with neighbors to pool the risks and rewards of floating a multi-billion-dollar bond.
A corollary to such cross-border cooperation is knocking down barriers to free trade, which is the second pillar of Moyo’s program. This is a problem largely outside the reach of African governments, which are only too happy to increase their exports. The culprits here are the tariffs instituted by Western nations at the insistence of liberal agriculture lobbies that exploit nativist sentiment. Moyo estimates that if farm subsidies were cut off tomorrow, some $500 billion would flow to Africa thanks to its cheaper production costs.
As a cool, no-nonsense analyst, Moyo has the potential to be the free-market answer to the current darling of the anti-globalization Left, Naomi Klein. Unfortunately, Dead Aid does not display the stylistic grace of the journalists who pen heart-rending dispatches from Africa. Moyo is properly more concerned with solutions than with sentiment, but the wonkish prose of Dead Aid handicaps her project of making a dent in the conventional wisdom. The book would have benefited greatly from profiles of Africans who have prospered from the mature solutions she recommends and who have been hurt by the bureaucratic inefficiency and bribery that have metastasized due to Western largesse.
Moyo’s abstract point of view has similarities with the tendencies she herself criticizes among the aid set, and it allows her to glide over important humanitarian issues. She is sanguine, for example, about China’s ever-increasing involvement in Africa, lauding its focus on infrastructural rather than humanitarian assistance. The argument pressed by many African democrats that this involvement has helped sustain the junta in Sudan or Robert Mugabe in Zimbabwe is apparently outside her purview. But if one truly wants to help the continent, turning a blind eye to China’s ugly authoritarian “capitalism” is hardly the way to go.
Despite these shortcomings, Dead Aid is a refreshing wake-up call and a sound rebuke to the ideology of aid that persists despite its record over the past half-century of near-universal failure. Dambisa Moyo helps point to the day when Africa will no longer be a page upon which Westerners fancy images in inkblots but upon which Africans themselves write their own future.