The Lords of Poverty: The Power, Prestige, and Corruption of the International Aid Business [Paperback]

The book is one of the most daming that I have read. Although short the book marshals its facts and explains every argument with a clarity that is breathtaking.

The arguments are that the organisations which are involved in providing aid are incompetent. There are a number of reasons for the incompetance but all orginsations which deal with aid are incompetant and corrupt.

At the head of the list is the world bank. The world bank is willing to make grants of aid conditional on changes to monetary policy and dismanteling of anti competative market systems but it never wants to make aid conditional on introducing human rights or democracy. As a result changes to make the market more competative almost always damage the poor by for example the removal of food subsidies. The benifits of World Bank loans almost always flow to the middle class or urban dwellers. The Indian Economist Sen has shown that democracies do not have famines. If the world bank was to make democracy the condition of aid packages it would be more likely to reduce famines in these countries. In fact govermental corruption or incompetance is the real reason for the sorts of problems which require aid in the first place.

The world bank is addicted to large capital intensive projects. Most of these turn out to be white elephants and have unsustainable maintence costs. Again the benifits of electification or transport benifits mainly the urban centres.

Those who are responsible for aid projects are overpaid, come from foriegn countries and lack language skills to properly evlaute projects. The result is that huge amounts of aid are used to pay for incompetant staff at aid bodies.

The author says that the proof of the pudding is that those countries which have had huge amounts of aid have simply gotten poorer. Aid projects have generally failed. The world would be a better place without any aid at all.

Whilst this is an extreme position the book is a valuable addition to debate in the area.

The second half of the book, however, is little more than a rant during which the author mocks and insults aid and development workers for about 100 pages. The vitriolic quality of writing makes one wonder if an aid worker dumped him at some point. You could skip this whole part of the book and be better off for it.

Maybe I take it personally since I'm an aid worker, but I can tell you with authority that Mr. Hancock really doesn't have any idea what he's writing about - he mischaracterizes the lives and personalities of most aid workers and oversimplifies the challenges and complexity of the work. He's angry and bitter about something and I don't think it's corruption or incompetence.

And just for the record: Reviewer Viola P. Reyna doesn't have command of the facts either. Most foreign aid workers are required to pay taxes in their home countries while living abroad. Americans living abroad for more than 330 days a year, whether they are aid workers or oil drillers or whatever, are not required to pay taxes unless they make over $80,000. Everyone is still, however, required to report their incomes and file their tax returns. So contrary to what Viola says, the US Government knows exactly what everyone is making.