3 June, 2014Issue 25.3EconomicsNon-fictionWorld Politics

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Development as Unfreedom

Ramin Nassehi

William Easterly
The Tyranny of Experts: Economists, Dictators, and the Forgotten Rights of the Poor
Basic Civitas Books, 2014
416 pages
ISBN 978-0465031252

William Easterly’s new book Tyranny of Experts can be read as the 21st-century version of The Road to Serfdom (1944) in the field of development studies. Inspired by the libertarianism and anti-positivism of Hayek, the book attacks the entire development industry, including international aid agencies, the World Bank, the IMF, and philanthropist organisations like the Gates Foundation for championing a technocratic, top-down approach to development. This approach frames the problem of poverty as a technical problem—involving lack of medicine, bed nets, roads, fertiliser, taxation capacity, functioning markets, and so on—which can be “fixed” by technical solutions, a move which automatically gives legitimacy to “development experts” to make social and economic interventions in developing countries. Easterly argues that this technocratic discourse neglects the individual rights of the poor—particularly their economic and political freedom—by viewing them “as passive objects of development effort”, hence leading to the tyranny of aid organisations, philanthropic foundations, and developmentalist autocrats over the poor. As an example, he starts his book with a moving story of farmers in Mubende, Uganda, whose farms were taken away by the military on February 2010 to pave the way for a forestry project designed by the World Bank.

To many development scholars these stories and arguments may sound like a mere reiteration of Easterly’s previous book, The White Man’s Burden (2006). However, his new book offers a richer philosophical and practical critique of development. The first part of the book traces the historical origins of the idea of top-down development. This attention to the history of ideas makes the book an engaging read. According to Easterly, technocratic development was born in China during the 1930s, long before Harry Truman’s famous development speech in 1949. In that period, the US was supporting Chinese Nationalists, who were headed by Chiang Kai Shek, in order to block Japan’s colonial expansion. The novel idea of state-led industrialisation was then proposed by Nationalists and American experts as an effective tool for protecting China against Japan’s expansion. It was in this context that the first ever development plan was written, being drawn up in China with the assistance of Institute of Pacific Relations, which had been set up by the Rockefeller Foundation and a local economist, H.D. Fond. Later, the idea of top-down development was picked up by the British Colonialists, in particular Lord Hailey, as a tool for preserving their empire in Africa in the 1930s. Accordingly, Lord Hailey appointed Arthur Lewis, who later won the Noble Prize in Economics, as the first black economic advisor to the Colonial Office in 1941. He also established the first Chair for Colonial Economies at the University of Oxford in 1946. Top-down planning later became the dominant development paradigm with the start of the Cold War and was widely embraced by nationalist and developmentalist autocrats in developing countries, popularising the notion of “authoritarian development” in the South. Easterly claims that this paradigm was alluring to autocrats and Western experts because its goal of material development shifted attention away from addressing individual rights in developing countries. He believes that this lack of respect for individual rights still runs through the development industry.

In the second part of the book, Easterly presents a series of philosophical critiques of technocratic development. Firstly, following the tradition of classical liberalism, he views individual freedom as an end in itself that should not be sacrificed for the aim of material development. Secondly, using Hayek’s anti-positivism, he questions the ability of experts to come up with useful solutions for economic development. This critique highlights the importance of tacit knowledge at the local level, which is inaccessible to technocrats, for economic growth. As a supporting example, he points to the inability of development experts to discover the “right policies” for economic growth. Thirdly, he criticises the ontological assumptions which adherents to the technocratic paradigm make about human society. They view every society as a “blank slate” which can easily be changed and improved by “experts”, hence ignoring the importance of history and initial conditions in shaping countries’ development trajectories. Drawing on the research conducted by New Institutional Economists, especially by Daron Acemolgu and James Robinson, Easterly emphasises the significance of political institutions which are themselves outcomes of long-term historical processes, for economic development. This argument automatically casts doubt on the ability of experts to enhance development overnight through technical solutions, as it views poverty as a political problem, rather than a technical one, with deep roots in history.

Finally, the author points out that the absence of accountability and self-correction mechanisms in “authoritarian development” makes the model prone to extreme failures in practice. To support this claim, he shows that, on average, autocracies have been disastrous for economic development, hence debunking the “myth of [the] benevolent autocrat” that has been inspired by a small number of high-growth cases, such as South Korea, Malaysia, Taiwan, Singapore, and, now, China. Even in these successful cases, Easterly questions the importance of state-led policies, and industrial policy in particular, to economic growth. This is the least convincing argument of the book, as the rich array of research conducted by heterodox economists such Robert Wade, Alice Amsden, Dani Rodrik, and Haa Joon Chang clearly shows that the East Asian miracle was the direct outcome of interventionist economic policies.

As usual, Easterly smashes the development industry without offering any solutions in return. For him, the priority is to “do no harm”. This prescription implies that top-down interventions made by experts automatically leads to tyranny, echoing Hayek’s warnings in The Road to Serfdom about the long-term horrors of social engineering for democracy. One may contest this claim by referring to the experience of post-war Europe, where, contrary to Hayek’s prediction, democracy and individual rights remained intact despite heavy government intervention in the economy. However, this argument is not relevant for developing countries as they lack the strong political institutions of post-war Europe. For this reason, Easterly rightly warns the aid industry against sacrificing the political rights of the poor for the purpose of their economic well-being. Viewing individual freedom as an end in itself, Easterly reminds us that “we must not let caring about material suffering of the poor change the subject from caring about the rights of the poor”. In this way, he urges us to question the very idea of development.

Ramin Nassehi is a Teaching Fellow at the Department of Economics at SOAS, University of London.