All about the money

“What do you think about international development?”

I get asked that question a lot. Fellow volunteers, a friend who works for a private foundation, a former USAID employee, an NGO worker – they’ve all asked it, in one form or another.

“What do you think of international development?”

I think every volunteer asks themselves that question at some point. We see a lot of NGOs doing a lot of stuff – some good stuff, some bad stuff – and often times we see it from the perspective of Cambodians. Our neighbors, co-workers, and students tell us about the NGO, and it’s usually a mixed bag. Afterwards, we’re left thinking, “Huh. What do I think of international development?”

I never have a good answer ready when someone asks. “It’s complicated,” I say. Then I usually give a platitude-laden response – people try hard, nothing is perfect, it’s so complex, cultural differences, aid dependence, building capacity, yada yada yada. There are a bunch of ways to use words and phrases indicating you know all about development without ever saying anything meaningful about it.

That’s all bullshit, though. I’m just scared to tell them what I really think. I’m afraid it will make me look stupid. I’m afraid they’ll pity me for my naiveté. I think it will make things uncomfortable. Most of all, I’m afraid they don’t actually care.

But if you don’t care, that’s cool. You can just stop reading. And if you think I’m stupid, I won’t be able to read it on your face. So you can get my real answer.

What do I think about International Development?

International development is structurally racist, suffers from the crippling bureaucracy demanded by donor governments, and utilizes people’s natural inclination to do good but traps them in a system that sets them up for failure. It is inherently flawed because it begins with a premise that we are rich because of something we do, they are poor because of something they do, and in order to correct this imbalance we must teach them what we do and how to do it like us.

Now, I know that answer is like a conversation-killing checklist: race, economics, politics, exploitation. I might as well hold up a sign saying, “No more fun here!” Hard to go back to entertaining anecdotes about how I pooped myself in the street once, or how I accidentally asked my host-mother if I could "fuck the dishes.” Anti-establishment diatribes tends to derail small-talk pretty effectively. It’s also not what I’m supposed to think.

As a Peace Corps volunteer, I’m supposed to have gone through this whole process and gained an appreciation for the nuances, tensions, and problems with enacting aid in poor communities here in Cambodia. At the beginning, during conversations with people who are far more experienced in international development than myself, I was told people in my community would be, to varying degrees, lazy, corrupt, difficult to deal with, waiting on foreign aid, and/or self-serving.

Those aren't the words they use, of course. 'Lazy' becomes 'different cultural attitudes toward work', 'corrupt' becomes 'lacking institutional support', 'waiting for handouts' becomes 'aid dependent'. But dressing up the language in academic, detached terms doesn't remove the racism, and it definitely doesn't make it true. 

The Truth

The truth is, I’ve learned none of these things - in fact, I’ve learned the opposite. For the development aspect of my Peace Corps service, all of the real difficulties I’ve faced have come from Americans, not Cambodians. Grants that get denied because they “set bad precedents” for my community, grants that are changed because they don’t meet the donor criteria arbitrarily set by a bureaucrat in Washington D.C., entire projects vetoed because they don’t fit within the current scheme of “appropriate” international development.

Ostensibly, as a Peace Corps volunteer who’s lived in my community for a year and a half, I would have the most intricate knowledge of what my community needs – apart from the community members themselves, of course. Yet this experience and knowledge does not translate to trust or money from higher-ups when it comes to attempting actual development.

And here's the scary part - even given all this, I believe the Peace Corp's reputation as a grassroots, effective development agency is deserved. I think they (or we) probably do an as-good or better job of ensuring the community's needs are considered properly when developing a project than any other organization out there. It's just not good enough.

What I’ve realized is that it’s not the people of Cambodia’s fault that development work is so hard, it’s the fault of the development itself.

It’s important not to mistake this with another common refrain – that “(Country X) gets too much aid.” This is dangerous and narrow-minded thinking. If the aid in a country is not helping the country properly, the solution is not to decrease the amount of aid the country receives – it’s to change the type of aid offered to that country. The distinction is important. Cambodia has not received too much aid, as some people think – it’s received too much bad aid.

"Good Aid" vs "Bad Aid"

"Bad aid" is a project that is designed and/or implemented by foreign-funded and foreign-operated agencies. Much of the development work funded by big aid agencies and NGOs are big projects. They try to connect a resource or product with a community that needs it. Wells, water filters, sanitation stations - it could be anything. Instead of outsourcing that work to the recipient themselves, by just giving them the money, they assume they can do a better job. The organization prioritizes the community's needs for them, rather than letting the community do so itself. 

The aid agency then employs smart, well-intentioned young people from western donor countries to come in for a year or two and form a plan.

No matter how well-intentioned, however, this plan will inevitably fail, because it starts with the flawed premise that a 25-year-old international development major from America knows more about the needs of a Cambodian villager than the Cambodian villager does. But, of course, they don’t.

In response to this failure, the people who wrote the plan will note all the difficulties they faced during implementation – cultural differences, social nuances they didn’t understand, institutional corruption – and shift blame to those things. They will collect their salary - many times the salary of a local worker, money that could have been given directly to a person in need - and they’ll go home. They’ll tell their friends how hard international development is, how complicated it is, never noting the inherent biases in that attitude, and the idea that development is inherently complex will further perpetuate itself.

I think that idea is wrong. I believe that poverty is not a complicated issue. Poverty is not difficult, and it’s not complex. It’s simple – people are impoverished because they don’t have enough money. If we want less poor people, we should give them more money. Giving people money - “good aid.”

Poor people + money = less poor people.

I know that sounds like I can’t be serious. It’s so naïve. I get that. It really doesn’t sound very smart, does it? For example, compare the following sentences. 

• “Giving poor people money makes them less poor."

• “The cultural differences and nascent institutions associated with socially oriented economic development in developing nations makes sustainable, capacity-building development projects difficult to execute without heavy involvement of invested local partners.” 

The former sounds like the musings of a fourth-grader, while the latter sounds like it came from a master’s thesis. And yet, maybe simple isn't all bad. Maybe a fourth-grader could do a better job of solving poverty than we've managed to do so far.

People are poor because they don’t have enough money – so why not just give them more?

That will never work.

I know. “Giving money to poor people” isn’t a very popular strategy. But what if it did work, and we just didn’t know it?

The first objection seems pretty obvious, particularly if you follow debates over welfare in the U.S. – if you just give people money, they’ll work less. Turns out, that’s not true. 

Over at Poverty Action Lab, a team of researchers from MIT and Harvard analyzed 7 trials in 6 different countries and found absolutely no evidence that cash grants discouraged work. To quote from their report:

“We do not observe a significant effect of belonging to a transfer program on employment or hours of work in any of the seven programs… We re-analyze the data from 7 randomized controlled trials of government-run cash transfer programs in six developing countries throughout the world, and find no systematic evidence that cash transfer programs discourage work.”

Which doesn’t surprise me. The villagers in my community wouldn’t stop working if they got more money. They’d spend that money on things like healthcare, education for their children, smartphones, motorbikes, home repairs, farm equipment – the results would be as varied as the personalities of the individuals. But none of them would take that money and go, “Oh, OK, I guess I have enough money now, I should probably stop working.” That’s not really how poverty works, and anyone who thinks a small cash grant will discourage work has probably never lived in an impoverished community.

OK, so cash grants might not discourage work. But does the money actually go toward improving the lives of the recipient? Well… in most cases, yes.

GiveWell, a non-profit that ranks charities based on their cost-effectiveness – dollar-in, output-out – also likes the idea of unconditional cash grants. Here’s a quote from a report they made:

"This trial indicated that unconditional cash grants lead to large increases in recipients' consumption, assets, business investment, and revenue… Bottom line: Cash transfers have the strongest track record we've seen for a non-health intervention, and are a priority program of ours."

Indeed, one of their recommended charities for 2015 is GiveDirectly, an organization that gives unconditional cash grants to poor people in Kenya and Uganda. 90% of the money a donor gives ends up in the hands of a recipient – which is hugely efficient compared to most other development programs. GiveDirectly was started by a group of economics students who studied various development techniques and found direct cash grants to be by far the best – yet couldn’t find an existing organization that focused on them. So they started one.

Innovations for Poverty Action (IPA), a group with 600 employees that focuses on statistical research to evaluate development programs, also supports the idea of cash grants, and they’ve found it to be effective even when the aid is targeted – for example, a program that gave unconditional cash grants but also gave parents information about school enrollment was as effective at enrolling new students in school as putting that condition on the grant itself. People don’t need to be told to send their children to school – they just need the opportunity. 

The Transfer Project, a collaboration of UNICEF and University of North Carolina, tracked the results of direct cash grant programs in seven different countries in Africa and found the quality of life of recipients improved significantly after cash grants.

These projects are hugely efficient, eliminating the need for a large staff of western workers to manage and oversee projects. They are highly effective, ensuring the money doesn't get lost through the many layers of government or institutions it must pass through before reaching the hands of an aid recipient. And they are empowering, giving people the choice of how and when to spend their money. 

So if the research suggests cash transfers are impactful, cost-effective, and simple, there’s an obvious question.

Why don't we just give poor people money?

Part of the reason is institutional inertia – change takes time. These programs are relatively new, starting within the past 5 years, and they're still on a smaller scale than most development projects. But real change will never come unless the current attitudes that development agencies endorse change dramatically, shifting from a top-down development approach to a bottom-up alleviation of poverty.

I don't think this attitude comes from conscious racism or cultural imperialism. Aid and development workers, by and large, are incredibly underpaid, compassionate people who have moved away from their homes and families in order to make a positive difference in the world. They're not trying to fail, they're trying to help.

I think many times, if you’ve made a career out of international development, you simply don’t want to believe that your job could be replaced by a direct cash transfer app on a smartphone. If you had spent your life studying how to get money from rich people to poor people in the best way, and the answer all along was “just give it to them”, you might be a bit put-out too.

And that’s fair, that’s a pretty human feeling. But at the end of the day, the goal should be directing as many dollars from aid organizations to aid recipients as possible. There will always be a role for development specialists – translators, researchers, health workers, crisis responders, skill sharers. But their role should be as limited as possible, far more limited than it is today, to ensure that the donor money is spent where it should be spent – on the people that need it most. The only people who stand to benefit more from a big bureaucracy that manages complex development projects today are the western aid workers themselves.

So what do I think about international development? I think if we want people to have more money, we should give it to them. I think if we were serious about ending poverty, we would end it. And I think that the power to do both these things already rests in our government coffers and wallets – all we need to do is start giving it away.