William Easterly’s recent article in the Foreign Policy compares the allegedly uniform prevailing philosophy of international development, which he calls Developmentalism, to ominous failed ideologies of the 20th century, Communism and Fascism. He says,
“Like all ideologies, Development promises a comprehensive final answer to all of society’s problems, from poverty and illiteracy to violence and despotic rulers. It shares the common ideological characteristic of suggesting there is only one correct answer, and it tolerates little dissent.”
In Easterly’s view, such “one correct answer” he deplores is free market defined as “doing whatever the IMF and the World Bank tell you to do.” Subsequently, he cites populist backlash in countries like Venezuela or Bolivia and deeply disappointing economic outcomes in places like Zimbabwe as evidence of failed policies of Developmentalism, which pushed those nations toward other failed ideologies.
Beyond sweeping generalizations that in a rather unsubstantiated manner indiscriminately link the most murderous regimes in history with the contemporary efforts (however flawed) to reduce poverty, three things strike me as weaknesses in this reasoning:
First, the bulk of Easterly’s article rests on tearing down a straw man argument that “the high church of Development, the World Bank” embodies the unquestioned and vaguely totalitarian single-mindedness in the development community and that the controversial policies of the Washington Consensus in the 1990s are still the reigning wisdom. For one, even the author of the phrase, John Williamson, admitted that his ideas were misinterpreted to signify “neoliberal or market-fundamentalist policies” that cannot be expected to provide an effective framework for combating poverty. But more importantly, the development community is not a monolith controlled by some DC-based “Politburo.” Painting the picture with such a thick brush and implying that all international organizations working with developing countries have identical modus operandi, that is they bring in foreign technocrats to impose some draconian policies termed as “free market” on unsuspecting victims, is simply not accurate.
Second, vilifying free market narrowly defined as a set of liberal macroeconomic policies tied to IFIs is doing a disservice to its true meaning. Easterly equates this simplistic understanding of the markets with his idea of “Developmentalism” and postulates that “the opposite of ideology is freedom, the ability of societies to be unchained from foreign control” and the ability of the people worldwide to choose their own policies and fate. But contrasting market economy with freedom fundamentally misses the core meaning of the former: the very nature of a true market economy is freedom expressed through the rule of law, transparency, accountability, equal opportunity to participate, compete on a level playing field and so on.
Third, while advocating each nation’s right to choose freely which path to self-advancement they want to take is certainly laudable, Easterly totally ignores the fact that often it’s not the foreign influence that prevents societies from expressing their will freely – domestic conditions matter much more. In countries lacking the other basic mechanism for manifestation of freedom, i.e. fully democratic governance, individuals have no way of communicating what policies they want their rulers to pursue. Consequently, it’s hard to consider the policies implemented by authoritarian governments such as those of Chávez or Mugabe as the expressions of “freedom” of their people.
Democratic and free market reforms must go hand in hand to be truly successful in bringing about greater freedom and spurring sustainable development. Organizations such as CIPE advocate these principles based not on some abstract development ideology but on the years of experience and lessons learned from successful work with local private sector, activists, and think tanks around the world. Does it make us a part of Easterly’s “evil empire” of Developmentalism? Hardly – because at the core of what this approach represents is a call for freedom, but freedom rising from the grassroots, freedom to build better institutions and good governance through the application of local knowledge rather than cookie-cutter solutions developed at the desk of a Washington-based bureaucrat.
In this I agree with Mr. Easterly one hundred percent that “the opposite of Development ideology is not anything goes, but the pragmatic use of time-tested economic ideas (…) by individuals, firms, governments, and societies as they find their own success.” Empowering those local agents of change is precisely what many in the development community already do as CIPE has been for nearly 25 years.
Published Date: July 27, 2007