RGTyler: Trade not Aid!

Godfrey Bloom, the UKIP MEP for Yorkshire, blundered into the silly season headlines last week as he described foreign aid as sending money to Bongo Bongoland. But his message was surprisingly sound.

As much as I hate to admit it Godfrey Bloom was right, even if he did screw up the delivery. His message on foreign aid being misspent is right on target and opens up room for the old debate of is Foreign Aid worth it?

Lets look at some of the facts first. The UK has the second largest budget in the world when it comes to foreign aid (£9 Billion per year), second to the US at $20 Billion per year. The difference between the UK and the US is that people in the US can sort of see what that money is spent on, as it has to be ratified by the Senate before it is sent anywhere.  In the UK we are just given a number.

However The Freedom of Information act has managed to show us this overly complicated document that offers up some figures on international development. And yet we still don’t know where all the money goes and what it’s spent on.

This week however, it emerged that foreign aid goods had been stolen by Al Qaeda. What’s more is that the Al Qaeda incident isn’t an isolated one. Rwanda’s government also used aid money that it was being sent to fund Congolese rebels.

But wait! It gets even more wasteful and ridicules. The UK has also been sending aid money to countries that don’t even want it. The Indian government has said time and time again that it doesn’t need nor want foreign aid from anyone. It wants investment and private industry not charity.  And then there is the unnecessary aid money sent to Israel, a country that certainly doesn’t need it yet continues to receive and spend it on weapons and crowd control used against Palestinians.

So with all this in mind you have to wonder. Is our foreign aid program really worth it or should we just abandon the whole farce in place of free trade? Imagine what we could achieve if we invested rather than simply handed money out to corrupt governments. We could open up not only new markets to sell our goods but also have access to the resources of another nations and start buying from them to stimulate more growth in both their economy and ours.

Once again it would all boil down to freedom of choice and competitive markets. The principle of Free Trade sits at the core of the Austrian School of Economics.  Free Trade could very easily replace foreign aid. If by trading with India it grew up a new middle class then we would have a market to sell luxury goods to. It would benefit the manufacturing industries and service industries as well.

And it’s also worth noting that Coca-Cola is able to reach the most remote areas of Africa and Asia yet governments with aid can’t. If private companies started up their own aid programs they could make things better for their own businesses and the lives of those they want to sell to.

 

 

So what do you think? Aid or Trade? Tell me in the comments or message me on Twitter @RGTyler. I’m always interested to hear other opinions.

9 comments on “RGTyler: Trade not Aid!

  1. Anthem
    August 14, 2013 at 3:15 pm #

    Those figures you quote there are quite astonishing. The UK gives roughly half the foreign aid of the USA despite having a GDP of roughly seven times less.

    That we also seem to be giving the second largest amount in the world despite us only having the 22nd largest economy in the world is also a bit strange.

    I obviously wish that we wouldn’t send foreign aid of any amount but it seems clear that we could reduce what we are currently sending quite substantially with plenty of justification.

    • right_writes
      August 15, 2013 at 8:47 am #

      We’ve also got the most expensive AGW “prevention” law… aka Mr. Ed’s “Climate Change Act”… £20billion per annum for the next 40 years.

      It’s astonishing what you can’t achieve with other people’s money.

  2. Rocco
    August 14, 2013 at 3:19 pm #

    In case anyone has missed it, Bono has some fascinating things to say on this subject these days. Google “Bono capitalism works”.

    • Anthem
      August 14, 2013 at 6:50 pm #

      I know this is bad form but I wrote a bit about that on my own blog today. Sorry for shameless plug.

  3. andrewporter
    August 14, 2013 at 4:09 pm #

    On a cursory glance I thought the title was ‘Trade not Aldi’.
    @Rocco – Bono has too much too say!
    Surely the point about trade is that it is so difficult in these regions. I have experience in being involved with a subsidiary in Nigeria. To be allowed to trade we had to partner up with a ‘chief’ who had to have 51%. Contributing absolutely nothing to the enterprise apart from the fact we could then trade he basically squeezed the company for every penny [niara] he could extort.
    Whilst I absolutely agree with the sentiment there is so much corruption that running a business is a real morale compromise /dilemma.
    The reason why these countries are poor is because there is little law and the political class “trouser the lot”

    • Rocco
      August 14, 2013 at 4:19 pm #

      No, seriously my friend. He came out and said “capitalism works, we know that”. And something to the effect of ‘aid is just a sticking plaster’. It’s remarkable stuff, you should check it out.

      • andrewporter
        August 14, 2013 at 4:38 pm #

        I have googled as suggested and yes an interesting ‘volte face’ On the same search I came across a blog that contained some incredible vitriolic comments in response to his ‘Damascene conversion’.
        From my experience I still think its wishful thinking that either capitalism or aid works. Both suffer from similar problems -corruption!

  4. kevinsmith2013bigkev
    August 28, 2013 at 7:38 pm #

    All foreign aid spending should be stopped, saving us around £9 billion a year. What we should instead do is offer humanitarian aid when disasters strike, such as Haiti, but even then it should not be sent as money, because not enough will reach the people its intended for. We should send food, tents, medical supplies, building supplies and skilled personnel to make use of the products we send.
    If we leave the EU we could also reduce or eliminate trade barriers to 3rd world countries and they could then afford to sell to us, plus we would save around £50 million a day by leaving, and we could scrap our commitment to the above mentioned Climate Change Act.

  5. kevinsmith2013
    August 28, 2013 at 7:41 pm #

    All foreign aid spending should be stopped, saving us around £9 billion a year. What we should instead do is offer humanitarian aid when disasters strike, such as Haiti, but even then it should not be sent as money, because not enough will reach the people its intended for. We should send food, tents, medical supplies, building supplies and skilled personnel to make use of the products we send.
    If we leave the EU we could also reduce or eliminate trade barriers to 3rd world countries and they could then afford to sell to us, plus we would save around £50 million a day by leaving, and we could scrap our commitment to the above mentioned Climate Change Act.
    UKIP were wrong to force Godfrey Bloom to apologise, who exactly was he insulting?
    If UKIP are not going to stand up for free speech, then who will?

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