Over the years I’ve recommended three books for those seeking alternatives to ineffective poverty fighting internationally: P.T. Bauer’s "Western Guilt and Third World Poverty," Darrow L. Miller’s "Discipling Nations" and Hernando de Soto’s "The Mystery of Capital." Now I’m adding a fourth: William Easterly’s jocularly titled "The White Man’s Burden."
NYU economics professor Easterly worked at the World Bank for 16 years, and that harsh experience is evident in his subtitle: "Why the West’s Efforts to Aid the Rest Have Done So Much Ill and So Little Good." Essentially, his conclusions are like mine regarding domestic poverty fighting: Folks I call "Beppers" (proponents of big economic plans) often do more harm than good. Top-down models almost never work.
Easterly’s initial riff — his jazzy writing style is pleasantly different than the typically dismal prose of economists — contrasts planners and searchers: "A planner thinks he already knows the answers; he thinks of poverty as a technical engineering problem that his answers will solve. A searcher admits he doesn’t know the answers in advance; he believes that poverty is a complicated tangle of political, social, historical, institutional, and technological factors. Planners apply global blueprints; searchers adapt to local conditions."
Although big plans fail regularly, Easterly writes, they continue to attract "politicians, celebrities, and activists who want to make a big splash." The better way is to "give matching grants to poor entrepreneurs who put their own money at stake to start a new business, have village elections that select (or reject) aid projects, give the poor ‘aid vouchers’ that they could spend on aid agency services of their choice." To put it simply, let the people who are to be helped decide, generally through market forces, how to use aid.
Easterly further explains his goal of treating the poor as people with brains and not just mouths: "Suppose we issue development vouchers to target groups of the extreme poor, which the poor could redeem at any NGO or aid agency for any development good they wanted — for example, vaccinations, life-saving drugs, a health worker’s visit, an improved cook stove, textbooks, seeds, fertilizer, or food supplements."
He notes, "the poor would choose both the goods they wanted and the agency they wanted to deliver the goods and would give their vouchers to that agency. The agency could then turn in the vouchers to the voucher fund for real money to cover the costs of providing the development services. Since the poor would be choosing which agency would deliver the goods, the agencies would feel competitive pressure to deliver results."
And what about development services such as roads, health clinics or schools that benefit not individuals but a group? Easterly proposes that vouchers be given to a village: "The villagers could then vote on how to spend the vouchers, aid agencies would find out how well they were doing at satisfying the poor based on how many village vouchers they attracted. The vouchers would at long last provide a ‘market test’ and a ‘voter test’ to the aid agencies."
Easterly, like many economists, underestimates the importance of spiritual change, but his overall message of avoiding big economic plans could clear some cobwebs from the heads of those who continue to sing, "I’m a Bepper, he’s a Bepper, she’s a Bepper, we’re a Bepper, wouldn’t you like to be a Bepper too?"
If Beppers change, they can do great good. If not, for all their good intentions, they often resemble the selfish rich folks F. Scott Fitzgerald described in "The Great Gatsby": "The were careless people, Tom and Daisy — they smashed up things and creatures and then retreated back into their money or their vast carelessness, or whatever it was that kept them together, and let other people clean up the mess they had made."