Aid effectiveness gaining attention

WASHINGTON — Arvind Subramanian’s recent WSJ op-ed “A Farewell to Alms” is one in a series of articles that lately has helped to elevate the visibility of the aid effectiveness debate. Subramanian and Raghuram Rajan’s research shows that aid has adverse effects on an economy’s competitiveness. But Craig Burnside and David Dollar, among others, have arrived at opposite conclusions about aid, and their work has also contributed to growing (and much needed) research on this topic. There is a danger, though, that such studies simply serve as ammunition for aid supporters and detractors in opposite corners, narrowing the scope of the public debate at the expense of serious consideration of what is ultimately needed — aid reform. In today’s interconnected world our national security, economy, and moral leadership are increasingly susceptible to the threats that emerge from global poverty and underdevelopment. Policy coherence is required to adjust to this new environment. This means that the next president’s foreign policy agenda must focus attention on fundamentally realigning aid and — very importantly — trade policies toward achieving accountable, strategic results.

The delicate work of aid coordination requires building consensus and political will for real, not cosmetic, reform in numerous U.S. agencies, donors, and the myriad NGOs and foundations that are playing a greater role in the global aid architecture. A broader transatlantic dialogue on how to make aid more coherent through greater coordination must occur concurrently with a tough-love analysis of our own aid institutions. And while considering change, we must allow new and innovative approaches like the Millennium Challenge Corporation and the International Finance Facility time to demonstrate results.

While the need for aid reform is compelling and urgent, the answer is not to walk away from our commitment to aid.