Foreign Policy Explained, Ep. 10: Does Humanitarian Aid Work?

Release Date
September 8, 2016

Topic

Charity Politics & Policy Role of Government
Description

What is it about well intentioned, well-funded, state led, humanitarian aid programs that makes them fail so miserably?
The truth is, humanitarian aid intended to alleviate suffering often fails, and in many cases causes additional harm to those who are already suffering. In the first 8 months after Hurricane Katrina, billions of dollars were wasted, some of which on a housing program that built empty and unused trailers. Why does this happen? And how can we really help? Professor Chris Coyne of George Mason University explains in this video.
Learn more about the true cost of foreign aid at: hayekandchill.com/foreign-policy

Foreign Policy (playlist): Learn how we can promote peace and human flourishing through our approaches to foreign policy. 
Foreign Aid vs. Charity That Actually Works (video): Do the trillions of dollars the government spends actually lead to long-term well-being in the countries that receive them? 
Foreign Policy (program): Join professors Christopher Coyne and Abigail Hall Blanco as they explore the history of foreign policy, the military industrial complex, and the effects of war on domestic policies. 

On January 12th, 2010 a devastating earthquake struck Haiti, killing 250,000, and displacing close to 1.5 million people. There was an immediate state lead humanitarian effort in responsive disaster, but much of it failed to accomplish, even the most basic tasks. Like rebuilding houses and delivering basic goods and services.
Six years later, despite billions of dollars in foreign aid and the efforts of tens of thousands of aid workers, the situation still remains dire. Approximately 80,000 displaced Haitians continue to live in tent camps across the country. And many of the camps lack on site access to water and toilets raising serious health and sanitary concerns.
How can well staffed and well funded state led disaster relief efforts intended to help alleviate suffering fail so miserably? Haiti is not the only example of state led disaster relief gone awry. In 2005, the US government failed to respond effectively to Hurricane Katrina, and that occurred within its own borders.
The truth is, humanitarian aid intended to alleviate suffering often fails, and in many cases causes additional harms to those who are already suffering. There are a few major reasons why humanitarian aid efforts often fail, and they’re all tied to the realities of politics. For one, state-led humanitarian action frequently involves intense rivalry between government agencies.
Agencies and both in recipient countries may spend a large amount of time competing for control over the monetary resources, rather than focusing on how that aid could be allocated most effectively. For example, former Secretary of Defense Robert Gates has emphasized how in fighting over policies in the halls of Washington DC contributed to the failures in Afghanistan and Iraq.
State provided funding also leads to competition between NGOs, which scramble to secure as much of the government provided money as possible. This shifts focus from helping those in need to lobbying government for additional resources. After the international community pledged $10 billion in aid to Haiti the number of NGOs joining the effort skyrocketed from 10,000 to 15,000.
These 15,000 NGOs spent exorbitant sums of money lobbying governments for a share of the $10 billion. Sums of money that could have been spent making the lives of desperate Haitians better. The competition between NGOs also creates a situation, where those who are suffering have little say in how resources are ultimately used on the ground.
In Haiti, of the 9 billion dollars spent by January 2013, 94% was funneled through international NGOs and private contractors. It is estimated that only 5% of the money pledged for relief for recovery efforts went directly to Haitian people and organizations. Yet another reason that state-led humanitarian efforts also fails is because they are stifled by inefficient bureaucracies..
In Haiti, trucks carrying supplies for the world food program were refused entry, and delayed for several days as Haitian bureaucrat filed customs paperwork. And shipping containers filled with basic relief goods were delayed entry for months due to bureaucratic hand wringing, but this isn’t unique to Haiti. In the first eight months after Hurricane Katrina, billions of dollars were wasted and mis spent.
Including a housing program that built empty and unused trailers. What is it about government bureaucracies that so often result in waste? Two things. First, bureaucrats are motivated to maximize their budgets and staff because this gives them outsized influence in policymaking. But in order to secure more money, bureaucracies have to commit to undertaking more activities, often beyond what they are actually capable of.
This is known as mission creep. Second, Bureaucrats have no incentive to operate efficiently because they are playing with someone else’s money. In fact if a bureau were to operate efficiently, and spend less than their budget as a result they would be punished with a reduced budget next year.
The realities of politics give us good reason, to be skeptical of government’s ability, to effectively provide short term relief to struggling countries. Whether it’s the incentives of state donors and NGO’s, or the nature of bureaucracy, the state often does more harm than good, when trying to lend a helping hand.