Should Cold Hard Cash $$$ Replace PCVs?

Thanks for the ‘heads up’ from Joanne Roll (Colombia 1963-65)

Foreign aid as a cash-only transaction? It’s worth a try.
By Christine Emba
September 26
Washington Post

“The United States is the world’s largest giver in the world, by far, of foreign aid,” said President Trump during his address to the U.N. General Assembly on Tuesday. Unlike some other claims he made during that speech, this happens to be true. In 2018, the United States budgeted nearly $40 billion for foreign aid, for interventions ranging from global health initiatives to disaster relief.

But trumpeting — or, in Trump’s case, complaining about — the big numbers leaves an essential question unanswered: Are we giving our money well ?

This month, the U.S. Agency for International Development (USAID) released the results of a landmark study on the best strategies for poverty reduction. Past evaluations relied on comparing aid recipients with control groups that received no aid. The ones who were given aid tended to do better (no surprise there) and sometimes didn’t see any change at all. But the new study compared the traditional approach to foreign aid against just giving the beneficiaries cash — and the results should make us think.

In rural Rwanda, where USAID is fighting child malnutrition, researchers assigned nearly 250 villages to either typical, mediated aid programs or no-strings cash transfers, and tracked the results.

One group of villages received a standard development aid program known as Gikuriro (“well-growing child” in Kinyarwanda, an official language of Rwanda) that included setting up village nutrition schools and microfinance communities alongside water and hygiene interventions, at a cost of $142 per household.

But in a second group of villages, households each received cash grants that closely mirrored the per-household cost of the standard Gikuriro program. And a third group received an even larger cash transfer of more than $500 per household — a mobile payment sent through a nonprofit called GiveDirectly.

After a little more than a year, researchers found, neither the standard intervention nor the equivalent cash transfer had moved the needle much on USAID’s primary goals of improving children’s health and family nutrition. (There were secondary benefits, however. Families were able to save more under the traditional approach; those who received the cash equivalent were able to pay down debt.)

But things were different with the larger cash transfer: Those villages saw substantial improvements across the board. Children were healthier, households had better diets, and families were able to build wealth and buy useful assets, such as livestock.

That’s a potentially uncomfortable finding. It may well be that our complex, traditional programs aren’t more helpful than just giving the money we spend on them to recipients to use as they see fit. And giving cash in larger amounts could be transformational , if we can bring ourselves to do it.

In his own writing on the study’s results, GiveDirectly co-founders Michael Faye and Paul Niehaus suggest that donors such as the United States and United Nations begin to use cash as a yardstick: “If an intervention isn’t more effective than cash, then perhaps the donor should switch gears.”

It makes sense. Cash is flexible and easy to distribute.

And studies show that, generally, people use cash grants sensibly to buy what they need — which can vary in ways even the most thoughtful aid program can’t address.

But here’s the catch: Americans really don’t like the idea of simply giving people money. We aren’t against aid or charity, of course, but that is not the same as just handing out cash for recipients to do with what they will. There is a paternalistic suspicion that they’ll waste it, or that we’ll create that much derided “culture of dependency.”

Domestically, that takes the form of closely monitored, in-kind welfare: food stamps or subsidized housing, say, rather the equivalent outlays in cash. When we offer our help abroad, our attitude is the same.

In fact, many Americans believe we already devote much more money to foreign aid than we actually do — and they generally think that it’s too much. On average, aid is estimated as a quarter of the federal budget when, in reality, it is less than 1 percent. Imagining those funds flowing directly to others in a stream of cash, rather than mediated by U.S. “expertise,” will sit even less well with the ordinary taxpayer.

But what if that’s what works? Maybe it is time to rethink the idea that we know better what other people need. Maybe the best way to help is to let the people decide how to help themselves. It is an attitude that could be applied domestically, as well, and one that could lend much more dignity and simplicity to our crumbling welfare state.

Later in his U.N. speech on Tuesday, the president said he would be taking a “hard look” at U.S. foreign assistance. “We will examine what is working, what is not working . . . ”

If he really means it, cold hard cash may be the place to start.


Leave a comment
  • Science so often deceives that one must rely on common sense. The children of the rich and powerful live a life of incredible privilege based upon generous handouts from mostly absent parents. Were they happier? Even those amongst the working class who received handouts via scholarships, grants and loans, what friendship did this foster? Appreciating kindness and patience is a very important ingredient to a long-lasting, positive relationship. Little cards filled with money, signed by a machine for a giant untouchable organization cannot do this.

  • Peace Corps’ three goals are to promote the overall mission of peace and friendship. So Lawrence Lihosit’s comment makes sense in reaching that mission goal. However, the first goal -sending trained people to interested countries is critically important and, I believe, woefully unfilled. I do not believe that Peace Corps has ever adequately evaluated that goal. People who are hungry, who are sick and have no access to medical care and who count their children by naming children alive and children dead, do not benefit from a friendly, but empty hand.

    I was a “health educator”. it became quickly apparent that health eduation is a preventive measure. When people are already sick and there are not resources to treat them, health education is ineffective. My experience with Peace Corps staff is they seem totally oblivious to this fundamental fact. At our COS conference in 1965(!), a PC/DC staffer sent down to “debrief” us, was “surprised to learn that boiled water would not “cure” amebic dysentery. Fast forward to 2009, in a phone chat with a PC>DC manager, a retired air force hospital administrator, I was trying to find evaluation reports and try ing to explain what I was looking. He was shocked when I talked about “dirty needles” being used in vaccination campaigns. That is real dangerous, he said. DUH. The lack of adeuate infrastucture to properly sterilize needles and instruments has been and continuse to be a critical problem in many, many parts of the countries in which Peace Corps serves. When John Turnbull complained that US trained doctors and nurses left their countries to come to the US, he was describing a real problem Many realize that the lack of proper infrastructure still makes it very difficult to safely practice medicine and nursing in many areas.

    The study is interesting. I do not know Rwanda or Africa. I do not know what was the selection criteria for grouping the 250 villages into groups. Were the resources available, prior to the study, equal? What was the long range effect of the study, not just an ealuation after one year. Were there any problems created among the villages because some receive money and others did not? I think the study is a good place to begin, not end.

  • I think Lawrence L is exactly right, in asking if anonymous hand-outs of money can ever engender the friendship and understanding that Pres Kennedy was talking about in 1961. My mind goes back to the memories of fifty years ago, visiting remote African villages as a PC geologist. What I was doing, in terms of PC First Goal, had no relevance whatever to the well-being of the villagers.

    BUT, there was a LOT going on aside from that. A person presumed to be important, but taking the time to notice the children and to talk and banter with them, meant that I, and my crew, in the view of the village elders, were safe and trustworthy, and to use the expression “on their side”. A tremendous amount flowed from that understanding. I was amazed at the degree of TRUST accorded me. It seemed, with the war going on next door in Mocambique, and bad things to be feared, it seemed the world was a little safer when I, and my crew, were there. It had nothing to do with helping the village enjoy better health or well-being. It had to do with simply being there, and taking an interest. And being an “important person” (i.e. a “Beeg Mahn”), I would have answers to questions they had — the village elders as well as the children.

    As early as 1964, even before Independence in the then Nyasaland Protectorate, there were already worries about creating, inadvertently, with all good intentions, a “Culture of Dependence” that Joanne R alludes to. All of the attention back in those early days in Africa, like a sort of PC Fourth Goal, was to create sustainability. To leave behind a structure, of whatever sort, which would continue the volunteer’s work. For ME, that legacy was back at the Geological Survey Dept office, I guess — not out in remote villages.

    Returning to the aforesaid article, it goes without saying that lavishing huge amounts of unearned income on people is going to have a measurable economic effect. How could it NOT ?? But, that isn’t what the Peace Corps was all about.

    I wish I could recover some of the things I earlier posted here, about those conversations with the village kids about whether the earth was flat, or round. Nothing to do with village health and well-being, and PC First Goal, but a LOT to do with friendship. John Turnbull Ghana-3 Geology and Nyasaland/Malawi-2 Geology Assignment.

  • Lawrence and John T.

    I think you are both speaking about the importance of the Second and Third Goals. I appreciate your concerns that if the First Goal were to be replaced with “cash”, what would happened to working and learning with Host Country people and bringing that knowledge home? I agree with those concerns. The pursuit of one goal should not take the place of the second or third.

    I urge a reevaluation of “sending trained people overseas”. If the felt need of a community is resources and Volunteers can not help to secure them, then maybe cash is the answer. After each of the “charlas” or little talks that we would deliver as part of our health education program, we would ask the mothers what they wanted. The most eloquent and poignant answer I received was repeated over and over and echos through the ages. “We want to keep the children we have alive and we do not want to have any more children.” Cash to those mothers would have gone a long way towards helping them meet those needs. Puppet show by well meaning PCV pol sci majors did not.

    Early days, we were not able to “give” anything…not a baby aspirin, not a centavo. We could leverage CARE food for school lunch programs. Today, I know that PCVs can help people request grants for projects. That’s good.

    I wish that NPCA would schedule a discussion on this topic at the next Conference in Austin, June, 2019.

  • Joanne, I think your idea for a discussion of the Big Picture is long overdue. I would only caution that Africa is a very different place that Latin America. I say that, from not only my early PC experience, but the reality TODAY of talking to immigrants from Central America, and Mexico, which I do. There simply is no substitute for person-to-person communication.

    I have advocated a sort of semi-privatization of the Peace Corps effort, making it less a government program, and more an effort of the American People. In that regard, and remembering the mission hospitals in eastern and central Africa, and the dedicated nurses and doctors who staffed them, many affiliated with a religious denomination, I have advocated the creation of a sort of partnership between a clinic or hospital, with a counterpart in Europe, Canada, or the US, or even Japan (which is getting a little less xenophobic by the year). A partnership going both ways, providing state-of-the-art care, and going the other way, a means of training from African personnel.

    In a similar vein, I have advocated school-to-school partnerships, involving not only the teaching staff, but the kids, corresponding with their counterparts regularly. Exchange student programs. Like an education-centered “City-to-city” program, but with gritty substance, not just ceremonial platitudes.

    My mind goes back to the week I spent (this in newly-independent Malawi), with the mission hospital run by the French-Canadian nuns. I had been sent there, with a helper, a British VSO, to survey and design the foundation for a new maternity wing, on their hospital. Africans seemed to sense that even being a Beeg Mahn, I was approachable — something I’m proud of.

    One day, at the post-op building, full of women recovering usually from C-Section deliveries, the novice, in her BLUE habit (this contrasted with the regular Canadian nuns’ white habits), said to me, something like “I so want to be one of the nuns, and pray with them, and still I am a ‘kitchen nun ‘ “. Being Beeg Mahn, maybe. . .”. Knowing exactly what she meant, I replied that I would carefully speak with the Mother Superior. As I wrote earlier, it had nothing whatever to do with PC First Goal, and the building-foundations surveying, but the PC Second Goal of understanding — and in this case doing something.

    Now, at my advancing age, I think that to have been a Beeg Mahn, AND at the same time perceived as approachable, was maybe the greatest accomplishment of my PC service. What memories ! Add to that, the village children elsewhere, following me and my crew through the bush, in single file, wanting to see what we were finding — and with total trust. What memories ! John Turnbull

  • Development is a complex enterprise whether in Africa, Asia or Latin America. Most of the African population depends on farming. The major primate cities are poles of attraction of the young able bodies for economic, educational and social opportunities. Hence this rural urban migration creates an uncontrollable demographic growth which governments find it difficult to deliver to the urban population the economic and educational opportunities the young labor force aspires. Should Aid Experts and the respective governments focus on Rural Development to maintain and sustain the young labor force from leaving their birth places by providing the needed urban amenities? That is the question that should be tackled. Most rural areas lack the basic necessities like potable water, electrical supply, health clinics, schools, proper diet, mode of transportation and communication. Personal interaction by those who provide aid is significant in terms of establishing trust, but the problem is much more complex than that. The problem of poverty is not solved by the simplistic approach of providing more cash to a target population or families. It might bring a temporary solution, but in the long run their plight will not ameliorate. Foreign Aid by the United States or other Industrialized countries has been around for more than fifty years.
    The funds allocated for development in Africa has not shown results that deserve to be applauded. In some cases the economic situation has been worse off. Foreign experts have tried band aid approaches by selecting narrow projects. It has not worked. The Peace Corps has made significant contribution in education and healthcare and I am sure most volunteers understand the problems in the rural areas in Africa or Latin America. There should be a comprehensive approach.

  • Edward M, Perhaps it’s for YOU to capture what Carl Sandburg might have said. To be perceived with total trust, in the midst of a sometimes dangerous world, even as your crew were armed with razor-sharp machetes and Africa-hoes, says something. We, and maybe a lot of African villagers, can thank God that the PC “visionaries” in Washington, were a long way away — in Washington. And the PC Country Director in Blantyre, was equally remote, and busy writing his reports. John Turnbull

  • Well, John T, my serious musings are balanced with foolishness it seems and here is a “nudge, nudge” form: MICE

    True, also, sometimes
    (which was the first horse and
    that looked like a pig) –AND IT’S NOTHING I CAN PROVE EXCEPT FOR
    ©Copyright Edward Mycue

      Waiting (1)
      Childhood desire turns life’s wheels,
      these large hoops, propelling them with sticks
      under the tall park elm trees. Movement of wheels.
      Everyone there is here now
      within you and all of your
      kin and all of your kith are here now and it will take a lifetime to
      flower and to fly and to sail this sea of
      thickening light.
      Room-tone, mouth-feel, a reordering
      of parts, rationing of emotions: I hear voices:
      they live here now without forgetting the way
      back under the surface of consciousness, the
      bungled aspirations, of leprosy as a model,
      and grim ire.
      Life pushes, photography wins over
      time, and over the mind a brown shale.
      Boatman Waiting (2)
      River of life life river the river life life a river bed all pass through Our
      earth is a riverbed our river of life River Styx forms a boundary between
      life, death Charon, the ferryman, carries souls across
      Dante says there are five rivers and that Styx is for the
      greatest damned living their wrath cursing war with each other for all
      Waiting for the Furthest Shore (3)
      My mischances shaped my apprenticeship-muscles
      When you are young you don’t know what’s coming
      Life is not the same poetry now, just verse
      My inner sanctum let joy become lost in Cairo
      I grasped failures through a lengthy history
      Wanting to learn dying before severing life’s link
      Welcome the far shore before you miss it
      Notice the far shore before you reach it.
      © Copyright Edward Mycue 5 October 2018

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Copyright © 2022. Peace Corps Worldwide.