Who pays for development?

I was just reading this on the Guardian’s Poverty Matters blog:

First, identify the most important issues. One of the main problems of the MDGs, as noted in countless analyses, was their failure to bring the major structural issues to the table. I know of no one who thinks that aid is the most important contribution that wealthier countries can make to development, but the vague terms of MDG eight allowed politicians to get away with aid promises (which in some cases they didn’t keep) rather than setting a bold agenda for transformational change in global financial governance, dealing with illicit financial flows, for example, taking bold steps towards international tax reform, and introducing fairer mechanisms for working out debt repayments.

Well, yeah, very true, but again this type of reporting skirts the issue of where those illicit flows are coming from and who took out the loans. The problem with the MDGs was that it failed to put any pressure on leaders of developing countries to stop being parasites. Worse yet, they didn’t allow for the provision and protection of basic individual rights to free expression, judicial rights and economic freedom, instead opting for a few vague and unverifiable targets which failed to address structural problems WITHIN developing countries.

In Kenya, at least, the government is bleeding the populace dry. Evidence from countries such as Botswana and Korea has shown that countries who want to develop can. The biggest obstacle (among all the other obstacles) to development is a lack of political will to do it.

To its credit, the article goes on to point out that domestic ag subsidies in wealthy countries are distorting the world market and preventing developing countries from being competitive on the world market. Eliminating these subsidies will be a real challenge, at least in the US. First, subsidies control price and market volatilities. The US electorate would go bonkers if the price of food went up and down like the price of corn does in developing countries. Second, Americans simply like subsidies and enjoy protecting agricultural interests at all levels. The right likes to pander to farmers for the rural vote while the left is somewhat bummed out because their favorite organic farms don’t have access to them. Though the left loves to pay lip service to ending ag subsidies, I can’t imagine they’d be all that sad if they were offered to their local hippie farmers. That’s speculation for another day, however, and I’m no expert on ag matters.

I hate to be pessimistic about development, but the barriers to progress are hobbled by forces both within and without developing countries and no one seems to be tackling the right issues to improve matters.

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About Pete Larson

Assistant Professor of Epidemiology at the Nagasaki University Institute for Tropical Medicine

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