The Roles of Aid in Politics Putting China in Perspective



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Sexton, Edwin A. and Decker, Terrence N. (1992), “US Foreign Aid: Is It for Friends, Development or Politics?” in Journal of Social, Political and Economic Studies, Vol. 17, pp. 303-315.

The history of American economic assistance is a troubled one because foreign aid has not always achieved its two primary objectives: support for US policy and successful economic development in Third World nations. One of the clearest indicators of the failings of the first objective can be seen in the voting records of the UN Security Council. The second objective is glaringly faulty because no recipient of US aid has become a truly developed nation since World War II.



Smith, Rogers M. (1989), “Morality, Humanitarianism, and Foreign Policy: A Purposive View,” in Loescher, Gil J. and Nichols, Bruce (eds.), pp. 41-60, The Moral Nation: Humanitarianism and US Foreign Policy Today, Notre Dame: University of Notre Dame Press.

What should be the relationship between humanitarianism and American foreign policy, and between humanitarian agencies of the United States government? These questions are embedded in the perennial debate over the proper relationship between morality and the national interest. In that debate, many stances can be discerned, but two cast the longest shadows.

The orthodoxy in government, perhaps in academia, surely remains some version of the disenchanted “realism” advanced in the postwar years by George Kennan, Hans Morgenthau, and others. Realism soberly admonishes us not to make too much of morality in international dealings. It often sanctions the harnessing of humanitarian ideals and agencies to other, more hard-hearted governmental objectives. Especially since the mid-1970s, many academic writers have therefore rejected such “realism” as cynical selfishness. They have instead called on us to strive to heed morality, and humanitarian organizations and advocates, in international affairs. Most of these writers have identified “morality” with cosmopolitan perspectives derived from the idealism of Immanuel Kant and sometimes from universalistic religious outlooks, as Henry Shue did, for example, in his noted book Basic Rights, and as he continues to do in his contribution to this collection.1

While these two positions, the “realist” and the cosmopolitan “neo-Kantian,” come down on different sides, in many respects they depict the relationship of morality to national interest similarly. Morality is held to express the grand aspiration to do right by all humanity. Although it may sometimes be taken as an element of national policies, it is at heart distinct from, and in tension with, purely national interests. Those interests are not thought of as chiefly moral, but as “pragmatic” or “political.” By these terms writers usually mean that national interests center on preserving if not enhancing the wealth and power of a nation’s government and people. Hence both camps agree: morality is fundamentally something apart from national interests, so that however often the two may coincide in practice, sooner or later morality must be subordinated to national claims, or vice-versa.

Neither side, let me stress, maintains this distinction absolutely. “Realists” often contend that avoiding excessive moralism in foreign policy leads to more moral results. Neo-Kantian moralists often stress, as Shue does, that certain moral considerations are part of the very definition of, at least, American national interests. Both are points on which I will build, especially the latter, for I believe that writers like Shue have done a service in arguing persistently for the relevance of morality to American foreign policy and international affairs. But the neo-Kantian moralists have not fully captured the genuine wisdom about practical possibilities contained in realism.

Consequently, in this essay I will argue for an understanding of the relationship of morality to national interests, and of the proper substance of American national morality, that differs from each of these dominant camps. Instead of taking our bearings from the somberly amoral worldview of realpolitik or cosmopolitan idealism, I will suggest we adopt a more consequentialist view of liberal morality, traceable to one dimension of John Locke’s pragmatic, yet morally directed, political philosophy.

In brief, this view goes beyond the neo-Kantians’ critique of realism by arguing that certain moral principles are not merely intertwined with American national interests. They constitute the very core of those interests. Indeed, they give moral standing to imperatives to provide for national welfare and defense so long as the nation does not permanently abandon the precepts that give its existence moral value. Those precepts are not best understood, however, as embodying transcendentally based universal principles of social justice. Rather, they express the nation’s reflectively chosen moral goals – to respect human liberties throughout the world and to advance them, initially and especially, at home. This view encompasses the concerns for actual consequences, and recognition of certain national claims, which form the strengths of the realist perspective, without sanctioning the dismissiveness toward morality realism can foster. And while it does not overcome the real differences in private and public perspectives on humanitarianism and national claims, it does clarify those differences and their moral appropriateness in ways that may make healthy dialogue and cooperation between governmental and private agencies more feasible.

Sogge, David (2002), “TWO: Who Is Aiding Whom?,” in Sogge, David, Give and Take: What’s the Matter with Foreign Aid?, pp. 24-39, London & New York: Zed Books.

Foreign aid is full of ambiguities and double bottoms. It does not fit neatly into any one of the three ways people are said to go about their material transactions: coercion, exchange and gift-giving.2 Being tied with geo-politics, trade and banking, foreign aid can’t be classified as purely gift-giving. Giving and getting have shadow sides, where even in daily life they can mask exchange or coercion. Across culture, people have been wary of gifts. In some Western and non-Western languages, words for ‘gift’ share the same root as words for ‘poison’.3

Aid is routinely portrayed as high-minded beneficence. But a little probing around an aid deal will usually expose a lively intermingling of high and low intentions. The bigger the stakes, the greasier the fingerprints of commerce, geo-politics and ideological crusading. Newcomers to the foreign aid business embody this. Public figures in industries as diverse as oil prospecting, media networks, computer software and popular entertainment want to be donors. Not only do they hand over cash, they also study the subject, swap ideas with experts and busy themselves in the details of aid provision. The New Rich, like those with Old Money whose privately endowed foundations were among forerunners to the modern aid system, have learned that ‘noble expenditure’ is among the best means of self-defiance in the court of public opinion.4 As long as some rich people and firms can portray their kind as beneficent, the day of reckoning with normal progressive taxation can be postponed for ever. The gratifications of giving are many, including a better bottom line.

The case of taxes and their avoidance recalls the fact that beyond coercion, exchange and gift-giving there is a fourth type of transaction, that based on obligation. Progressive taxation is a main example. It is self-imposed, and accepted by huge majorities as both fair and a good idea. It makes possible the provision of public goods and the combat of public bads. Still other kinds of public policy are based on obligation. Think of health insurance companies’ duties (in some welfare states) to provide insurance cover to persons regardless of risk. Yet foreign aid is only rarely grounded in obligation. The duties of the International Committee of the Red Cross and the UN High Commissioner for Refugees are established in law and practice, but elsewhere in the aid system, no one is a duty-bearer.

GIVING AND TAKING: INSEPERABLE TWINS Aid has deep and tangled roots in the history of Western expansion. Needing a respectable rationale for imperial rule in Africa and Asia, British ideologists came up with the notion of a Dual Mandate. One face of the mandate was trusteeship: Britain had paternal obligations toward its subject peoples; it had to take decisions on their behalf, protect them and guide them. The other face was accumulation: the colonial power had to develop the colonies’ economies for profit and insert them into the world system run by the West. The unspoken rationale of the aid regime strikingly resembles the Dual Mandate.

Guiding the USA was a vision of an open frontier.5 France pursued a mission civilsatrice. Detectable in these and other colonial ideologies were two drives: giving and taking. To legitimize those two purposes – trusteeship for others and accumulation for one’s self – colonial power elaborated doctrines of modernization and development. To manage the territories politically, they imposed systems of indirect rule via local potentates. In the end, however, colonialism was too costly. The trustee and mercantile rationales could not be sustained, at least under one imperial flag.

As people in the South asserted rights to speak for themselves and manage their own affairs and resources, Western powers had to drop their talk about civilizing missions and mandates towards ‘backwards’ areas. Former overseas dominions were repackaged as exclusive clubs: America’s Good Neighbors in Latin America, Britain’s Commonwealth, Frances francophine, Europe’s ex-colonies assembled as the Lomé group, and Japan’s flock of ‘flying geese’ in Asia.6 Northern officials collaborated with the new ex-colonial leaders, cultivating them through elite networks. Some African rulers took their vacations, had their suits made, and sent their children for schooling in Europe.

Behind rhetoric about self-determination, the US and European powers have used aid to compete with one another through their colonial and neo-colonial systems.7 Trade and investment wars have gone on in the name of a super-project of social engineering called ‘development’.8



The Players

The aid system has played with a fixed cast, but has also seen givers and receivers come and go. Major trends and episodes may be summarized as follows.

AT THE PROVIDER END The USA has held commanding positions, first as the major bilateral donor, but also the driving force behind the IFIs. Japan’s aid effort has grown dramatically: in the 1990s it became the biggest spender in absolute terms. Figure 2.1 shows the relative importance of main aid providers from 1960 to 2000.

For the Soviet Union and its Eastern European allies the role of aid donor ended around 1990, whereupon, broken up and broken down, they became net aid recipients. The period 1973-92 saw a number of oil-producing countries (chiefly Saudi Arabia and the Gulf States) appear for a while as heavyweight donors. Peaking at $9.6 billion in 1980, their grants and loans went chiefly to Asian and African countries with large Islamic populations. Much of the money went into projects in transport and energy; theirs was an aid programme for Islam and for the oil industry.

Foreign aid comprises many kinds of flows. This book’s chief focus is on foreign aid as used by officials (most of the time) in the strict sense of flows from official sources under soft or ‘concessional’ terms, chiefly for purposes of economic development and welfare. Resources for political or military purposes are thus, in principle, excluded. When directed towards low-income countries of Asia, Africa and Latin America it is termed ‘official development assistance’ (ODA); when directed towards Eastern Europe, the ex-Soviet Union or other ‘countries in transition’ it carries the less condescending label ‘official aid’ (OA). In this book, OA is included in ODA unless otherwise noted.

Since the early 1980s bilateral or country-to-country aid has accounted for about two-thirds of total ODA. About one-third of net ODA has flowed from multilateral bodies: the IFIs, European Union channels and the United Nations agencies. Multilateral aid has helped shield donors from the political risks of acting alone where recipient sovereignty is breached, namely in attaching macro-economic and political conditionality to aid. It has also helped in special cases such as South Africa and Namibia, where donors together helped pull the plug on apartheid.

AT THE RECEIVING END Recipient countries form a mixed group. Former colonial or current neo-colonial relationships strongly determine who gets what from whom. This appears in informal sphere of influence: the USA in the Middle East and Latin America, Australia in Papua New Guinea and Fiji. Appendix A provides a snapshot of top recipients of 14 major donors at the end of the 1990s. Geography, colonial history and culture are decisive for France, Britain and Portugal, countries whose aid goes chiefly to their ex-colonies. Historical ties show up in Germany’s aid to Turkey. For over a decade the same populous countries have been among the top four recipients of total bilateral ODA: Indonesia, China, India and Egypt.

The poorest countries have never been the highest priority; they account for less than one-third of total ODA. More important have been those in the ‘other low-income’ category such as Indonesia, China, Côte d’Ivoire, India and Pakistan, and ‘lower-middle-income’ category, such as Egypt, Jordan, Guatemala, Bolivia and the ex-Yugoslavian states. Table 2.1 presents net ODA disbursements in the 1990s across six categories.

Poverty may be a main justification for aid, but it has seldom been the main criterion for allocating it. If aid were distributed according to a simple head count of poor people, then China, India and other South and East Asian countries would have received most of it. But in the 1990s they received only about one-third ODA. Other factors, such as size of a country’s population, count. For a given poverty rate, smaller countries tend to receive more aid. Imperial scrambles for territories and preferences for island and enclave nations have biased aid’s distribution.

As shown in Figures 2.2 and 2.3, both bilateral and multilateral ODA have been directed towards poor countries, but not the poorest.



Who’s Really Aiding Whom?

Aid’s public image is one of Western beneficence and non-Western beggary. Apart from a parade of stories told to make benefactors feel good about their aid, there is rarely a hint that the North gets something in return. On the contrary, the usual insinuation is of unproductive and ungrateful welfare queens living high on Northern generosity. That is an illusion. Foreign aid is a sideshow. Real benefits, and real costs, appear in quite different and larger flows and blockages.

Between richer and poor countries, gains and losses can be estimated in various ways. Official flows in funds, goods and people can be compiled with some accuracy. But the global growth of unregistered transactions – in illicit goods, tax evasion, remittances – blow large holes in the date. Lack of information is in part a result of deliberate deregulation of capital, and the rewarding of old practices of bank secrecy, tax paradises and fictitious bookkeeping.

Table 2.2 shows only recorded transactions. In the case of worker remittances, actual values are far larger. In the case of tiny Somaliland, for example, they total about half a billion dollars annually.12 Personal transfers surpass all official and non-governmental aid. In 1998, officially recorded remittances from the Netherlands to 42 low-income countries (exclusive of Eastern Europe) totaled about US$ one billion, a sum equivalent to 115 per cent of official Dutch aid to those countries.13 Most value, however, is redistributed upwards and outwards, from poorer to richer. These flows take the following forms.

BRAIN DRAIN Richer places gain from professionals migrating from the South, many of them trained at university level through aid-funded bursary programmes. The UN estimates that African professionals departing for work abroad numbered about 27,000 in the 15 years up to 1975, 60,000 from 1985 to 1990, and 200,000 in the period 1990-99.14 Today an estimated one in three African university graduates works outside Africa.15 Asia has suffered a ‘haemorrhaging of talent’, particularly to the USA, where ‘stay rates for advanced students in engineering disciplines and the sciences can be higher than 75 per cent for students from particular countries’.16

CAPITAL FLIGHT Northern financial circuits gain from Southern capital, whether looted or legitimately saved. To escape regulation and taxation, well-connected firms and persons use many scams including mis-invoicing of imports and exports and suitcases of cash to stash wealth abroad. Tax havens help account for the difference between the $85 billion poor countries should receive in taxes from foreign corporations and the $50 billion they actually receive.17

[B]y the end of 1990 the cumulative total of flight capital from developing countries was approximately $700 billion, equivalent to more than half the size of the external debt of developing countries. In effect, roughly half of the foreign borrowing by developing countries was transformed into an outward movement of private capital by citizens of the indebted countries.18

Figure 2.4 indicates the importance of capital flight in some selected African countries. Researchers have speculated that the impact ‘of a return of such (relatively) huge investment flows would clearly be massive’.19

NORTHERN TRADE BARRIERS Northern business interests gain from excluding imports from the South. ‘Each year developing countries lose about $700 billion as a result of trade barriers in rich countries: for every $1 provided by the rich world in aid and debt relief, poor countries lost $14 because of trade barriers’.20

LOSSES DUE TO NORTHERN DUMPING Northern interests gain from crushing Southern competition. Crop and livestock agriculture have been especially hard hit. ‘In some African countries where it costs $74 to produce 100 kilos of maize, the local market price feel to $21 due to subsidized Northern exports.’21 In 1986, Haiti was largely self-sufficient in rice, a staple food for its people. Forced by donors and lenders to drop trade restrictions, the country was flooded with rice from the USA, where farmers are subsidized. ‘By 1996, Haiti was importing 196,000 tons of foreign rice at the cost of $100 million a year. Haitian rice production became negligible. Once the dependence on foreign rice was complete, import prices began to rise, leaving Haiti’s population, particularly the urban poor, completely at the whim of rising world grain prices.’22

REPAYMENT OF DEBT Debt repayment from poor to rich far exceeds aid. In 2000, lower-income countries paid to their creditors, net of what they received in new long-term loans, $101.6 billion – more than three times what they received in aid grants in that year. In 1999 the imbalance had been even greater: lower-income countries had paid to creditors almost five times more than what they received in aid grants.23

From 1992 to 2000, debt repayments as a share of poor country earnings from their exports and services changed as follows. Repayment of loan principal rose from 14 to 19 per cent; repayment of interest on loans rose from 8 to 10 per cent. All together in 1999, debt repayments (interest + principal) consumed 28 per cent of the earnings of lower-income countries.24

UNFAVORABLE TRENDS IN TERMS OF TRADE Trade losses swamp aid flows. The purchasing power of most Southern exports has fallen steadily throughout the era of foreign aid. ‘Right through the 1980s, commodity prices fell on average by 5 per cent annually in real terms. By 19990 they were 45 per cent below their 1980 level … Between 1980 and 1991, the developing countries suffered an estimated cumulative loss in total export earnings in real terms of US$290 billion, an annual average loss of US$25 billion.’25 ‘For the nonoil African countries, excluding South Africa, the cumulated terms of trade loss [from 1970 to 1997] represent almost minus 120% of GDP, a massive and persistent drain on purchasing power.’26 The usually optimistic World Bank estimates that the purchasing power of most commodity exports in 2010 will be lower than it was in 1997.27 These dismal trends stand in contrast to the unremitting pressure aid providers have put on low-incomes countries to ‘export their way out of poverty’.

§

Aid is an ambiguous, two-faced thing. There is commonly a lot less to it than meets the eye. Under its many padded layers, the business of giving camouflages its much larger and inseparable twin, taking. Neither bilateral nor multilateral aid is targeted in proportion to the poverty at the receiving end. The terms of loans from the helpers can be as hard as, if not harder than, the terms, set by merchant bankers. Finally, aid flows are simply dwarfed by the flows from poor to rich.



None of the foregoing should be read as new or astonishing. Most of these processes are not the result of intentional scheming or wickedness, but merely the unreflecting pursuit of the rules of the game. Most depend on collusion within the cosmopolitan ‘global North’, such as between bankers and other business people in both richer and poorer countries. A story of uniquely predatory Northern actors victimizing uniquely defenceless Southern actors is a myth. Predation is worldwide, though some countries are better-positioned that [sic] other to practice it.

Sogge, David (2002), “THREE: The Aid Regime and Power Agendas,” in Sogge, David, Give and Take: What’s the Matter with Foreign Aid?, pp. 40-64, London & New York: Zed Books.

It has been called a sector, an enterprise and an industry. As a hierarchy of bodies whose practices converge around a set of rules, the aid system may also be called a regime. It is a system of power doing its work in a wider realm of international politics. During the Cold War, the Soviet Union and its allies formed their own modest aid regime. That collapsed around 1990, whereupon most of its members found themselves at the receiving end of today’s only major regime, that of the OECD club of rich countries.

This chapter looks at what drives the regime, what institutions occupy its commanding heights, what checks and balances constrain its members’ powers, and what rules are supposed to guide it. The chapter sets the stage for the following two chapters about aid chains at upper and lower levels.

Is the aid regime one coherent thing? Some specialists have voiced doubt on the point, arguing that Western aid was at best an arbitrary set of practices run by each country according to its own rules and purposes. France, for example, has frequently gone its own way. Japan makes business the centerpiece of its aid.

More frequently at the non-conforming fringe have been a few smaller, trade-dependent countries with robust traditions of domestic social welfare: Norway, Sweden, Denmark, Canada and the Netherlands. As middle-power internationalists, from the mid-1970s to the late 1980s this so called Like-Minded Group tried to harmonize their aid and related policies along social-democratic lines. Much earlier than others, they focused on poverty and on political and civil rights. Since 1975, all except Canada have met the UN spending norm of 0.7 per cent of GNP. This suggests that a Nordic-Dutch sub regime of aid exists, or did exist.

Today’s aid regime discourages non-conformity. Indeed, it looks, talks and walks like a state-run monopoly. It is a prime candidate for break-up and for the cure it blithely prescribes others: competition. Why such structural adjustment is unlikely may be apparent in the following pages.



Why Provide Foreign Aid?

Rarely has one compelling drive been pre-eminent, although victory in the Cold War was clearly the dominant purpose in the aid regime’s first four decades. Assigning a single motivation to the aid regime would be absurd. Aid’s motives are always mixed. Hence the risks of incoherence – the frustration of some aims by other aims – are always high.



The mix changes over time, and varies between donors. Small trading nations will pursue a mix of aims different from those of a continental super-power. The useful question, then, is: what motives predominate? Aid specialists have probed the matter and commonly locate motives in three clusters.

Strategic Socio-Political Motives

  • Short-term Abroad, to reward and keep a client ‘on side’ politically during negotiations, wars or other crises; to defuse public protest and insurrection; to provide a base for intelligence-gathering; to influence decision-making in international fora. At home, to reward or retain loyalty of ethnic/political constituencies, to be seen to be ‘doing something’ during a crisis.

  • Longer-term Abroad, to gain regular access to and loyalty of leadership at the receiving end; to win or deepen acceptance of a doctrine or model of development; to reinforce a country’s place in a larger economic, political and military system; to stabilize economic or demographic trends in a country or region in order to stem unwanted effects such as terrorism and migration; in international institutions, to set and steer economic and political agendas. At home, to consolidate political and support of voter and contributor constituencies, particularly the private sector, but also those with ethnic ties to aid recipients.

Mercantile Motives

  • Short-term Abroad, to seize market opportunities. At home, to promote interests of a sector of business and related employment; to improve the lender/donor’s balance of payments; to assure the solvency of creditor banks, public or private.

  • Longer-term Abroad, to win, expand, protect trade and investment opportunities, including strategic access to raw materials and cheap labor; to shape and stabilize North-South economic roles and hierarchies; in international institutions, to win and stabilize adherence to economic rules. At home, to consolidate and protect economic sectors.

Humanitarian and Ethical Motives

  • Short-term To show concern and compassion for victims of war, upheaval and natural catastrophes;

  • Longer-term Abroad, to demonstrate concern about poverty, human rights abuse including the human rights of women; to compensate for damages. At home, to show solidarity with a particular country or group, to claim the high moral ground.

Discussions of what motives actually drive aid frequently get clouded by talk about what should drive it. Debates about it can evoke public displays of doubt or pride about national character and power. Are we a generous people? Are we pulling our weight in the world? A study of how Dutch, Belgian and British politicians talk about their nations’ foreign aid roles in the period 1975-90 reveals much about national self-regard. Dutch rhetoric shows a self-image of ‘The Activist’: aid should be used to advance social justice, development and stability. Belgian politicians, by contrast, talked about their country’s interests in terms of ‘The Merchant’: aid should benefit the domestic and international market. In British parliamentary debates, the dominant role conception was that of a ‘Power Broker’: aid should support friendly governments and advance British power and influence.2

Greater solidarity at home can mean greater beneficence abroad. Strong political commitments to domestic welfare, as in Nordic countries, are associated with strong aid performance, measured both by quantity (aid spending as a proportion of national income) and by quality (proportion of aid aimed at poverty reduction). Weak commitments to domestic welfare, as in the USA, coincide with weak aid quantity and quality.3

Some have argued that the Western foreign aid regime arises from ethical and humanitarian motives.4 Certainly moral concerns influence conventional talk about aid, especially talk for the public at large. The World Bank’s corporate motto since the late 1990s has been: ‘Our dream is a world free of poverty.’ But does donor practice match this talk? A team of researchers probed the determinants of aid-giving behavior, comparing US, French, Japanese and Swedish bilateral aid flows to Africa in the 1980s. They looked at how these donor distributed their aid according to recipient countries’ strategic importance, economic potential for the donor, and humanitarian need. The results pour cold water on the notion that humanitarianism drives foreign aid. Ideology and the pursuit of commercial advantage are the main determinants.

Official aid is seldom a tool of altruism, even in Sweden, whose aid was long assumed to be driven by humanitarian concerns. Data suggest that Sweden acts rather more as a Merchant than an Activist, even in the 1980s, when it made important contributions to political change in southern Africa.5 Since then, Swedish commerce and investment, including corruption-tainted sales of weapons to South Africa, have been consistent with those findings. Other researchers have reached similar conclusions: ‘the direction of foreign aid is dictated by political and strategic considerations, much more than by the economic needs and policy performance of the recipients. Colonial past and political alliances are the major determinants of foreign aid.’6

As noted elsewhere in this book, national aid agencies have largely fallen into step behind the IMF and World Bank. Yet here and there motives are getting re-mixed. Beginning in 1997 a streak of idealism was detectable in British aid policy. Like other donors, the UK sees aid as a means to hitch low-income wagons to turbo-charged global markets. But it also accepts that aid should help civil society activists to mount pressure on decision-makers to protect citizens’ rights – even where those rights are frustrated by market forces. US policy, on the other hand, shows a different trend. It has downgraded foreign aid to Africa and the Caribbean, regions targeted in its Trade and Development Act of 2000, whose theme is business, as usual. Low-income countries, as far as the USA is concerned, have to export their way out of poverty.

Motives behind aid never come in fixed and stable proportions. One observer therefore concludes: ‘Perhaps the safest generalization to make is that foreign aid, when used alone or in combination with other policy instruments, has a unique ability to allow the donor to demonstrate compassion while simultaneously pursuing a variety of objectives.’7

TWO NEGLECTED MOTIVES Aid usually revolve around self-interest, but two types of motivation are often overlooked: obligations to compensate for suffering and damage, and imperatives to respond to common problems of a region or the globe.

Compensation From the late 1940s to 1981, Japan made grants totaling $1.9 billion to 13 Asian countries; commercial gain was part of its motives, but the formal purpose was to compensate those countries for losses in the Second World War and during Japan’s prior colonial exploitation.8 Through treaties and commissions, the USA instigated and enforced Japanese reparations. In so doing it applied a double standard, since elsewhere Western powers have ‘always insisted aid must not and cannot be seen as a form of compensation or reparation for damages inflicted by colonialism’.9 In the 1970s, for example, Southern advocates of a New International Economic Order found no Western sympathy for their proposal to create judicial means to take ex-colonizers to court for ‘development damage’. Today, counties hurt because of policies imposed by the World Bank and IMF have no means of legal redress.

Common interest Deadly microbes, criminal mafia, radioactivity and greenhouse gases easily spill across borders. Migrants in search of a better life are now entering richer areas at faster rates. Global risks are increasing and vocal publics are demanding protection and guarantees of compensation. Such trends are concentrating the minds of politicians and policy-makers. Up until recently, complacent in their fortress nations, they paid little attention to approaches built around global and mutual interests. Today, among some policy elites and activist groups, and understanding is slowly crystallizing that lands both rich and poor face a common fate, whether they exist together in a region such as Mediterranean basin, or together in a single Planet Earth. Where common interest is a point of departure, joint and reciprocal initiatives can be a fairly short step. Hence, recent talk about global public goods10 and warnings, in the wake of the suicide attacks in September 2001, that prosperous countries should prepare for significant transfers from rich to poor. That, however, would mean largely junking today’s arrangements and moving towards redistribution – something wholly different from today’s aid system. […]

This chapter has cast a cursory look at the commanding heights of the aid system, the motivations, institutions and rules which drive it, and some of the checks and balances that should make it publicly accountable but usually fail to do so. The regime operates and reproduces itself in extended hierarchies or aid chains, the motif of the following two chapters.


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