Cartoon explains the problem of aid accountability
You can tell I just discovered the tumblr web site I Love Charts
So glad to discover this more accessible description of the principal-agent problem afflicting aid (and domestic bureaucracy as well).
Sad update on Ethiopian blogger Eskinder Nega: sentenced to 18 years for "terrorism"
July 13, 2012 story from the BBC:
A prominent Ethiopian journalist and blogger has been sentenced to 18 years in jail for violating the country's anti-terrorism legislation.
Eskinder Nega and 23 others were found guilty last month.
They were accused of links with US-based opposition group Ginbot Seven, which Ethiopia considers a terrorist organisation.
"The imprisonment… is emblematic of the Ethiopian government's determination to gag any dissenting voice in the country," Amnesty's Ethiopia researcher Claire Beston said in a statement.
"The Ethiopian government is treating calls for peaceful protest as a terrorist act and is outlawing the legitimate activity of journalists and opposition members."
That same government continues to be flooded with aid by the World Bank, US, UK, and other donors.
*See previous post on Nega July 9, letters to the New York Review of Books forthcoming August 18, 2012 and a previous one January 12, 2012, and another post on Democracy and human rights being absent at the World Bank.
Why is the World Bank so much less accountable than Penn State?
The World Bank has also had its own scandal featured on the front page of the New York Times. The charge was that they financed a project in Uganda in which poor people had their homes, cattle, and crops destroyed as the project forced them off their own land. The World Bank promised an investigation, which inspired us to post a clock beginning at the time of the promise.*
The clock is now at 294 days, 17 hours, and 54 minutes. The investigation has been repeatedly stonewalled. Unlike Penn State, no World Bank executives faced any consequences. Unlike Penn State, the victims have not been compensated. Unlike Penn State, no institutional reforms have taken place to make it less likely to happen again.
Why the different outcomes? I speculate the most single powerful difference is the state of public opinion as it affects the respective organizations' reputations. The level of public outrage at Penn State was uber-many times greater than outrage at the World Bank for the respective transgressions. The offenses were different of course, but that alone does not explain the difference in outrage.
It is great that there are more people in rich countries than ever before that care about poor Ugandans. But the level of caring is still way too faint to force the World Bank to be held accountable when it does wrong to poor Ugandans.
*Relevant updates, which were mostly no news, were posted at this site.
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).
The most powerful argument against autocracy yet
The North Korea Disney show [youtube http://www.youtube.com/watch?v=_XRWqnD8HV8&w=560&h=315]
A theory of dictator kitsch: that's what you get when you have no mechanism for critical feedback (wait, I feel a metaphor for aid coming on!)
Today's mention of this jailed dissident is really one mention too many
From a letter just published in the New York Review of Books, signed by me and others:
On June 27, 2012, the Ethiopian high court convicted journalist Eskinder Nega and twenty-three others on vague terrorism charges, continuing a trend in which Prime Minister Meles Zenawi jails his critics as “terrorists” ...
Eskinder Nega, who received this year’s PEN/Barbara Goldsmith Freedom to Write Award, has been a leading voice for press freedom in Ethiopia for almost two decades. He has been repeatedly detained, imprisoned with his wife Serkalem Fasil on treason charges.
Now Eskinder Nega is facing between 15 years and life in prison...His sentence will be announced on July 13, 2012.
We call on President Obama and all world leaders to condemn Eskinder’s imprisonment.
This site just mentioned Eskinder last week, and just this last January publicized a previous letter in the NYRB about Eskinder's case.
Let me be honest. I am tired of writing about Eskinder Nega. You are tired of reading about Eskinder Nega. This site really needs to move on from Eskinder Nega.
Let me consult Elie Wiesel on our major compassion fatigue:
Wherever men and women are persecuted because of their race, religion, or political views, that place must — at that moment — become the center of the universe.
We must always take sides. Neutrality helps the oppressor, never the victim. Silence encourages the tormentor, never the tormented.
The opposite of love is not hate, it's indifference. The opposite of art is not ugliness, it's indifference. The opposite of faith is not heresy, it's indifference. And the opposite of life is not death, it's indifference.
Let's call on all to condemn the imprisonment of Eskinder Nega.
The Market does not judge you, just meets you where you're at
Socialism is for perfect people, Capitalism is for people as they are.
The other Economic Development, HQ Oklahoma City
As shown by this site, a completely different set of professionals also refer to themselves as doing Economic Development. What can our Economic Development learn from them?
The Art of Aid Effects on Growth
A new paper shows evidence that researchers manipulate econometric regressions to artificially attain a "real" (i.e. "statistically significant") result. See Aid Thoughts for the key graphs, also Marginal Revolution. This is old news, but important. So of course, at this point you are wondering: how can I do this so I can also get my papers published? Here is a pedagogical illustration:
"Failed state" keeps failing as a concept to have any failed content
Africa is a Country gives a hard time to a 2012 Failed States Index. Here at the Development Research Institute, we are always glad when we can recycle an old "Failure of State Failure" post making the same point 2.5 years ago as something today. The basic problem is that "failed states" is either (1) a less well-defined way to express other more well-defined concepts like "civil war" or "lousy institutions" or (2) just has no coherent definition.
Maybe we can get unstuck by being more creative about the definition. How about "states that someone might like to invade?"
The Real America and the Ideal of the Fourth of July
America is a multi-national nation where there is currently much polarized debate as to who or what is the "Real America."
Perhaps the key to understanding America is that it's a nation defined, not by ethnic attributes of the citizens, but by the ideal of July 4th-- an ideal that all are created equal, with unalienable rights to liberty (yesterday's post).
35 Words
We hold these truths to be self-evident, that all Men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are Life, Liberty, and the Pursuit of Happiness.
The Development of Freedom since 1776 has been about including more and more men and women in that word "all".
The Worst Promotional Aid Video of All Time
[youtube http://www.youtube.com/watch?v=tYrBSTBHCS4&w=560&h=315] Courtesy of the Marines, ad during the Euro Cup final paid for with your taxpayer dollars, "Moving towards the sounds of chaos"
"We are the first to move towards the sounds of tyranny, injustice, and despair" (image of helicopter gunship carrying boxes labelled "aid")
Mr. Defense Secretary Leon Panetta, you are now obligated to finance an equally high profile ad that will present the other side, I.e. theory and evidence against the model of Development at Gunpoint
Progress? Internet Dating Replacing Friends and Family Introductions
Source here
Maybe the role of friends and family could be changed to betting on InTrade whether your relationship will last...
Awesome graphic: Earth's center of economic gravity returning to location of 1 AD
One major caveat: the projection from 2010 to 2025 is not to be trusted, based on the dubious assumption that China's rapid growth will continue (that one will require a whole future post).
Sources: this version of this widely circulated graphic is taken from WSJ. Personal HT to Chris Blattman, where I first saw it.
Nation's Newspapers Have Banner Headlines About the Wrong Thing
On the day in which the Supreme Court announced some incomprehensible decision, the true story of the day was in the back pages.
This story was a sign that, however much you may be discouraged about political gridlock, a free society really is self-correcting anyway. Heavily motivated Scientists have now solved the problem of the tasteless grocery store tomato.
World Bank President Completes Record Democracy-Free Term
Here at DRI, we must concede our longstanding strenuous effort to get the individual who has been World Bank President to say the word "Democracy" has ignominiously failed. His term ends this weekend.
Alas, this is more than a game. Yesterday, the peaceful Ethiopian blogger Eskinder Nega was convicted of "high treason" and "terrorist acts" for such nefarious activities as noticing there was an Arab Spring. (Nega should have followed the World Bank President's exemplary speech on the Arab Spring that omitted the word "democracy" even in a purely descriptive sense. ) The World Bank has given Ethiopia's government more than $2.5 billion (2007-2010) during Robert Zoellick's term.
Of course, President Zoellick did have to obey China the 1944 Articles of Agreement, which forbids interference in "the political affairs of any member." But when Ethiopian rulers use the aid to give food relief to supporters and starve opponents, according to careful documentation by Human Rights Watch (HRW), one begins to wonder if aid itself is political interference? Wouldn't suspending aid be more consistent with the Articles in that case?
At least the Development Assistance Group for Ethiopia (which includes the US, Canada, the UK, and the EU, together accounting for another $6 billion to Meles Zenawi over 2007-2010) sternly commissioned a field investigation into the HRW charges. Which has since quietly been cancelled. A 2009 secret US cable released by Wikileaks said that donors to Ethiopian leader Meles Zenawi were already “keenly aware that foreign assistance … is vulnerable to politicization."
Mr. Zoellick, you still have two whole business days to use some word form of democra____. Maybe you could just casually mention the official name of North Korea?
Why Women Can't Have It All; Why Development Can't Have It All
The hot debate that recently erupted in feminism from Anne-Marie Slaughter's problems with "having it all" may have reached closure with this new piece by Lori Gottlieb,
There's No Such Thing as 'Having It All'
Ms. Gottlieb self-mockingly notes that her revolutionary insight is that there are TRADEOFFS between work and family (for both women and men)
I am curious how admitting tradeoffs got to be anti-feminist.
Development people will recognize a familiar theme. Anyone who points out tradeoffs between AIDS prevention and treatment hates people with AIDS. If you point out tradeoffs between health and other development priorities, you might as well announce you want more children dying. So economists, who of course build their whole field around the concept of tradeoffs, have gotten the image of the Gestapo accountants of development.
Perhaps the "debate" on the existence of tradeoffs (undeniable! really!) is just a secret code that hides the real issues. Advocates see those who point out a tradeoff as having an agenda against one of the things being traded off. Advocates deny the tradeoff as a way of asserting an absolute right to the thing that you allegedly don't have to trade off.
There is a valid debate hiding there somewhere, which could make more progress if the debaters just spoke more ... honestly.
How much do Europeans account for economic development?
From the Wall Street Journal, by Daniel Lippman:
European settlement had a longstanding positive effect on economic development in countries that were colonies, notwithstanding the terrible effects of Western diseases and political oppression that often resulted, according to new research.The paper, titled “The European Origins of Economic Development,” was written by New York University’s William Easterly and UC Berkeley’s Ross Levine, who set out to build a new comprehensive database of the European share of the population in the early phases of colonization. It also looked at the impact of the settlers on the former colonies’ economic development today.
In an “illustrative exercise” that the two professors run in their paper, they find that “47% of average global development levels today are attributable to Europeans.”
What could accounts for that large number? The paper argues that it could partly be explained because “Europeans brought growth-promoting characteristics — such as institutions, human capital, connections with international markets, and cultural norms — that diffused to the rest of the population over generations.”
A large number of commentators generously congratulated the authors on being obvious, wrong, and racist.
You may find the NBER link to the paper above to be restricted. If so, here is an unrestricted link.