International Aid: A Partner in Crime

June 6, 2011

in Nepal, Philanthropy

The conflict of interest inherent in international development is that donor dollars perpetuate (and even exacerbate) more social and political problems than they ameliorate. International donors (e.g., USAID, its British counterpart DFID, and a wide range of other agencies) have given billions of dollars in foreign aid over the past few decades yet failed to “develop” Nepal. The country continues to be unstable, with widening class disparity and on-going violence.

As globally-conscious citizens of a wealthy nation, we feel a responsibility to the world’s poor. Yet we have to ask, “Are we really helping?” Graham Hancock documented the failures and hypocrisy of international development in his landmark 1988 book Lords of Poverty. Aid agencies attempted to address the scandal, but the nature of the industry remained flawed a decade, two decades later. An independent consulting group has even generated a model for assessing whether aid programs are doing more harm than good–and the conclusions often contain unwelcome truths.

The Economist recently published a good article on the corruption of aid in Nepal, inflaming my frustration of 12 years as a witness to ineffectual development. Nepal has had 20 governments in 20 years, which has enriched corrupt politicians and local officials while doing little to govern the country. More than half of the government’s annual capital expenditure comes from foreign donors even though the government has been totally stalled for three years. If Nepal’s government had to earn its budget through tax revenue, they would be forced to build the country to a working condition. Moreover, without lucrative project budgets funded by outside aid, public coffers wouldn’t have much to steal which would make political posts far less coveted.

Instead, political rivals from the highest levels of government down to the smallest villages will compete, threaten, beat, kidnap, and kill in order to gain control of authority positions that come with a steady line of public funds. Encouraging this behavior is a culture of impunity, revealed occasionally in the papers. News stories within the last month include police taking a $6000 bribe to release someone under arrest, a man accused of human rights violations and murder being appointed to the new government’s Cabinet, political parties controlling the appointment of university and hospital administrators, political cadres beating a journalist, and border officials complicit in the smuggling of endangered species. Rarely is anyone prosecuted to the point of jail–and certainly not for mere embezzlement of funds. If development officials can’t see that their programs are corrupt at the local level (as cited by The Economist), it is because they are willfully ignorant. More likely is that they do not want to acknowledge it. Not only is corruption of aid projects pervasive, but it is often common knowledge to people of the local area. They simply have no recourse. Police, government officials, and other authority figures are the corrupt ones. Justice is nowhere to be found.

As global citizens, we’d like to believe that our nations are funneling millions of our hard-earned tax dollars into “peace-building” programs because it helps a poor and disadvantaged place like Nepal. A painful truth, however, is that it is exactly these funds which are constantly misappropriated, which create both violent and diplomatic struggles for power, and which fuel a large gap between rich and poor. International donors contribute to local violence and corruption, but they turn a blind eye (intentionally or not) so they can claim success and expand their own programs and budgets. What international director wants to state his/her organization doing more harm than good and should scale back its programs? The bureaucracy of aid is moving towards a dystopian future, and it is the poor and powerless of Nepal who suffer in the name of development.

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