Monday, April 1, 2019

Foreign Aid

What is the point of Foreign Aid?

While before World War II there were instances of countries helping allies or client states militarily, it was generally a transactional type situation where in exchange for assistance the recipient made certain commitments.

After the war, the United States instituted the Marshal Plan which helped much of Europe rebuild and was ultimately designed to prevent them from falling under the Soviet Bloc.

While a lot of time has passed and foreign aid programs have taken a number of forms, including peaceful and military, the idea that it is an investment in exporting western concepts of equality and democracy underlie it.

It involves a lot of money and the success of it is hard to assess.

It is clearly the carrot we offer while sanctions would be the stick.
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The ultimate objective of it would be for the recipient to become self sufficient and, like Europe after the war, become a valued partner of ours economically and perhaps militarily.

Whatever aid we give to poor countries is designed to help the poorer citizens of that country have better opportunities.  Unfortunately, in too many cases the money gets diverted and misused.

From that aspect, cutting off foreign aid to a country as a punishment will impact the ruling class of that country, depending on the degree of corruption involved.

Of course if the foreign aid is being used effectively, cutting it off will increase poverty and probably lead to more citizens giving up hope and exiting.

Cutting off aid to the countries that have the most migrants is likely to backfire.

Time will tell.

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