Social Change

ABSTRACT Third World poverty is one of the most pressing problems of our age, condemning billions of people to lives of hardship and misery. Such poverty has led many first World countries to want to help Third World peoples, both for humanitarian reasons and to increase our own trade and national security. In response to Third World poverty, these governments have provided billions in assistance since World War II. As this figure indicates, foreign aid is politically popular. Besides its humanitarian supporters, many special interest groups lobby for foreign aid. For example, American farmers back food assistance because such programs help eliminate politically embarrassing food surpluses caused by agricultural subsidies. While foreign aid is a political success, it is an economic and social failure. By increasing government power, destroying economic incentives, promoting unprofitable enterprises, and subsidizing misguided policies, foreign aid increases Third World poverty. In this essay we will examine two types of foreign aid: humanitarian and development assistance. We will then discuss alternatives to aid in helping the Third World, especially the policy of free trade.

INTRODUCTION According to Wikipedia authors, “Third World is a categorical label used to describe states that are considered to be underdeveloped in terms of their economy or level of industrialization, globalization, standard of living, health, education or other criteria for "advancement". The name Third World arose during the Cold War to refer to nations that did not belong to the similarly termed "First" or "Second Worlds". There is debate over the appropriateness of the term. Critics of the term caution that the term implies that industrialization is progressive [1]. Supporters of the term advocate that the term is embraced by many Third World nations themselves , particularly in the Non-Aligned Movement, and that no alternative is without detractors, Dr. Robert Ayot in his book “Community Development’ says "Third World" is used in this context to refer to the term the nations which so far, have been unable, or not permitted to share in the power and wealth of the world. Third World could also be described as groups of people under the domination of the First World which controls the technology and conditions of who shall have power. The Second World is made up of a few countries which have been able to take advantage of technology without the mental, political or economic control of the First World. Examples of the Second World countries would be the Soviet Union and Japan. First World can be described as those countries which control the wealth and power of technology, industrialization and urbanization. They control what ideas are exported. They also setup the rule. Current thinking about development shows a large misunderstanding of the real issues at stake. The disturbing question is how we come by this misunderstanding. There are at least three major explanations of this failure.

1. The historical approach to aid for development. Shortly after Second World War, economists, states men, financiers and industrialists thought that the transition from underdevelopment to development was mainly technical problem. The goal became to industrialize non-industrial countries. This was to be achieved by injecting large amounts of capital into Africa, Asia and the other poor countries. in the American After a while it became evident that the capacity of a nation to make good use of outside capital depended on the skill of importantly placed people within those nations with the technical know-how to productively invest the colossal external. As a result primary emphasis shifted from money to placing technicians and experts who could administer outside capital in the most successfully This technical assistants continued to grow in number educators, administrator, and veterinarians. Posted to the underdeveloped investment countries. After a few years of this experiment however, a general disaffection set in. Of what use were technical advisers? It was asked if they had to function within systems or institutions that were not friendly to their own view of development? Why request advisers at all if they were not used to training local people to carryon the job after the foreigners departed? And what happened to experts who were not in one country? From these questions a new pattern emerged. The new thinking declared that trained people was the goal. Commitment to developments is usually made on buildings, roads, factories or such. It was Realized that what is needed more than projects are human agents to carry out projects. The emphasis shifted from bricks to education and training. Bowman (1963) states that training of people between the Third World and Western countries development. Students and professors were sent to the United States. France, England and Israel to learn how to modernize their institutions. At the time training programmes were begun in the poorer countries to turn local people into better administrators, educators, manage businessmen, policemen, etc

At this point, it becomes fashionable to say that underdevelopment country could make significant professionals standard and a non- political commitment to development. Advisers from rich countries came to tell poor countries that they had develop honesty and punctuality if they hoped to become efficient, and had to accept political realism before they could win economic;: independence. What became apparent was that the ideals being preached were the values and behaviors, which were purely western in orientation. During this period of the late fifties, developers displayed overwhelming loyalty to non-economic factors in development. It was argued that a dollar investment in education generated more development than a dollar invested in dams or steel mills. In this approach, problems or values, motivation, the forming of elite's kept coming up to take the sweetness out of this latest view. Perhaps the reason that the noneconomic' factors did not work was that they were viewed mechanically: that is, as means to speed up economic expansion.

An increasing awareness of such thinking made way for a new emphasis. Development, in this new view, is not pre- defined but related to a society's overall philosophy of the good life and the ideal society. Economic, institutional, and political modernization is desirable to the degree it promises to be useful and is in line with the values of the particular nation. Development is no longer through of as primarily a technical problem. The goals and cost of this new approach have not been answered, however. 2. The Third World not been able to say what they think development The second reason for our failure to understand the real essence of development is that, recently, the countries of The Third World have not been able or have not been permitted to tell others what they think development. This has changes recently. As an example, Julius Nyerere urges Tanzanians to practice self- reliance in their efforts to modernize the nation. His approach is challenges the citizens to take self-

reliance as more important prerequisite to economic success. People describe their ideals of development when it rises in protest against attacks on its own values. If a society suspects that modernization is too destructive of its family structures, its rhythms of work and play, or any other aspect of its society life, it may react negatively to development agenda proposed or imposed on it sometimes, it is true, the reaction is romantic in hoping to keep the old while gaining the new; but there are instances of nations consciously rejecting the values of modernization. The Third World has been telling the First World about its ideas of development, and most effectively at international conferences. They are saying that the differences between rich and poor countries are intolerable and they have lost faith in the will of the underdevelopment countries to close the gap. They say for that the poor countries all forms of domination are bitter, even if they are sweetened by the promise of higher standards of living. 3. Belief that underdevelopment existed only in the Third World The third reason why development has been so poorly understood is that we have believed that underdevelopment existed only in the Third World. The West sees itself a very self, righteous. They are blinded to their own underdevelopment, their poverty, structures of privileges, and non-participatory politics. Worse still, this blindness makes the West unable to think that the Third Word may be more developed culturally and humanly than the West. It has led them to believe that the West alone has something to teach, while the Third World is only to learn. But who will teach the 'development' countries about working together while their own, countries are torn apart, or how to have better human relationships when their own family structures no longer work? Most of western thinking in development has avoided the human problems. Can development, which includes more money, increase technology, changes in the

organization of life and the redistribution of money, be seen without answering the human questions? No. The failure of such attempts has been witnessed in many countries. Experts set up resettlement schemes that were technically perfect except for one details; the people's own attachment to their former land to which they returned as soon as they learned that they drought was over. No practical developer can be insensitive to the damage that follows their own action which has been hitherto, unexamined. Development is at one and the same time both art and science. Development is successful when all the people involved participate in proposing the plans and the actions to carry out the steps towards development. There cannot be a division between thought and action. In other words, plans for development cannot be the thoughts of a few 'experts' in the capital city who expect the people to automatically carry out the actions. Until a philosophy of planning is made that links community- development with decision making, most efforts will fail. It is impossible to put into priority identical values for any two different societies. For example, better farming, better communication; more education may have equal value for a society. To place identical values in an order, again separates the whole of human development. Living with many values is a form of pluralism which is a value that should be encouraged. The question that needs to be raised is whether development means acquiring more material goods. People will need to struggle and pass judgment on the positive or negative influences that material goods have on making a good life. A nation may have to ask itself whether having a thousand factories will improve the quality of life of its members. It is generally agreed that the best arrangement for building and sharing national resources and wealth is through co-operation and integrating groups from different

religious, regions, tribes, etc. If this is so, then the plans for such and effort must be put to all the people involved. It can either be accepted or rejected by the people of all cultures and philosophies. It can be said that neither the elite alone nor the whole population is enough for social decision- making. Making choices about who makes decisions is depended on the cultural situation and the degree of importance each nation attaches to such values as productivity, efficiency and professional mobility. However, the limits and the vision of those choices need to be worked out. From these basic ideas, several proposals can be made to those interested in development. These proposals are intended to be worldwide rather than national or regional. A tiny fraction of the world's population uses the majority of the World's wealth to keep its own economy in operation. This inequality is immoral. There is enough wealth in the world to meet the real needs of all people, but there is not enough to satisfy the greed of each one. It proposes a charter similar t the United Nations which would create new social arrangements governing the weal th of the world. Complaints about the lack of standards for overseas advisers and technicians have been issued throughout the Third World. It has been urged that there be an international code of ethical standards that would assure host countries that they were receiving not only qualified people, but people sensitive to that host country's scheme of development. As such, the idea of such a code should be brought into the open and considered. I also propose an investigation into a new international legal order which is related to development should be instituted. In many Third World countries, new approaches to community leadership and adult education are being considered which take seriously the ideas of the people. A study of these approaches would shed light on the differences between elite groups and those with whom they are to work. Also worth investigating would be the success and failure of such programme. The aim of the inquiry would be to

find out what makes an approach helpful to the poor after they have undergone these different forms of assistance. Although development can be studied as if it were separate from human life, in the final analysis the development goals are the goals of life itself which are intended to create opportunities for people to live fully human lives. In other words, development is good if it helps individuals live the good life. This means that there is no common standard for judging the ideal quality of life for different civilizations. For Teilhard (1989) fullness of life is not found in narrow success of individuals or nations, but the whole of mankind reaching towards unity, increased self-awareness and expanded creativity. Definitions

of

development

in

terms

of

industrialization,

urbanization,

modernization and growth are obsolete and irrelevant to Third World situation. It must be defined according to the deepest values of a people. It could be described as a series of changes from a phase of life seen by a population as being less human to a phase seen as more human. As the gap between developed and underdeveloped countries widens, what appears likely is more poverty and bitterness rather than social justice and harmony. The answer to the question "Development for what? Could well be the division of the globe into a small group of rich master nations and poor slave- nations. However, development can create a world in which people become progressively more free because social structures are created to release people from disease, self centeredness and blindness. If people were to achieve such freedom, they could be inspired to risk the exploration of the fullest dimensions of human life. Even if a person acquires all the cultural and material wealth that the past and the present place within his/her reach, the future would still be unknown and full of discoveries. Development, like history, never utters its final word summary of approaches to development by Danis Goulet.

From the above, it is clear that Aid to third world countries come in two major forms:A. Humanitarian Assistance Humanitarian assistance is aid designed to avert immediate disaster and mainly takes the form of food aid. One problem with food aid is that the dumping of free food in Third World countries depresses prices for local farmers, therefore resulting in less domestic production. According to George Dunlop, chief of staff of the Senate Agricultural Committee, millions of Indians may have died of starvation because American wheat dumped in India bankrupted thousands of Indian farmers. Thousands of Guatemalan farmers were likewise hurt when food aid poured into the country after the 1976 earthquake. For these unfortunate farmers, "the price of domestic crops dropped at a time when farmers desperately needed cash to improve and repair their homes...." A second major problem with food aid is that it encourages the recipient nations to adopt policies that discourage production. With food aid to "cover-up" the most grievous results of their actions, Third World governments can pursue such counter-productive policies as forced collectivization and price controls on farm products. For example, Tanzanian President Nyerere was able to collectivize farms and engage in massive relocations of peasants because food aid "hid" the consequences of such actions.[7] In many cases, such as in Bangladesh, food aid leads to the neglect of agricultural production because of the belief that other nations will provide sufficient amounts of free food: The end result of programs such as Food for Peace is a complete dependence on food aid for many countries. Food aid destroys Third World food production, creating a perpetual crisis that requires more aid to avoid famine. The cycle continues until the country is completely dependent upon free food from abroad. As one analyst put it, foreign aid has become "the opiate of the Third World" that keeps the less developed countries (LDCs) permanently dependent on the West for their very existence. A third consequence of government-to-government food aid is the destruction of more efficient private efforts. Before World War II, private charities provided hundreds of

millions of dollars in emergency aid. Because private food aid is administered directly to the poor -- it is an exchange between individuals, not governments -- it does not destroy markets through indiscriminate dumping or lead to destructive farm policies. Government food aid hinders private efforts by limiting the feeling of moral responsibility among citizens of more wealthy nations. Even more important, government food aid has "politicized" many private organizations by providing the bulk of their budgets, therefore destroying their incentives to be efficient. Without private alternatives, Third World nations are quick to accept public aid that increases the likelihood of future food shortages. B. Development Aid Development aid attempts to promote long-run growth of the LDCs by building large projects, giving budgetary and balance of payments help, and funding a variety of research and planning efforts. For instance , since 1946 the United States has given over $131 billion in development assistance. Despite the scale of these international transfers, they have not led to sustained growth. Rather, aid has significantly impaired LDC progress by expanding the role of the public sector in the recipient nations. Development aid is based on the premise that Third World nations don't grow because they lack of financial resources. But financial resources have relatively little impact on growth rates when compared to other factors. As P. T. Bauer argues, "Economic achievement depends on personal, cultural, social and political factors, that is people's own faculties, motivations and mores, their institutions and the policies of their rulers. Even if financial resources were vital to growth, the Third World does not lack the means of obtaining international credit. If anything, the more than $800 billion total debt accumulated by LDCs shows that they may have had too much financial capital, rather than too little. As with food aid, development assistance politicizes Third World economic life. Aid helps incumbents expand their power through political patronage. According to economist Doug Bandow, "The tendency of ruling groups, particularly in societies where

political power is so important, is to use aid, or funds released by aid, to strengthen their own position, reward their supporters, and buy off or crush opposition movements. By limiting political competition, foreign aid inhibits the implementation of badly needed market-oriented reforms. Even aid that is not used for overt political repression leads to the growth of large, unproductive bureaucracies. According to a recent Agency for International Development report: "Many African institutions officially responsible for planning and implementing development are saturated with development assistance, paralyzed by administrative inefficiency, staggering beneath a burden of complex and differing donor requirements, and are themselves in danger of becoming obstacles to development. Some countries that receive large amounts of development aid, such as Zambia, use over 20 per cent of their GNP to provide civil service employees with a standard of living which is "totally out of synch with the rest of the economy." Through these large bureaucracies, development aid fosters political exploitation. There are many examples of Third World governments using aid to enrich the ruling elite at the expense of the masses. President Sese Seko of Zaire, for instance, used foreign aid money to partly fund the construction of eleven presidential palaces. Foreign aid is also used to build expensive capital cities, such as Brasilia, Islamabad, Abuja in Nigeria, Lilongwe in Malawi, and Dodoma in Tanzania, that benefit few people except the ruling classes. Foreign aid is also used to subsidize expensive Third World airlines. These airlines benefit only the elite of the country, while taking away resources from needed private sector activities. Even if development aid didn't lead to political exploitation, it would still foster economic inefficiency. Unlike firms in the private sector, government projects are not subjected to the discipline of profit and loss accounting. Because they operate outside the market, government projects -- the kind financed by foreign aid -- have low or negative rates of return. In many cases, aid agencies explicitly undertake such projects because the private sector refuses to finance them. Foreign aid thus channels the recipient nation's resources into unproductive areas of investment:

Without the price system to guide them, Third World nations have attempted to develop by simply building the same type of enterprises that flourish in more advanced countries. Steel plants, aluminum factories, and oil refineries funded with aid money dot the Third World, despite the fact that the markets for these products are already saturated. Because they cannot hope to compete with more established firms, these aid projects drain skilled labor and other resources away from the private sector with no corresponding benefits. Foreign aid not only wastes scarce resources in the very nations which can least afford waste, it also creates international tensions. Foreign aid has united the governments of the Third World into a cohesive unit that has but one goal: secure more aid. To accomplish this, the Third World has found that the politics of confrontation work best. In their eyes, the world is divided between rich and poor, with the former having an obligation to help the latter. The result is international conflict: Finally, we must note that development aid significantly drains our own resources. Many people support foreign aid because of the perception that it helps our export industries. In fact, there are stipulations on most aid packages requiring the use of American goods whenever possible. Because foreign aid subsidizes American companies which deal with the Third World, it shifts assets from more efficient firms, thereby reducing our overall economic performance. Supporting aid in the hope that some of it might be spent in the first world countries is like a supermarket giving money away in the hope that consumers will spend part of it in the store -- there is always a net loss.

REFERENCES 1. Bowman MJ and Anderson CA, "Concerning the Role of Education in Development." In Geertz C (ed), Old Societies and New States. Glencoe IL: Free Press,1963,pp247-279

2. Doug Bandow, "The U.S. Role in Promoting Third World Development," in Doug Bandow, ed., U.S. Aid to the Developing World: A Free Market Agenda (Washington: The Heritage Foundation, 1985), p. ix. 3. Daniel A. Sumner and Edward W. Erickson, "The Theory and Practice of Development Aid" in Bandow, op. cit., p. 57.