Jewish World Review July 13, 2005 / 6 Taamuz, 5765
Walter Williams


Aid to Africa
http://www.NewsAndOpinion.com | British Prime Minister Tony Blair is
pressuring the rich nations of the world to give more foreign aid to
Africa - to the tune of $25 billion a year by 2010. The U.S. already
gave $3.2 billion last year. In the wake of this pressure, we might
ask ourselves whether it's foreign aid that Africa needs most for
economic development.

A standard myth is there's a "vicious cycle of poverty" that makes
economic development virtually impossible for the world's poor
nations. This myth holds that poor countries are poor because income
is so low that savings cannot be generated to provide the kind of
capital accumulation necessary for economic growth. Thus, it is
alleged, the only way out of perpetual poverty is foreign aid.

Let's examine the "vicious cycle of poverty" myth and whether foreign
aid is a necessary ingredient for economic development. The U.S.,
Britain, France, Canada and most other countries were once poor.
Andrew Bernstein of the Ayn Rand Institute wrote in an article titled
"Capitalism Is the Cure for Africa's Problems" that pre-industrial
Europe was vastly poorer than contemporary Africa.

A relatively well-off country, like France, experienced several
famines between the 15th and 18th centuries as well as plagues and
diseases that sometimes killed hundreds of thousands. In France, life
expectancy was 20 years, in Ireland it was 19 years, and in early
18th-century London, more than 74 percent of the children died before
reaching age 5.

Beginning in the late 18th century, there was a dramatic economic
turnabout in Europe. How in the world did these once poor and backward
countries break the "vicious cycle of poverty" and become wealthy,
without what today's development experts say is absolutely necessary
for economic growth - foreign aid handouts, World Bank and
International Monetary Fund loans, and billions of dollars of debt
forgiveness?

The answer is simple: Capitalism started taking root in Europe.
Capitalism is an economic system where there's peaceable, voluntary
exchange. Government protects private property rights held in goods
and services. There's rule of law and minimal government regulation
and control of the economy.

Check out the Washington, D.C.-based Heritage Foundation's "Index of
Economic Freedom." Heading its list of countries with the freest
economic systems are: Hong Kong, Singapore, Luxembourg, Estonia,
Ireland and New Zealand. Bringing up the rear as the countries with
little or no economic liberty are: North Korea, Zimbabwe, Angola,
Burundi and the Congo. It's not rocket science to conclude that
economic liberty and the wealth of a nation and its peoples go
together, not to mention greater human rights guarantees.

Some economic development "experts" attribute Africa's troubles to its
history of colonialism. That's nonsense, because some of the world's
richest countries are former colonies, such as the U.S., Canada, Hong
Kong and Australia. In fact, many of Africa's sub-Saharan countries
are poorer now than when they were colonies, and their people suffer
greater human rights degradations, such as the mass genocide the
continent has witnessed.

One unappreciated tragedy that attests to the wasted talents of its
peoples is that Africans tend to do well all around the world except
in Africa. This is seen by the large number of prosperous,
professional and skilled African families throughout Europe and the
United States. Back home, these same people would be hamstrung by
their corrupt governments.

The worst thing that can be done is to give more foreign aid to
African nations. Foreign aid goes from government to government.
Foreign aid allows Africa's corrupt regimes to buy military equipment,
pay off cronies and continue to oppress their people. It also provides
resources for its leaders to set up "retirement" accounts in Swiss
banks.

What Africa needs, foreign aid cannot deliver, and that's elimination
of dictators and socialist regimes, establishment of political and
economic freedom, rule of law and respect for individual rights. Until
that happens, despite billions of dollars of foreign aid, Africa will
remain a basket case. easy.


--
A general rule: if enough people predict something, it
wonąt happen. -- J. G. Ballard

"America is a vast conspiracy to make you happy." -- John Updike

"Long term commitment in relationships is only necessary because it takes
so damn long to raise children. Marriage may well be some kind of trick
to keep the males around beyond sexual satiation." -- Captain Compassion

"Progress is the increasing control of the environment by life.
--Will Durant

Joseph R. Darancette
res0mp8t@NOSPAMverizon.net