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Aid For Scoundrels

In response to:

Foreign Aid for Scoundrels from the November 25, 2010 issue

To the Editors:

William Easterly’s article “Foreign Aid for Scoundrels” [NYR, November 25, 2010] may have missed an important component of the continuation of aid to corrupt and repressive regimes: the strong pressure the professional staffs of multilateral aid agencies are under, once a particular aid project has been approved, to keep the money flowing. Their own performance reviews and careers would not be helped by a recommendation to shut off aid to the client country for which they are responsible. I am sure similar pressures exist for the initial approval of such projects despite the often well-known corruption of the regime. The thinking seems to be: “If we aren’t lending why do we exist?”

Richard Wasteneys
Port Townsend, Washington

William Easterly replies:

I completely agree with Mr. Wasteneys. These pressures are a well-known incentive to give aid no matter what the behavior of the recipient. However, this begs the question of why aid agencies should be designed to have such perverse incentives. Part of the answer to the “aid for scoundrels” problem is changing such incentives in the direction of avoiding aid to brutal autocrats. I hope the revolt in the Arab world will change some of the complacency toward autocrats on the part of the aid agencies.

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