It is hard to think of a more famous global academic than Jeffrey Sachs. He advises the United Nations, collaborates with presidents, hangs out with Hollywood idols, parades around the planet with pop stars and persuades billionaires to part with money. He has starred in a film alongside Angelina Jolie and written a best-selling book on ending poverty. Since becoming a full professor of economics at Harvard University in 1983 at the astonishingly young age of 28, he has seemed an almost permanent fixture in the public eye making impassioned pleas for his pet causes.
His influence has been amazing. In 1985, just two years after taking tenure, he was advising a Bolivian government confronting hyper-inflation. Sachs devised a strong austerity package that hurt many citizens but reined in inflation. This ‘shock therapy’ became his trademark, exported first to Poland as it emerged from the Soviet communist straitjacket and then to Russia with dire consequences. The nation’s economy shrunk by half, state assets were pillaged and, ultimately, the ravaged nation turned to a nationalist strongman to restore stability. As we survey today’s turbulent world, it is arguable he bears some responsibility for Putin’s rise.
By time the impact of his ideas became apparent, Sachs had found a fresh cause after a trip to Zambia: the elimination of global poverty. This crusade might have seemed ambitious, but not for such a brilliant and self-confident fellow. He decided the problem was a poverty trap that left impoverished countries unable to tackle core problems – and the solution was giant dollops of foreign aid to solve issues such as disease, illiteracy, lack of jobs and antiquated agriculture that held back development. “We can banish extreme poverty in our generation”, he said in 2005.
His simple, uplifting gospel coincided with the rise of a new generation of Western political leaders, especially in Washington and Westminster. They were influenced by Live Aid, desperate to show they cared about the world and susceptible to such arguments. Among those who befriended him was George Osborne, then a young Tory shadow chancellor, who travelled with him to Uganda, penned joint articles on aid and pushed the idea of ring-fencing the discredited UN aid target in law. The New York Times called Sachs “the most important economist in the world”. Bono gushed that “his voice is louder than any electric guitar, heavier than heavy metal.”
For many years, those that dared question such tactics were dismissed as callous xenophobes. The political class largely closed ranks, demonstrating the worst kind of groupthink and ignoring evidence of consistent failure. The aid industry became bloated as budgets soared, especially in Britain where they surged even as public services were slashed by austerity. Now we see the consequences: a scandal-plagued charity sector focused on protecting lucrative brands, fat-cat private firms creaming off huge sums and vast flow of funds into pockets of repellent regimes. The estimated poverty trap is now half the size of annual development aid spend.
Some voices have emerged in recent years to question this ‘big bang’ approach promoted by Sachs. They range from African leaders and activists through to Western academics, including a Nobel-winning British economist lauded for his expertise on global poverty. Yet still few politicians question the frittering away of vast taxpayer sums on aid, let alone the dubious morality of donor-dictated policies being inflicted on poor nations. Besides, they are terrified of a backlash from self-serving charity chiefs accusing them of selfishness. And this is why a new report ordered by the department for international development (Dfid) is so significant.
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SubscribeHere I am again standing in an arid desert for the want of fellow-feeling contributors: My new girlfriend happens to come from Togo, and she told me that the average salary of a teacher was £7-9 a day. I said, “that works out to about £1 an hour! What can you buy with £1. You can’t possibly feed a family”. “Exactly”, she said. “Why is that?” I asked. “Corruption”, she replied, “and a country run by a military dictator and his son for over 50 years, with a blind eye turned by France.”
‘The Togolese economy is rated mostly unfree for the second consecutive year. GDP growth, however, has been healthy for the past five years, driven by large public investments.
The government has an ambitious development plan to attract private investment to establish Togo as a financial and logistics hub and, to advance that goal, has started privatizing key sectors of the economy, including telecommunications and banking. Success, however, will require such economic freedom”“friendly changes as reforms to the judicial system and a commitment to tackling the serious and long-standing problem of corruption.’
https://www.heritage.org/in…