Business

Last updated: 22 january, 2010 - 15:27 GMT

The Price (and Potential) of Failure

About this programme by Peter Day

How can outsiders respond to the earthquake in Haiti and its aftermath? Send money to an NGO is the immediate psychological reaction, hoping it will be turned into effective action, fast.

I did that, but somehow it seems feeble and inadequate, maybe even adding to the chaos of rescue efforts. Maybe it even blunts the political pressures for larger actions with the feeling that "I’ve done something, anyway".

Is it right that attempts at mass rescue are always so improvised? Where is the international rescue agency waiting everywhere for disasters to happen, as they do so regularly?

In the face of human tragedy on such as scale as earthquakes or the Indian Ocean Tsunami in 2004, it is difficult not to feel puny and overwhelmed.

But somebody also has to think about recovery from disaster … from natural disasters such as earthquakes, and from those committed by human inadequacy, too.

It so happens that the other day Clare Lockhart was passing through London on her way from five sleepless days and nights in Afghanistan back to her base in Washington DC, so I sat her down to talk about disasters natural and man-made.

Clare Lockhart co-founded something called the Institute for State Effectiveness in 2005, together with the former Afghanistan finance minister Ashraf Ghani.

Poverty

The Institute seeks to promote good governance in difficult places; two years ago the two cofounders published a book called "Fixing Failed States" … pushing into the spotlight the idea that some countries have utterly failed their citizens for whatever reason, but also that there are ways out of the mess.

"Failed" is an absolute sort of judgement to make about a country, and of course it depends what you mean by failure; Clare Lockhart prefers the adjective "failing", admitting the possibility of change.

But the experts say that many more countries than you might expect fall into the "failing" category: 40 or 50 worldwide, says Clare Lockhart. Haiti had that status before the disaster, close to the bottom on the least developed country list, three quarters of the 8-million population below the poverty line, huge deforestation, crime, violence, and corruption, despite large amounts of foreign aid.

The US National Academy of Public Administration put it bluntly in the title of its report in 2006: it was called "Why Foreign Aid to Haiti failed". The World Bank itself said most of its assistance from 1986 to 2002 was "unsatisfactory in its impact if not highly unsatisfactory".

It is difficult to think about long-term change from failed state status when much of Haiti lies in ruins without the means to distribute even basic supplies. But out of disaster must come recovery at some stage, if the right things can be done.

What are the right things? At the heart of the general principles put forward by Clare Lockhart and Ashraf Ghani is transparency: daylight poured upon how countries raise their revenues and spend them: accountability.

Education

The other key aspect of the fixing failure framework put forward by the Institute for State Effectiveness is using the resources that most countries still have: people, their skills and potential.

So (says Clare Lockhart) the emphasis should be on local economic revival: let local construction companies get the reconstruction contracts, not overseas incomers; build smaller ports and new towns well away from the ruins of the capital Port-au-Prince, to stimulate widespread economic revival.

And in the medium term, remember that getting out of failure needs homemade leaders. It's all very well to build primary schools, says Clare Lockhart, but do not neglect further education from which is where an educated elite will emerge.

"Globally we have underinvested in human capital," she says.

Failed states can come back, Clare Lockhart insists. Look at Singapore since the 1960s, Spain after Franco, states in the southern USA, Chile, Peru, Rwanda … it can be done. Aid will help if it is subject to accountability, but the key to a transformation is, of course, the people.

Here and now these thoughts will bring little comfort to Haiti. But in time, they might.

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September

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August

  • Peter Day asks whether the credit crunch crisis creates a big opportunity for women.

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July

June

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