The Aid Distraction

The focus of Beyond Aid has, from the outset, been the ideas and actions of others. But this week is a special one, at least for high-level international talks, as both the Busan aid effectiveness summit and the Durban climate change conference kick off. So to mark these dual events (and because I am a little under the weather), here is an analysis piece I wrote for the Broker Online in early October. It was written with Busan in mind, but I believe its point regarding global democracy applies equally to Durban.

Talk is cheap. Results are what matter. That is the apparent consensus ahead of next month’s aid effectiveness summit in Busan, whose organizers promise “a clear focus on development results,”  while sceptics worry about a lot of rhetoric and little concrete follow-through.

Unfortunately, the most important and most difficult conversation has barely begun.

There are certainly some positive noises in the lead-up to Busan: recognition that aid is just one aspect of development, talk of mutual accountability and commitment to sustainable development. But if these promises are to become more than talking points, greater efficiency and more reliable data will not be enough. In order to create the kind of massive global change they profess to desire, the leaders of the world’s wealthy countries will have to follow their rhetoric to its logical conclusion.

To say that development is more than aid is an understatement. Donors should begin by acknowledging that aid is a potentially useful but relatively insignificant component of development. As things stand, member states of the OECD’s Development Assistance Committee – the driving force behind Busan – contribute just over 0.3 percent of their combined gross national income to development assistance. Even if they all made good on their decades-old promise to increase that amount to 0.7 percent and on their more recent pledge to give recipient countries ownership of the development process, 99.3 percent of their wealth would still be devoted to economic activities that sometimes clash with the interests of the world’s poor.

The mutual accountability being promised must demand more from donor countries than ODA transparency (though that would be nice too); it has to mean a serious analysis of the impacts their self-interest has on those who do not belong to their electorate. Yale philosopher Thomas Pogge argues citizens of wealthy countries, as well as elites around the world, benefit from “a transnational scheme of social institutions under which some persons are regularly, predictably and avoidably denied secure access to the objects of their human rights.” (Thomas Pogge (2002) World Poverty and Human Rights, Polity Press, Cambridge, p. 227.) In his view, these privileged people have a negative duty not to harm the world’s poor that is greater than the positive duty to provide them with aid. Certainly, such thinking is in line with legal codes around the world that punish crimes but do not reward good deeds. Moreover, Pogge believes the time is right for a rethink of the global system, with the financial crisis providing “a great opportunity to showcase and propagate both causal and moral institutional analysis.”

Transfer pricing by OECD-based transnational corporations costing poor countries billions in lost tax revenues each year; the Canadian government refusing to investigate (or withdraw financial and diplomatic support from) Canadian mining companies accused of serious rights abuses overseas; European and American trade negotiators lobbying hard to prevent loosening of intellectual property rules that impede the fight against non-communicable diseases in poor countries… The list is long and there is a whiff of blaming the victim to the claim that poor countries are responsible for their own development. Certainly, their agency is essential; improved conditions are unlikely without sound local and national policies, which have often been lacking in the past. At the same time, poor countries neither have the jurisdiction nor the political influence to rein in transfer pricing or change the international intellectual property regime. As for the role or indifference of host-country governments regarding extractive industry abuses, factors may include asymmetrical diplomatic relations and incentives built into international rules that grant ownership of natural resources to countries, even though a better case could probably be made for local or global ownership.

The point here is not that poor countries are good and rich ones are bad. But foreign policy accountable only to the voters of the home country has extremely limited democratic legitimacy, and the current global system – one that over the last few centuries has been determined to a great extent by countries that today are OECD members – is in many ways bad for those who are poor. While micro-lending or support for institution building may help, they cannot address bigger systemic problems. And yet, the vast majority of the intellectual and practical effort expended on development over the last 60+ years has focused on changing the way people – from farmers to presidents – in poor countries behave and think.

It is time to look at the second half of the equation without losing sight of the first half. It is time for the established, wealthy countries to accept their share of responsibility for poverty in distant lands and to begin handing over their global control. Not to China, India and Brazil but to the 7 billion people of the world.

Of course, ushering in an era of global democracy would be a lengthy undertaking, far exceeding the scope of a three-day summit, however high-level it might be. But Busan does have the power to significantly change development thinking, and the recognition of negative duties would be a huge step in questioning a global order that leaves billions with virtually no voice.

Sound unrealistic? Maybe. Surely though, it is no more so than suggesting competing entities, whether they be corporations or national governments, will spontaneously prioritize cooperation over their own short-term interests. Or maintaining that by giving away a tiny fraction of their wealth, they can counteract the negative impacts of their core activities and a global system designed to further their goals.

Depressingly, sustainable development would be even tougher to achieve than global democracy, as it would also require counteracting generational selfishness. Is it possible to extend democracy in time as well as space?

Difficult, no doubt. And unless we shift the conversation, impossible.

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