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What Was the Marshall Plan?

Yesterday the American Enterprise Institute hosted Deepak Lal and Sarath Rajapatirana to discuss their recent paper, "The Triumph of Hope over Experience: A Marshall Plan for Sub-Saharan Africa?" The GII's own David Devlin-Foltz shared the podium and offered a response.

Authors Lal and Rajapatirana aim to challenge recurrent calls for new Marshall Plans by examining just what the MP was and why it worked:

Politicians have long invoked the MP as a rhetorical device, clamoring for Marshall Plans in the Caribbean, East Asia, Egypt, and even in the Gulf Coast after Hurricane Katrina. British prime minister Gordon Brown has taken up the banner, calling during his chancellorship for a Marshall Plan for Africa.[9] Prominent figures such as Bill Gates, Bono, and economist Jeffrey Sachs have likewise swelled the ranks. Unlike past advocates, however, many of these new Marshall Plan proponents use the phrase literally and call for vast increases in aid.

...the European Marshall Plan and post-independence aid to Africa were responses to entirely different situations, so drawing parallels between the two is not justified. Some fifty years of accumulated experience about outcomes for Western Europe and Africa informs the contrast...

Instead of assuaging their collective guilt by transferring their taxpayers' money into aid programs, rich nations should keep markets for African goods open, allow foreign capital to flow freely, and let Africans find their own route to development. For too long Africa has been a theater for Western ideologues' pet panaceas, with disastrous consequences for long-suffering Africans. It is not as if Africa cannot develop: Botswana and Lesotho, to name two countries, show that Africa can produce spectacular growth.

In the paper, you can read a host of very good reasons why it is not accurate to compare the MP to most of the aid that's been given to Africa. But how do we know that something like the MP could not work in Africa? After all, we just proved it's never been tried. In fact, scholars from AEI proposed a "real" MP for Africa last year.

But these questions surrounding the way foreign aid is structured beg a bigger discussion about what we advocates expect -- and promise -- from foreign aid. David's response ties these together with the ongoing debate about how aid should be structured -- or if it should be given at all.

Whenever we talk about whether foreign aid "works" in Africa or elsewhere, let's immediately clarify the question: Works to do what? For whom?

...the goals of aid to Africa have been extremely mixed. They include maintaining or strengthening geostrategic alliances during the Cold War. And as is more common during these days of the 24 hour news cycle, we find aid aimed at helping to alleviate the immediate famine, drought, disease and civil war that my cousin Donna and other westerners see on their televisions...

I would argue that the most marked successes of economic development aid in Africa have come - not surprisingly - when the purpose of the aid was, well, aid. That is, not simply a transfer of funds intended to, as the authors assert, "[keep] governments in power that ignored the general welfare of their populations."

This conversation that we're having here today is important, not because I wish to defend aid in the myriad dumb ways it has been given or the many counter-productive goals it has pursued. Nor is it my intention to defend terrible decisions made by African leaders. But this conversation is valuable precisely because it can help us get to the bottom of what we expect from foreign aid. If we give to alleviate suffering, we must be careful not to promise - or even let the expectation persist - that we will create Western European style free-market democracies in Africa. We won't. We're not very good at creating Western European free-market democracies in the Middle East, as no less an authority than AEI's own Danielle Pletka acknowledged in her NY Times op-ed contribution this past week. Sometimes we're not even good at creating Western European free-market democracies in... Western Europe. So it's time advocates for large-scale aid programs spoke a bit more humbly, and a bit more clearly, about what they aim to achieve.

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