Kerabu

Why aid still won't work

In this month's lead essay at Cato Unbound, 'Why Aid Doesn't Work,' William Easterly makes a rational case for directing international aid dollars toward programs where the results can be objectively measured by hard scientific methods. He's persuasive, but in the end, the scientific method is still just a patch, a facsimile for what's really missing: legality.

In the developed world, the distinction between government and non-government organizations is meaningful, but not in places where government is corrupt and ineffective. In a lawless state (ie, one where corruption dominates the channels through which people get things done, for good or for ill), both aid organizations and entrepreneurial warlords effectively operate by the same rules. One's moral orientation is not the point. If the basic sphere of operation is illegal (in the deepest sense of the word), then there is little chance that your efforts will result in enlightened, long-term improvement. Will Connors, a Chicago journalist and blogger working in Ethiopia has written compellingly about corruption in the aid community there.

Any aid-before-government aparatus is still going to break down--it will just do so further down the road. As Easterly suggests, you may demonstrably produce healthier, taller, better-educated children by buying them meat to eat twice a week, but if the best they can hope for is to grow up to be a corrupt low-level official, have you really accomplished anything lasting?

Better to see aid dollars spent as investment dollars--sunk into private businesses, rather than programs of any kind. It is possible. It is even possible that the weaker the local (corrupt) government, the greater the opportunity for leveraging capital investment. In Carol Pineau's documentary, Africa: Open For Business, the CEO of Daallo, a Somali airline, marvels that the only reason he's able to thrive is that there's no government at all in his country. No government means no corruption, he observes dryly.

cross posted on Samizdata.

The Truth About Fair Trade Coffee

The Globalisation Institute (a British think tank with ideas as fresh as my brother Din's daily brew at Ristretto Roasters) has some really interesting thinking on what the Fairtrade movement really means for growers in the developing world. Here's a snippet of what Alex Singleton has to say on the subject:

It is Fairtrade Fortnight, and we are all being encouraged to pay extra for everything from coffee to bananas. Coffee, a totemic product for the development community, is a product where many producers have suffered from lowering prices. Massive overproduction, caused largely by mechanisation in Brazil and the rise of Vietnam as a major producer, has had its effect on prices.

To read Singleton's manifesto on how to renovate the Fairtrade movement to make it truly meaningful to growers, check out Fairtrade 2.0 (n.b., best viewed while imbibing a nice cup of Ristretto's Kenya AA Katuro).

Tags: fairtrade, coffee, globalisation

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Lords of Hypocrisy

A superbly written blog I've been following of late is Will Connors' Things We Should Have Written Down, chronicling the author's adventures covering conflict in and around Addis Ababa. Connors is a correspondent for a regional newspaper there, but the blog is far better than any newspaper reporting.

What prompts me here is a two-part post on "Lords of Hipocrisy," or the "opulence and inefficiency" of NGOs in the area. In Part 1 Connors details several anecdotes about aid workers from Care, Save the Children, Doctors Without Borders and other groups tooling around in their SUVs and generally lording it over the locals. Here is Part 2:

The estimated budget for an upcoming 17-day ‘research trip’ by an acquaintance working for an anti-hunger NGO:

SUV rental: 500 birr per day x 17 = 8,500 birr ($979)

Gas for SUV: 600 birr per day x 17 = 10,200 birr ($1,175)

Hotels: 200 birr (two people) per night x 17 = 3,400 birr ($391)

Miscellaneous supplies: 100 birr per day x 17 = 1,700 birr ($195)

Estimated Total Expenses: 23,800 birr ($2,741)

Destination: Several of the top tourist spots in Ethiopia

Justification for this trip: “Preliminary research for a future survey”

Hungry Ethiopians that could have been fed with $2,741: ???

I'd go so far as to draw a parallel: Connors' blog is a far better resource on Ethiopia than any newspaper.  And like newspapers, these aid organizations are similarly obsolete, bloated and ineffective.  What blogs have done for information, entrepreneurial types will soon be doing for development. And we can probably learn a lot about the opportunities and pitfalls New Development will face by looking at what New Media has gone through in the past few years. Might save some wheels from being reinvented.

Open Source Women in Africa

Via WorldChanging (which is having a fund drive, btw), I came across the Africa Linux Chix site, which is so hot and so cool it's almost ridiculous. Here's the bulk of the post I commented on, and the bulk of my comments, after: 

It is probably a good thing that FOSS strategies and tactics are being used in Africa to move things in whatever direction they're gonna go in -- without the additional (colonial?) burden of rights-bound software.

But in the face of limited resources on the planet and even fewer resouces in the majority of African countries, will computing be to Africa be as "important" as it is in the North? Will it take the same shape as we in the US expect? Flash-animated websites, adservers, news feeds for one class of user, proprietary networks for another class of user, etc.

Are woman-centered FOSS efforts going to work differently than capitalist and anti-capitalist (male) ones?

It seems to me that successful computing in Africa is going to have to follow a low-power, distributed model. Everyone who has computing capacity is going to have to share it with everyone else... like the SETI project, in a future Africa, idle cycles from all manner of computing devices (cell phones, PDAs, desktop machines, workstations) are going to have to support the information infratstructure of a future Africa.

Or will Africans simply centralize their computing power in resource-intensive, air conditioned, highly-secured physical locations?

If Cheik Diop was right about Meridional Civilization vs. Northern Civilization, then in the same way that the regular flood of the Nile "programmed" humans to work collectively (ultimately making examples of both monumental architecture and long-term peace possible), Digital Africans would benefit from seeking similar approaches to computing resources. For Diop, what was learned in Egypt thousands of years ago still operates in contemporary Black African cultures. At the time he probably would have classified computing power as a natural resource or a scientific field... this is long before it became a lifestyle. To me, FOSS strategies & tactics, in relation to Africa, could work much more like music.

And my reply (to more in the post than this)...

Computing is indeed a natural resource--we talk of "data mining" but what computing really accomplishes is mind mining--in evolutionary terms, it's the way we can make our brilliance as valuable as once was our physical labor. No place is better situated to make that leap, I think, than Africa (I write this from Southern California).

One point I'd make is that Open Source isn't anti-profit, it's merely anti-capital--in an open source environment, you don't have to amass before you can produce. You can have an idea, write it, and take it to market. There are still barriers, to be sure, but they're fewer than ever, historically. An African woman has as much access as a white man in Palo Alto--other than being outside of the insidery tech community. What she has to weigh against that is a lack of preconceived notions and blissful ignorance of the accepted wisdom in her community--both of which are key ingredients in innovation. I'd urge you to take a "capitalist" approach in terms of monetizing your efforts--make products, start companies, sell stuff, think entrepreneurially. Entrepreneurialism is the noble cousin of capitalism.

The next Steve Jobs may well be an African woman--or women. I think it's very, very likely that this will happen eventually, and that the greatness of a continent will come about as a result of the innovativeness of a true outsider tech culture much like the underground culture that drove Silicon Valley in its heyday.

As for the idea that strategies and tactics could work more like music: that's the most beautiful and powerful idea I've heard in a long, long time, for so many reasons. Music is both deeply structured and intuitive, and that's what computing is--and the business structure that houses it must be exactly that in order to thrive.

A sentimental journey?

Thanks to Jackie Danicki for her post "An Exercise in White, Western Megalomania", which pointed me indirectly toward Ethan Zuckerman''s summary on Global Voices of what African bloggers actually think of Live 8 and the surrounding hoopla.

Highlights:  A Kenyan blogger points out the lack of, um, African performers.  Another writer proposes an "alternative" in the form of "a festival to celebrate the aid Africa gives the North: natural resources at fire-sale prices, skilled health professionals who leave Africa to work abroad, and a market for subsidized agricultural goods."  An antidote to all the ignorant treacle. 

The longer I live, the more firmly I come to believe that do-goodism is nothing but the worst form of vanity--and that at root, all true vanity is essentially cruel.  It all goes back to my favorite quote from James Baldwin, from an essay in Notes of a Native Son on Harriett Beacher Stowe's Uncle Tom's Cabin:

"Sentimentality, the ostentatious parading of excessive and spurious emotion, is the mark of dishonesty, the inability to feel; the wet eyes of the sentimentalist betray his aversion to experience, his fear of life, his arid heart; and it is always, therefore, the signal of a secret and violent inhumanity, the mask of cruelty. "

A whole new take on your friendly neighborhood rock star's politics, eh?

Venture Capital for Africa

Catching up on my blog-reading after a bit of a lapse.  VC Brad Feld posted this last month on his blog:

A Denver-based friend – Rob Fogler (a partner at the law firm of Kamlet Shepherd) and his colleague Antoine Bigirimana (the founder of the Kigali Center for Entrepreneurs) have started a Rwanda-based Venture Capital firm called Thousand Hills Venture Fund. 

While I’m personally not terribly clued into Rwanda (or Africa in general), a number of my friends in Boulder (including Amy) are and it’s easy to support guys like Rob (Amy and I are investors in THVF) who believe “that the US business community must pay greater attention to the opportunities and challenges of doing business in emerging markets if it will continue to thrive in the globalizing marketplace.”

Rob pointed me to an article in the Washington Post by Carol Pineau titled “The Africa You Never See” which asserts that Africa’s media image – which is filled with stories about hardship, AIDS, war, genocide, poverty, and corruption – does the people of Africa a major disservice....

I recently got my hands on a review copy of a documentary by Pineau called Africa: Open For Business.  In it, she profiles several African entrepreneurs. A few brief moments stood out to me:  One was the founder of what may be Africa's only animation studio, Pictoon in Senegal, saying that one of the "extra" costs of doing business in Africa was having to replace all his pricey MACs every year because the insonsistent power supply fried them.  Another was the CEO of Daallo Airlines in Somalia commenting that they owed their success to the fact that Somalia had no government at all.  "No government means no corruption," he said, laughing in disbelief.

At this I said simply, "Wow."  Then I thought about all great rushes to development, and how they often seem to take place in a lawless environment--or at least a mild vacuum.  If' you've been watching HBO's Deadwood, you've seen a blistering recreation of one of those environments.  Silicon Valley was another--expansion into the uncharted territory of the internet always outpaced regulation, and sales taxes still haven't caught up.  I didn't vote for Gore precisely because he was so keen on owning internet that I thought he'd mess it up (threw my vote away on some damned libertarian instead).  Most people operate under the assumption that something is always better than nothing.  As the Somalian CEO recognized, no government is better than bad government. 

The best thing the West could do to promote prosperity in Africa would be to find a way get venture capital to entrepreneurs and neutralize government interference while doing so--maybe forgive debt equal to a multiple of every investment dollar that actually goes to enterprise?

Looking into Africa

This post is to introduce everyone to Franklin Cudjoe, who has agreed, upon reading the Kerabu business plan, to undertake a preliminary feasibility study for Africa.  Franklin is the head of Imani, an entrepreneurial think tank in Ghana, and writes some pretty fierce editorials advocating economic liberty instead of "rock star economics."  Begging his pardon, here are some snippets of what he wrote to me upon reading the Kerabu plan:

Very interesting Hillary. Looks like the most cogent plan for bridging the micro credit gaps as you mentioned.  And I’m already considering joining the ‘bandwagon’ as a social entrepreneur combining charity with the business acumen of a for-profit corporation in order to enhance social transformation.

I have been in touch with the Country Director of Action Aid, Ghana and my imagination is that as you mentioned ‘allies’ such as non-profits already in the microfinace business, it might be a good chance to network with them.

Under “The Existing Micro finance Market”, Kerabu has a fine plan for lowering loan costs while maintaining that personal contact. A colleague who works with the Adventist Relief Agency in Ghana complained a fortnight ago about a rare feat he chalked for the NGO in the area of loan repayments. He was the only one in the history of the NGO to have had a 52 pc recollection rate whereas many recorded less than 30 pc....

Franklin has a lot more to say, but I'll exercise restraint in quoting.... I'm looking forward to hearing more from him.