Idiot Tracker has a post on food security that uses food security as a means of focusing the reader on the challenges that climate change are likely to present in the near future. In short, the argument goes that climate change will negatively impact our future agricultural productivity, making it difficult to increase that productivity as our population grows. If we do hit nine billion people by mid-century (barring cataclysm this seems to be the minimum number we will hit), the author calculates that we will need to come up with 14.5 trillion calories per day, and notes that climate change is likely to present significant barriers to meeting this need.
I agree . . . in a general way. We are losing huge amounts of arable land each year to soil degradation, and we are running out of productive places in which to extend new farms that do not create really problematic ecological tradeoffs (like massive deforestation that speeds climate change). Climate change is likely to force the transformation of entire agricultural regimes in otherwise sustainable areas – for example, by changing temperatures and precipitation such that most strains of maize will have difficulty germinating in Southern Africa in a few decades. This is all a very big deal. But this post is also very, very thin on support for its argument.
As the post does not present any hard data, including how the 14.5 trillion calorie per day figure was derived, I cannot be sure if the author did any real math on our current production or the likely loss of caloric production that might occur under any number of likely climate scenarios (a problem unto itself, at global circulation models are much better for temperature than they are for rainfall, and there are few regional circulation models that can correct this problem – see the fascinating recent work of FEWS-NET on modeled versus empirically-measured patterns of precipitation in East Africa). All of these might create significant error bars around likely future caloric production. Further, I cannot tell if the author has considered whether or not crops will migrate as their ecological zones shift – surely farmers that previously could not raise a certain crop will start to take it up as the local environment allows and as other producing areas fall out of favor. We know that some ecosystems will at least start to migrate if corridors for such movement are available – and agricultural systems are just another form of (heavily managed) ecosystem. As cropping areas shift, what will the net caloric impact be? It is not enough to say that we will lose a lot of calories when maize stops germinating in southern Africa. We will need to get a net figure by calculating in all of the new areas in which maize will germinate.
Of course, such math only works at the global scale, and issues of hunger have very little to do with global production – hunger is local, shaped more by the intersection of markets, the environment, politics and society. So noting that maize will germinate in new areas does nothing for the people in southern Africa who will be without maize. However, we have to obtain another net figure: the lost calories from maize versus the new calories from new crops that people can grow, but chose not to before. This may still total a net decrease in calories (indeed, it probably will), but this is not the same as simply subtracting maize from the equation.
Finally, what of plants that are edible, but that we currently choose not to eat? The clearest analogy, to me, is the evolution of seafood here in the US. I like to explain to my students that these new, exotic fish that are showing up at restaurants are the species that no self-respecting chef would touch two decades ago. But when you wipe out the cod, you start getting creative. And don’t get me started about tilapia. It’s the rat of fish. Seriously, it likes murky, stagnant water. It will grow anywhere. There is nothing I find funnier than hearing a server say “we have a very nice tilapia today.” Yeah, I’d love to pay $20 for the swimming pigeon, thanks! That said, people do eat tilapia and all sorts of other hilarious species because they are hungry and willing to pay. So what new species of plant and animal will we be willing to eat a decade from now? Three decades from now? This is hard to predict, but I’ll bet quite a lot that we will find new species to exploit and offset even more of this caloric loss.
Despite all of this, I do think we face significant food challenges in the next three to four decades. These will be felt very unevenly around the world, but they will be felt in significant ways. To figure out what these impacts will look like, and who will experience them, requires that we carefully think through not only the exposure of crops to climate change impacts, but also the sensitivity and adaptive capacity of the agroecological system to those impacts. It is only when we understand how such systems are likely to respond that we can begin to really plan for the challenges ahead.
Author: Ed
Liveblogging Dead Aid: Enough is enough
My efforts to liveblog my reading of Dead Aid have run aground on the reality of my life – I have a full-time job and a couple of things from my academic life that require my attention. That, and I admit to such frustration with the book that I start to question the purpose of my efforts – I saw this exercise as an effort to provide a detailed, reasonable critique of the book as I was reading it, and to offer redress as best as I could. However, as I have gone deeper and deeper into the book, I have come to realize that a serious effort to address and correct the numerous issues in this book was likely to consume another short book’s worth of space. I have another book or two worth of writing in me, but not on this topic. So, I will finish with this post, which covers the remaining chapters of the book in a more abbreviated fashion . . .
Chapter 6
p.80: Yes, emerging markets seem to offer higher returns on investment – and they are often countercyclical to economies of developed countries. But this does not automatically make them useful hedge tools. Moyo seems to ignore the fact that most emerging economies have a limited capacity to address shocks, which means that a minor event for a diversified economy can lead to horrendous outcomes in a smaller, less diversified economy. For example, concerns over how the Europeans were going to define chocolate, which might have changed global demand for cocoa, wracked Ghana’s economy in 1999-2000 because cocoa was such a huge part of that economy. This makes bond offerings inherently risky, even for well-governed developing countries like Ghana – even a well-governed country can’t do much about global market fluctuations in their primary commodity. So these markets are quite a bit dicier as hedge instruments than Moyo seems to want to admit. There’s a reason money isn’t pouring into these places . . .
p.81: Moyo’s discussion of credit ratings for countries is amusing . . . in that she has chosen not to discuss how much of a disaster the rating agencies turned out to be in the US market for real estate products. Credit rating agencies are not arbiters of truth.
p.82: Good, she notes that these economies are indeed quite fragile and subject to unique stresses. However, she does not offer any real way to address these challenges – the idea that we are “over” the sorts of panics that lead to contagion (when problems in one place lead investors to question their holdings in other places), and therefore any big shock to an economy won’t trigger wider problems within that economy or surrounding economies, is empirically problematic.
p.87: Moyo addresses the issue of default, but it’s a whitewash that makes it sound like bond markets won’t really mind. Even if this were true, she fails to grasp that many causes of default will not be addressed by reform issues in markets – as long as developing countries are natural-resource dependent and not particularly diversified, they will be at risk from default . . . and defaults will keep them from diversifying away from natural resource dependence. This is one of the many reasons why aid is important!
Chapter 7
This chapter strikes me as completely divorced from reality. Her treatment of concerns over the surge in Chinese interest in Africa casts them solely as short sighted concerns with China’s lack of conditionality on its loans – that is, people who object to Chinese engagement in Africa do so because China does not demand certain kinds of political or market changes along with its loans (some term these reforms, but the history of structural adjustment makes that term somewhat farcical). She dismisses the idea that many Africans are mistrustful of the Chinese, casting these concerns as a continuation of longstanding paternalistic attitudes toward Africa. She shores up this very thin argument by citing poll data to argue that the residents of many countries view the Chinese in a positive light. First, I would love to know the source of these data – she does not point to a source in the text. The reason I am interested is because I work in two countries where the view of the Chinese is not at all positive – Ghana and Malawi. I’m curious why the mistrust and concern I see in those countries is not manifest elsewhere. Second, assuming these poll numbers are valid, just because people have a positive view of China (or, at least a relatively more positive view of China than the US) does not mean that they are benefiting from Chinese involvement in their economy. This still has to be demonstrated. Moyo makes no effort to address this issue in her argument.
Finally, how can she talk about Chinese involvement and not address the issue of agriculture? This is where the real land-grabbing is going on. It is absolutely clear that the Chinese are investing in countries with arable land, and helping to build infrastructure to access that land. They are setting Africa up as China’s farm of the future – and that is not going to diversify African economies. It will simply perpetuate the challenges that Africa is already trying to address, and that Moyo seems to believe Chinese investment will solve.
Chapter 8
I must say that this was one of the better chapters in the book – well, the first half. Pages 114-119 are a good, concise review of trade barriers that hinder African development. Then Moyo lapses into pro-Chinese argumentation that suffers from the same problems I saw in Chapter 7 – a sort of “the-Chinese-will-save-us” attitude. Interestingly, while she recognizes the serious challenges that Africa’s limited infrastructure poses for industrial development and economic diversification, she completely ignores the role that aid might play in building out such infrastructure. Instead, she seems to think that African countries should take out much higher interest loans in the private markets (because this would improve the country’s reputation on global markets, which would enable future loans . . . but does nothing to really explain why anyone should take a higher-interest loan and turn down aid in the first place), or trust external investors to work with them to build the infrastructure they need . . . which is something of a return to colonialism – after all, mother countries did build infrastructure in their colonies – just the infrastructure needed to ensure the continued export of valuable resources. Incidentally, anyone paying attention to Chinese investment in Africa can see exactly this sort of behavior taking hold . . . but Moyo is either willfully blind to it, or does not know her history very well. This is another example of a recurrent problem with this book: in the end, it is a political argument that selectively mobilizes its data to support those politics while ignoring anything that might contradict the argument. The real challenges of African development are much more complex than she presents, and the likely solutions are going to require more than just capital investments.
Chapter 9
The first part of the chapter focuses on microfinance. It lays out the basic concept, and goes through the usual Grameen example. It also lays out an interesting Zambian adaptation of the idea. However, she dismisses a growing body of work that criticizes microfinance in a really shallow paragraph on 129-130, arguing that excessive interest rates will be reduced by competition (but doesn’t discuss where competition will come from, or if there is even room for competition in many microfinance-sheds – margins are pretty tiny in microfinance, even at high interest rates) and that borrowers forced into Ponzi situations (using one loan to pay off another, instead of productively investing it) will eventually go away as better information about their repayment rates becomes available (without discussing where that information will come from, or what to do about the honest farmer caught by an environmental or economic shock). It is distressing that she completely ignores the very large literature on microfinance’s failures in sub-Saharan Africa.
The discussion of remittances is interesting, but ends with a really weak recognition that they are really aid in another form – and they are justified because they reach the poor don’t increase corruption (but again, no substantiation of this).
Yes, Africa needs more savings – but this is a long-term problem in development that many have wrestled with. Acting as if this is revelatory, and failing to address the efforts to enable and spur savings that have and have not worked, does little to further the discussion. In this discussion, and that on the Grameen Bank, I find myself wondering (as I have many times in this book) whether the problem is that she really doesn’t know about these critical literatures, or she is strategically ignoring them to make her work seem more new and important. Either answer speaks to deep intellectual irresponsibility.
Chapter 10
p.140: I find it interesting that Moyo thinks private loans would not be stolen, because any corruption would lock down future loans. This may be true (though I have my doubts), but if it is a large enough loan, and enables a single act of massive theft, a corrupt leader might make a calculated decision to steal a lot out of that loan even if it leaves their country in the lurch. Private markets might not encourage repeated theft, but if they cannot prevent the first act of theft (which guarantees an unrepayable loan) and then, after that theft, cut off all outside sources of revenue for the country, the net impact on that country’s economy is more or less the same – unrepayable debt and no new sources of income to build productive projects to generate revenue and pay that debt. I just don’t buy the “private markets solve governance issues” argument at all.
p.147: Here it becomes clear that labeling Moyo the “anti-Sachs” is a joke. All along, she’s suffered from the single greatest failing of Sachs – staggering intellectual hubris. On this page, she says something that echoes the words of Sachs: “Development is not a mystery; each of the elements of the Dead Aid proposal has been tried and tested and yielded success – and governments and policymakers know it.” This is the same argument, more or less, that Sachs made in The End of Poverty and subsequent work: we know how to do development, we just choose not to. This is an awful ad hominem attack on a lot of good, smart people trying to further development around the world. The fact is that there are not tried and tested methods of bringing development about – if there were, WE WOULD USE THEM! But neither Sachs nor Moyo really understand development as a discipline – its history and theories – and so they are free to make staggeringly arrogant statements. Of course, the failure of the MVP is giving Sachs his comeuppance . . . who knows what will bring Moyo around.
p.149: Wait, did she just suggest that the average African wants to overthrow aid regimes, but are held back by the force of the state? Are you joking? Anyone who has spent time studying recent African history (or the old discipline of peasant studies) knows that starving the population is never sufficient to generate revolt, so the persistence of deep poverty is not evidence for the coercive force of the state.
p.151: Good lord, she’s othering her own continent – really, she’s referring to the “four horses of Africa’s apocalypse – corruption, disease, poverty and war.” I feel like I am reading a travel narrative from the late 19th Century, or most anything written by Robert Kaplan. Why not just start quoting Heart of Darkness and get it over with?
And, in summary, her plan seems to be: turn off aid over a five year period, and the problems will work themselves out. It’s really that easy!
Oh wait, it’s not.
+++++++++
Well, that’s that. Having spilled many thousands of words on this book, and having tried to read it with an eye toward constructively reworking it, I find very little recoverable here. It is, in the end, a short, semi-coherent work of staggering intellectual hubris that sees little need to take seriously the history of development efforts, the talents of those working in development, the wide range of evidence for and against her proposals, or indeed any of the complexity of the real world. This, in sum, is what happens when an investment banker decides to tell development and aid experts how to do their jobs.
I now have much greater sympathy for those in the markets who get angry and frustrated with development/aid worker misreadings of speculation in food markets to argue that all speculation is bad and should be banned – here we have development and aid specialists presuming to lecture the markets on their behavior. If nothing else, we should take a lesson from this book and make sure that when we do engage with market actors, we are informed enough to make intelligent arguments that contribute to the conversation. Dead Aid, in the end, is not a contribution to conversations about development for those of us who actually do the work – it is a non-sequitur that does not deserve the attention it has received, or any further attention.
On Egypt and the administration
While this is somewhat off the subject of development and global change (well, I suppose revolution in a country as pivotal as Egypt could count as the latter), I feel a need to chime in with an opinion on the role of the Obama administration and recent events in Egypt. It’s been noted all over the place that the administration has seemed behind the curve and ineffectual throughout the entire Egyptian revolution. This, of course, is based on public statements that seriously hedged the American position and clearly responded/reacted to events on the ground as they developed – the result, was a series of statements that shifted rather dramatically from weak support for Mubarak to stronger and stronger support for his removal.
I’d like to offer a few thoughts here – and they are just thoughts. I have no special sources or insights here, except as someone who works in the international realm and within the government and therefore has some familiarity with how things really get done. I am not, however, suggesting that the following is in any way to be seen as me reporting on things that I know to have happened behind the scenes – simply put, my security clearance doesn’t go that high, even if I wanted to know.
Simply put, I don’t think the administration was as out of the loop and reactive as people think. I’ve found it surprising that most who have noted the very close ties between the US and Egyptian militaries have largely limited discussion to noting that the Egyptians are armed largely with American weapons. Oddly, nobody has really been talking about the information black hole that developed around the Pentagon over the past three weeks – they stopped talking, almost entirely. That is unusual. Further, it is clear that the Egyptian military wavered at least once during this revolution, and looked like it might throw in with the Mubarak regime, at least until the next election. Yet they did not tip over – and surely part of this is because the military is drawn from a broad segment of Egyptian society, and was therefore very, very unlikely to fire on its own citizenry. But does anyone think that the Pentagon wasn’t working full time behind the scenes through every communications channel it had to the Egyptian military? In the end, the United States arms and offers training to the Egyptians, which gives us enormous formal and informal clout with their military. Does anyone really think that, after the first few days of the revolution, the Pentagon wasn’t delivering the message that Mubarak had to go? Did we have any other lever of change after the first few days? The answer to all of the above, for me, is no. We had no diplomatic lever to effect any change in Egypt after the first few days, once Mubarak turned defiant and started using the “foreign meddling” theme as a means of self-defense. This is not Secretary Clinton’s fault – I’ve been deeply impressed with her work relative to more or less everyone who has occupied her seat over the past 10-15 years. She just had no levers or influence once the diplomatic tide turned. But our military always had pull . . . and I am certain that the administration knew this and used this, calibrating its public statements to stay off the toes of the informal, unacknowledged communications that were going on between the Pentagon and Egypt’s military leadership. This is pragmatism at its finest – it doesn’t matter how it gets done, or who gets the credit, but I strongly believe that the Obama administration played this one about as well as it could, and was probably a lot more effective than most folks realize.
Someone will write a history of this 20 years from now, when the FOI requests are easier to fulfill, and we will have a much better sense of what really happened. I suspect the account will be kinder to the administration than much contemporary writing . . .
When you've won the Peace Corps, you've won the war
Absolute best personal tweet I saw today, from @goldenmeancap:
@edwardrcarr Reading Delivering Dev. Memories flooding back of 1 team member’s @PeaceCorps service in Swedru, GH C/R. He can’t put it down!
No matter which Swedru he means (there are two in Ghana’s Central Region, Agona Swedru – pretty big – and Swedru – pretty small), I actually think I know the place he’s referring to. Not well, of course, but I have passed through Agona Swedru one time, and passed by Swedru I don’t know how many times . . . pretty cool.
But a larger point – when you can get a Peace Corps volunteer to start having (largely positive) flashbacks to their fieldwork, you know you’ve done something right . . . at least in the first half of the book, which takes the reader down to the village and into the lives of the residents. This tweet review made my day.
Let's play identify the falling metal . . .
**Update** NASA tentatively identifies the metal as from an Indian launch
Sorry for the slow posts – it is a very busy week. And the coffee maker broke this morning. And my wife got lost on the way to the mall to buy a new one. Tomorrow morning is going to be less than fun.
Anyway, to keep my work-and-caffeine related whining in perspective, I bring you METAL FROM THE SKY. Mary Thompson, one of my Ph.D. students (you may remember her from hits such as this) is currently in Malawi, working around the Mt. Mulanje Forest Reserve to assess the use of the reserve by surrounding communities and the impact of a growing fortress conservation mentality on local livelihoods. It’s a great project, and we have built into it some serious efforts to assess forest impact via transect walk sampling and some fun work with satellite imagery.
So Mary just posted to her Facebook page (<<in grumpy old man voice>> in my day, we didn’t have Facebook . . . we had nonfunctioning landlines that we could reach once every two weeks . . .) an amusing story and picture.
So, last night at about 11pm there was this loud rumbling noise coming from somewhere. I kept thinking that if this was thunder it is the longest lasting thunder I’ve ever heard. And it was clear out. So eventually it stopped and didn’t happen again and I went to sleep. So this morning the people who work here said they think it was probably a small earthquake on the mountain or somewhere. Rare but not totally uncommon. I thought that was pretty cool and didn’t give it too much thought aside from giving my research assistants a lesson on how earthquakes work.
Then, we were leaving Monjomo village and passed a man that we knew from Likhubula on his bike and stopped him to ask the quickest way back on our bikes. He told us, and then said that he had just been to Chambe (a few miles up the road from where I live) where last night something metal had fallen from the sky and made the big noise everyone had heard and there was a rumor that another piece had been found at another village some distance away. So, of course we had to go check it out. we got there and there were hundreds of people hanging out for the excitement. This is very rural Sub-Saharan Africa, excitement here can be a little hard to come by. The police were there and had roped off a section of someone’s maize field (that had been flattened by all the people). In the center was a piece of metal a little longer than my arm that clearly belonged to some sort of machinery at some point. Since I’m a visitor (aka since I’m white and had a camera) they let me go under the rope barrier to take pictures. VIP UFO treatment for sure.
The chief of the neighboring village where I had been working for the past three months said she heard the loud noise and then her house was rattling and she thought it was a landslide from rocks on the mountain but she went outside and everything was lit up like electric lights (which they definitely don’t have) and she got scared and went back in the house.
I’ve never seen a plane over this area (doesn’t mean they don’t pass over from time to time), so who knows…
So, here is a picture of what fell from the sky:
OK gang, WTF is that? I can see a hinge at top left, and what looks like shearing on the part of the object nearest to us in the picture. The metal looks alloy, but what the hell do I know? Ideas? Anyone?
**Update 9 February**
Mary just sent me a message:
So, I emailed NASA’s Orbital Debris Program’s chief scientist and he said that the description and time fit well with an Indian rocket body that had been launched on the 2nd of Feb and reentered near this area on Feb 7th. I may change careers to UFO investigator.
Necessary adjustments – but quant and qual still meet
The other day, I posted about the convergence between my own qualitative findings on the food security outcomes of food price instability and those of Marc Bellemare, Chris Barrett and David Just: that, at least in various parts of Africa, such instability was most likely to impact the middle and upper income cohorts more than the lower income cohorts of a given population. However, I jumped too quickly in assuming that their dataset included rural and urban households – as Marc pointed out on his blog, they used a panel of rural household surveys. So my initial argument about convergence does not hold up, as they did not consider the urban context in their work.
This is not to say that I am backing away from my assessment of the vulnerabilities of urban populations to this sort of challenge – I stand by it, having seen it, if only anecdotally, in towns and cities in Ghana over the past 13 years. Urban populations are generally much more dependent on markets for their food supply than those living in rural areas (though this is not always true), and therefore price instability does create significant livelihoods uncertainty that is very difficult to manage, especially for the urban poor. I therefore stand by my argument that we need to be keeping a close eye on the relative impact of price volatility on urban and rural populations, as the impacts of such volatility is likely to have very different impacts on these groups.
But recognizing that Bellemare et al’s work only addresses rural outcomes is not a problem for my argument about what I am loosely calling temporary deglobalization as a strategy for managing price instability (and price increases) – indeed, I think it strengthens the argument because it means that their dataset is now commensurate with mine, which was also rural. As I argued in an extended comment on Marc’s blog:
The rural farmers most hit by price instability are those most integrated with global markets – the ones least able to deglobalize, as it were, when things get uncertain . . . Meanwhile, the bottom 60% is not as engaged with markets in which price volatility matters, and therefore can back away from them in terms of how they use their crops. In my work in Ghana, I found very few true cash crops (in the area I was working). Instead, some crops were treated like “cash crops” in years where price conditions and farm outputs of staple crops were favorable, and as staple crops when either prices were not favorable (including periods of volatility) or outputs of other staples used for subsistence were not adequate to meet household food needs. (Note: in many cases, the treatment of a crop as “cash” or “staple/subsistence” was highly gendered as well). The real difference between the rich and poor (relative terms in the Ghana sample) is the overall livelihoods strategy – one strategy (seen among the wealthier) is much, much more engaged in production for local markets, while the other (seen among the poorer) hedged market production with significant subsistence production (again, highly gendered). In years of volatility (or really in the face of most shocks), the market-oriented livelihoods were simply less resilient than the more diversified livelihoods strategies of the poorer households.
Or, as Marc himself noted in his response to my post on his blog:
[The wealthier] households tend to be hurt by price volatility because they are producers and therefore net sellers of most of (if not all) the seven commodities retained for analysis (i.e., coffee, maize, beans, wheat, teff, barley, sorghum).
So this means that the “temporary deglobalization” argument is not merely a rural-versus-urban argument, but one that can separate households in the same rural community. This, I think, strengthens one of the arguments I was making in my original post:
- Demanding that rural producers orient themselves toward greater and greater integration with global markets in the absence of robust fallback measures (such as established, transparent microinsurance and microsavings initiatives) will likely extend the impact of future price instability further into the poorest populations.
Disciplinary history and theory are useful II: Understanding the MVP’s enduring popularity
In my guest post on Aid Watch yesterday, I argued that a basic familiarity with the history and philosophy of development, and some training in critical approaches to development, might have averted at least one of the problems currently associated with the Millennium Village Project (a conflict of interest for project workers when the stated goals and interventions of the project and the needs of MVP communities do not align) before it happened.
A failure of background knowledge also lies at the heart of the MVP’s enduring popularity, even in the face of mounting empirical evidence that it is not working. It is one thing to ignore the predictions of a lone academic (or a few academics). It is another to overlook evidence of problems trickling in from around the world. If the MVP is so flawed, why do so many continue to support it?
I argue that the MVP drew its popularity from two sources: its theoretical eclecticism, and from the ways in which it resonated with conventional understandings of development and development practice in the major agencies. If one goes through the literature on the MVP, one will find echoes of many different bodies of development theory (I say “echoes” purposefully: the MVP has never overtly referenced any bodies of development theory in its publications, forcing critics to read between the lines). For example, various authors (e.g. here and here) have found in the MVP the influence of “big push” theories with their foundations in the 1950s, while others hear the reverberations of Reagan-era privatization and deregulation.
While drawing upon many bodies of theory to build something new is not a problem in and of itself, doing so productively requires an understanding of each theory from which one is drawing. The framing of the MVP shows no sign of such familiarity. Instead, it appears to pluck “useful” bits and pieces of these theories that support the project’s larger political agenda and justifications for its technical interventions. It adopts the language of “big push” theories when it argues for a concentrated injection of capital across sectors of a village economy to get them all moving simultaneously. At the same time, it turns to the governance focus with echoes in modernization theory. As I argued in my article on the MVP:
This focus, insofar as it does not consider the ways in which existing processes do function and places a priori weight on Western modes of administration and governance, echoes earlier, often ethnocentric, tenets of modernization theory, such as the need to convince societies to embrace new, Western forms of administration on their path to ‘development’. (338)
The problem is that these “useful bits” were parts of larger theories that, on the whole, often contradicted one another.
For example, as Cabral et al. (2006) have observed, ‘big push’ theories of development that see a coordinated injection of capital across all sectors of an economy as a productive means of driving economic ‘take off ’ and development (for example, Rostow 1959) run contrary to the claims of modernization theorists like Lewis (1954), who saw unbalanced growth in different sectors of the economy as a key to stimulating the overall economy. (338)
The result was a project that on one hand had something for every development perspective. However, this came at the cost of internal coherence, and the ability to reflect upon or address the well-known historical problems encountered by those who employed the larger theories from which these bits were taken. A reasonable familiarity with the history and philosophy of development would have made these issues apparent long before there was a need to gather empirical evidence on the performance of the MVP.
But this sort of eclecticism only goes so far in explaining the popularity of a project – after all, most people do not worry much about the underlying assumptions of a given project or program. What policymakers certainly do notice are the ways in which the MVP nicely aligns itself with conventional understandings of development policy and practice. For example, there are broad similarities in approach and assumptions between the MVP and Poverty Reduction Strategy Papers (PRSPs) which suggest that the MVP is not only nothing new, it is nothing revolutionary (or, in fact, even that different from what is already being done by the mainstream development community):
Like the MVP, PRSPs tend to deal with development issues sectorally, without addressing either the tradeoffs or the synergies between different sectors – this is particularly true in the context of sustainable development planning. PRSPs also tend to conceive of solutions to sectoral problems without reference to local conditions. For example, lagging agricultural production is often addressed through the introduction of more inputs, which on its surface might seem like the ‘common sense’ application of ‘tested and true methods’. Such a set of solutions and rhetoric is nearly identical to that seen in the MVP. Finally, PRSPs, like the MVP, do not consider the social context and processes through which problems are identified and solutions shaped at the national or local level. Yet, national politics may influence the identification of a particular harvest as ‘insufficient’ or ‘sufficient’, a label that shapeshow people view that harvest and the needs of those who are dependent on it for their livelihoods. In short, the MVP and the PSRPs are mutually reinforcing – there is no challenge to the development status quo in the MVP, except perhaps in the form of a call for more money to fund the ‘big push’ (Cabral et al. 2006) needed to ‘kick-start’ development in these villages. (338-339)
Again, a familiarity with the conceptual literature in development studies would have allowed those who touted this project as something new to recognize its fundamentally conservative approach to development.
All of this goes to deepen an underlying point in the Aid Watch post: more practitioner training in the history and philosophy of development, and a wider exposure to critical approaches to development, are critical first steps toward the creation of (or simply the recognition of) truly revolutionary, coherent and ultimately successful projects.
Where Quant and Qual meet: On speculation, price instability and food insecurity
UPDATE: Marc Bellemare pointed out some issues with this post, which I have addressed here. These issues, though, strengthen the argument about strategic deglobalization . . .
§§§§§§
There have been an interesting series of blog posts going around about the issue of price speculation in food markets, and the impact of that speculation on food security and people’s welfare. Going back through some of these exchanges, it seems to me that a number of folks are arguing past one another.
The most recent discussion was spurred by a post on the Guardian’s Global Development blog by John Vidal that took on the issue of speculation in food markets. In the post, Vidal argues that food speculation is a key driver of price instability on global food markets, which results in serious impacts for the poorest people in the world – a sort of famine profiteering, as it were.
The weakness of this post, as I see it, are twofold. First, it doesn’t take the issue of price arbitrage seriously – that is, how speculation is supposed to function. Aid Thoughts, via one of the comments on Vidal’s post, takes Vidal to task for this. As Aid Thoughts/the commenter point out, the idea behind speculation is to pull future price impacts of shortage into the present, stimulating responses to future shortages before they occur. Thus, a blanket condemnation of speculation makes very little sense from the perspective of one who wants to see food security enhanced around the world – without speculation, there will be no market signal for future shortage, creating a world that addresses shortages in a reactive instead of proactive manner. This is a completely fair critique of Vidal, I think.
However, neither Vidal nor those responding to him actually address the evidence for significant market manipulation, and the intentional generation of instability for the purposes of profiteering. This evidence first emerged in a somewhat anecdotal manner in Fredrick Kaufman’s “The Food Bubble: How Wall Street starved millions and got away with it.” In this article, Kaufman uses a fairly limited number of informants to lay out a case for the intentional manipulation of wheat markets in 2008. It is an interesting read, though I argued in an earlier post that it suffers from trying to be a parable for the pervasive presence of complex investment vehicles in the modern world. And in the end, its findings can hardly be called robust.
Though Kaufman’s argument might, by itself, be less than robust, it received a serious empirical boost from the International Food Policy Research Institute (IFPRI) in the fall of 2010. In a discussion paper that remains underreported and under-considered in food security circles (trust me, it is difficult to get anyone to even talk about speculation in program settings), Bryce Cooke and Miguel Robles demonstrate quantitatively that the dramatic price rises for food in 2008 is best explained by various proxies for speculation and activity on futures markets. Now, we can argue about how large an impact that activity had on actual prices, but it seems to me that Cooke and Robles, when taken in concert with the Kaufman piece, have demonstrated that the speculation we see in the markets right now is not merely a normal market response to potential future shortage – indeed, the Food and Agricultural Organization (FAO) of the United Nations has been arguing for months that there are no likely supply issues that should be triggering the price increases we see. In other words, while it is foolish to simply blame price arbitrage for food insecurity, it is equally blind to assume that all of those practicing such arbitrage are doing so in the manner prescribed in the textbooks. Someone will always try to game the system, and in tightly connected markets, a few efforts to game a market can have radiating impacts that draw in honest arbitrage efforts. There is need for regulatory oversight. But regulation will not solve all our food problems.
But this all leaves one last question unanswered: what is the impact of price instability, whether caused by actual likely future shortages or by efforts to game markets for short-term profits, on the welfare of the poor? Vidal, Kaufman and many others assume that the impacts are severe. Well, maybe. You see, where matters (again – yep, I’m a geographer). In a very interesting paper, Marc Bellemare (along with Chris Barrett and David Just) demonstrates that, at least in Ethiopia:
contrary to conventional wisdom, the welfare gains from eliminating price volatility would be concentrated in the upper 40 percent of the income distribution, making food price stabilization a distributionally regressive policy in this context.
This finding may be a shock to those working in aid at first glance, but this finding is actually intuitive. In fact, in my book (out tomorrow!) I lay out a qualitative picture of livelihoods in rural Ghana that aligns perfectly with this finding. In Bellemare et al, I would bet my house that the upper 40% of the population is that segment of the population living in urban areas and/or wealthy enough to be purchasing large amounts of processed food. Why does this matter? This is the segment of the population that typically has the most limited options when food prices begin to get unstable. On the other hand, the bottom 60% of the population, especially those in this cohort living in rural areas (it is unclear from the study how much of an overlap between poor and rural there is in the sample, but I am betting it is pretty high), has a much more limited engagement with global food markets. As a result, when food prices begin to spike, they have the ability to effect a temporary partial, or even complete, disengagement from the global market. In other words, much as I saw in Ghana, this study seems to suggest that temporary deglobalization is a coping strategy that at least some people in Ethiopia use to guard against the vagaries of markets. Ironically, those best positioned to effect such a strategy are the poorest, and therefore they are better able to manage the impact of price instability on food markets.
In short, I would argue that Marc’s (and his co-authors’) work is a quantitative empirical demonstration of one of my core arguments in Delivering Development:
2. At globalization’s shoreline the experience of “development” is often negative. The integration of local economies, politics, and society into global networks is not the unmitigated boon to human well- being presented by many authors. Those living along the shores of globalization deal with significant challenges in their lives, such as degrading environments, social inequality that limits opportunity for significant portions of society, and inadequate medical care. The integration of these places into a global economy does not necessarily solve these problems. In the best cases such integration provides new sources of income that might be used to address some of these challenges. In nearly all cases, however, such integration also brings new challenges and uncertainties that come at a cost to people’s incomes and well- being. (pp.14-15)
I’m not suggesting Marc endorses this claim – hell, for all I know he’ll start throwing things when he sees it. But there is an interesting convergence happening here. I’m glad I met Marc at a tweet-up in DC a few weeks ago. We’re going to have to talk some more . . . I see the beginning of a beautiful friendship.
In summary, while efforts to game global food markets do exist, and have very serious impacts on at least some people, they do not crush everyone in the Global South. Instead, this instability will be most felt by those in urban areas – in the form of a disaffected middle and upper class, and a large cohort of the urban poor who, lacking alternative food sources, might be pushed over the brink by price increases. The policy implications are clear:
- We need to be watching the impact of price increases on urban food insecurity more than rural insecurity
- Demanding that rural producers orient themselves toward greater and greater integration with global markets in the absence of robust fallback measures (such as established, transparent microinsurance and microsavings initiatives) will likely extend the impact of future price instability further into the poorest populations.
- We need to better understand the scope of artificially-generated instability and uncertainty in global food markets, and establish means of identifying and regulating this activity without closing price arbitrage down entirely.
A world with less poverty . . . maybe
Brookings has come out with a report suggesting a dramatic decrease in the number of people living in poverty (using the $1.25/day mark as a measure of poverty) since 2004. The report suggests that where 1.3 billion people met this description in 2004, today less than 900 million are dealing with similar circumstances. In short, we are on target to achieve the first Millennium Development Goal (MDG) of cutting the global rate of poverty to half of the 1990 rate – indeed, the report suggests that:
the MDG1a target has already been met—approximately three years ago. Furthermore, by 2015, we will not only have halved the global poverty rate, as per MDG1a, but will have halved it again. (p.4)
This is remarkable news. Brookings notes that the rate of poverty reduction varies dramatically by region, with East and South Asia cutting rates by about 50% between 2005 and 2010, while sub-Saharan Africa’s rate fell just under 8% in that same period. Further, just two countries can account for the majority of this drop: India and China. So there are still big challenges out there to be addressed, but things are looking up.
Or are they?
A glance at the methodology employed by this study leads me to think that the error bars on this study are rather huge. Indeed, the authors are fully aware of the data and analytic challenges related to any effort to estimate poverty levels. As the authors note, in development
we find it remarkably difficult to measure whether it is happening, and if so how fast. This is especially the case when it comes to producing global poverty data, as the challenges of national poverty data collection are multiplied several times over and then further compounded by the tricky—and unsatisfactory—business of converting national results into internationally comparable terms.
In short, the authors know that the project on which they have embarked is likely to generate estimates with significant potential errors – “error bars” as it were, around their data points, in which reality might actually exist. Oddly, the report makes no effort to present these error bars. Instead, it makes rather bold claims about reductions in the level of poverty largely without caveat. I am not convinced these claims are warranted.
First, there are major data issues here. Their 2005-2010 measures are predicated on recent household survey data. Here is the problem with household survey data in sub-Saharan Africa: a lot of it is junk. I’ve tried to deal with such data in Ghana, a country that has a relatively robust infrastructure for this sort of work, and found their survey data to be a mess. I suspect that in some regions (Latin America, parts of Asia) the data is actually quite good, on the whole. But in a lot of places (most of SSA and Southeast Asia) the data is likely very problematic. And even where the data infrastructure is pretty good, the survey methodologies are often found wanting. I was part of a team that tried to get a handle on livelihoods near a forest reserve area in Southern Malawi – to do so, we sampled 300 households across four villages (75 households/village) quarterly for a year, to capture things like seasonality in our dataset. 2400 structured interviews had to be undertaken to do this, and those interviews were supplemented by semi-structured interviews with subsamples of the group to explore issues like household power and gender relations to give context to that larger dataset. This was enormously labor-intensive . . . and necessary to really understand what was going on in those villages. Most household surveys are not done in this manner, and thus are subject to seasonal bias, or the presentation of data as comparable across the country when, in fact, it has very locally-specific meanings rooted in local social context. I do not expect that all national household surveys will be as rigorous or labor-intensive as ours was, but one should acknowledge the limitations of the data. No discussion of this in the paper, but that can put a pretty wide margin of error on your findings.
I won’t even wade into the issues with population data that they gloss over in this study – I spend a good bit of time in chapter 9 of Delivering Development talking about census issues and the problems of compounding data error in estimations of economic growth. Let’s just say that there are significant uncertainties around census data that compound any other errors in the data – again, growing error bars.
Second, there is a moment in the analysis that I found stunning – their projections to 2015 predicated on a surprising assumption – that distribution of wealth will stay the same. Well, given that economic growth is, by and large, predicated on unevenness within regions, countries and between countries, there is basically no chance that the distribution of wealth will remain the same in any place that is growing. Generally speaking, the GINI coefficient goes up as growth goes up . . . and a lot of places they are talking about are meant to experience fairly robust rates of growth now and in the near future. More error.
What does this mean? Well, to me it means that the data they presented like this:
Really has a wide margin of error, even for past observed data (but compounded going forward) that should look be presented like this (with margins of error in red, and not to scale. I did not calculate them, as this is just illustrative):
OK, so perhaps there should have been some error bars in there. So what? Well, this is a policy brief, with policy recommendations that might actually be followed by someone . . . and this brief is arguing that we are on top of the whole poverty reduction thing, which is sure to become an argument for looking for ways to trim development budgets.
Even if the budgetary ax does not fall because of this brief, there is a risk of reprioritization that may not yet be appropriate. In the recommendation
aid donors must adapt to the evolving poverty landscape and update their policies and programming to reflect current needs and priorities
the brief implicitly argues that agencies should be reevaluating their programming based on the findings in the brief – toward a focus on Africa and fragile states, and away (apparently) from much of Asia and those parts of Latin America, the Caribbean, and the Pacific where we currently work. However, this is a recommendation based on much thinner evidence than it seems.
The worst part is that I think this presentation of the data undermines one of their excellent policy points:
One final policy recommendation revealed by this analysis is the need to improve the quantity, quality and timeliness of poverty data, at both the national and the global level. For both developing country governments and aid agencies working to fight poverty, it is impossible to efficiently allocate resources toward this goal using poverty data that is incomplete, unreliable or out of date.
At the country level, there has already been a significant uptake in the use of household surveys and an improvement in their quality. Yet in remarkably few countries is there a standardized, recurrent—and therefore consistent—approach to household survey data collection and analysis. A renewed, long-term commitment to build capacity in domestic statistical agencies would be a valuable use of aid agencies’ resources.
I agree completely, and have argued for this need, but by presenting the data as so clear and robust, they have essentially undermined this argument. Any policy maker looking at this will wonder why s/he should give more funding to something that already works . . .
Folks, policy makers will never learn to deal with uncertainty until they are faced with it . . . if we keep copping out and “firming up” mushy results into single bold trendlines, they will expect certain outcomes from uncertain data indefinitely.
Liveblogging Dead Aid (Chapter 4)
After a few days off (a sort of sherbet for the mind, as it were), I’m back with Chapter 4 . . .
p.48: The chapter starts with a strong diatribe about the ubiquity of corruption in Africa. First, it depends on where you are . . . and when you are. Ghana in 1997 was run with small bribes. Ghana now is navigable without much, if any, bribery – and a new generation of public servants is more efficient and transparent than ever. Which leads to my next point . . . in the last chapter, Moyo warned against arguing that African culture somehow prevented development from taking root, and demanded we move past surficial explanations. Here, however, she never interrogates why corruption happens – inadequate salaries of public servants, huge financial demands on the employed by extended families that lack access to social safety nets, etc. By leaving this discussion out, Moyo is implying that Africans are inherently corrupt – and she is not moving past the surficial to interrogate causes. Aid does not cause corruption to happen – aid is what is stolen when corruption exists.
p.50: Moyo is making staggeringly sweeping statements about how aid leads to corruption, arguing against the view that increased civil servant salaries reduces corruption. She offers no evidence, just armchair psychology. But there is evidence . . . that increased salaries help. I’ve seen it myself, in Ghana. It is not a magic bullet, but her dismissal of this corruption reduction tactic is unconscionable. She’s just tossing away arguments that don’t fit her narrative.
p.51: Er, this isn’t Moyo’s fault (except that she is using it as evidence), but a study statistically examined the correlation between an ordinal scale of perceptions of corruption and economic growth? Are you joking? Do you know how many variables you’d have to control for to even begin to make that sort of analysis meaningful?
p.52: Wow, this is all sorts of loose correlation . . . OK, let’s say that 25% of all World Bank lending ever has been misused (as she claims). First, is misused the same as stolen? No – sometimes it was rerouted to other projects that were over budget, and might have had some productive outcome. You have to capture that before you claim how much aid has actually been lost. Second, this statistic does not really support the claim “vast sums of aid not only foster corruption – they breed it.”
In fact, let’s do some quick math here. The World Bank had been making loans for 63 years at the time Moyo was writing. Let’s say that an average of 110 countries a year received those loans (a low estimate, for sure), we have 6930 country/year data points. Divide the $525 billion in total loans made by the Bank across this time, and we find out the average loan per data point (country/year) is . . . $75 million. Sorry, but this is not vast, by any stretch.
But let’s get concrete. Ghana’s 2009 GDP was $29 billion. That same year it pulled in $7.8 billion dollars in revenues. Its net aid receipts were $1.2 billion. Yeah, that’s a lot of money, but still only 15% of Ghana’s total revenues. In the scheme of things, aid is not the big slush fund Moyo is trying to make it seem.
p.53: Holy crap, if you are going to point out we lend to corrupt governments, you might want to talk about why . . . and bring a real discussion of geopolitics to the table. We lent to Mobutu because we feared the communists – everyone knows that. So the problem wasn’t aid, it was the geopolitics driving bribes in the form of aid.
p.54: The section is title “Why give aid if it leads to corruption?” Well, mostly because the links are pretty unclear, and because you’ve done nothing in this chapter to link them meaningfully.
To her credit, though, she is quite right about the agencies and how they value the size of the portfolio of lending, not the outcomes. The World Bank has long been accused of this, and there is enormous pressure in every agency to get the budget spent on something . . . lest the budget be reduced next year. However, USAID just took a huge step toward addressing this with Shah’s call for independent, transparent and publicly-available impact assessments of all projects. Really crap projects will soon be visible to the public, and those responsible for them will be held to much greater account if this comes to pass.
p.55: Moyo has no idea what she is talking about on the Malawi food corruption issue. As a result, she misapplies it to her larger argument that we lend regardless of corruption. The issues of corruption in Malawi in 2002 had nothing to do with the food insecurity of the country that year – that was driven by the removal of a seed/fertilizer subsidy program at the insistence of the US and World Bank (who saw it as a market distortion).
p.57-58: And we are further into territory for which she seems to have no real understanding . . . the problem of government accountability is not really driven by aid. The argument that aid reduces the need for taxes – and so the middle class and the population more generally could care less what the government is doing is astonishingly Western-biased (and neoliberal as hell). The lack of responsiveness preceded aid, and persists because the state tends to lack the capacity to do anything for much of its population. If anything, you could argue that aid has failed to improve state capacity such that the citizenry might feel bought in . . . but aid is not eroding civil society.
p.59: Mother of God, aid is what people are after when they try to take over a country? Really? Hell, even her example argues against this – Sankoh wanted the DIAMOND MINES, not aid. She undermined her own argument – who the hell edited this book?
p.61-63: Well, yes, aid can be inflationary, causing problems for exports. This is a problem that should be addressed.
p.64: Yes, inadequate absorptive capacity (the ability of a country to take up income of any sort and use it productively) can be a huge challenge in aid, and lead to waste and fraud. But how often is it a huge challenge? Note what I observed above – average annual World Bank lending, per country per year, is only $75 million. That’s not a huge amount of money. Absorptive capacity examples are much clearer in contexts where oil comes online quickly . . . which is why I am a bit concerned for Ghana at the moment.
p.66: OK, I’m getting worn out here by the overgeneralized, unsupported statements: “Aid engenders laziness on the part of African policymakers.” Really? All of them?
But what is the source of frustration here? Keep reading, and you find this:
Because aid flows are viewed (rightly so) as permanent income, policymakers have no incentive to look for other, better ways of financing their country’s longer-term development. As detailed later in this book, these options, like foreign direct investment and accessing the debt markets, offer more diversified and greater prospects for sustainable development.
This sounds a hell of a lot like an investment banker pitching a fund . . . oh, wait . . . she’s an investment banker. Assuming Moyo believes that this really is the best way to go, it strikes me as remarkable how unreflexive she is about her own background and biases.
p.68: Oh, hubris: it seems that nobody has ever thought of an alternative to aid. Really? There is a lot of stuff in the later postdevelopment literature, all kinds of efforts to reimagine capitalism . . . now, we can argue about whether or not these are viable alternatives, but at least explore them before we run to the capital markets!
This is deeply frustrating – I like a controversial argument, but I also like a well-framed and supported argument. We have the first part, but the second is completely absent thus far.