One crisis after another is showing us that our world is badly designed. And in large part, this is because we’ve inherited institutions that are now out-of-date and unfit-for-purpose: an entity tasked with keeping us safe that makes many people feel anything but; a system of public representation that is unrepresentative; firms that are meant to make our society more prosperous, but instead drive inequality and environmental destruction…
Our institutions — defined by the Nobel-memorial prize winning economist Douglass North as the “rules of the game” — need to change.
But institutions are, as economists describe them, “sticky.” There are a number of reasons for this. First, they are old. Many institutions governing our lives today are either revered as valued traditions, or simply taken for granted because it’s always been the way it is. Second, they are hard to see. Many institutions are either unspoken, like social norms; or are hidden in plain sight, like water to a fish, because they are already so deeply embedded in our ways of living. Third, and perhaps most crucially, they provide stability. Institutions, in economics-speak, eliminate transaction costs: thanks to everyone’s recognition of property rights, a landowner wouldn’t have to repeatedly assert his claim over a piece of land and constantly risk his life defending it. But the trouble is, one man’s stability can be another’s suppression: in the UK, it was only in 1882 — approximately 800 years after the origin of the concept of private property — that married women were able to retain their own property separate from their husbands.
The aid sector is similarly governed by institutions that are outdated, unquestioned, sub-optimal, and oppressive. And they are just as sticky — if not more, since people are loathe to problematise something that is supposed to be “for good” or “for charity.”
So how can we change the aid sector’s sticky institutions?
Perhaps we can learn from psychology.
Mental health issues like PTSD or trauma are reinforced or exacerbated by faulty rationalisations in one’s own head. Like, “A bad thing happened to me because I’m a bad person.” Or, “I got abused because of my own actions.” These cognitive errors act like sticky institutions: they are logics one inherits from their wider context, whose assumptions hide in plain sight, and easily explain away one’s circumstances (instead of pushing them to confront uncomfortable truths).
Something that has proven to be effective in challenging these cognitive errors among those with PTSD or trauma is Cognitive Processing Therapy (CPT). Unlike typical talk therapy, CPT is short-term and systematic. Those undertaking it are given worksheets that, like essay questions in an exam, prompt one to look critically at, and poke holes in, such cognitive errors.
One main exercise in CPT is looking for “stuck points,” which the journalist Jaime Lowe describes as “something you hold to be true but might in fact not be true.” Lowe experienced abuse as a child. And in a podcast where she tries out CPT for herself, she found many stuck points in her own narrative — “It happened to me because I smiled”; “It happened to me because I was wearing these clothes” — that she had to systematically unlearn.
What are some of the aid sector’s stuck points (that is, sticky institutions) and how might we unstick them? I propose a few.
Stuck point 1: Competitive grant-making is the most efficient way of allocating resources
There are grand calls for reform in the aid sector, like decolonising development or shifting the power. But most problems these reforms are trying to solve are inextricably linked to the boring, un-grand issue of funding. The supposed efficiency of competitive grant-making remains unquestioned, perhaps due to the pervasiveness of the free market logic even in the aid sector. But it is far from efficient and equitable in reality.
For example, in the humanitarian context, needs assessment is conducted by INGOs themselves, instead of an independent entity. The needs assessment informs the humanitarian budget requirement (which INGOs artificially inflate); the budget requirement informs donor funding (which INGOs anticipate will be lower than the total budget, thus the artificial inflation); and the donor funding allocation is heavily skewed by UN/INGO lobbying. Richer UN agencies/INGOs, of course, will have bigger advocacy teams, which means they tend to get the lion’s share of donors’ money. (Owen Barder also explains the aid sectors’ flawed funding process in an episode of Displaced.)
UN agencies/INGOs — and even for-profit consultancies who win government contracts — further sub-grant the actual work to smaller organisations, who must similarly bid in a competitive process. And this bid is often unnecessarily onerous — with extremely tight turnarounds, burdensome due diligence checks, and strict monitoring and reporting requirements. Of course, organisations with high incomes have better compliance capacity, so those with lower incomes lose out. The rich get richer…
Is competitive grant-making, in fact, the most efficient and equitable way of allocating resources? This is an empirical question that must be finally asked. In the meantime, we can consider alternatives: like unrestricted multi-year funding, which has been found to be a “win-win” for both donors and smaller organisations; or even re-conceiving aid as a pot of global public investment, where all countries chip in and get their fair share.
Stuck point 2: We can hold ourselves accountable
Social change requires a diversity of change agents — from insider reformers to outsider activists. But as I argued in a New Humanitarian piece on the Future of Aid, we have been overly reliant on internal reforms: self-policing by INGOs through internal committees; self-imposed quality standards for the sector; pressure from donors to tackle issues like sexual abuse; and even a proposal to have an aid ombudsman.
But, as the literature on how change happens tells us, we require outsiders to hold us accountable, too. Specifically, the people and communities we intend to serve. In health, there are organisations specifically for “patient advocates” that champion patients’ rights. In aid, recipients don’t need “advocates” per se — they are perfectly capable of speaking for themselves. What would help them, however, are resources and platforms to amplify their voices — because as individuals or unorganised small groups, their leverage can be limited. We need radical ideas like aid recipient unions, who can collectively hold INGOs to account; or citizens assemblies, whose diverse perspectives have been proven useful in policymaking in areas like environmental justice or civil rights.
Stuck point 3: Donor publics need to hear simple but effective stories of “development”
There has been a poor understanding of how “development” happens even among aid and development practitioners. For most of the past three decades, two ideologies prevailed: a version of modernisation theory, where all that’s needed is a “big push” in the form of aid for low-income countries to get them out of the poverty trap; or alternatively, a technocrat supremacy, where “development” is achieved by (Global North) experts imparting knowledge and good governance to their poorer counterparts. But as the growing body of evidence shows, both these ideologies are wrong: “development” is not, in fact, a linear process but a complex one — where inputs (like financial transfers or technical “best practice”) do not necessarily lead to good outcomes.
Among aid insiders, this new “development 2.0” narrative is taking hold. Yet the story of development we tell members of donor publics remains infantilising. Sure, we’ve made some progress from poverty porn towards a more positive depiction of the people we serve. But our sector still believes simple sells: “Give £5 to save a life!”, “Sign this petition to make a change!”
It is often said that we need solidarity, not charity. But solidarity that hinges on simple, emotive narratives is a weak kind of solidarity — and it may have adverse consequences beyond what many INGO marketing and campaigning teams anticipate.
Pablo Yanguas in his book, Why We Lie About Aid, argues: Development programmes often fail because INGOs are not experimental and adaptive enough. This is because INGOs usually face unhelpful constraints from donor policymakers. This is, in turn, because donor policymakers are accountable to donor publics — whose expectations of how “development” happens are shaped by the very INGOs’ simple narratives. This leads to, at the very least, things like staff salaries getting unfairly scrutinised in the Daily Mail; and at worst, a shift in aid policy away from effective ones (like experimentation and adaptation), and towards promoting “British values” and “British interests.”
These are some of the institutions that govern our sector. There are many others — similarly unquestioned because it’s always been this way, or unspoken or hiding in plain sight because we have not been able to articulate our assumptions thus far. But if the aid sector were to truly change, we need more than just rearranging players and pieces; we need to change the rules of the game.
In doing so, our first task must be just like in CPT: that is, to unstick our stuck points. If we can challenge the unchallenged logics that seem to explain how aid works, then we’ll be more capable of changing how aid, in fact, works.
Aid Re-imagined’s mission is to help usher the evolution of aid towards effectiveness and justice through deep, radical, and evidence-based reflection and research — unafraid to venture beyond the realm of development and humanitarianism, using insights from philosophy, economics, politics, anthropology and sociology, as well as management. Aid Re-imagined stands for a more effective and just aid for our new, ever-changing world.