Tell us about the United States Agency for International Development (USAID).
We work with other governments, private partners and civil societies all around the world with the goal of extending opportunity to the most vulnerable and poorest people in the world. Our mission encompasses saving kids from unnecessary death due to preventable disease, preventing hunger and malnutrition in destabilising communities, and providing support for the spread of democracy and democratic institutions during unique moments in history, like the one that the Middle East is in the midst of. It’s very exciting to be a part of USAID.
Some say that US assistance is not enough relative to US GDP.
Well, we’re the largest development partner of any country in the world. USAID alone manages about $24bn in development investment annually. President Obama wants to double our commitment to foreign assistance over time. But to do more we need to convince the American people that foreign assistance generates results that create a better world with more opportunity and security. And that investing in development is far better than the alternative, which could be sending troops into harm’s way after places fall apart. We work hard to use our resources efficiently and we want to do more.
Your first book choice is economic historian Gregory Clark’s A Farewell to Alms. Its subtitle promises “a brief economic history of the world”. Please give us a précis of the book and Clark’s guiding thesis.
It’s a very exciting book that shows how for hundreds, even thousands of years basic economic progress was largely stagnant. As economies were able to produce more food, populations grew. You didn’t have rapid compound increases in living standards until around 1800. Around then, the industrial revolution and its precursors created a massive divergence. Some countries and some societies got on a pathway towards growth – towards better health, longer life expectancy, higher income per person and more investment in education. While other countries remained on a slower-moving pathway.
That great divergence, and the study of it, is at the core of development. It is that divergence which we try to learn from and correct for. We define success in development as helping communities and countries get on that pathway towards improved health and education and greater wealth creation.
Clark concludes that some societies failed to take advantage of the availability of modern technology because their cultures were antagonistic to development.
I disagree with Clark here. With the right conditions in place, you can unlock a formidable work ethic from a range of different cultures and communities. The last 50 years have shown us that. I didn’t choose this book because I think it is the definitive story on development, but rather because I share its focus on core economic growth as the driver of divergence.
The Nobel prize-winning economist Robert Solow says that Clark discounts institutional reasons why development is difficult in some countries – cronyism, inequitable taxation, ineffectual government. What role do these institutional factors play?
Solow is absolutely right. Institutions are very important. I keep referencing the Solow growth model, which defines the core driver of economic growth as technological innovation. We try to make science, technology and innovation a bigger part of what USAID does around the world.
How can foreign assistance be structured to strengthen recipient country institutions?
By investing in local capacity and local institutions, we can leave a legacy of economic infrastructure, strong and capable leadership and transparent, effective public and private sector institutions. USAID's partnerships in Latin America, or with South Korea, helped country after country develop strong institutions. Unfortunately, there have been examples where aid and assistance have been provided in a manner that was not as sensitive to building lasting local capacity and local institutions. This is true for all partners, not just our agency. That's why we've launched a programme called USAID Forward, to refocus on working in a way that will create durable and sustained progress.
Next are the development success stories encapsulated in Millions Saved by Ruth Levine and the What Works Working Group.
I participated in this working group. We got hundreds of examples of potential success stories, and chose those that were based on the most rigorous data and that succeeded at scale. These aren't about saving two lives in one village somewhere, although that is important to do. These stories are about transforming the health of entire countries and reaching hundreds of thousands over time. All these projects also built institutional capacity that was sustained after the donors went away.
This book demonstrates that smart, well-constructed investments in global health can achieve widespread impact on the way people live. Some of the big successes they discuss include iron and iodine fortification, which improved the overall level of human health and nutrition. And in the field of family planning, by reducing the population growth rate, development programmes created the underlying basis for economic growth. These are very important examples and the book also defines some of the characteristics that are common across them. For instance, the success of most of these projects was attributable to working in partnership with local and regional partners. The book also highlights the need to have really strong evaluation and data collection, because often when you launch these programmes they don't work right away – we need information to understand how they're performing, and adapt.
Please give us an example of one specific lesson learned in the field of public health that USAID is putting to work?
In our Feed the Future programme, we have taken all of the best practices of this report and put that into how we design food security programmes around the world.
Dr Rajiv Shah has led America’s international development agency since 2010. Prior to heading USAID, Shah was undersecretary and chief scientist at the US Department of Agriculture. Before joining the Obama administration, Shah piloted the Gates Foundation’s public health and agricultural development programmes. He received his medical degree and a master’s degree in health economics from the University of Pennsylvania