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Soros operative Jeffrey Sachs

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MLD38   Wednesday, 02/28/07 04:24:38 PM
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Soros operative Jeffrey Sachs

Previously mentioned in Shadow Party, Shadow Conventions, etc post:
re United Nations Millennium Project & long-time Soros operative named Jeffrey Sachs
Aug 2006, Soros Stealing America
http://atlasshrugs2000.typepad.com/atlas_shrugs/2006/08/soros_stealing__1.html
...long-time Soros operative named Jeffrey Sachs has been placed in charge of the United Nations Millennium Project – a global war on poverty designed to transfer wealth from rich countries to poor ones. Jeffrey Sachs is currently demanding that American taxpayers turn over $140 billion per year to his global welfare bureaucracy....


Jeffrey D. Sachs : Biographical Information, etc
http://www.earthinstitute.columbia.edu/about/director/fullbio.html
Jeffrey D. Sachs is the Director of The Earth Institute, Quetelet Professor of Sustainable Development, and Professor of Health Policy and Management at Columbia University.

Jeffrey D. Sachs as Director of the Earth Institute at Columbia ( http://www.earthinstitute.columbia.edu/ ) leads large-scale efforts to promote the mitigation of human-induced climate change.
From 2002 to 2006, he was also Director of the UN Millennium Project ( http://www.unmillenniumproject.org/ )and Special Advisor to United Nations Secretary-General Kofi Annan on the Millennium Development Goals, the internationally agreed goals to reduce extreme poverty, disease, and hunger by the year 2015.

Sachs is also President and Co-Founder of Millennium Promise Alliance ( http://www.millenniumpromise.org/site/PageServer?pagename=home ), a nonprofit organization aimed at ending extreme global poverty.

Soros pledged $50 million to Millennium Promise Alliance
http://www.millenniumpromise.org/site/PageServer?pagename=about_supporters author of hundreds of scholarly articles and many books, including "The End of Poverty" (Penguin, 2005).
Jeffrey D. Sachs is the 2005 recipient of the Sargent Shriver Award for Equal Justice . ( http://www.povertylaw.org/news-and-events/poverty-action-report/july-2005/sachs )

Sachs is a member of the Institute of Medicine and is a Research Associate of the National Bureau of Economic Research.

Prior to joining Columbia, he spent over twenty years at Harvard University, most recently as Director of the Center for International Development. ( http://www.cid.harvard.edu/ )

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July 2005: Sachs is quoted in "The G-8 Summit and Africa's Development"
Roger Bate (resident fellow at AEI) Testimony: Committee on International Relations --- Subcommittee on Africa, Global Human Rights and International Operations (Washington) starts off:
http://www.aei.org/publications/filter.all,pubID.22786/pub_detail.asp

..."Many powerful people are pushing for more aid and debt relief. The proposals of the UN and the Africa Commission headed by British Prime Minister and G8 host, Tony Blair, aim to achieve the Millennium Development Goals by guaranteeing to double aid over the next ten years. While this will surely be a boon to the aid industry, it merely repeats past mistakes on a grander scale and is similarly destined to fail. The failure will not stem from a shortage of good will on the part of policy makers and citizens of wealthy nations, but because the proposed aid model is fundamentally flawed. That is not to say that specific aid projects, especially humanitarian relief efforts, are not vital, but that systemic aid has not proven successful. And though it is likely that future aid can and will be done better than in the past, the perverse incentives that dog even the best designed aid projects remain.

The US Administration has gone further than other G8 nations in trying to ensure that incentives bound up with aid packages are positive. By requiring prudent institutional changes ahead of aid delivery, the Millennium Challenge Account avoids a common aid pitfall: assuming that aid can promote sustainable policy improvements in countries where domestic stewardship of such changes is absent. However, as the experience of the MCA has demonstrated, such a careful and targeted approach to aid is difficult, slow, and decidedly unglamorous."...
Includes section: Does aid improve growth?

..."Development economists, led by the UN’s Jeffrey Sachs, continue to promote the ‘poverty gap’ theory of development. This correctly observes that poverty prevents the accumulation of savings, which results in low investment and hence low growth, but proposes that foreign aid can 'fill the gap' between insufficient savings and the requisite level of investment in the economy. However, such an assertion confuses cause and effect."...

After discussion and examples, etc, the section ends with:

..."In short, even in the most favorable of policy environments, there remains little support for the initial assertion that aid promotes economic growth.

Despite the apparent simplicity of the poverty trap theory, it doesn't square with common sense or historical reality, as it implies that no country can ever develop. Whereas obviously, nations have developed without massive infusions of aid, and continue to do so. All western nations have developed by hard work, saving small amounts at first, and good institutions like strong protection of private property and sensible, well defined and limited public sector regulation.

Moreover, aid is often spent on projects that benefit political elites rather than citizens, thereby supporting corrupt regimes and often crowding out private sector initiatives."....

The section, Perverse incentives of Aid, starts off:

..."Aid creates perverse incentives for donor and recipient, incentives that are certainly not amenable to economic growth. As Harvard University historian David Landes in the Wealth and Poverty of Nations, writes: ‘History tells us that most cures for poverty come from within. Foreign aid can help, but, like windfall wealth, can also hurt. It can discourage effort and plant a crippling sense of incapacity…at bottom, no empowerment is so effective as self-empowermen"...

Nigerian President Olusegun Obasanjo estimated: ...“corrupt African leaders have stolen at least $140 billion from their people in the [four] decades since independence.”... Corrupt leaders do not discriminate between foreign aid and other revenue (such as oil wealth) when stocking their Swiss bank accounts, so it is nearly impossible to discern how much pilfered loot came directly from development funds. In many cases, however, it is clear that foreign aid’s only enduring gift to many Africans is a large debt burden,"...

Section includes Professor Sachs comments:

..."Professor Sachs, however, seems to dismiss thorough internal reform as a prerequisite for African economic growth. As he recently opined in The New York Times, “The poor are blamed for their problems. We say the poor are poor because they are corrupt or because they don’t manage themselves. But in the past two years I’ve seen exactly the opposite…. The idea that African failure is due to African poor governance is one of the great myths of our time.”...

But evidence is not on Professor Sachs’s side:

..."African corruption has been getting worse not better over the past few years. Each year, Transparency International publishes its Corruption Perception Index (CPI). The CPI defines corruption as “abuse of public office for private gain.” It is measured on a scale from 0 to 10. The higher the number, the lower the corruption. In 2000, the average African CPI was 3.24. By 2004, the African CPI fell to 2.87."...

Section ends with:

..."The truth is that there are no quick fixes to African poverty. Like so many times in the past, the grand utopian visions of well-meaning Westerners are likely to crash on the hard rocks of African reality. In the end, Africans will get it right and prosper, but, as Robert Guest points out, “they will not succeed by imagining that somebody else is going to solve their problems for them, that aid is a panacea, or that anyone other than Africans can make Africa rich."...

Section, The G8 Plan - Making Poverty History?, starts off:
..."There are, however, ongoing complications arising from pre-existing bad debt. These debts are the precise consequence of the flawed aid model and perverse incentives discussed above. Money leant by the World Bank and IMF for development schemes often turned out to be poor investments. Variously, the schemes were too poorly designed to produce the benefits or returns that were claimed or the schemes cost more than the estimates. At worst, schemes were vehicles for graft or plain fraud.

The US has agreed to write-off $40 billion of largely unrecoverable debt from 18 poor countries which are deemed to be following good governance practice. All the OECD G8 countries have come to this agreement,"...

includes:

Major targets, especially those for health, are replete with failure
....e.g. WHO targets - 1978 announcement of Health for All by 2000, which obviously has failed, the Roll Back Malaria announcements of 1998, which have been followed by increases in the malaria rate, and the 3 by 5 initiative to treat 3 million AIDS patients with antiretroviral drug therapy by 2005, which is also failing ---- Indeed, in a rare moment of cogency, in 2004, WHO Director General Lee warned that “if we cannot reach 3 by 5, there is no reason to believe we will achieve the Millennium Development Goals.” ...
As shown previously, there is little support for the idea that a poverty trap exists at the international level:

..."No country has become wealthy from handouts from another. Lack of both good governance and rule of law, among other factors, keeps citizens poor and foreign aid that props up regimes which starve their people of these institutions is a sure way to starve them of bread, as well."....

alternative approach of tailored aid to specific projects and marginal reform of institutions :

..."In the real world it’s the alternative approach of tailored aid to specific projects and marginal reform of institutions that is promoted by economists like Bill Easterly, author the Elusive Quest for Growth, which has proved most successful, especially among the Asian tigers. Despite beginning a half century ago with the same level of GDP, and receiving much less foreign aid than their African counterparts, the Asian nations have boomed."....

The US has made great strides with this more sensible approach towards aid.:

..." In addition, to the MCA, support for humanitarian projects will certainly benefit many in poor nations. Initiatives like the $15 President’s Emergency Plan for AIDS Relief (PEPFAR), the over $1 billion already donated to the Global Fund to fight AIDS, Malaria, and Tuberculosis, and the recently announced $1.2 billion for malaria will bring needed assistance and save lives.

Unfortunately, not all of the humanitarian assistance that the US Congress has allocated to developing countries is being administered properly. Though the MCA is an excellent initiative, the United States Agency for International Development is still responsible for the vast majority of US foreign aid."....

Section ends with:

..."Investing scarce resources in terrible diseases like HIV/AIDS and malaria is a good idea, but the US Congress must demand that the agency it entrusts to handle these funds is fully accountable and spending the money properly. Before the MCA begins to operate on a larger scale, Congress would be wise to ensure that the MCA has the proper mechanisms in place to operate transparently and with fully accountability to US taxpayers"....

In the section, Economic Freedom Will Save Lives:

Popular support for assisting those in poor countries is gaining momentum through the Make Poverty History campaign. The group creditably wants to end world poverty, and part of the purpose of the Live8 pop concerts will be to influence the July G8 summit.

There is a lot about Make Poverty History's agenda that makes sense. It opposes export subsidies as they distort trade at the expense of the developing world's poor. It also advocates the cancellation of debt, which makes sense in some cases, as discussed above.

Yet Make Poverty History advocates that developing countries adopt protectionist policies even as developed countries open up their markets. The campaign deplores free trade as 'unfair' as it sees the exchange of goods and services in an open market as merely shifting wealth from the poor to the rich rather than create wealth for all. But 200 years ago the Edinburgh economist Adam Smith observed that trade promotes economic progress and that the invisible hand of the market directs buyers and sellers towards activities that promote the general good. Nothing has changed to make that basic observation less true today."...

Conclusion:

..."The US approach to aid and trade development is broadly correct. As the MCA rolls out the grants to countries (currently Madagascar, Honduras, Nicaragua and Cape Verde), and assuming the approach remains steady and thoughtful, and continues to measure performance relationships with GDP, we may see whether aid really does lead to development. After 50 years of widespread failure, this is more important than throwing billions at non-implementable projects of often dubious value.

There are many sensible policies which may be dull but have shown success, such as trade liberalisation and research into increasing agricultural output in unfavorable conditions. If large trading blocs were to remove their export subsidies and import tariffs, they would allow underdeveloped countries fairer access to their markets. Economic history shows that all parties win from open trade (with the exception of those formerly receiving financial protection in order to remain solvent). Agricultural research can do much to make food sources more resilient and productive in warmer, drier climates. This would also enhance water security, since by far the greatest proportion of fresh water currently consumed in developing countries goes for agricultural use.

Poverty will not be made history by aging rock stars and good will, but by sound institutions and domestic growth. Aid has a role to play, especially in humanitarian relief, but it is a minor one, and can be counter productive if not done carefully."...


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