Articles:
Making poverty history

In western Europe this year, we seem to be experiencing a strange mixture: a cult of the celebrity and a cult of Africa all rolled into one. This is occurring because of the increased attention being given to the plight of Africa´s poor and to the need to increase aid donations from western governments. Yet this campaign is not being led by politicians or by economists. It is being led by pop stars.

            The most prominent roles are being played by two Irish rock stars, Bono and Bob Geldof. Bono is at least still a current pop star, as lead singer of the band U2. Bob Geldof has not been much of a star since the 1970s and 1980s, when his band, “the Boomtown Rats”, had their heyday. Yet he has been a star of the aid movement ever since 1985, when he organised a special concert to raise money to help relieve the famine then under way in Ethiopia. Now he is organising another concert, in support of what has become known as the “Make Poverty History” campaign.

            It is an admirable idea: to use your celebrity to draw attention to a worthwhile cause. Princess Diana was the most brilliant exponent of this, during the 1990s. Moreover actors and actresses have long also acted as “ambassadors” for the United Nations childrens´ fund, Unicef.

            This year´s cult, however, fills me with some concern. My worry is that these celebrities, for all their good intentions, may end up focusing public attention in the wrong direction, a direction which will not end up helping Africa very much, or the poor in general.

            That wrong direction is the idea that the problem of poverty can be solved simply, or mainly, by sending money. The special series of concerts that Geldof and Bono are organising, just before the rich-country (“G8”) summit in Scotland in July, will no doubt raise quite a lot of money. And the political pressure such concerts and demonstrations produce may well encourage governments to increase their overseas aid budgets—as the European Union, supported by Japan, has already promised to do.

            But aid is a misleadingly easy way for the rich to help the poor. Africa has had billions of dollars in aid over the past 30 years but most African countries have got even poorer, because aid is a palliative, not a solution. It helps governments finance their budgets. But it does not make economies work better, does not build sustainable health-care systems, nor sustainable education systems, and does not solve the huge problem of corruption. Indeed, it often makes it worse. Aid makes countries dependent on hand-outs and unable to support themselves. It also, crucially, tends to add to corruption.

            What African countries need are better government institutions—including, crucially, justice systems—and the ability to sell the goods they produce overseas. Only then can African economies establish a virtuous cycle of prosperity, escaping their current vicious cycles of poverty. But neither of those two things is easy to achieve.

            To build better government institutions does require money but to make it happen may well require interference from abroad, which is politically very sensitive. To allow poor countries to sell their goods is easier, since it requires markets to be opened in other countries. But that is politically difficult at home. The agricultural goods and textiles that many poor countries would be able to export are subject to protective barriers in many parts of the rich world, including Japan and Europe. Our countries are especially tough in resisting food exports. Others block textiles, or at least nowadays the raw material for textiles, namely cotton.

            Since January 1^st a long-standing set of worldwide restrictions on textile exports from poor countries, known as the multi-fibres arrangement, was abolished after a ten-year transition period. Since then, however, there has been a big fuss in both America and Europe about rapid rises in exports of clothing from China. Yet that is exactly what was always expected. China is a poor country, still. And its best way out of that poverty is to make goods and export them.

            No doubt the celebrity aid campaigners and their supporters would also like trade liberalisation as well as increased aid. They certainly say they do, although a current controversy in Britain suggests that some of their supporters aren´t quite sure whether they are really comfortable with the implications of increased trade.

A popular symbol that is being used to show that you support the Make Poverty History campaign is a white wristband, which people buy cheaply and then wear. It has just become known that the main supplier of these wristbands is a company in China, which some campaigners accuse of making them in what they call “sweatshops”. That word really just means a busy, hard-working factory. So if the poor earn their way out of poverty by making wristbands, rich-country campaigners say they are being exploited.

There is a more serious issue, however. It is that while increasing aid donations simply costs a few billion dollars, which is a small amount when compared with total government budgets, liberalising trade requires special legislation through parliament and special efforts to force local interest groups to accept it. And that can be politically costly.

            So the risk that concerns me is that all the increased attention that these celebrities bring to the campaign to help Africa may become focused just on increasing overseas aid, and not doing the much harder tasks of liberalising trade. Reducing agricultural protection is not popular in Japan or South Korea, and it is not popular in France or Spain either. So politicians will do all they can to look as if they are helping the poor by finding a bit more money for aid. And then, once the concerts are over and the celebrities go back on tour, the politicians will hope everyone forgets about the issue. Which, sadly, they probably will.