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By Fareed Zakaria
I’m in Davos, Switzerland, the site of the World Economic Forum's annual meeting. I usually use our “What in the World” section to give you my thoughts about something that struck me. But I’m going to cede this space to someone else today – Bill Gates.
His annual letter is out. It debunks three myths about fighting poverty and has gotten attention for its claim that by 2035, there will be no more poor countries in the world (using today’s definition of poor, of course).
But what caught my eye was myth number two: foreign aid is a big waste. Actually, this might not strike many as a myth. Lots of people believe that what we send abroad doesn’t really help countries alleviate poverty and develop. Well, Gates does a very nice job carefully explaining why foreign aid has in fact been a pretty spectacular success. The largest piece of evidence for this is literally the life-saving effect of aid.
Gates gives us the numbers:
– Since 2000, 440 million children have been immunized against vaccine-preventable diseases
– Since 1988, 2.5 billion children have been immunized against polio
The results are stunning. Twenty-five years ago, the number of polio cases each year was 350,000. In 2013 it was 400.
And it’s not just about health either – the percentage of children in school in Africa has gone from the low of the 40 percents to 75 percent over the last forty years.
Savings people’s lives, making them healthy and ensuring that they get an education is not simply and deeply a moral thing to do – it has practical benefits as well. These people now work, earn a living, and help make their countries less reliant on aid. Many countries that received large amounts of foreign aid from the West are now developed enough that they don't need it anymore: among them, China, Mexico, Brazil, Malaysia, Singapore, South Korea, Morocco, Peru. In fact, China is now a big donor of foreign aid.
Part of the problem here is that we lump together all kinds of aid. There’s aid that was given during the Cold War – say to Mobutu Sese Seko, who led what was then Zaire – for purely strategic reasons with no attempt to develop the country. There is aid for research and science. There is aid for public health. And then there is aid for general economic development.
The reality is that foreign aid programs have to be well designed, properly targeted, and well implemented – just like any other effort in the real world, whether it be public or private. They must be monitored for corruption and unintended effects. But when these conditions apply – and they do in many, many cases – foreign aid has a big positive effect.
And how much are we spending to get these benefits? Americans guess that their government spends 25 percent of its annual budget on aid. How much should it be spending, they are asked? Ten percent is the answer. Well, the fact is that the United States spends less than one percent of its budget on aid. That’s $30 for every American. Is this money a waste?
If you add up all the money spent on health-related aid since 1980, and divide that by the number of children's deaths that have been prevented, you get a figure of just $5,000 to save a child's life.