The White Man’s Burden: Review

In the sixty plus years since the end of WWII, Western governments and aid agencies have dolled out more than $2 trillion dollars in economic assistance to the world’s poorer nations as a means of economic development. The results of all this assistance, to put it mildly, have been far from stunning. Numerous studies have found no positive effect of foreign aid on economic growth, and there is even some evidence that the impact may be negative.

And while some countries have seen spectacular growth in recent years (to the point where the standard of living in these formerly “Third World” countries now exceeds that of many places in the West), this growth has tended to be in countries that have received little in aid.

The Pope is Right on Condoms

Last week, while traveling in Africa, Pope Benedict came under withering criticism when he suggested that condoms were not the answer to the AIDS crisis. “You can’t resolve it with the distribution of condoms; on the contrary, it increases the problem.” But as Dr. Edward Green, Director of of the AIDS Prevention Research Project at the Harvard School of Public Health noted in an interview yesterday, from an empirical perspective the Pope was absolutely right:

I am a liberal on social issues and it’s difficult to admit, but the Pope is indeed right. The best evidence we have shows that condoms do not work as an intervention intended to reduce HIV infection rates, in Africa. (They have worked in e.g. Thailand and Cambodia, which have very different epidemics) . . . What we see in fact is an association between greater condom use and higher infection rates. We don’t know all the reasons for this but part of it is due to what we call risk compensation. This means that a man using condoms believes that they are more effective than they really are, and so he ends up taking greater sexual risks. Another fact which is widely overlooked is that condoms are used when people are engaging in casual or commercial sex. People don’t use condoms with spouses or regular partners. So if condom rates go up, it may be that we are seeing an increase of casual sex.

(HT: Mirror of Justice)

A Free Market for Water

Both at home:

There are clear gains from having an active market in water rights. It would help solve the problems posed by current water shortages in the West, and it would provide the flexibility necessary to confront the impact of climate change on water supplies in the coming decades. It would be, in a word, fluid.

And abroad:

The solution for the poorer parts of the Third World is deregulation of the market for piped water, combined with the enforcement of property rights. Yes, I’m saying that Third World governments should consider letting private companies sell water at any price they want… And no, I don’t mean a water concession with a price regulated by the government, I mean true laissez faire in water supply. No price regulation, no rate of return regulation, no government ownership of assets, no political pressure to keep prices low.

Many of the world’s poor don’t get good water because they don’t live near a piped water connection. Or if they have a connection, it is often bad and irregular, with backflow putting dangerous and dirty substances into the drinking water. The underlying problem is that many governments artificially hold down the price of water, or they won’t let water companies cut off nonpaying customers. The result is that water companies don’t want to serve these poor customers in the first place, and they certainly don’t want to spend money by adding more water connections for the poorer areas. Deregulation would give water companies a stronger monetary incentive to serve these customers.

Chinese is the New Black

A high court in South Africa ruled on Wednesday that Chinese-South Africans will be reclassified as “black,” a term that includes black Africans, Indians and others who were subject to discrimination under apartheid. As a result of this ruling, ethnically Chinese citizens will be able to benefit from government affirmative action policies aimed at undoing the effects of apartheid.

More. I remember reading a 19th century case concluding that Chinese immigrants were “black” for the purpose of California’s segregation laws. What goes around comes around, I guess.

Hope for Africa?

News stories about Africa typically are about war, famine, pestilence, and/or death. But according to a recent article in the Financial Times (reg. required), some underreported trends in the region are more hopeful:

The number of armed conflicts has dropped dramatically from over 20 in 1999 to 5 today; for example, long running civil wars in Angola, Mozambique, Sierra Leone, and Liberia have all come to an end.

Unnoticed by the media and much of the investment community has been a step change in Africa’s economic performance in the last 5 years. Real GDP growth in Sub-Saharan Africa (SSA) averaged 4.1 per cent in 1997-2002 and by 2007 it had risen to 6.6 per cent.

More importantly, real incomes are rising and Africans are getting richer at an unprecedented rate. In 1997-2002, real GDP per capita rose at a rate of 1.8 per cent per annum, this was up to 4.6 per cent in 2007. At 1.8 per cent per annum it takes 39 years for real incomes to double, but at 4.6 per cent per annum real incomes double within 15 years.