Joshua FoustBack to OpinionJoshua Foust

A new approach to post-conflict aid

The U.S. should encourage economic growth instead of supporting tyranny.

An Egyptian man sits in front of closed souvenir shops usually frequented by tourists, in the Khan el-Khalili bazaar in Old Cairo on Feb. 10. Photo: AP/Tara Todras-Whitehill

As the world watches the Middle East erupt in revolt, it is becoming increasingly clear that the previous regional order, in place since the end of the Cold War, is coming to a close. Even if some of the tyrants currently facing down thousands of their own people in the street remain in power, the U.S. should take these uprisings as an opportunity to change how it engages with the Middle East.

The best way for the U.S. to modify its approach to the region is through the application of consistent principles. When Egyptian dictator Hosni Mubarak fell, there was much talk of whether this development was the “fruit” of President Bush’s so-called “Freedom Agenda” — the idea that the invasion of Iraq and the installation of a democratic government in that country somehow spurred the revolts in Tunisia, Algeria, Yemen and Syria.

Of course, this “Freedom Agenda” did not mesh particularly well with the Bush administration’s subsidization, arming and training of Egypt’s security services — nor of both Bush and Obama’s arming of the brutal regime in Yemen, or tacit approval of the tyranny in Syria or elsewhere in the Middle East. In fact, rather than focusing on “freedom” (however defined), for the last decade American foreign policy in the Middle East has instead been preoccupied with terrorism and access to energy supplies. This needs to change, and in doing so, it is still possible to secure America’s strategic interests while also helping the masses of Arabs yearning for a better life.

One way to start is to invert our normal methods of foreign aid. Economic and development assistance typically takes a top-down approach: the host government is supported, and expatriate development workers descend on the capital city to craft plans for how they think the national communities they’re meant to serve should grow and develop. The projects that the aid community focuses on tend to be either amorphous and ill-defined (like “capacity building”) or large-scale infrastructure development (like paving highways and building buildings). Missing in this standard approach is any consistent means to empower and promote the needs of regular people in the target countries. Rather, they are driven by donor concerns and political arrangements in the capital. In short, the traditional development approach relies on the existence of institutions for continued development to take place.

But what if there are no institutions on which to build? One of the primary concerns in UNSC 1973, the U.N. Security Council resolution that establishes the no-fly zone over Libya, is the Gadhafi government’s ability, or lack thereof, to deliver services — water, gas, electricity — to its people. While it remains unclear how a bombing campaign against the Libyan army is meant to deliver those services, the language in the resolution clearly indicates the importance that the international community places on a government’s ability to deliver these basic necessities.

But governments cannot just provide the bare minimum services to their people and be considered successful. The lack of civic and formal institutions that support economic development is one of the most common reasons development can stall; yet within the post-conflict development community there is very little attention paid to why and how those institutions can be transformed into constructive enablers of growth.

One way to rethink the doctrine of development and assistance aid is “expeditionary economics.” At the heart of ExpEcon, as it is known, is the assumption that economies grow because businesses grow and that growing economies are a benefit to U.S. national interests. Growth is not the result of a generic set of capacities or regulatory structures; it is the result of businesses creating wealth, expanding and hiring new people to take on new tasks to generate new wealth. Therefore, ExpEcon is fundamentally about business development, with a focus on empowering local communities.

ExpEcon is not, however, a blueprint for Western foreign direct investment. While that may be one of the ways these local firms receive cash injections, ExpEcon is not primarily about promoting multinational corporations to set up businesses in conflict zones. Rather, it is about applying the lessons learned from successful business growth in other sectors: What sort of agencies and institutions encourage economic growth? How can you structure taxes and regulations to encourage it? By creating the conditions in which local businesses can grow and thus spur economic growth in their communities, the international community can achieve their development goals while empowering target communities to take ownership of their own futures.

The best aspect to ExpEcon is that it does not require economic planning. The current methods of encouraging economic growth — especially when performed by the military, but also by civilian agencies — follow a Soviet approach to economic growth: top-down, authoritarian, inflexible — and often ineffective. ExpEcon works on the assumption that local communities know what they need far more than an expatriate aid consultant does. There’s no need to dictate any process of privatizing state-run industries or the development of new ones. The goal of development should be to remove barriers to economic growth, rather than to dictate how that growth should take place.

There are, of course, pitfalls to this new model of development. One is that it just might prove impossible: In the U.S. we have a difficult time reforming our government institutions, so why would we assume other countries’ institutions can be created or reformed quickly or easily? There is also the danger that a target community might develop in a way the international community finds unacceptable. In Afghanistan, for instance, there is a thriving, extremely profitable agricultural commodity market; it just happens to involve opium, instead of food. There is also the more fundamental concern that the U.S. simply should not be in the business of nation building.

Many of these concerns can be overcome with proper planning and flexibility. There is no reason to assume, for example, that any sort of institutional or structural change will happen instantaneously, or that it will bring about instant results. Similarly, it is possible to constrain a community’s economic development with law enforcement and monitoring to make sure it doesn’t rely on illicit activities for its growth — that way you avoid the Soviet approach of dictating development while still enforcing basic rules and norms. Finally, the conceit behind ExpEcon isn’t that it is a better way of nation building, but rather that it avoids the need to nation build altogether. In fact, ExpEcon is organized around the idea of letting nations build themselves, without requiring intrusive and expensive Western meddling.

As we ponder how to best handle the aftermath of the no-fly zone in Libya, and how the U.S. can manage and perhaps alter the ways it engages with putative allies currently brutalizing their citizens like Bahrain and Yemen, we should look at new ways of achieving U.S. foreign policy. The revolts across the Middle East have been hugely disruptive, both to U.S. security concerns over counterterrorism programs and to the normal lives of Arabs throughout the whole region. By empowering communities to prosper, instead of leaning on governments to be less abusive, the U.S. can achieve two goals at once: undercutting a major plank of al-Qaeda rhetoric (e.g., the U.S. support for hated tyrannical regimes) while building up the local resilience to upheaval that will facilitate better long-term planning.

Expeditionary economics present a win-win foreign policy. They allow the U.S. to engage with communities in key strategic areas, while transforming the terms of that engagement to have the long-term focus of leaving communities more prosperous than when we found them. The current period of upheaval and chaos, while stirring in its democratic potential, is also creating many hardships in the region. The time is right to alter how the U.S. engages with the Middle East by creating growth instead of enforcing tyranny.

 

Comments

  • http://twitter.com/#!/shrikale Shrikant Kalegaonkar

    Joshua’s persuasive & wise essay can be summarized as: Let aid recipients PULL services instead of donors PUSHing programs.

    Pull versus push is not a new concept. It is what the world’s finest manufacturer & leading innovator, Toyota, has been applying and perfecting as a business model since its inception – The Toyota Production System (TPS): get the customers what they want when they want it. (It’s also known, more generally, as lean manufacturing.)

    A core concept in TPS, and an especially important point Joshua makes is that “…local communities [customers] know what they need far more than an expatriate aid consultant [supplier] does.” Another goal of lean manufacturing that Joshua nicely captured in the context of development aid is that “…development should be to remove barriers [bottlenecks] to economic growth [process]…”

    I’m really excited to see these ideas move beyond industry and at least being talked about, if not yet applied, to address social problems we face. By their nature they seek the most efficient & effective solution.

  • http://twitter.com/#!/shrikale Shrikant Kalegaonkar

    Joshua’s persuasive & wise essay can be summarized as: Let aid recipients PULL services instead of donors PUSHing programs.

    Pull versus push is not a new concept. It is what the world’s finest manufacturer & leading innovator, Toyota, has been applying and perfecting as a business model since its inception – The Toyota Production System (TPS): get the customers what they want when they want it. (It’s also known, more generally, as lean manufacturing.)

    A core concept in TPS, and an especially important point Joshua makes is that “…local communities [customers] know what they need far more than an expatriate aid consultant [supplier] does.” Another goal of lean manufacturing that Joshua nicely captured in the context of development aid is that “…development should be to remove barriers [bottlenecks] to economic growth [process]…”

    I’m really excited to see these ideas move beyond industry and at least being talked about, if not yet applied, to address social problems we face. By their nature they seek the most efficient & effective solution.

  • Frank N. Blunt

    Have you ever regarded Schumacher? Seems like a revision of his precepts.
    Anyway, the problem with US involvement is the indulgence of the military industrial complex where the tragic consequences of war as a business has meant production. However, that must create continued conflict which paradoxically entails death, devastation, and destruction while having a narrow focus of ensuring conflicts must endure and even exacerbate to ensure job security while going on to the next opportunity. Just like this nation is now experiencing despotism and oligarchy so have those other nations that have been imbibed with monetary support seen accelerated paths toward that very end. On another issue somewhat related and shows some hypocrisy of the situation, while this dubious matter of protecting the world and promoting human rights is happening abroad, military retirees such as myself are being forsaken and even supposed to deal with health and financial hardship from disregard and exploitation by the very facilities and agencies that were designed to support and serve our needs. It’s difficult enough recognizing that those that should be providing revenue are allowed to evade paying their just and due share but nothing less than deceit and betrayal that people like me are victimized after we have sacrificed and suffered to protect whatever this nation has become. Believe me, retiring into poverty with a pension much less than a third of that earned on active duty, consistently denied compensation and other benefits, while having health needs are disregarded leading to deformity and disability are conditions that are undeserved and abhorrent; but then realizing that the people working in those facilities and agencies operate under clandestine policies while getting better treatment, compensation, and benefits than those that they should be serving do is a human rights violation. Yes, indeed, that is another aspect of the corporatization of government by promoting the facilities and agencies to operate like GSEs so that they treat us like commodities where we are regarded as assets when they can plea for budget appropriations while on the other hand perceived as legacy liabilities when they have to provide services. As entitlements are eroding and benefits are disappearing whom do I blame and where will I go to seek redress for grievances if not assistance especially when the idea that some are exploiting is globalization while they dare to still consider themselves citizens of the USA? Frankly, I’ve been personally injured, offended, exploited, victimized, and had other trespasses committed by the supposedly wonderful citizens of ScAmerica than I have ever had by any alleged foreign terrorist individual or organization. It’s a stark but shameful reality that has made me shake the delusion of whatever nation building that could occur abroad then those people should do so without the involvement of the type of people screwing up things as bad as they have in ScAmerica. I’m sure propaganda and rhetoric proliferates abroad as much as it has duped the gullible domestically since there must be some reason that we aren’t going Egyptian in the streets en masse from all the injustices, atrocities, and cause of socia-economic disparity that have consistently occurred during this era where values are in crisis, ethical breaches are common, dubious morals proliferate, and hypocrisy is rampant. Should they know the truth then I would not doubt they would avoid any ties like the plague. Then again, when you’re talking about buying friendship, cooperation, or some other aspect or even a virtue then you get what you deserve and should expect that in return so that is just why it won’t work and never will.