The Human Journey

Creating a Sustainable Future

Aid – Introduction

The West has spent $2.3 trillion dollars on foreign aid over the past 50 years, and yet:

  • over 30% of the world’s population, or 2.2 billion people live on less than two dollars a day. (World Bank Overview on Poverty, updated 2015)
  • 783 million people do not have access to clean water (UN)
  • 1.3 billion people are without access to electricity (IEA)
  • almost 2.5 billion do not have access to adequate sanitation(UN)
  • 2.6 billion people are without clean cooking facilities (IEA)
  • more than 72 million children of primary education age are not in school and 759 million adults are illiterate (UN)

What Went Wrong?

In his book The Tyranny of Experts William Easterly, Professor of Economics at NYU and Co-director of the NYU Development Research Institute, notes that since 1949 when President Truman announced the first U.S. foreign aid program, the West has been under the illusion that global poverty was a technical problem that merely required the right “expert” solutions. Additionally, the West’s “Blank Slate” mentality – the belief that aid needs no analysis beyond comparative statistics and growth rates – came, he suggests, from the perpetuation of an “engrained but unexamined premise: that people in poor countries cannot be trusted to make their own decisions” and from our willful neglect of their histories.

Rapid growth of average incomes has reduced extreme poverty so that the number of people living on less than a dollar a day fell from 1.5 billion in 1981 to 805 million in 2008. The success of China and India put a huge dent in world poverty, but sub-Saharan Africa has failed to reduce poverty or fertility rates, so the number of poor people there almost doubled during the same period from 169 to 303 million. However income inequality has increased during this same period. According to a report called “Working for the Few” released by Oxfam International:

Graph of the percentage increase in share of income of the richest 1%
The percentage increase in share of income of the richest one percent

Graph of the share of national income going to the richest 1%
  • Almost half of the world’s wealth is now owned by just one percent of the population. Reference.
  • The wealth of the one percent richest people in the world amounts to $110 trillion. That’s 65 times the total wealth of the bottom half of the world’s population. Reference.
  • The bottom half of the world’s population owns the same as the richest 85 people in the world. Reference.
  • Seven out of ten people live in countries where economic inequality has increased in the last 30 years. Reference.
  • The richest one percent increased their share of income in 24 out of 26 countries for which we have data between 1980 and 2012. Reference.
  • In the US, the wealthiest one percent captured 95 percent of post-financial crisis growth since 2009, while the bottom 90 percent became poorer. Reference.

So might knowing more about the history of a region help development economists understand their target communities, governments and countries and might that enable them to make better decisions? How much does a community’s history affect its current situation?