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Photo: simminch

Some say yes, calling foreign aid a form of neo-colonialism that does not alleviate poverty, but in fact perpetuates it.

I had a particularly privileged friend during high school—let’s call him Joe. On Joe’s sixteenth birthday, his father bought him a brand new Audi, a truly sweet piece of machinery. After several months of joyrides and speeding tickets, the engine block locked up, and the Audi was finished. Joe had never changed (or even checked) the oil. His father was furious and refused to foot the steep bill of repair.

What did Joe do? He got motivated. He mowed lawns and cleaned gutters every weekend until he could afford a twelve-year-old jalopy. And he cared for that clunker with the proud dedication of a doting mechanic. Was Joe’s sudden maturity unusual, or was it a natural result of his newfound self-reliance?

The bigger questions for our purposes are:

1. Does the weight of liability change human behavior?


2. If so, how should this inform the first world’s approach to extreme poverty in the third world?

In the realm of sustainable development and foreign aid (that is, not emergency-relief aid), there are no easy answers. The ongoing debate comprises a plethora of polemics, but I discern three main viewpoints among them:

1. Big money, top-down “planners”

The proposition: Extreme poverty is a big, multi-level problem that requires big, multi-level solutions. We need large-scale plans—ambitious, multi-billion dollar initiatives by resource-rich outfits such as UNICEF and USAID.

Top-down planners advocate a comprehensive strategy due to the interdependency of factors inherent to poverty. That is, economic invulnerability depends on diversity of employment options, which depends on access to quality education, which depends on reliable infrastructure and students’ health, so we must build roads and hospitals and distribute mosquito nets. . . and on and on. Everything relies on everything else.

Photo: dlisbona

The opposition: Ineffective penetration, lack of accountability. Big aid money goes to governments rather than the people, as money gets siphoned off at all levels. This approach enables corruption and encourages irresponsible governance.

Grandiose schemes are poorly implemented due to insufficient understanding of ground conditions. In short, there is too much distance between planners and intended beneficiaries.

Also, such aid smacks of neo-colonialism. Gift money brands recipients as junior partners in the exchange, and thus paternalistically prohibits self-reliance by perpetuating need.

The tone here is negative: “We pity you, so here’s some help. But we won’t invest and trade with you on equal terms, because you’re beneath us.”

2. Small money, bottom-up “searchers”

The proposition: Lasting gains are intrinsically incremental. Establishing improvements that actually benefit the poor requires ground knowledge. Aid workers must go to the bottom rung, learn the environment, and search for ways to improve conditions within quantifiable parameters.

Unlike top-down aid, bottom-up aid focuses on building capacity within target communities to become active participants in the determination and execution of development projects. This approach aims to level the exchange, so beneficiaries are gradually empowered to take up their own cause. Weaning is essential, hence these NGOs have an exit strategy.

The opposition: The process is slow, but hunger and disease don’t wait. And as with top-down aid, the onus of responsibility is lifted from local government. Government officials can sequester resources while remaining nominally responsible for the progress made by NGOs within their jurisdictions.

Though subtler, bottom-up aid is still paternalistic. It feigns home-grown development, but foreign influence is undeniable, especially in cases where community “input” amounts to locals saying yes to whatever is proposed by those holding the checkbook.

3. The “bootstraps” faction

The proposition: Foreign development aid is a self-perpetuating, growing institution and has actually harmed the third world. Aid fosters dependency, encourages corruption, and in turn exacerbates poverty. Top-down aid fails to create jobs or other lasting improvements, and likewise most bottom-up aid functions on the condescending presumption that target communities cannot participate unassisted in the open market.

This position calls for a sea change in the mindset of aid recipients, who have been conditioned to believe that foreign aid is the solution to their plight. They have been systematically incentivized against their own initiative.

Big money, top-down aid is more culpable for increased disenfranchisement in the developing world than the bottom-up variety, because its magnitude of misguided funds has more solidly entrenched corrupt leaders.

“A largely libertarian approach may have worked for North America and western Europe, but these same countries arguably caused many of the developing world’s problems through imperialism.”

Bottom-up aid in which “searchers” prepare locals for full participation in the free market is non-ideal, but not necessarily harmful. The answer lies in pro-market measures: microfinance, foreign direct investment, trade, floating bonds—systems that encourage innovation and foster self-reliance.

The opposition: There is no definitive, causal link between foreign aid and extant poverty. The two are correlated, but there are too many excluded variables—access to water and other resources, quality of soil, geopolitical history, and so forth—to place the blame squarely on aid. Removal (even a phase-out) of aid in highly dependent areas could be disastrous.

A largely libertarian approach may have worked for North America and western Europe, but these same countries arguably caused many of the developing world’s problems through imperialism. And owing to this differing root of poverty, it may be beyond the capacity of today’s third world to elevate itself out of the poverty trap.

So, what’s the solution?

I don’t know. Like most development workers, I am ambivalent about what exactly the developed world should be doing. My views both align with and diverge from certain arguments proffered by each stance. Every approach seems to have some merit, yet they contradict one another.

My intent is to raise the right questions, not offer answers. That’s where you come in. Share your opinions and experiences in the comments section!

Community Connection:

What about aid on a personal level? Check out 10 Ways You Can Help Street Children Without Giving Money.

Culture + Religion


About The Author

Eric Lewis

Eric Boehling lives in Siem Reap, Cambodia and volunteers at PEPY, an education-focused NGO. When not writing in third person, he enjoys the three 'R's: reading, rock climbing, and researching issues in development.

  • Lindsay

    You should read Dead Aid by Dambisa Moyo and Banker to the Poor by Muhammad Yunus. There was also a really interesting show on Public Radio International/To the Best of Our Knowledge on 24th October called “Ethics of Western Aid.” The podcast of it is free to download on itunes; it’s very interesting and worth the listen. Hope you enjoy!

  • alexblackwelder

    Hi Eric,

    Interesting article. I’ve written a few op-eds about aid and development for my University and I think its a great topic that needs to be discussed more.

    I think the most dangerous thing about top-down , huge foreign aid is that it leaves countries and politicians in debt to the givers. Politicians begin to act in ways to please their benefactors instead of their constituents. I don’t know how many times I’ve heard our foreign policy makers threaten to withdraw foreign aid from a country if they don’t allow some unmanned drones on their land or a nearby military base.

    I’ve always been a bottom up kinda gal. Can’t really help it. I think solutions lie on a local level. We like to paint Africa with a broad brush and pretend that solutions that worked in Ghana will work in Chad. Most problems have different roots and should be addressed as such, not just shipping tons of goods and money to some of the most corrupt people in the world.

  • alexblackwelder

    One last thing,

    I would like to think that American aid to other countries (I am talking about governmental aid, not NGO) is for the right reasons, but I really think it is our way of sticking our hands in as many places as possible. Colonization is not so hip anymore, so we have to be discreet about it and take our piece of the pie on the hush hush.

  • Abbie

    I feel as though the U.S. sometimes (maybe even often) steps in and tries to “fix” things, I think that helping other countries is, at it’s core, a good thing, but there’s that problem mentioned in #3, in which people become dependent on the aid and can no longer create a sustainable economy themselves. Personally, I think an effective plan would be to get into these countries and work on getting the people educated and trained at useful skills, which some organizations are doing, and while this is going on, there could be a scaffolded level of assistance (more aid at the beginning, and gradually fade out as the program begins to work and the people don’t need as much aid). I’m a bit biased because I’m a teacher, but I truly believe that education is the root of success…and yes, it takes longer, but dropping some food/money/supplies in a country doesn’t really help long-term, but education is the gift that keeps on giving! :)

  • Heather

    I recently completed an AmeriCorps VISTA year of service program, which has a mission to eradicate poverty so I’ve given a lot of thought to this problem of how to make assistance a “hand up” instead of a handout and don’t think there’s an easy solution. If there was it would have been done long ago. I think the main tools to fight poverty and the social problems that accompany it are education and training (on both the giving and receiving ends). Communication is key, as is building self- esteem among recipients (because receiving charity can feel degrading). A lot of problems also stem from recipients not being encouraged to get envolved enough to develop a sense of “buy in”. As for comparing top-down or bottom-up approaches, I’d say they’re all good but none of them alone can fill the gap. Poverty is just too big and messy of an issue. Also, some may disagree with me but I think aid to people who seem lazy and waiting for a handout isn’t always a bad thing and shouldn’t automatically be cut. You’ve got to think about educating and helping those people’s kids, the next generation. I feel strongly about this because in my personal experience i’ve seen it work. I am that next generation.

  • Hal Amen

    Nice post, Eric. The microfinance route makes the most sense to me. As you mention, it’s all about liability. I worked with an NGO in Bolivia called Energetica (–bringing energy solutions to isolated rural communities. The solar panels, hydroelectric converters, etc. were not gifted to these communities. Rather, there was some combination of gov. assistance plus microloan. Why? In Energetica’s experience, equipment that came free was never properly maintained/cared for. That feeling of ownership makes all the difference.

    I also second Abbie on the importance of education. Pursuing that long-term path simultaneously is key to the sustainability of any aid.

  • Eric

    Hi Lindsay,

    You’re dead on about those two books–lots of great ideas in them! I was lucky enough to meet Dr. Yunus in Bangladesh and ask him a few questions concerning the future of microfinance. His insights on human motivation and the appropriateness of social entrepreneurship (such as his own Grameen Bank) in the developing world are keen and, I think, correct. I’d never heard of this podcast, though–I’ll be sure to give it a listen!


  • Kim

    I don’t think that you can ignore foreign aid in emergency situations, but the proverb of “teaching a man to fish so that he will have food” holds very true. There are key items that need to be fixed by foreign aid that will allow people to start contributing to the greater economy. A read of Jeffry Sachs books – esp the End of Poverty – is essential to understand the problem.

  • Julie Schwietert


    Thanks for this thoughtful, intelligent article.

    And thanks to everyone else for your equally thoughtful comments; I particularly appreciate that they’re based on your own experiences working on foreign aid and development projects.

    Eric, though this article is framed around the delivery of foreign aid, I think the arguments you present here are equally applicable to domestic aid efforts, and perhaps no example is more illustrative than the recovery efforts in New Orleans and the Gulf Coast of the US after Hurricane Katrina.

    I was in New Orleans last summer documenting the work of a group called the Culinary Corps, which I’ve profiled here on Matador, and I was able to observe lots of other organizations and efforts in the community in the areas of rebuilding, repairing infrastructure, and providing work/school opportunities. I spoke with someone who made a really powerful observation about the musicians’ community spearheaded by Brad Pitt and Harry Connick Jr. The idea was that a neighborhood would be built specifically for musicians–they’d be given houses and the whole thing would be this great idea. But a local community organizer and planner said: “It sounds nice, and the efforts were appreciated, but why do people think that musicians necessarily want to live together? And can you imagine practicing your tuba while your neighbor’s practicing the drums?”

    What I realized was what this person was saying was really a metaphor for all kinds of aid and development: all too often, people with excellent intentions and resources sweep into a community and think that the idea for rescue/recovery/assistance they’ve developed will save the day. Or it’s a model that worked somewhere else, so it should work here. Yet they never involve the people who will be directly affected by this aid in their planning and decision making conversations.

    And that, I think, is the problem that is inherent in all three models of aid.

  • Christine

    If anyone is interested in learning a bit more about Dambisa Moyo’s point of view, we did a piece over at BNT a few months ago about it:

    I certainly believe in the micro-loans initiative (though I understand there are issues there, too), and think something has got to change QUICK in our efforts to propel certain countries, specifically within Africa, considering they almost solely rely on rainwater and there has been so much drought in the past decade there. I think current foreign aid policy from Western countries is hardly well-thought out and is only an attempted band-aid that doesn’t really want the wound to heal.

  • Tim Patterson

    This is an excellent article that raises some important questions in a literate and non-judgmental manner. I chuckled to scroll down to the bottom and see that you’re with PEPY, Eric. Daniela and the team has done a great job learning how to navigate the challenges of running an NGO in Cambodia, and I look forward to a night out with y’all in Siem Reap later this month.

    Cambodia is a great place to study development issues – one major problem is the lack of accountability on the part of the government because of the ubiquity of aid organizations. If the government perpetrates a land grab, and moves the displaced people to a barren patch of land, they know that NGOs will descend to drill wells, build schools and take care of the basic needs of the affected population. No wonder land grabbing is such a pervasive issue in Cambodia, and no wonder the Cambodian People’s Part seems oblivious to the problem.

  • Mo-ha-med

    “Dead Aid” is a terrible, terrible book. The claims are unsubstantiated, the information not referenced, and even those who agree with some of the basic premises of the book find it hard to defend some of her wackiest claims (like suggesting that poor countries should reject aid and go borrow money on the world capital markets? WTH? :)
    I wrote this review of the book – perhaps you may find it interesting to read a different take:

    If a real debate about aid is what you’re after, then I suggest you pick up Jeffrey Sachs’ The End of Poverty, and Bill Easterly’s White Man’s Burden – diametrically opposed arguments by a pair of brilliant development economists (Dambisa Moyo is not a development economist, she’s an investment banker for heaven’s sake).

  • Mo-ha-med

    Now to the topic of the article. Eric, you’re implying an answer in your very title. Is aid perfect? Surely not. However, we must think how many people would be much worse off without international food and financial aid.

    We first need to split aid into various categories:

    a) emergency humanitarian interventions. There is generally little disagreement that sending food, blankets, and what have you to crisis situations – an earthquake, a civil war, etc. I believe that’s not what we’re concerned about.

    b) Budget support. This is long term assistance going directly to the central budget of governments. It is often discretionary spending and primarily helps pay government salaries. There is indeed a possible question of dependency here.

    c) Development aid. Geared towards the establishment of development projects – a very large category – this type of aid often comes with many strings attached, from national purchases (meaning, if USAID gives money to renew a hospital, the machines need to be bought from the US) to the donor selecting what they want to fund regardless of the preferences of the host country (ex: Spain for some reason loves to finance agricultural projects in Palestine, even though the Palestinian government has different spending priorities).

    So, is aid imperfect? Totally. But we need to realise that if it weren’t for it, many people would go hungry tonight, government employees would be unpaid (ex: in 2006/2007, Palestinian employees went 7 months without a salary because aid was suspended for political reasons), and someone would not be able to get their dialysis, jeopardising their life.

    As for microfinance – yes, a brilliant idea. I celebrated the day Muhammad Yunus won a peace prize. But we need to have realistic expectations. Microfinance cannot pay for a million employees’ salaries, can it? Plus microfinance will only grow this much – after that, a growing micro-enterprise will necessarily rely on commercial banking anyway…

    The discussion is far from being over. However, claiming that aid is harmful with nothing but anecdotal evidence is counterproductive.

  • Daniela Papi

    Perhaps your title implies more judgment than you had intended, Eric, but I think breaking down some of the arguments around aid for those new to the topic is useful. Putting aid ideas into three buckets can help people get a taste for the many ideas out there, so thanks for breaking it down for us! To get an even further understanding, I’m sure you would agree that we can learn more about each of these buckets of development theory by reading Jeffrey Sachs’ “The End of Poverty”, Bill Easterly’s “White Man’s Burden”, and Dambisa Moyo’s “Dead Aid”. Then to get more ideas, we can throw in less polarized views like Paul Collier’s “The Bottom Billion”. There is so much to read on these topics, though of course working in development helps us realize that no one of these people are 100% correct.

    Each unique situation requires unique solutions, and understanding a variety of view points will help us all be better prepared to adjust to the challenges we continue to face. No one solution is going to help bring about any of the changes we want to see in the world, and each genre of aid, like micro-finance solutions can have positive or negative impacts depending on how/when/why/where they are implemented.

    It’s complicated, at best, but I do very much agree with the comment above stating that education is the key to change. OUR education is part of that key, knowing what questions to ask, and where to give our money and time to best support the work we believe in is a great place to start. Thanks for encouraging us to learn more, Eric!

  • Eric Boehling

    Believe it or not this is another Eric Boehling (I thought I was the only one) and I served in the Peace Corps from 1997-1999 working with an NGO that was working with/for other NGO’s. To the groups I was involved with, it certainly became more about receiving a handout than creating anything sustainable. I became very disillusioned at that time, but after reviewing our own failure with the war on poverty from the 60′s, I concluded a distant government is not the solution. Your story of “Joe” and his Audi is a great analogy. Now how do we motivate the locals and find the lawns that need mowing and the gutters that need cleaning. Thanks for the post..

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  • alicia

    Personally I think some of the models for development need to change. The focus should be more on empowering the people in these areas. I do agree with how bottom-up do things. We need to go into areas humble, open, ready to listen, and slow to respond. Some areas where I differ is me dictating how the money should be spent. In my opinion, if someone wants to keep living in a metal shack but has clean water, food, etc… let them until they are ready for something else. Don’t FORCE change on people. Also, when we go into an area, look at the strengths the community already has and build off those strengths. There also should be people that want to be able to solve these problems in their village, city, or country. Find them. Train them. Empower them to go back and reach their own people in ways that are culturally honoring and respectful. If you train enough local, indigenous people they will be much more effective at bringing development in. You are also then creating jobs and training for people. The local/indigenous people you train will then be able to be paid through the NGO and they would be basically, an employee etc.. Who can, if they want, start their own training school or even lending micro-finance loans etc… The problem with poverty is that it’s a HOLISTIC problem.. Not just one specific area. You can see the effects poverty has on a community as a WHOLE, not just in the financial area. It affects them physically, emotionally, mentally, and spiritually so we need to “attack” the problem on all sides. I am planning on starting a research project in Eastern/Central Africa about community development and refugee camps etc… and then starting something different based on the principals I stated above: empowering indigenous/local people to reach out to their own people. If it works in these areas, it will work in many other areas. I say this confidently because many places in DR Congo and other Eastern Africa countries have been a place well known to sustainable community development people as difficult and nearly impossible to create lasting and impacting change. I hope that some of these ideas make sense and I look forward to implementing them in the near future. For me sustainable development is all about empowering the people in all aspects of their life to then go and empower their own people. Show people why they should care about each other and you’ll see a world of difference.

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