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By Root 592 0

of publicity at the Davos World Economic Forum in 2005 from Gordon Brown, Bono and Sharon Stone, bed nets became a fashionable icon of the aid industry. Unfortunately, when given out free by donor agencies, they often become fashion items instead, being sold on the black market for wedding veils or used as fishing nets. They undercut local merchants supplying them for money. One American charity, Population Services International, came up with a better idea. It sold the nets for fifty cents to mothers attending antenatal clinics in Malawi and subsidised this price by selling the nets for $5 to richer urban Malawians. The poor mothers who bought these nets with half a day’s wages made sure they were used properly. In four years, the proportion of children under five sleeping under such nets went up from 8 per cent to 55 per cent.

To do more good and less harm, says Easterly, the aid business could be transformed into a more transparent marketplace where donations compete to fund projects and projects compete to attract donations. Fortunately, the internet makes this possible for the first time. Globalgiving.com, for instance, allows projects to bid for donations from any donor. In the week I was writing this paragraph, projects that needed funding on the site ranged from feeding Ethiopian refugees, to building the fence around a retirement home for a pet cheetah used to inspire underprivileged children about conservation in South Africa.

In forums like this, aid could be democratised, taken out of the hands of inefficient international bureaucrats and corrupt African officials, taken away from idealistic free-market shocktherapists, separated from arms deals, removed from big industrial projects, distanced from patronising do-gooders and given person-to-person. A rich country could give each taxpayer a tax break for each suitable donation. To those who say that this would make an uncoordinated, unplanned business, I reply: exactly. Grandiose goals and centralised plans have just as long and just as disastrous a history in aid as they do in politics. Nobody planned the industrial revolution, or China’s economic surge. The planners’ role was to get out of the way of bottom-up evolutionary solutions.

Bound to fail?

Most economists are agreed on a list of reasons for the failure of Africa to generate economic growth. Many African countries are more or less landlocked, which cuts them off from world trade. They have poor and deteriorating roads linking distant cities. They have exploding birth rates. They suffer from epidemic malaria, AIDS and other diseases such as sleeping sickness and guinea worm. Their institutions have never fully recovered from the disruptions caused by the slave trade. They were once colonies, which meant rule by minorities uninterested in allowing the development of an entrepreneurial class. Thanks to their imperial colonisers, their Marxist independence leaders and their monetarist aid donors, most African countries have lost many of their informal social traditions and institutions, so property rights and justice have become arbitrary and insecure. Their most promising industry – agriculture – is usually stifled by price controls and bureaucratic marketing agencies imposed by urban elites, and stymied by trade barriers and subsidies in Europe and America, not to mention devastated by a proliferation of over-grazing goats. Ethnic strife between the biggest tribe, which maintains one-party rule, and its hated rival usually poisons politics. Paradoxically, African countries are often also cursed by sudden windfalls of rich mineral wealth, such as oil or diamonds, which serve only to corrupt democratic politicians, strengthen the power of dictators, distract entrepreneurs, spoil the terms of trade of exporters and encourage reckless state borrowing.

Take, therefore, one such typical African country. It is landlocked, drought-prone and has a very high population growth rate. Its people belong to eight different tribes speaking different tongues. When freed from colonial rule in 1966 it had eight miles