Anti-poverty campaign gets it almost all wrong
July 5, 2005
BY JOHN O'SULLIVAN
President Bush today will appear at the meeting of G8 government leaders in Scotland with a surprisingly good chance of being hailed as a savior of mankind. That is all the more surprising because his audience there will consist not merely of the presidents and prime ministers of the world's wealthiest economies in the G8, but also of several million anti-poverty campaigners, progressive pop stars, socially aware bishops, labor union executives, environmental radicals, "thoughtful" corporate statesmen, anti-globalization networkers, and young idealists of indeterminate kinds.
Under the banner of the "Make Poverty History" campaign, wearing their idealism on their white-armbanded sleeves, fresh from wrapping much larger white armbands around St. Paul's Cathedral and other public buildings (to signify, well, something or other), they will have walked miles, slept in fields, lined up outside portable loos, attended globally linked pop concerts, signed petitions, cheered "Sir Bob" Geldof, and generally fought world poverty in a roundabout way.
Not to stereotype anyone, of course, but people like that seldom have a good word to say about Bush -- and they have a lot to say about him, generally along the lines of "murderer," "Bush Lied," and "Bush, Bush, Bush, Out, Out, Out." So why are they likely to be singing his praises today, or at least humming them under their breath?
Well, Bush announced Thursday that he -- that is, the U.S. taxpayer -- would be doubling aid to Africa. Since he had already agreed to cancel the debts of the world's poorest countries and, before that, significantly increased funding to combat the AIDS epidemic in the Third World, the president had done almost as much as they had asked and much more than they had expected.
We know enough about this president to see that ameliorating Third World poverty is a project that would appeal to him. He famously said that government should step in to help when someone was "hurting." And his evangelical Protestantism, with its missionary impulse, would direct him to help where the need is greatest, namely sub-Saharan Africa.
A reasonable objection can be raised that this kind of missionary charity is no business of the U.S. government. Let me set aside that objection, however, and raise the less-obvious criticism that if the U.S. government does embark on helping poor Africans, it should first ensure that it really is helping and not harming them.
An examination of the "Make Poverty History" Web site raises very serious doubts on that score. The Web site is almost entirely devoted to the organizational details of the campaign -- the white wrapping, the pop concerts, the petitions, etc. -- to the point of resembling a Web site for an international pop group tour. It devotes a minuscule amount of space to its actual proposals for relieving poverty. And those proposals are, to put it kindly, "controversial" -- i.e., mainly wrong, seemingly unaware of the well-established criticisms of previous aid programs, and likely to make matters worse.
It has one very good idea -- that the United States and western Europe should stop agricultural export subsidies that destroy the markets for poor Third World farmers. That is not, of course, charity since it would also benefit the taxpayers of the rich West. Still, it is a good idea -- if a very limited one.
Why does the MPH manifesto not carry the usual proposal that the rich West should reduce or eliminate its much more important domestic agricultural subsidies, quotas and tariffs and open up its markets to food imports from Africa, Asia and Latin America? That would benefit the Third World rural poor far more effectively than merely shutting down export subsidies -- and it would benefit poor consumers in the West since they would get cheaper food.
MPH seems unconcerned about consumers at all, including consumers in the poorest countries. It wants protectionist tariffs for agriculture in the Third World; it urges governments to impose them, and it warns international agencies not to discourage them. Such policies would have at least two damaging effects: First, they would raise food prices in those countries, penalizing the poorest of the poor, and second, they would choke off trade between poor countries as well as with the West, thus reducing economic opportunities for producers, as well.
Indeed, the more one examines the MPH manifesto, the more sinister it seems. It is a manifesto for government controls and against markets -- ignoring the fact that government in poor countries is very often inefficient, corrupt and clannish. It wants more aid instead of more trade -- ignoring the fact that aid goes to governments, not the poor, and strengthens their power even in the rare cases where they use it honestly, whereas trade benefits the enterprising and hardworking. It wants to stop privatization programs -- ignoring the fact that government monopolies in the Third World are overstaffed with relatives of influential people, treated as private bank accounts by ministers, and thus forced to charge high monopoly prices to the non-influential (i.e., the poor).
In short, MPH ignores almost all the valuable work done in development economics since the 1960s, which established that when private property is legally protected, pettifogging regulations reduced to a minimum, and producers allowed free access to domestic and foreign markets, the poor lift themselves up by their own bootstraps.
That anti-poverty campaigners should pass over these well-known findings is sinister rather than merely foolish because aid agencies benefit from having the poor not as active agents in their own success, but as grateful recipients of their largess. So they have an interest in keeping aid flowing and the poor dependent. Aid should be made conditional not merely on ending corruption in government, as Bush as rightly seen, but also on protecting the property rights of the poor, cutting the red tape that holds their "informal sector" businesses back, and going to local organizations rather than central government.
Otherwise, don't do it, George. Don't Make Poverty Permanent.
http://www.suntimes.com/output/osullivan/cst-edt-osul05.html
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