45 – Aid Effectiveness

International aid is not just a matter between governments. Throughout the western industrialized nations there are numerous charitable organizations also working to assist people in developing countries.

The familiar UNICEF Halloween campaign, for example, began in 1950 when a priest in Pennsylvania suggested to his Sunday school students that instead of asking for candy when they went Trick-or-Treating, they ask for small change to support UNICEF. Those first students raised $17. By the 1960s, which the United Nations declared to be the Decade of Development, students in schools throughout the United States were being encouraged to take small orange-colored milk cartons with coin slots cut into them around on Halloween night. And to encourage those students, educational materials were produced, including posters which showed pictures of hungry children in developing countries, pictures of people living in “the huts and villages” which President Kennedy had spoken of in his inaugural address.

They were the same kind of pictures one still sees today in television ads asking people to sponsor a child in a developing country. In fact, most people would see little difference between the images used in 1961 and those used in 2011.

More fifty years have passed since the United Nations declared the 1960s to be the “Decade of Development”–but for all too many people living in developing nations, conditions not only haven’t improved–they’ve actually deteriorated.

Of course, nations like Canada continue to provide “development assistance” to countries like the Dominican Republic.

In the period between 1961 and 1984, trillions of dollars in aid were transferred from countries like Canada and the United States to lesser developed nations. But much of that aid had been political and often had strings attached to it. In many cases, the funds never actually left the donor country. They went to corporations within the donor country in order to fund large-scale development projects such as the construction of hydro-electric dams, highway systems, sewage-treatment programs, huge irrigation projects and so on. Even scholarships to bring overseas students to universities in the donor country were considered foreign aid.

Those contracts were certainly beneficial to the corporations and universities which received them–but one has to question how much benefit they were to the nations of the South. The justification for this type of project-funding had been that it would create an infrastructure which would contribute to the economic stability of Southern nations and lay the groundwork for future development.

If the projects were judged by how well they achieved their expressed goals, then they were not very successful at all. Developing countries are generally less stabile economically today than they were even twenty years ago.

Dominicans in 1984 were significantly worse off than they’d been in the 70s, and–if one examines the economic criteria which banks and other credit rating agencies use–they’re even worse off today. In 1984, after the structural adjustments imposed by the International Monetary Fund, there were three Dominican pesos to the US dollar; today the exchange rate is 38 pesos to the US dollar.