The NewsHour's Economics Correspondent Paul Solman reports on the effectiveness of foreign aid in reducing proverty.
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PAUL SOLMAN, NewsHour Economics Correspondent:
What do all these have in common? The IMF and World Bank; the U.N.; billionaires Bill Gates, Warren Buffett, and George Soros; superstars Bono and Angelina Jolie; many of the world's highest profile politicians. The link? A public commitment to end world poverty and disease through foreign aid.
BILL CLINTON, Former President of the United States: Regardless of size or scope, our problems will yield to concerted action and innovative partnerships of individuals, NGOs, businesses, and governments.
But one skeptic claims that the more than $2 trillion spent on foreign aid over the past 50 years or so has been a tragic waste, failing to deliver even the cheapest of fixes, like rehydration kits for babies dying of diarrhea. Cost: 10 cents.
WILLIAM EASTERLY, Economist, New York University:
And yet, still last year, 2 million babies died because they didn't get these.
The skeptic is William Easterly, former self-described left-wing do-gooder. He grew up in Ghana, the son of a missionary. Former World Bank staffer for 16 years, now a hard-nosed economist at New York University. Malaria medicines, he says, can save a life for 12 cents, and yet…
There were 1 to 3 million deaths from malaria last year. It's true of so many simple interventions, that aid money could pay for over and over again, the existing aid money, without even increasing aid. And yet, somehow, the aid is not actually reaching the poor people.