Council on Foreign Relations
New York, NY
JOHN CASSIDY: Hi. I'm John Cassidy from the New Yorker. This is Professor Jeffrey Sachs from Columbia and many other places. My first job is to introduce Jeffrey. Just as a matter of interest—I mean, he doesn't really need any introduction. Is there anybody in the room who doesn't know of Jeffrey and his work? [Laughter] I'm not—I don't see any hands up. So, it'll be a very brief introduction.
Jeffrey, as TIME magazine said many years ago, is probably the best-known economist in the world. I first came across him when I was an undergraduate. One of the great things about Jeffrey is he's always been interested in the big sort of political-economic issues. I remember "stagflation"[economic stagnation and inflation]. I remember Jeffrey made his academic reputation, I think, on that with [economist] Michael Bruno, among others. And that was a big issue back then, obviously. Then he went to Poland, Bolivia—in fact, there may not be a country in the world he hasn't been to. I noticed he said on the bio I've been given that he's currently consulting for governments in Latin America, Asia, Africa, and Europe. There seemed to be a gap there; North America is the last continent left. So perhaps the U.S. or Canada can hire him.
Anyway, Jeffrey, as I said, has always been producing interesting work, and his latest work is—well, most of you are probably familiar with, since about 2001, I think, maybe 2002, has been with the U.N. on the big global policy projects, the U.N. Millennium [Development] Goals, which Jeffrey, I think, oversaw. He was special assistant to the [U.N.] Secretary General [Kofi Annan]. And he's now produced this book, which—have we got a copy up here? There's certainly copies outside, which you should certainly pick up—I reviewed in the New Yorker—fascinating book about how to defeat global poverty. And that's, I think, where we'll start this morning.
Jeffrey, when the book came out, it seems like the Bush administration didn't want anything to do with the Millennium Goals, et cetera. Now the last few weeks, we've seen [musician and humanitarian activist] Bono in the White House, we've seen [U.K. Prime Minister] Tony Blair in the White House. Debt relief is now going through. Have things changed in Washington? I mean, are you now winning? [Laughter]
JEFFREY SACHS: It's a hard fight. Definitely, the world is focusing on this right now as it has not for a long time, and that's partly because Tony Blair said that the issue of Africa's extreme poverty would be one of the two centerpieces of the G-8 [Group of Eight] summit, and because five years ago, when the Millennium Assembly took place and the General Assembly adopted the Millennium Development Goals, they agreed to meet again in five years in September 2005 to figure out where we stand. So it could be foreseen in the last couple of years that there would be a bit of a crescendo on an issue which is usually mostly ignored, that there would be more attention on the issues of extreme poverty allowed now than is usual, and that's happening, indeed. Tony Blair came to the White House to try to enlist the U.S. in an effort to double development assistance, both worldwide and specifically to Africa as a subset of that. And George Bush said no, basically. And that's really where things stand in this moment right now. There will be the G-8 summit in Gleneagles, Scotland July 6-8.
The Millennium-Plus-Five assembly of world leaders, which stands to be the largest gathering of world leaders in history, most likely will take place September 14-16 at the U.N. And extreme poverty is the issue that most of us—the IMF [International Monetary Fund], the World Bank, and most European governments—have come to believe should headline the agenda. They agree that we should have an overall doubling of aid.
Most of us that have looked at this in recent years—and I've been looking at this intensively for about a decade now—believe that if we're going to help the impoverished regions get out of a trap of disease, hunger, environmental degradation, excessive population growth, and the whole spiral of disasters, we must provide serious financing. And there now is pretty much a worldwide consensus on this, except in the United States, which stands aloof from that consensus. And we have a pretty deeply ingrained feeling in this country that we should not do more. That's a feeling that has many different roots. But when George Bush said to Tony Blair last week, "We won't do more,"he was expressing what is a commonly held belief in American politics.
It's important to understand that this view that more financing is not necessary, however comfortable it is in our country, is not shared by the rest of the world at all right now. We're almost standing alone, believing that money for the poorest of the poor doesn't really count, or can't be used correctly, or shouldn't be spent. The view is quite dominant that there should be more financing directed at AIDS, malaria, TB [tuberculosis], hunger, food production, schools, water and sanitation, and other direct needs as a key. And the fact that the U.S. is half of the missing financing is the big problem, in my view, but it's very hard to change the politics, especially in a context of large budget deficits. So I think it is a constant of American society, whether we're in a boom or a recession, a surplus or a deficit, that we won't spend money on this.
CASSIDY: Right. I mean, far be it from—for a writer from the New Yorker to defend the Bush administration. But they could do something in there. I mean, isn't the debt-relief initiative a significant event?
SACHS: It's interesting on all of this. The trick is to separate the headlines from the ground reality. And so, take the issue of the debt relief, which is something I've also been in favor of and worked on for a long time—I made the proposal for this 100 percent debt cancellation back in 1998 in the [Allan] Meltzer commission [advocating changes in the IMF and World Bank]. I think I was the first one to articulate it. There's [then-Chief Executive Office of Aetna, Inc.] Dick Huber there, a colleague of mine on the commission, and we worked on this seven years ago. But arithmetic is the most important thing in this, the arithmetic of life and death, and the per capita, you know, flows that are involved. So here's a headline: Forgiving $40 billion of debt—what does it mean?
First, that $40 billion in undiscounted cash flow over several decades to come, the actual cash flow involved, is about $1.5 billion a year over these 18 countries. They will not get $1.5 billion of net relief even from this because the way that it's going to work is that these countries will stop paying, and the U.S. and other creditors will pay the cash flow to the World Bank and to the other asset holders to keep those balance sheets whole. But the U.S. has said that when it pays the Bank, in lieu of these countries paying the Bank, it's going to take it out of existing aid budgets.
So what's the real issue here? Is there any real resource gained from this at all? Hard to know, but it's small, because even if it were $1.5 billion, all of the estimates are for Africa that we need about $25 billion a year; after all, there are 750 million people in Africa exposed to some of the worst disease pandemics in the world. So this would be tiny even if it were resources actually flowing, and it's not clear it is net resources. It's a very small part of the overall necessary aid.
The biggest myth—if I could just filibuster for one more minute on this—the biggest myth in our country is how much aid we give and how much has gone down the drain. This is what I confront every day, many times a day from hate mail, to questions, and so forth. Let me just run through, if I could, what we actually do for Africa.
The U.S. aid to Africa is $3 billion this year. That $3 billion is roughly divided into three parts: The first is emergency food shipments. Of the billion or so in emergency food shipments, half of that, roughly $500 million, is just transport costs. So the commodities are maybe half a billion dollars. That's not development assistance, that's emergency relief. The second billion is the AIDS program, now standing at about $1 billion. That, on the whole, is a good thing. I would call it a real program. It's providing commodities; it's providing relief. It started late and it's too small, but it's there. The third billion is everything else we do for child survival, maternal survival, family planning, roads, power, water and sanitation, malaria; everything is the third $1 billion. Most of that, approaching 80 percent, is actually American consultant salaries. There's almost no delivery of commodities, for example. There's essentially zero financing to help a country build a school or build a clinic or dig a well.
When you get down to it, the actual financing we provide to help Africans invest in their future is well under $1 per African per year. Then, the politicians say—as George Bush did yesterday—we give so much money and it's misused; we won't let that happen. The fact is we put in almost no funding, and it accomplishes almost nothing. And then we bemoan the waste. I don't know how to break through that misunderstanding. That's what I've been trying to do for many years, but it's very, very powerful in this country.
CASSIDY: What about the Millennium Challenge Account, which they've launched? I mean, this was the Bush administration using this argument, they said, "OK, we're not going to give money that's wasted, but if countries satisfy a certain number of criteria, then we will give money."There was a lot of criticism when they didn't—no countries passed the criteria. But now they've introduced some money for it, haven't they?
SACHS: So that's another interesting thing. The Millennium Challenge Corporation was announced on March 14, 2002. I remember the speech. They also asked Bono to sit next to the president as he spoke at the Inter-American Development Bank to announce this. Then we went to Monterrey, Mexico, where there was the International Conference on Financing for Development. George Bush came. The U.N. ambassador at the time, John Negroponte, came over and whispered in my ear, "Well, you're getting what you asked for,"which is always a dangerous thing to hear! [Laughter] And they announced $10 billion in the next three years of well-targeted aid to well-governed countries.
Let me tell you now, we're three years, four months since that date. Not one penny has been disbursed. One program for Africa has been signed—that's for Madagascar. It's a four-year, $110 million program. It was signed in April. As far as I know, not a single penny has actually gone yet. The first year is supposed to be $27 million. It's a program that, in my view, is poorly conceived anyway, but that's—I don't even want to quibble on that. But it is, at best, that we'll have in the first four years $27 million going to Africa.
This is what passes for our help. If it weren't 6 million people dying of their poverty in Africa every year, you could regard it as, well, probably incidental. I don't go on a trip to Africa—and I go every month—where I don't see someone dying in front of my own eyes in a clinic; a child in cerebral malaria, an AIDS victim that can't get the medicines. The amount of death is unbelievable. The amount of suffering is unbelievable. Consider what this lack of development actually means for instability. We regard the Sahel as a security risk right now. We have a counterinsurgency effort building up in the Sahel, which is the poorest place on the planet. There's no water. The herdsmen and the farmers everywhere are in conflict, not just in Darfur. Children [growth rates] are stunted 50 percent or more. There's pervasive malaria and parasitism. We're doing nothing, just about nothing.
CASSIDY: Why, then, don't Bono and Tony Blair break with the Bush administration? I mean, they still seem to be making pretty positive noises about it.
SACHS: Because nobody wants to break with this administration. They seem awfully tough folks. And Bono's belief has been that being nice is going to be the way to bring everyone along. And everything that's been announced has been championed. We get good headlines for the Millennium Challenge Corporation. We say it's wonderful. The Bush administration claims it's tripled aid to Africa, which, aside from the fact that you can multiply three times an insignificant number and still get an insignificant number, it's also not even true in terms of the numbers.
But this is an administration that people don't like to take on head-on. You get slammed when you do it. They work very closely with the White House, Bono and his group, because they think that that's what's going to bring—that's what's going to bring everything along. I mean, Bono's not only well-meaning, he's heartfelt and earnest, and incredibly hardworking, and I admire him enormously for it. But my job is to know the arithmetic, and we're not solving the problems. We're just talking about them.
And there's so much confusion that it's very hard to break through, because—as you probably know, the actual views in America—when people are asked to estimate what we give, they overestimate by a factor of about 30. And when you look at what the president says, like he said yesterday and the day before, and when Tony Blair came—it is absolutely deep misinformation, so there's no way to get out—no way to get out of this, in terms of public—it's almost impossible to get out of it in terms of basic public understanding.
And the readiness of people to hear this message is low. Americans do not like to hear this, and when I said it last night on television, I got a slew of e-mail [saying], "That can't be right, you don't know what you're talking about, stop picking on the president, and stop picking on us, and why should we throw money down the drain for Africans?"—and many things like that.
So this is really deep, and it's—it is coming to the truth right now, I think. The moment of truth, I should say. When Tony Blair came and George Bush said no, this was the most decisive moment of many years of this effort, because he basically said, "We're not joining this effort."
What's happened in Europe is—Europe has had a big political advance on this issue, actually. Whether it adds up is another matter, but when Bush came to Monterrey in March 2002, all of the world signed a document called the Monterrey Consensus. And it says in Paragraph 42 of the Monterrey Consensus, "We, the signatories, urge all countries that have not done so to make concrete efforts towards the target of 0.7 percent of gross national product as official development assistance."0.7 percent in the U.S. is $82 billion right now; nice, round number which we use in Iraq. But that's the target for international aid. We signed that, along with the rest of the world. Europe, last month, announced a timetable to reach that goal by 2015.
The Bush administration has said, in effect, "We never committed to any goal; we reject any goal. And we reject even a doubling of aid for Africa."So the problem is that the U.S. is 53 percent of the financing gap, by the estimates of our project, the Millennium Project, but it's almost exactly the same finding as Tony Blair's Africa Commission, and the recent IMF-World Bank report, which also called for a doubling of aid. So it's very hard to solve these problems without the United States at the table. But we're choosing, deliberately, simply not to respond right now.
CASSIDY: Jeffrey, just moving away from the politics, [inaudible]. I mean, the argument that aid is being wasted; I mean, it's not been American money, but [inaudible] trillion-dollar figure gets thrown around [inaudible].
SACHS: But that's a false number.
CASSIDY: Well, a large amount of money has been spent in aid over the last 30 years.
SACHS: Yeah, but 30 years is a long time, and there are lot of people in the world. And whenever you take those big numbers which are bandied around—and I'm supposed to be so impressed by them—I divide by the years, and then I divide by the people, and then I divide by the fact that it's mostly consultant salaries of rich countries—
SACHS:—and I take out the food aid, and I find out that it's a few bucks per person per year, and I'm supposed to be impressed by this. When people like Bill Easterly at NYU [New York University] say that it's X trillions of dollars in the last half-century, he means to suggest that, for a half-century, we've been wasting money. But the way you should think about it is different. You should divide by 50. Anything over a half-century is a large number. It's just a phoney way to do this. Divide by the years, divide by the people, take out the part we kept, take out—basically, you should also take out the emergency food shipments, because that's not actually investing in the future, whether it's meritorious or not. Look what's left over for really solving problems: almost nothing. I think the right question is whether aid could be used effectively. That's a good question.
SACHS: And I think the answer is yes, if it's directed at things that make sense and that are measurable, monitorable, and audited and run like a business. Aid should be a business. It should be run with the rigor of a business.
CASSIDY: Right. But I mean, the amounts you're calling for are quite substantial—$150 billion, whatever it is, by 2015. I think that's been one of the figures—
SACHS: Yeah, from the whole rich world to the whole poor world, in 10 years from now.
CASSIDY: Right. I'm not saying it's an enormous figure—
SACHS: Right. It isn't.
CASSIDY:—but a substantial amount of money.
SACHS: Yeah. OK. Yeah.
CASSIDY: In terms of a few African countries, it would be a large share. There would be—
SACHS: No, no, but that's for the whole world, not just for Africa. Africa's the—
CASSIDY: Right. But there are some figures, I think, that it would—in some of the countries, it would add up to like 10 [percent] or 15 percent of their GDP [gross domestic product] per—
SACHS: Even more than that.
CASSIDY: I mean, won't that money go into the pockets of, you know, corrupt leaders and—like it did in the—and it did in the past. This is the argument you face all the time, I'm sure.
CASSIDY: And I've argued against it myself, saying that it can work. But I mean, surely you have to accept that in the past, sometimes aid has been wasted. And what's going to be different this time is the question.
SACHS: Right. So we give a lot—we don't give a lot of aid for anything, but the aid that we give, we have tended to give for geopolitical purposes. So we've given aid to not have Israel and Egypt go to war. We've given aid to Pakistan, to Turkey. Much of the aid increase recently has simply been to Iraq. And we're spending $7 billion of aid in Iraq this year, which is more than twice the total amount to all of Africa. So we do aid for all sorts of reasons. What I'm talking about is actually development assistance. That's different.
It's pretty clear, in my view, what the impoverished, peaceful, not-at-war countries of Africa—which is most of them—really need. In general, Africa suffers from three profound liabilities. One is, they don't grow enough food, because Africa did not have a green revolution, as did Asia. Second, Africa suffers from massive disease. And third, Africa suffers from an almost complete lack of rural infrastructure—electricity, roads, telecommunications—and about 75 percent of the population lives in rural areas.
So what we would actually use resources for, in my view, would be, first, to help African farmers grow more food. It would be like helping to instill a green revolution in Africa like we did in Asia in the 1960s. This is the biggest difference in the development experience of the two continents, actually, in the last 50 years. Asia had a green revolution. That's what got India and China out of an endless rut of famine and poverty. Africa did not. That's largely for agronomic reasons that have been overcome through good science, but African farmers don't have the inputs they need to actually grow more food.
And just to give you an example, this March we gave free, improved seed to farmers in a Kenyan village in a little philanthropic project. It cost a few bucks per farm household. That's all. They're having a 400 percent increase of their harvest this year, as a result, compared to last year. This is not rocket science. This is the most basic agronomics. But the United States does not fund agriculture; we send food aid. That's the difference. So what I'm calling for is so straightforward, but we choose not to do it.
Second, disease control. We gave the people bed nets. I don't know if any of you saw the New York Times story a few days ago about malaria control. Malaria will kill 3 million people this year. It's utterly preventable. It's 100 percent treatable. It will kill 3 million children. It's really something to see a child dying of malaria. I've seen a lot of them in the last year dying of malaria. It's the most useless, ridiculous thing in the world, because a pill in the right time would save them, and because every child that I saw dying of malaria had not had the benefit of a $7 bed net.
The United States has not seen fit to give away bed nets. It's seen fit to advertise the sale of bed nets in what's called social marketing. And what you saw in that article last week, if you caught it, was that we spend all our malaria budget on advertising in Africa rather than giving away bed nets. Our total spending on malaria is $90 million a year. In other words, 25 cents per American. This is not commensurate with a disease which will kill 3 million children, nor is it right to spend the $90 million with $60 million of it being in advertising as opposed to delivery of services.
And then I've been in the White House—on e-mail with the White House every day in the last week in the lead-up to the summit. They're sticking with this social marketing because that's the only sustainable approach, they tell me. It's got to be done through the market. The only sustainable approach. I say to them, "But isn't it a mark on your sustainability that 3 million Africans will die this year? Is that very sustainable?""Well, yeah; but sorry, Professor Sachs, we're not going to get Africans dependent on our aid,"is the answer. So the fact of the matter is that public health specialists understand very well how this massive disease burden could be brought under control, but we're not doing it.
And then the third thing that's needed is basic infrastructure. It would be possible for $1 billion to lay a fiber-optic cable throughout Africa. One billion dollars is the best estimate. If we cared to do it, we could do it. Why don't Africans do this? Because Africans don't have enough to eat, much less to invest the surplus. The average income in sub-Saharan Africa right now is about $350 a year. But that's not even income; that's imputed value of food grown and eaten. It's just non-food subsistence. So there is no surplus there. And until this week, we've been asking them to repay even that $1.5 billion cash flow on the debt, which in many of those countries was more than the total health and education budget.
The clinics that I go to do not have running water. They don't have a complete surgical kit. The mothers that make it to the clinic, in breech birth or in need of a C-section, or in hemorrhage, they die there because there aren't the facilities. These are not hard things to change. Once in a while, private efforts get together to try to do something, like Rotary International to control polio. They have a great success. Smallpox, by the way, which was successfully eradicated, as you know—the United States voted against it, the effort, in the 1960s. Said it could never happen. It turned out it was some tens of millions of dollars to actually do this, once we decided to do it. African river blindness has gotten under control. [President] Jimmy Carter has been trudging through the poorest places in the world, controlling African Guinea-worm with remarkable success at a very low budget.
The problem [inaudible] that you can't do these things. These are actually human beings on the other side who want their children to go to school. They want their children not to die of malaria. They want to grow more food. There are receptive people. It's not all these vultures waiting to pounce and steal our money, which is the American image of Africa, and of all these tyrants running around. I got an e-mail this morning, very nasty, saying, "Why should we give money to [Zaire's leader] Mobutu [Sese Seko]?"—who has been dead for almost a decade. [Laughter] Because what we see as Africa is the worst of the worst, generalized everywhere.
CASSIDY: OK. Thanks for that. I'm going to open the discussion up to questions. Just—the Council have asked me to ask you to speak into the microphone directly, state your affiliation, and also make them questions, not statements, please. First person in the back? I think you had your hand up.
QUESTIONER: Thank you. My name is Herb London, Hudson Institute. I wonder, Mr. Sachs, since you've talked about arithmetic, if we can talk about private contributions that the United States makes to both Africa and other underdeveloped countries. The number thing you use, since we are talking about arithmetic, are niggardly if you compare government assistance to private assistance. But if you're looking at private assistance and the government assistance in the aggregate, it's about $116 billion. $50 billion—
SACHS: Could you tell me—could you just do the arithmetic for Africa for a moment?
SACHS: Tell me the African numbers, please.
QUESTIONER: [Inaudible] I mean, you conflated, you conflated foreign aid and you've conflated—
SACHS: Tell me the African numbers, please.
QUESTIONER: Well, the African numbers are obviously less, but let me—
SACHS: So just do the African numbers, since you proposed it.
QUESTIONER: But let me—let me finish my point, if I may. It's $116 billion, and if you were to look at—
CASSIDY: Do you have a question, please? What's the question?
QUESTIONER: Well, the question is, why aren't you considering the private assistance that occurs in remittances, that occurs in church-related activities, that occurs with foundations that are giving support? Because countries like Japan and Norway, which are regarded as very generous in their foreign aid—do not have the same kind of contribution.
CASSIDY: I think we get it. Jeffrey, always these arguments are made from the right: Americans are generous, if you consider private contributions. Is that true?
SACHS: I think if you would get us the numbers on Africa, it would be very interesting. My sense that it's a very, very small number. And when I see these numbers quoted, they include military expenditures in the USAID [U.S. Agency for International Development] numbers. They include remittances, which I do not include as foreign aid; that's money that is earned by people and given to—for their families that they're separated from. If you count remittances—there are very few to Africa, but if you count remittances—I don't consider that aid; I consider that our people's private income. And I also would ask you—I'd be very interested if the Hudson Institute would work out numbers that you believe are right for Africa. I'd be very interested to see that.
CASSIDY: OK. Gentleman in the front, here.
QUESTIONER: If you were—Chris Brody—if you were testifying in front of a congressional committee, and you were asked—
CASSIDY: Sorry. Can you just wait for the microphone?
QUESTIONER: Pardon me. Chris Brody. If you were testifying in front of a congressional committee and you were asked, "Why does this matter to the average American, doing something about Africa?"—what would you answer be? And if the second question was, "What would it take for this country to do it right?"—what would your answer be?
CASSIDY: Keep it relatively short—
SACHS: Yeah. I [laughter]--that's sometimes [inaudible]. Mr. Chairman, [laughter] I think we have a direct humanitarian interest, first of all, which most Americans believe in, and second, we have national security interests, and third, we have a long-term economic interest. But let me go straight to the second and the third.
The security interests are already leading us to a growing military build-up in Africa right now. It's below the radar screen, but we have more than a thousand troops stationed in Djibouti right now. We have a pan-Sahelian counterinsurgency effort that is underway and growing. And we are not going to solve the problems of these hungry, poor, unstable places, which can be breeding grounds for disease, for terror, for criminality, for money-laundering, for extremism of all kinds if we're going to view this as a military—through a military lens, because with very hungry and dying people and economies that cannot get out of this on their own, the situation will get worse.
In terms of even our economic interests, it's estimated that about a quarter of our oil will come from West Africa in the next 15 to 20 years for the United States. And those are unstable, [inaudible] increasingly agitated societies. And in my view, since the amounts of help that I'm discussing are really tiny compared to what we routinely give for our national security considerations, I think that this is imprudent of us to believe that we're addressing our problems with almost no spending. We're spending half a trillion dollars on the military right now each year. And as I said, if you net out the food aid and net out consultants' salaries of Americans, it's about a billion for all of Africa. And to me, that's not a prudent investment.
What would I do? I would address the underlying factors of the need for an African green revolution, the need for disease control, and the need for basic infrastructure. I would direct it, like the Millennium Challenge Corporation talked about, to the relatively well-governed countries, because I think that those are the ones that can make best use of this. But I would do the arithmetic. I would address this at a scale of the challenge. For malaria, for example, a series of estimates over recent years has shown that about $3 billion from the whole world could save more than a million lives per year and get this disease under control. The U.S. share of that would be about $1 billion—that's all—with about $2 billion coming from other donors. Three billion dollars could get bed nets to all the people in Africa. It could get effective artemisinin [antimalarial] combination drugs to all of the people that need them in Africa. It's an example of the specific, targeted, monitorable, measureable program in the same lines as polio eradication or smallpox eradication that could be accomplished if we decided to invest in it. And I think there are many programs like that on food production, basic infrastructure, and disease control that I would urge that we do.
CASSIDY: Very—very succinct by Capitol Hill standards. The lady in the middle.
QUESTIONER: Thanks. Peggy Hicks from Human Rights Watch. In his recent report, the [UN] secretary general stressed the inter-linkages between security, development, and human rights. You talked a little bit about how security relates to development. Could you say something about the human rights side to the problems that you've discussed, in particular the attainment of rights for women and girls in Africa?
SACHS: The main devastation about gender inequity in Africa is that women carry the burden of there not being fuel wood, water, clinics, schools available in the communities. It turns out that women, therefore, carry water several hours a day in typical rural areas of Africa; women carry fuel wood several hours a day. It's like a beast of burden. The best thing we could do in the immediate future would be to help villages have the most basic infrastructure that would relieve women of this backbreaking toil and free them up for other roles in society.
Also, women are the farmers. We send tens of millions of women out to the fields every day to try to grow crops on soils that are biophysically incapable of delivering a crop. Remember what I said, and it's very important to understand this, in three months this village where I'm working is going to have a 400 percent increase of its food production. That's not ten years of arduous effort; that's putting fertilizer on the soil. Want to help women? Put fertilizer on the soil, on the land that they till, and you will change everything about these societies. And these are the kinds of basic things we should do.
Now, women—there are many other things to do when you give to communities, make sure that women are part of the governing structure, as they are in the places where I'm working, and insist on women's representation. It's very important. But the real essence of the issue is that women till the fields, collect the water, collect the fuel wood and they're put—and they care for disease-ridden societies. And they're put in an impossible situation having to be the farmers, the cooks, and the caregivers with no resources available at all. It's devastating. That's the real problem. It's a human tragedy as well as a human rights tragedy.
CASSIDY: OK. Thanks. Sorry, just to point out, I think I should have said in the introduction, when Jeffrey's saying "we are doing this,"you're referring to the Earth Institute at Columbia?
SACHS: That one is—yeah, Columbia University. A private philanthropist said, "Can you help show how the Millennium Development Goals can be met in a village?"And for $50 per capita, they can be met. It's just 50 bucks per capita.
CASSIDY: Gentleman on the right there, Mr. Gutfreund?
QUESTIONER: John Gutfreund. I don't understand—because I haven't studied it—the arrangement with consultants, whether they're government arrangements, private arrangements, and why such a large percentage of the dollars seem to go to them. Would you explain that a little bit?
QUESTIONER: Who is that?
SACHS: These are—what these are, are beltway firms that are technical advisers on development.
QUESTIONER: Lobbying firms?
SACHS: No, not lobbying firms. These are direct-delivery firms in Africa. And what USAID does is award contracts to firms like these who then go over and are charged mainly with advising and service—I'm sorry—mainly advising and organizing efforts, but actually not even delivering services, primarily. It's very expensive, and we do it because we don't want to give money to African governments so we give money to our own organizations. That's the basic idea, that what we're doing is we're paying Americans to deliver services in Africa.
Most of what we pay for, though, are salaries of Americans, and it's so that we don't directly deal with African governments in the delivery of the financing. It's not as though we're pouring money down the drain; of what we do give, which is, as I say, something like a billion dollars, most of it's going through American development-delivery organizations. And like the malaria article a few days ago showed, they're not even delivering the services. What they're delivering is the advice on the services or the advertising on the services.
CASSIDY: OK, the lady there.
QUESTIONER: Gail Gerhart from the Institute of African Studies at Columbia. So can you describe in a more ideal situation how, exactly, would aid of the type you're describing be delivered without the intermediate services of such consultants? And in particular, in those countries where we would describe the governance as poor or fair, is there any prospect of your kind of solution being reached in the absence of local implementers in those poorly governed countries?
SACHS: In the poorly governed countries, I don't think you can do a real turnaround. I don't have an answer, you know, for what to do in the Democratic Republic of the Congo, for example. Right now it's too violent and too unstable. And I think that there are things one can do with local NGOs [nongovernmental organizations] or even international NGOs that can do a little bit, like immunization, but you can't really help to develop a broader-based development strategy in places very poorly governed.
But Africa, as you know, is 49 countries in the sub-Saharan region, and there are many that are absolutely above any threshold for low-income countries to get started, places like Ghana, Senegal, Mali, Niger, Tanzania or Malawi. These are places where you can get development going. They're peaceful. They're relatively open. They need the same standards that have enabled other successful countries to get off the ground. What they generally lack is adequate soil nutrients or disease control or basic infrastructure. So there are pragmatic issues that they face that need to be addressed.
How you would do this depends on the kind of issue you're talking about. For malaria, this is not so complicated, as the successes of immunization campaigns and disease control have shown. We should basically organize an effort for a mass delivery of insecticide-treated bed nets the same way we do immunization successfully. And it's not hard to do. And I'm working with the country-level officials of the malaria control agencies in a dozen countries right now. They don't have the resources or the mandate to do it, but I've been working with them to develop hypothetically how you would actually do a mass distribution effort. They know it because they do it in the area where they're charged to do it, which is on immunizations.
So that's one way that you would directly do this. For the fertilizer and other issues, there's a lot of experience of how to make a green revolution, actually. Again, it's like the immunization. We helped to diffuse modern seed, fertilizer and irrigation throughout Asia. We played an important role in the 1960s in that diffusion. It's a package of deliveries. And the same thing could be done in rural Africa. Each country would have its slightly different way, but it's basically on-the-ground investments that should be quantified and monitored.
What you don't do is—no one in their right mind would give a blank check to anybody. You would treat this, in my view, as an investment project where you would have quantitative targets, you would have an implementation plan that's subject to monitoring, evaluation, and audit. And yes, you'd lose, no doubt, some funding, like you would in any construction project. But these are not huge efforts, actually, these are pretty directed, modest efforts.
I have no plan to make Africa rich, by the way. [Laughter] I'm talking about a plan to help Africa feed itself, deliver basic infrastructure, and get the major killer diseases under control over a 10-year period of time.
CASSIDY: Jeffrey, just to be clear, who would be doing the monitoring? Do you want it done through the U.N., through the World Bank, through—
SACHS: No. OK, any donor that gets together, like the Global Fund [to Fight AIDS, Tuberculosis, and Malaria], or Bill Gates's Global Alliance for Vaccines and Immunizations, would write a contract with the counterpart. The counterpart could be the National Malaria Control Agency. You treat this as a business proposition: He who gives the money sets a timetable, benchmarks, and monitoring. I would like to hire some private firms, professional auditing firms, and accounting firms to go in and do the accounts. They know how to do this. And so you do spot audits, you do checks in villages, you do random visits in different areas, and you visit districts. This is how you would do a project in general. If you're building a highway here or if you're building a clinic or a school, you have milestones, timetables, performance checks, and standards. And the one that would do this would be the one who's giving the money.
What I do recommend, in general, is that those who are giving the money pool their resources into projects, so it's not a thousand individual donors, but 10 projects, and that those projects set aggregated milestones.
CASSIDY: Right. Right. The lady in the middle has had her hand up for a while.
QUESTIONER: Patricia Rosenfield, Carnegie Corporation. I think, Professor Sachs, that you have identified some really critical issues that all of us need to figure out how to do better. But one of the concerns that I have is that by focusing on the negative in Africa so much that you reinforce the mythology of failure in Africa. And that when you were just mentioning before the Ghanas, the Malis, even the Onchocerciasis Control Program, which is a 20-year effort of remarkable organizational skills on the part of Africans, that somehow the successes in Africa that have been undertaken by Africans—as you said, 53 countries with very different situations—get lost in this process. So I'm wondering—
CASSIDY: What's the question?
QUESTIONER: No. The question is actually for you, too, Mr. Cassidy. How to ensure that there is better reporting of the successes, because I actually think that Americans are really tired of the failures in Africa, and that perhaps by focusing on the successes, one might change the image and also change the respect and dignity that's given to African leadership and African expertise, which is abundant in the continent. The human resources are remarkable.
CASSIDY: Are you too negative on Africa, Jeffrey? I'm sure you're not usually accused of that. [Laughter]
SACHS: I am trying to tell you what I'm seeing, as best as I can. I'm seeing hungry people, and I'm seeing a lot of disease, and I'm seeing an absence of infrastructure. And I'm seeing that over large parts of the continent. I hope I'm not denigrating the human beings that I'm dealing with, because I regard them as doing amazing things in nearly an impossible context. But I don't want to sugarcoat the physical reality, because what I'm seeing is absolutely dreadful, and it's quite real. And it's not meant to be negative about anybody. It's meant to tell the truth.
We have millions of people in an absolutely acute hunger crisis right now, and tens of millions of people or hundreds of millions in a chronic under-nutrition crisis. Food yields—that is, yields per hectare—are the lowest in the world and are not rising. Environmental degradation is going up. I can't help it; that's how it is.
I don't think it's right to say that this is a slam on Africans. I spend most of my time saying that our stereotypes about African corruption are a near-obsession on our part. They're not the ground reality. Nobody believes me, virtually, but it's the truth.
But let me say another thing about successes. You're right; when we do specific things, we have successes. If we were to control malaria, we'd have a success. If you do a village project, you can have a success, because you can afford it on your own. You don't have to wait for the permission of the big donors. You can just do it. I believe in those demonstration projects, and I believe in showing what they can do. I like the fact that Jimmy Carter has taken on African Guinea-worm and has had a big success of it. That's a great thing. We should explain those success stories, but we should also understand that they don't add up to an overall development success. There is not a development success in Africa right now. It's very sad, but there isn't.
CASSIDY: Two more questions. The gentleman in the front and the gentleman here. Just identify yourself when—
QUESTIONER: Tilden LeMelle, Africa Today Associates. My question really focuses at the micro level. How—in addressing the three major problems that you've identified, how, in addressing those, could they be translated into providing increased number of jobs for Africans? Which of course, would result in local capital formation for local investment by Africans, creating more jobs, so that that can ultimately become the engine for development, rather than constantly depending upon outside support.
CASSIDY: Thank you.
SACHS: I think there are two parts to the answer, but the first part is that about 75 percent of the jobs in Africa now are farm jobs. Africa is an agricultural society, as are all poor countries. A green revolution is the best way to have productive jobs. That's how almost all development starts, that the farmers who go from subsistence and hunger to commercial farmers.
That's, I think, the first step that Africa could achieve in a very short period of time if the farmers had basic inputs—fertilizer, improved seed, small-scale water management—to enable the communities to grow enough food. And in as little as three months you can have a breakthrough, actually, even from one input—two inputs, sorry; two out of the three if you're in the right environment.
What happens then is that farmers go from working round the year growing an insufficient amount of food, to working part of the year to grow more than enough food, and then they diversify, to cash crops, to citrus, to cut flowers and horticulture, to dairy products, to food processing or to rural manufacturing, like furniture, woodworking, and other things.
So this is how India started to get out of the rut. After their green revolution, they had a white revolution, which was the milk revolution involving dairy cooperatives. But that came after the food production went up. So the rural-led development is right at our hands right now, and that would make a huge difference for tens of millions of jobs immediately.
The other part of this is the urban areas of Africa, mainly the cities which are now overrun with impoverished rural migrants, and they're not functioning as outlets to world markets. Places like Dar es Salaam, Maputo, Mombasa, Dakar, and Accra should be vital centers for tourism, for call-waiting services, for small-scale manufacturing. And those places need container ports, they need 24-hour, seven-day electricity. They need some basic urban-based infrastructure. A decent assistance program would say, "We'll help you get above the threshold in the rural areas through a green revolution and disease control, and in the urban areas with at least industrial zones to help you get started."
And in my view, that's what Asia did, actually, that two-pronged attack. And I don't see any reason that Africa couldn't have the same story, the same approach: a rural-based development strategy and an urban-export strategy, as the cornerstones.
In each case, though, you ask, "Well, why don't foreign investors go to Africa right now?"In the cities, we may say, "Well, it's corruption and so forth,"but that's actually not what they say. They say, "The electricity is unreliable; the port doesn't work; I can't get a container out of the port."It's very practical considerations. And those are investment problems, not more than that.
CASSIDY: Final question? The gentleman here.
QUESTIONER: Jeffrey, Peter Ackerman. Your take on the debate between the United States and Europe over genetically modified crops and its impact?
SACHS: Yeah. This GMO [genetically modified organisms] issue is the easiest of all, which is the GMOs are an important technology. And they need to be used with appropriate environmental scrutiny, for sure, but they're very important for development because they have this huge benefit that all the technology comes packaged in the seed. And you can do a lot of wonderful things. You can upgrade the nutrients of rice with Vitamin A.
You can increase the amino acid content, add the critical amino acid to maize. You can put in, of course, a pest-resistant to avoid the use of herbicides. And what seems to be very promising right now is that you can probably modify crucial food crops to be drought-resistant. And that could be one of the greatest scientific breakthroughs of the next couple of decades.
There are two main issues. One is environmental safety, which I think is greatly exaggerated. But it is an important issue. And the other issue is property rights and ownership. And there is a matter of truth to the fact that if you develop high technologies under patent without provision for the poorest of the poor, the technologies won't reach the poorest of the poor. And that's what happened with anti-retroviral medicines. You have to go into this with an escape valve that companies that are making these products are going to make money in the high income markets, but they're going to somehow make the science available for the poorest people in the world, not under patent protection. And that kind of market segmentation is feasible and important. It's what we've done with anti-retrovirals, finally. And it should be done with the GMOs.
And what's happened is, of course, a firestorm for all sorts of reasons—partly protectionism, partly European opposition, partly some environmentalists exaggerating the risks—in my opinion—and partly the firestorm over intellectual property rights. And what I caution on this whenever I speak about this is, "Keep the technology issue separate from the environment issue, separate from the IPR [intellectual property rights] issue."There are three different issues. And be systematic in your thinking. The technology is very powerful; never dismiss a powerful technology. But think systematically about its regulatory needs and its equity needs. And then I think you can have a very powerful result from this.
CASSIDY: OK. Thanks. I'm reserving the right to ask the last question, because I forgot to ask it earlier, and it's a journalistic question. [World Bank President] Paul Wolfowitz made a speech last week saying, once more, aid for Africa. Are Sachs and Wolfowitz on the same side now?
SACHS: Well, we are. He works at the World Bank now. [Laughter] And we're very much on the same side. And what I like about Paul Wolfowitz is that he understands what a real budget is, because he was dealing with a $500 billion budget. Now he's being asked to fix the world on a $7 billion budget, and he knows that he's operating at the level of a failed weapons system now. [Laughter] So I think that—I think he'll be an important voice.
CASSIDY: Right. OK. Thank you very much. [Applause]
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