John Kerry in Ethiopia Today Fails to Change History of Rights-Abusing Aid

UPDATE 2, May 2, 12:47pm EDT: Is it progress to have provoked a  one-on-one Twitter war with Ethiopian Foreign Minister Dr. Tedros Adhanom Ghebreyesus?

UPDATE: May 2, 2014  Coverage of John Kerry's "concern" yesterday about arrested Ethiopian bloggers in US media today: none. US State Department follow-up: none.  USAID follow-up: none.

If a US policy concern falls in the forest, and no one is there to hear it, is it a policy?  END UPDATE

The Ethiopian government, a major US aid recipient, operates with such impunity on rights that it arrested 9 new dissident journalists and bloggers on the eve of US Secretary of State John Kerry's visit to Addis Ababa today. 

Kerry raised his "concerns" about the detained bloggers with in a meeting today with the Ethiopian Prime Minister Hailemariam. The Ethiopian PM doesn't need to be too concerned about US "concerns," much less any reduction in US aid, since Kerry earlier today more loudly affirmed the US alliance with Ethiopia's government to fight terrorism and violence in Africa.

Plus ça change, plus c'est la même chose. The long history of aid ignoring and even facilitating rights abuses in Ethiopia sadly continues.

How good writing experts are not always right

The political economy of why your flight is two hours late today

Flights were delayed by up to two hours across the country on Monday...Airline executives were furious over how the {Federal} aviation agency handled the government-inflicted chaos, and privately said the agency was seeking to impose the maximum possible pain for passengers to make a political point.

The airline executives in this NYT story are using a venerable and plausible theory of how government agencies behave in response to budget cuts. An agency would strategically cut areas that make the public howl in pain so as to increase the probability that the cuts will be reversed. If the agency cut areas that did not directly affect the public, it risks the public and politicians saying "good riddance" and making the cuts permanent.

Quotes from anonymous airline executives do not an empirical proof make, of course. I hope someone is using the current sequester to collect some data on some natural experiment that would test this theory.

For the first time in history we've got a perfect advocacy message, but challenges remain

Owen Barder adds an April 17 statement by World Bank President Jim Kim to his century-long list of leaders who have declared about once a decade: "for the first time in history, we can end poverty". Owen had already published this list 3 months ago. Why does this phrase keep recurring? One thought (not original to me) is that advocacy messages are driven by what works best for advocacy, and not by any necessary relation to reality.

"We can end poverty" -- the task is doable, the cost is manageable, it's almost easy.

"For the first time in history" -- this answers a question implied by "we can end poverty": if it's so easy, why didn't it already happen?

Another version of what works best for advocacy was given by a World Bank press release the same day (April 17) as the Kim statement in a story on poverty numbers. Here was the headline

Remarkable Declines in Global Poverty, But Major Challenges Remain

As shown by this headline, the best advocacy message is in Goldilocks land. Things are getting better (for which we get the credit), so that kills pessimism that is bad for advocacy. However, it would be bad for advocacy if we are too hopeful,  because that works against the urgency of ever greater effort and funding.

"But challenges remain."

This phrase deserves special recognition because it surfaced in a private discussion some development folks had a while ago as winning a stiff competition for the worst and most meaningless cliché ever. Does this distinguish poverty from any other problem? Is there any issue anywhere where no challenges remain?

What is the lesson?  A bit more evidence that official development agencies lack accountability if they keep repeating stock phrases with either no connection to reality or no meaning at all.

A Serious Point on why the Chinese Government does not understand The Onion

The New York Times and every other newspaper in the United States reports: The official Chinese Communist Party newspaper People's Daily reran a story from The Onion that they headlined:  "North Korea's top leader named The Onion's Sexiest Man Alive for 2012." They did not realize it was satire.

Quoting The Onion's spoof report, the Chinese newspaper wrote, "With his devastatingly handsome, round face, his boyish charm, and his strong, sturdy frame, this Pyongyang-bred heartthrob is every woman's dream come true."

"Blessed with an air of power that masks an unmistakable cute, cuddly side, Kim made this newspaper's editorial board swoon with his impeccable fashion sense, chic short hairstyle, and, of course, that famous smile," the People's Daily cited The Onion as saying.

There IS a serious point here. Satire that mocks authority obviously is not allowed in an authoritarian system. Having never seen satire, and instead receiving nothing but fawning praise themselves, the autocrats are incapable of recognizing satire. It's very funny, but it's also very sad.

HT Mari Kuraishi @mashenka

Jane Jacobs on Development: the Nation is not the ONLY possible unit of analysis

From Don Boudreaux at Cafe Hayek, quoting Jane Jacobs' book Cities and the Wealth of Nations:

Nations are political and military entities... But it doesn’t necessarily follow from this that they are also the basic, salient entities of economic life or that they are particularly useful for probing the mysteries of economic structure, the reasons for rise and decline of wealth.

So for example, two important factors in development are technology and culture. Neither spreads primarily at the unit of the nation.

This is the kind of helpful insight that will DEFINITELY have NO impact WHATSOEVER because it is so much more convenient both data-wise and politics-wise to focus on Nations.

Drone Terror: Maybe Defense and Development are not complementary after all

I feel duty-bound to write this one. Hilary Clinton said a while ago that Defense and Development were complements.

Not so much. A new report from Stanford and NYU (see excellent summary in the Guardian) found that US drone strikes (greatly increased under this administration) in Pakistan were killing and terrorizing civilians, while very few killed their terrorist targets.

It would be hard for Development to benefit from "drones hovering 24 hours a day over communities in northwest Pakistan, striking homes, vehicles, and public spaces without warning."

The report alleges that drones strike areas multiple times, killing rescuers of victims of the first strike.

Next challenge in US: getting people to care about this.

The Revolt against TED

Evgeny Morozov in the New Republic on TED conferences:

Today TED is ...a place where ideas, regardless of their quality, go to seek celebrity, to live in the form of videos, tweets, and now e-books. In the world of TED—or, to use their argot, in the TED “ecosystem”—books become talks, ... projects become talks, talks become books—and so it goes ad infinitum ... until any shade of depth or nuance disappears into the virtual void....how “ideas worth spreading” become “ideas no footnotes can support.”

Why is he so upset? Christopher Shea at WSJ Ideas Market summarizes and shares Morozov's revulsion at the "distinctively TED-style attitude toward politics in which institutions and democratic debate are derided and technology is looked to as a deus ex machina that will solve such once-intractable problems as poverty and illiteracy."

Morozov's critique comes in the middle of a review of a self-parodying manifesto from TED Books Hybrid Reality: Thriving in the Emerging Human-Technology Civilization, By Parag Khanna and Ayesha Khanna. He continues:

That they can spit out the following passage without running any risk of being disinvited from respectable dinner parties and television shows is a sign of how well our debate about technology—a seemingly neutral and nonpolitical issue—conceals deeply political (and, in this case, outright authoritarian) tendencies:

(Quote from the Khannas' book:) " ...nonfunctional democracies ...are prime candidates to be superseded by better-designed technocracies—likely delivering more benefits to their citizens.... To the extent that China provides guidance for governance that Western democracies don’t, it is in having “technocrats with term limits.”

Morozov keeps piling on to the end:

That solving any of their favorite global problems would require political solutions—if only to ensure that nobody’s rights and interests are violated or overlooked in the process— is not something that the TED elite, with its aversion to conventional instruments of power and its inebriated can-do attitude, likes to hear. ....TED’s techno-humanitarians—{are nother} brigade of what the Nigerian-American writer Teju Cole has dubbed “The White Savior Industrial Complex."

Can't wait to hear Morozov's TED talk...

US election depends on whether voters believe output has a unit root

This is not my area, but there has been a long debate since forever on whether real GDP is "trend stationary" or "has a unit root." The Economist magazine discusses how this debate has unexpectedly erupted in the US Presidential campaign.

In the unlikely event you don't know what a unit root is, here's the Cliff Notes version:

Output is trend stationary if a downward movement is temporary, because it will be reversed until output again catches up to the previous trend.

Output has a unit root if a downward movement is permanent, and sets the "new normal" from which output starts growing again.

(This question also matters in developing countries of course, and it may even differ by level of development.)

Why does this matter in the US election?

If an incumbent inherits a large downward movement, then has an anemic recovery, is his performance below normal expectations? If he was stuck with a permanent downward movement, his "unit root" performance does not look so bad compared to the "trend stationarity" expectation that output should have regained the trend by now.

On culture: maybe more research is needed

Inspired by this NYT story on beach behavior in Qingdao, China  to say I'm glad that economists are starting to work on social norms, culture, and development. It's moved way beyond the primitive circular reasoning whereby any poor people were assumed to have a "bad" culture. Culture is partly an endogenous choice; for example, parents decide how much effort to exert to pass their culture on to their children. For a good intro, check out the work of my NYU colleague Alberto Bisin.

PS the relevant cultural norms relevant in the picture are apparently how much female beauty involves pale skin, and on how much extreme measures are acceptable to achieve that.

Mr. Sachs loses AIDS debate to Mr. Budget Constraint

The World Bank hosted a debate (click on the above screen shot to get to the link for the whole webcast) on the proposition:

Continued AIDS investments by donors and governments is a sound investment, even in a resource-constrained environment.

Jeffrey Sachs and Michel Sidibé  (head of UNAIDS) argued in favor, and Mead Over and Roger England argued against. There was a show of hands of the audience pro and con before and after. As Mead Over reports, nobody was surprised that a vast majority was pro before the debate; the surprise was that a substantial minority changed their minds to con after the debate.

Mead Over has written a post summarizing the debate, paraphrasing in his words each participant's argument (see the video linked above if you want the exact words of each). Here is Mr. Sachs:

Jeff Sachs: This debate is a sham, because resources are not really scarce. With financial transactions taxes and higher taxes on the rich we would have more than enough money to address all the health problems of the world.

Mead Over and Roger England argued that, in the real world, alas, there really is a budget constraint on health and on everything else.

The cost of pretending this budget constraint does not exist, they argued, is that the lives saved by increasing AIDS spending cause many more lives to be lost when AIDS crowds out more cost-effective health interventions.

Cost-effectiveness calculations of course make the big assumption that both AIDS and alternative  interventions are or would be effectively implemented.  Aid critics like me have of course questioned aid effectiveness, but I and others have also argued that aid's effectiveness is greater in health than in other sectors.

Roger England doubted even the effectiveness rate in AIDS (as paraphrased by Over):

Roger England: The $100 billion that has been spent so far on AIDS has created an “AIDS-industrial complex” and the international AIDS meeting in Washington this week is its trade fair. The money has otherwise accomplished much less than it could have if wisely spent.

Sounds like Mr. Budget Constraint did win the debate.

Why markets do not imply "Greed is Good"

Inspired by a John Kay column in the FT today.* Naked greed does not maximize corporate profits. Customers do not have full information about product quality, so they must trust their suppliers. When a corporation like GlaxoSmithKline (GSK) gets caught cheating its customers ( by suppressing information about negative side effects of one of its drugs), the gain in extra profits from cheating on this one drug is surely more than offset by the loss in profits on all drugs (from the damage to GSK's reputation as a trustworthy supplier).

Contrary to popular wisdom, the market doesn't reward greed, it punishes it.

*I don't bother linking since it's gated. Kay has been providing important insights about corporate profit maximizing for a while now (including in his great book Obliquity).