Friday, June 24, 2005

Dumping Foreign Aid Into Africa Is NOT the Answer

A study done by Investor’s Business Daily shows that dumping money into Africa is NOT the answer to their poverty problems, and that it is a waste of money.
Since World War II, the U.S. has spent $1.2 trillion on foreign aid to 70 countries – and all are worse off than they were in 1980, according to the U.N.

Britain's Tony Blair will ask President Bush to join him in creating a "Marshall Plan for Africa," pouring vast amounts of aid into African countries. But it's doomed to fail, according to Investor's Business Daily (IBD).

he original Marshall plan cost the U.S. $13 billion – equal to about $100 billion in today's dollars – between 1948 and 1951.

But the countries it aided in postwar Europe had scientists, engineers, skilled laborers and other professionals who were able to lift their nations back to prosperity. They also had governments that worked.

In Africa, on the other hand, most countries are "undemocratic, corrupt, lawless and lacking in property rights," says IBD. "Aid is simply wasted – swallowed whole by corrupt bureaucrats and African warlords.

"Study after study shows that many factors affect how countries climb out of poverty. They include democratic government, low levels of taxes and corruption and clear legal protection for the ownership of property. But not aid."

To make its point, IBD cites a mid-1990s U.N. analysis of U.S. and European foreign aid. The U.N. found that the U.S. spent $1.2 trillion on aid, but all 70 countries that received it were worse off than they were in 1980 – and 43 nations were worse off than in 1970.

Tony Blair suggests spending $25 billion in aid, seven times what the U.S. will spend this year.

But IBD stated: "Virtually no evidence exists that aid does much of anything.

"Aid can actually hurt nations that receive it – a Band-Aid when radical surgery is needed."

It's nice to hear someone else validate what I have been saying all along, that you need to clean up the Gov'ts in Africa before you can dump money into those countries. I do empathize with the poor in Africa, but giving money to the corrupt Dictators and Warlords that run those countries is not going to help. They need big changes, to the Gov'ts, cultural changes and massive influx of high skilled labor, before any money will help them. So all this BruHaha by Tony Blair, Bono and Bob Geldorf's Live8 concerts is really for nothing, all it will do is ease their guilt on being rich. If they really want to help, they will address the root problems and those can't be fixed with dollars.

Mr Minority