How Can We Improve Aid Effectiveness?

by Joshua Foust on 4/29/2011 · 20 comments

It’s rare I agree much with National Review, but they ran a piece by Marine Corps War College professor Jim Lacey that resonated with me a great deal:

The same thing struck me as I flew into Kandahar a few weeks ago. Below me was a city of approximately 800,000, and it was working. In fact, it has been working since Alexander the Great created a Macedonian military colony there almost 2,500 years ago. Do the city’s markets function with the efficiency you would find in the developed world? No. But they do function. Every day 800,000 persons get fed, without the help of American soldiers or any foreign-aid workers. If every westerner left Afghanistan tomorrow, they would all still get fed.

This raises a question: What are we still doing there? If the answer is nation-building, then it is time to declare victory and leave. The nation is built. It may fail again later, but that will be a problem for the Afghans. As of this moment, Afghanistan has a functional society and a working economy. How it works is ugly beyond measure, but it works, and everyone gets fed.

Apart from the “getting fed” part (Afghanistan, including Kandahar, is actually one of the most food-insecure places in the world), I mostly agree with this, and it parallels my discussion last week on Afghan politics. Afghans are capable of running their own affairs just fine; if given the chance they can develop their own economy, grow their businesses, and develop their own economy. We don’t have to dictate to them.

This makes for a good segue to discuss the some of the research I’m doing at my think tank. This week marks the release of an intro paper for a series I’m doing on reforming the aid process in crisis and post-crisis states. It’s a doctrine called “Expeditionary Economics.”

One way to alter aid policy is to invert the normal methods of foreign aid, and improve on “bottom-up,” community-centered aid. Economic development and assistance projects usually take a top-down approach: the host government is supported, and expatriate development workers descend on the capital city to craft plans for they think the national communities they’re meant to serve should grow and develop. The projects that the aid community focuses on tend to be either amorphous and ill-defined (like “capacity building”) or large scale infrastructure development (like paving highways and building buildings). They are focused, in other words, on inputs—if the right things are done to a recipient country, then the right outcomes should result.

Unfortunately, “bottom-up” approaches make this same mistake: they often rely on expats dictating to communities what their needs and opportunities are, and assume that if they bring the right inputs, the right outcomes will naturally follow. Missing in both aid approaches is a full appreciation of outcomes. Many aid organizations measure their success in terms of money spent, miles of road paved, or amount of time devoted to a project; it is relatively rare to see assessments based on outcomes (that is, what effects that money, construction, or time actually had on the target communities). Missing, too, is any consistent means to empower and promote the needs of regular, non-elite people in recipient countries. Rather, aid projects are driven by donor concerns and political arrangements in the recipient capital.

One way to rethink the doctrine of development and assistance aid is “expeditionary economics.” At the heart of ExpEcon, as it is known, is the assumption that economies grow because businesses grow and that growing economies are a benefit both to U.S. national interests and to global security. Growth is not just the result of a generic set of capacities or regulatory structures—the normal “instruments” of aid policy—but rather the result of businesses creating wealth, expanding and hiring new people to take on new tasks to generate new wealth. Therefore, ExpEcon is fundamentally about business development, with a focus on empowering local communities instead of international organizations.

This may or may not really work out in practice — it’s kind of a new thing, and part of why I have a salary is to explore practical and strategic ways of implementing this idea. But when we think about what a country like Afghanistan really needs, it’s not a lot of high-priced consultants telling them what to make and what to grow and what to sell. Afghans (and most people, actually) are really perfectly intelligent. We can best serve them by getting out of the way, and getting other bad actors out of their way so they can do their own thing.

Subscribe to receive updates from Registan

This post was written by...

– author of 1848 posts on 17_PersonNotFound.

Joshua Foust is a Fellow at the American Security Project and the author of Afghanistan Journal: Selections from His research focuses primarily on Central and South Asia. Joshua is a correspondent for The Atlantic and a columnist for PBS Need to Know. Joshua appears regularly on the BBC World News, Aljazeera, and international public radio. Joshua's writing has appeared in the Columbia Journalism Review, Foreign Policy’s AfPak Channel, the New York Times, Reuters, and the Christian Science Monitor. Follow him on twitter: @joshuafoust

For information on reproducing this article, see our Terms of Use


Homira April 29, 2011 at 4:54 pm

Josh, I’ve been a big fan of your blog and recommended it to many people, but I’m perplexed at your foray into “aid effectiveness”. There’s already a great deal of literature looking at results-based (outcomes) development in all sectors, and ExpEcon sounds like a new name for the business-as-usual school of economics called the Washington Consensus. I applaud anyone who wants to learn about a new field, but I, personally, would be cautious before I venture into military strategy or energy policy. I hope you’re reading Bill Easterly’s blog, Alanna Sheikhs, How Matters, as well as the performance-based financing ones out there. There’s an excellent on-line discussion from The Economist I posted onto my Facebook that amply demonstrates that the jury is way, way out on methods that appear to be quite scientific such as RCTs, so to simplify economic growth and its attendant benefits to just business growth is missing a LOT of the picture. A lot of good work has been done in development in Afghanistan, and I hate to say that because I’m normally a fan of the glass-is-half-empty camp and I love to find the gaps in what is claimed to have been achieved. And of course the high-priced consultants approach is not optimal, but not all of what these consultants are useless, nor are all of the international organizations incompetent. Very, very gray dude. However, on your point of removing the bad actors to make progress, I whole-heartedly agree. Can the Afghans do it alone once that’s done without aid? Look at the per capita aid Afghanistan is receiving compared to Bosnia, Rwanda, and every other post-conflict zone in the last 30 years. The degree of devastation that exists in Afghanistan coupled with the social trauma of a phenomenon like the Taliban has never been experienced in modern history. Add to that the natural disasters from earthquakes to floods to droughts and the lack of infrastructure. Afghans are strong, exceptionally resilient and resourceful, but they deserve better than to be left to the grassroots predators that we’ve enabled. And it takes more than intelligence to pull yourself out of so much trauma and deprivation. Yes, the aid system in Afg (and everywhere) needs aggressive reform, but it takes strong institutions to deliver the aid effectively and sustain progress after the donors leave and despite all our flaws, we do have an evidence base on what works and what doesn’t.

Joshua Foust April 30, 2011 at 11:34 am


I appreciate your concerns, however I don’t think EE is just another version of the Washington Consensus. The WC approach focused extensively on capital-oriented high-level government reforms, and dictated a very specific economic structure (e.g. exports-led development). EE actually advocates the opposite—working outside the national capital, empowering local communities, and, most importantly, not dictating to them how their economies should develop. That should be their choice, not the expat consultant’s choice.

As for devastation in Afghanistan, I agree. It is a major problem. At the same time, when I look at what happens when Afghans are given a little space and just a little peace—somewhere like Herat or, for that matter, Haqqani-occupied Khost—it is remarkable to see how quickly an entrepreneurial mindset takes hold. Without American dictation, or IMF-sponsored capacity building.

Keep in mind, too, that this doctrine I’m exploring isn’t meant for Afghanistan. It might be appropriate there, or it might not be. But I do think one of the biggest problem elites have when contemplating these decisions is the assumption that we, the West, must solve all problems before the poor dumb natives can take over their own affairs. Not only is that insulting, it flies in the face of reason and logic.

Homira May 1, 2011 at 1:49 pm

Your points are well-taken Josh, but it’s a little like throwing the baby out with the bathwater. The IMF is one of the most responsible actors in the donor community right now, withholding disbursements until the central govt cleans up its act, and by doing so, enormously influencing other bilateral and multilaterals to put pressure on corrupton. There’s no question that development should be ‘owned’ by the people, and it’s widely agreed upon that community-driven development (CDD) is what works most effectively, e.g., the NSP is one of the few programs working in parts of Afg, and it’s all village-council led, but you also have to have national-level programs for large infrastructure, trade, energy, including regulatory frameworks (that are enforced) for all these sectors, and in that case the policymakers aren’t all from the ‘community’. Much of the upper levels of the IROA are from the Afghan diaspora, and we would hope they have the interests of the nation-at-large in mind, but that’s rarely the case. No time to go into this further, but bottom line is that there has to be accountability.

If SMEs are the panacea for poverty and economic recovery, why aren’t we investing madly in them all over the world?

M Shannon April 29, 2011 at 5:28 pm

My experience is that the best (speed, cost effectiveness, least corruption, Afghan capacity building and least disruption from security elements) method of delivering projects in Afghanistan is:

1) ask the locals what they want and will support with laborers,
2) if their plan is feasible send them to the governor for his OK. Be careful with grand irrigation projects. The hydrology is complicated and you don’t want to do more harm than good
3) have the locals get the local Taliban’s OK. This advice sends army folks up the wall but it’s how things get done.
4) use blind bids and public opening of bids for materials. Aim for 10-12 bids near cities. Don’t sub-contract.
5) use Afghans to supervise projects and different Afghans to monitor the project. A number of GPS based tools can be used to help monitor projects
6) use as few expats as possible
7) go low profile and don’t use PSD security teams. Live downtown.
8) listen to the military and be polite but realize their plans are likely bad
9) don’t worry about coordinating with PRTs

That’s how you do it. That said delivering development and aid dollars don’t seem to stem this insurgency and in fact the influx of dollars seems to be, along with stolen NATO & ANSF supplies, funding the Taliban.

As villagers get flush with cash and food, at least in part due to development and aid, they have a surplus that can be stolen by or donated to the Taliban.

In any event most US develop cash is wasted on too many “experts”, profit margins, sub-contracting and far too many security folks along with their armoured vehicles and FOB accommodation.

Grant April 30, 2011 at 3:42 am

Alright, but what do you propose we do about the issue of corruption?

Andrew Moriarty April 30, 2011 at 7:07 am

Can anything be done, though? I have yet to see an impoverished nation like Afghanistan effectively tackle issue of corruption.

M Shannon April 30, 2011 at 8:33 am

Corruption: US or Afghan? The US is by far worse and much more costly.

1. Stop sub-contracting of projects
2. Pay workers and venders directly and never through middlemen
3. Go through NGOs as often as possible
4. Use blind bids for materials and public openings
5. Afghan government never touches the money
6. Stop cost plus contracting
7. Pay for results and not for “trying”.

Homira April 30, 2011 at 9:57 am

Shannon’s formula’s the closest to a winner, but by stop sub-contracting, you mean what? when you go through an NGO, that’s still sub-contracting. The rest is excellent.

Joshua Foust April 30, 2011 at 11:36 am

I’d disagree with both of you. One of the big issues facing Afghanistan is that 99% of the aid and development goes outside the government. It means that the national government never learns how to monitor or regulate activity within its own borders; instead, as MShannon notes, they just spend all their time seeing how much they can skim off the development budgets that were never cleared through any locals or administered locally.

StaffGuy April 30, 2011 at 12:40 pm

M Shannon: So how do I get the military to buy off on your development / anti-corruption methodology? And take the question as sarcasm if you want to however it is not asked in that vein. As one of the military folks trying to get better results from our efforts, I would truly like to know what would be a good way of convincing my seniors that these concepts work.

If not that, then:
4 – what is “near” a city? Is population density (best guess would have to work I assume) the best metric for judging what near is?
5 – how do we pick who supervises and who monitors? The list of qualified Afghans is, regrettably, short. And by qualified I am not talking about western letters following one’s name, just those that actually can effectively do the job.
9 – nothing but agreement from me here
5 – doesn’t this conflict with #2 in your develop list? Or is the idea that the government approves/supports but, behind the scenes, still has no access to the money?
7 – yes!

By and large I really like your lists. I think that they are something that I could hand to, say, a company commander, and that Cdr could make better things happen. Granted, far from perfect. But better than what we’re doing now? I would like to think so. And yes, it means military involvement. But since we’re here anyway I am thinking that if we can be more effective then that is better than just sitting around on QAF and not watching the local prisons.

Dishonesty? April 30, 2011 at 9:12 am

Lesson learned (very funny-regrettably)
USAID’s agriculture problems in the south began with money. Too much of it.

In 2009, the agency issued a $300 million grant to Arlington-based International Relief and Development (IRD) to help farmers in two southern provinces — Kandahar and Helmand — improve productivity over just one year. The agency initially did not want to spend so much in such a small area so quickly, but it was told to do so by Richard C. Holbrooke, who had been President Obama’s special envoy to Afghanistan and Pakistan until his death in December.

The program’s goal was to increase employment opportunities by rehabilitating farms in both provinces. That was to be accomplished by paying for day-labor jobs to clean canals so more water could get to crops, offering subsidized seeds so farmers would be encouraged to switch from growing opium-producing poppies, distributing tractors and other equipment, and constructing a network of gravel roads so growers could take their goods to market.

Because many parts of the two provinces were too unsafe at the time for civilian reconstruction workers, IRD concentrated its activities on a few districts, flooding them with cash and supplies. Some American officials and development specialists would later conclude that the influx distorted local economies and created an unhealthy dependence on U.S. handouts.

In Kandahar province, farmers were given far more seed than they needed, according to an evaluation conducted by an agricultural adviser working on the project. “Instead of distributing one package of seeds and fertilizer per farmer, those who could be found ended up walking away with six packages, perhaps more than any one individual could possibly contemplate planting,” the report stated. The result was that farmers took tons of seed and scores of free tractors to neighboring Pakistan and sold them for cash, according to officials involved with the program.
In Kandahar, a program to pay thousands of men to prune 50,000 acres of orchards — in an effort to increase the amount of fruit grown on the trees — has been met with derision from the governor. “In my childhood, everyone was cleaning the canals. They were pruning their trees. Nobody was paying them,” said Kandahar Gov. Tooryalai Wesa, who holds a doctorate in agricultural economics. “IRD is killing the culture here.”
USAID had been reluctant to give IRD another extension, reasoning that a gap in agriculture assistance would be less bad than continuing a program it knew to be problematic. Several agency officials also believe that the current program’s emphasis on day-labor projects is unsustainable and needs to end.
But the military has a different take on day labor. It regards “cash-for-work as a critical component of U.S. counterinsurgency operations” , allowing the Americans to lure disaffected, unemployed young men away from Taliban recruiters. And when it became clear to commanders that there would be a gap between the programs, they howled.
“AID feels bullied into this,” the senior official said. “It feels powerless to say no to the military.”
In the case of its program to bolster local governments, USAID’s problem stems from a failure to communicate.

The agency designed a $140 million initiative last year to help stabilize areas in the south in the wake of military operations to clear out insurgents. The new program, which was supposed to begin this spring, was aimed in part at coordinating what have been disparate and overlapping efforts to train local officials and fund small reconstruction projects. In one part of Kandahar city, USAID recently discovered that it had several contractors “doing the same thing,” one senior agency official said

Homira April 30, 2011 at 10:10 am
M Shannon April 30, 2011 at 6:46 pm

“My” system requires working with the local government- hence the requirement that locals go through the DG or PG. Most have piles of requests for projects submitted by locals. The purpose of going low profile and limiting expat staff is to put an Afghan face on things and reduce security costs. Ditto for ignoring the PRT (unless I’m invited to lunch).

Every project requires a MOU signed by a level of Afghan government. I stay away from grand openings and let the PG/DG take the credit- but all funds are doled out by me. I don’t attend shuras if I can help it. I expect the DG/PG/MRRD folks to consult with the locals to determine what projects are needed. I leave the locals and DG/PG to figure out what they want and will support and my Afghan engineers to report on it’s feasibility and costs. Afghans engineers will plan the project. As for monitoring most projects there are far more qualified Afghans around that many expats think- many won’t work for the military but are happy to work for an NGO or low profile dev corp. It’s amazing what will happen if Afghans are treated with respect and employed in jobs that they have experience in.

Sub-contracting is the sale of the project by the initial winner of the contract. USAID could contract with XYZ NGO to do a project but XYZ should be required to execute the work and not sell the project to another organization. Getting a cut and then passing on the project shouldn’t be allowed.

Steve Magribi May 1, 2011 at 2:14 am

This MShannon system is really the same as all others. Nothing special or delicate.

A. A very key weak link…”My engineers run the costs”…Shannon is basically dependant on the deals that the Engineers makes, the relationships the Engineer has in the area and how he relates to the local guy. This super professional Afghan engineer exists only in his head. Yes, super capable, but nothing is getting done without the key “big guy” getting involved..usually one of the WJ members who holds sway over the area. Nothing and nothing gets done without his “cut in it”….Shannon probably has no idea who this is and is thus getting his clock cleaned through this. An MOU from the PG or DG does not even mean the PG or DG has seen this. Another flunkey will just go “Ok…I get it signed for you” and Shannon runs off with his check mark…”DG involved” ….pretty lame.

Though it makes it all sound so good. He is blissfully ignorant and his Afghan handlers are running the show. This is what happens when you think you have got things figured out after a couple of years in country and don’t really know anyone at all. The Afghans are over joyed by this kind of set up…just overjoyed.

B. What this misses is that in no way does any of this aid garner support for the Government or War Effort. When I talk to the Elders or in Afghan groups, they just laugh about the aid. There is no way to make it anything other than what it is, just a corruption device.

The “Afghan way” on this is like no other, been this way for hundreds of years…not going to change. They think we are just dumb for spending money like this and know that most of it is used to buy houses in Australia or England or wherever. You can always enjoy the video from these rich guys and their huge huge weddings in Australia or Britain though. Quite a show. Your Aid money at work. Thanks to the PRT, Shannon, the NGOs and USAID…

C. Someone mentioned having a Company Commander do Aid. Not a chance, wrong guy. Always a disaster. Company Commanders are the last ones who should ever do anything but work with the ANA in their area. The more the American Company Commander gets involved the less that will get done in the future. Big huge mistake. Keep the Army, and the PRT out of it all. This is what Afghans want, have said one thousand times and we never listen to it.

C. The PRT is just like Shannon. They have their “go to guys” and ones they like working with. Can be no other way. The Engineers are trapped at the base and need to get things checked somehow. No difference. Different title …same system. Same type of small BS projects that do not make one iota of difference in how Afghans consider their Government or ISAF.

D. What Joshua was saying is the only way to go. All money all aid, all projects, period needs to go through Kabul and down to the Province. All the Aid..all the time….From Kabul down to the Provincial Government Development Section and from there to the town governments and population. This is how things NEED to be, and how they will be some day…The Afghans understand this and have asked for this one thousand more time. We just won’t understand.

The PG is not going to like it, the NGOs are not going to like it. Shannon and the PRT are not going to like it. But until this happens it is just the goat screw system that we have now. A joke.
All this effort all these years, the Afghans just say “The Soviets did a better job all the time.” This is one of the saddest things anyone can ever hear. After the Russians killed over one million Afghans they still think we are unable to deliver Aid and projects like they did.

The Soviets concentrated on a few key areas, big agriculture, urban housing, communications etc. They did not go around installing BS water pumps and farmers markets wherever they went. Afghans had markets before the US did, they can figure that out. The Soviets at least understood what Afghans want.

E. Things are very very simple if you just look at over the long term. What would make the most difference to Afghanistan are big mega projects. These when done make a difference to thousands and will be remembered.

Projects like a new Kabul Jalalabad highway cutting the trip and routing through Western Nangahar. Big electrification projects like the Indian project with links to Tajikistan, The Chinese Railway project. Hospitals are always on the list. This kind of big project is what Afghans always point to and say, wow that is what they did for us. If you cannot understand that you are missing the point and do not understand Afghans’ aspirations and dreams for their country.

All these small BS police substations, cleaning the canals, small roads…are not what the country wants. These small piddly ass projects are what Afghans laugh at.

They want new infrastructure that they can point to, that they can be proud and thankful for, that the Government can say :”look what we did with the Americans.” Even the simple farmer can understand big projects, big hospitals, big highways, and big electrification Big Bridges…etc..

As soon as the ten thousands of Aid people get out of country and we just do big projects nothing is going to matter. This is what Afghans want, this is what we should do, and this is the best way to make progress in Development in Afghanistan.

Afghans think big, we should too. They do not want these small dumb mini localized projects they want something that propels the country forward in the future on a solid fundamental basis.

Homira May 1, 2011 at 1:36 pm

@Shannon: I fretted over this yesterday because even if you avoid local government, they often own the local “NGOs” indirectly, so they’re still getting a fat cut. This is endemic. If you bring in a new local NGO or from another province or district, you find the equipment conveniently set on fire, so you have to go with the Governor’s NGO. It’s not smart to point out the conflict of interest if you want your work to go forward and not have your local staff killed, not to mention that even most of the Ministers in Afghan government have their own NGOs and it’s not considered a conflict of interest. I would really like to figure out a solution to this, I’m not trying to be critical of your list. Then there’s this lovely piece from Rajiv in yesterday’s Post:

How would you manage this if you were the project manager? Under pressure to report on kms constructed each month, paying for protection that you don’t know if you need or not, but getting attacked anyway. $143 million for security? And that’s just the officially accounted costs.

I humbly offer that better tribal mapping and on-the-ground intell could weed out these guys and their networks? but this is the Haqqani network and on their own turf, so I’m asking what the experts like Kilcullen would advise?

M Shannon May 1, 2011 at 2:15 pm

Homira: The question is not how to do it but why if you know you’re funding the enemy and are likely to have huge problems. I wouldn’t expect a private business to do this project.

I’d use a US Army or Navy construction battalion with a cavalry squadron complete with AHs for security of the actual construction with mentored ANA battalions and US ambush teams guarding finished stretches.

I don’t believe in fighting to deliver development. If the locals want and need a project but are unwilling to secure it fine we’ll go somewhere else. Let the Taliban explain why the half million dollar irrigation project was cancelled. Reinforce success not failure.

The road in question is a security project not for development or aid. It’s primarily designed to allow military movement and has been foolishly contracted to firms that everyone knew would sub-contract (perhaps multiple convoluted sub-contracts) instead of being done by soldiers.

WRT NGOs I’m referring to western NGOs not Afghan. This is for financial accountability and not competence or trust worthiness reasons. I’m all for helping local NGOs but the cash should be tightly controlled and again since I’m against sub-contracting handing off a project to the PG’s pet NGO should be forbidden.

Homira May 1, 2011 at 2:57 pm

Interesting Shannon. Incredible sense when you say: “I don’t believe in fighting to deliver development. If the locals want and need a project but are unwilling to secure it fine we’ll go somewhere else. Let the Taliban explain why the half million dollar irrigation project was cancelled. Reinforce success not failure.” But if we allow insecure areas to fester, then how do we enable stability? A question that has always vexed me is the chicken or the egg theory of security and development. Sure, they’re great together, but can one lead to the other? If you give people hope that their children will live and prosper, will that motivate them to resist the brutality of the insurgents? And villagers who have lived for hundreds of years without the half-million dollar irrigation project are probably not going to miss it enough to resent the Taliban for preventing its construction. I don’t have the answers and I like your practicality, but I’m confused about what you think our goals should be.

M Shannon May 1, 2011 at 4:47 pm

Homira: I think our goal should be to get out as quickly as possible but in the meantime there are ways to do what we’re doing more cost effectively. If you allow a football analogy: I think we should punt but if you insist on going on fourth down here’s a play.

I believe most Afghans don’t support the Taliban. Unfortunately the majority of the anti-Taliban population, and the vast majority of the educated classes, aren’t keen on fighting the insurgents. For this reason, even if ISAF could articulate a sensible mission, I believe our efforts are fruitless.

WRT where to do projects, as I’ve said previously, I don’t think development reduces the insurgency and in fact often funds it. If you wish to execute aid projects on humanitarian grounds then people who live in quiet areas certainly deserve as much or more help as the inhabitants of restive districts. Why spend your limited funds on security if doing so reduces the number of needy people you can help?

If you see development as a mechanism to reduce political violence then you’ll be hard pressed to provide evidence in the current campaign. The Taliban aren’t in the field because they want better services, feel left out of economic opportunities or believe that Pashtoons are discriminated against. They believe they are fighting a resistance against foreigners and their puppets.

The “sort out the government corruption” model has worked in Latin America but Afghanistan isn’t a fight about competing social and economic systems amongst the locals, it’s a fight against a foreign occupier and that makes the economy irrelevant to the war beyond providing money for guns and ammo and opening up a plethora of opportunities for corruption.

M Shannon May 2, 2011 at 10:10 pm

I should explain that I’m of what some call the “CT” school. I think aid & development should be left to civilians, ISAF CT (SOF & Air) forces as required (probably fewer than now) should remain in country and that the bulk of ISAF currently trying to pacify the country and nation build should withdraw over the next three years. I don’t believe that as long as the US is hostile to it the Taliban can ever regain power or host significant terrorist training camps.

We should return to roughly the state we were in 2002 with the difference being that now the GOA and ANSF are present across the country. I would be very clear to Karzai that most of our forces are leaving and that the ANSF had better get a grip.

HDMI 1080P May 9, 2011 at 9:50 pm

This is a great blog,I like this post it is very good and informative. I am sure that this post will be very much helpful for people. usbonlinegroup

Previous post:

Next post: