I had the pleasure of recently reading Paul Collier's excellent work of non-fiction,
"The Bottom Billion: Why The Poorest Countries are Failing and What Can Be Done About It"
which has recently been awarded the Lionel Gelber Prize, a prestigious prize for the non-fiction genre. Collier is a professor at the Oxford School of Economics and a preeminent scholar in African economies. The Bottom Billion is a phenomenal effort in describing the traps of poverty, and what can be done to alleviate these traps. The trap concept is one that is not unique to Collier's work; his approach at systematically targeting the traps through a combination of trade laws, military intervention, and proper international financial accountability is. Collier's explation of the paradox of anti-globalization activism and the damage this misguided view plays on the poorest economies was also unique and well-targeted. Fairness and equity must play a role, but the closing of markets will not foster economic growth and increased prosperity. Collier also played close attention to the so-called "Natural Resource Curse," that is, the damaging effects of high value commodity exportation on most developing countries around the world. It is indeed a fact that the discovery of oil will completely wreck the economy of any developing country in the current globalized world; more on this to come, as I am currently reading "Untapped: The Scramble for Africa's Oil," by John Ghazvinian.
With regards to Collier, I wish to focus on his summation of the role of aid in breaking these traps that keep the "Bottom Billion" mired in hopeless poverty. There is a large role to be played by international aid and the agencies that are the facilitators; however, the approach needs to be modified to fit the changing face of a global crisis. As with Jeffrey Sachs, Collier is an optimist, a man of ideas and of action-here is his strategy for reforming the field... Collier writes:
"The key obstacle to reforming aid is public opinion...using aid strategically to promote growth in the bottom billion is not high on the agendas of politicians. Public opinion drives them into the 'I care' photo opportunities that dominate aid...Aid agencies should become increasingly concentrated in the most difficult environments. That means they will have to accept more risk, and so a higher rate of failure. They should compensate by increasing their project supervision, which means higher administrative overheads. They should become swift-footed, seizing reform opportunities at an early stage. They should intervene strategically, financing big-push strategies for export diversification. They should introduce governance conditionality..."
----(Agencies are naturally risk averse-they also have strict accountability to their donors, and are increasingly cutting back on overhead expenses; if you visit the website of any major organization, they will have a prominent pie chart detailing their costs, with an obvious emphasis on minimizing administrative and managerial expenses...it is rather intriguing to hear Collier's point of view on a topic most people take as a cut and dry. The constant drive for low overhead can very well be inhibiting the agencies' basic effectiveness, and thus be totally counterproductive. The costs of continuing with "more of the same" in this field is tragedy; tragedy can be averted by following the wise ideas of a few wise men. In a related note, (wise men, that is) check out the Presidential contender's plans for international development. Barack Obama is truly progressive in his outlook and plans in this critical arena. Vote Obama! )
Collier concludes...
"Within the societies of the bottom billion there is an immense struggle between brave people who are trying to achieve change and powerful groups who oppose them. The politics of the bottom billion...is a dangerous contest between moral extremes. The struggle for the future of the bottom billion is not a contest between an evil rich world and a noble poor world (sorry, Che). It is within the societies of the bottom billion, and to date we have largely been bystanders...we do not have to be bystanders. Our support for change can be decisive. But we will need trade policies, security strategies, changes in our laws, and new international charters. In short, we need to narrow the target and broaden the instruments."
Well said, indeed.
Collier's Homepage at the Oxford School of Economics:
http://users.ox.ac.uk/~econpco/
Barack Obama's foreign policy plans, including a doubling in non-military assistance:
http://www.fpif.org/fpiftxt/4901
