Friday, December 31, 2004
Well, now we have an authoritative answer. The following paragraph, written by Richard Posner, is lifted from the Gary Becker-Richard Posner weblog:
"I agree that my statement that foreign aid is an inappropriate use of public funds requires qualification in several respects. First, it can be a way of buying allies, and from that standpoint the fact that the money is diverted to the political or economic elite of the recipient country need not be an objection. Second, it can be a way of conferring utility on Americans who have ethnic or religious or family or other ties to people in the recipient countries. Third, it can be a subsidy to U.S. industry if the aid is conditioned on the recipients’ using the money to buy U.S. goods; in such a case the net transfer to the recipient nation may be small. Fourth, as in the case of the Indian Ocean tsunami, it can be a form of social insurance. It is also possible that such aid can confer utility on the populations of the donor countries because the plight of the victims of the tsunami triggers altruistic sentiments in those populations, and that emergency assistance, being temporary, is somewhat less likely to be appropriated by the ruling elites of the recipient countries."
About that second category: Second, it can be a way of conferring utility on Americans who have ethnic or religious or family or other ties to people in the recipient countries. "Other" ties? Hmm ... Is Matthew 25:34-40 relevant here?