Giving the “LIVING PROOF: Why We Are Impatient Optimists” talk with Melinda at Sidney Harman Hall (Washington, D.C., 2009).
Improvements in agriculture and health have relied heavily on the generosity of rich countries. But this generosity represents a much smaller portion of foreign aid than many people realize. Aid for health rose from $5.6 billion in 1990 to $21.8 billion in 2007, which was less than 14 percent of all foreign aid from rich countries that year. This money was incredibly well spent—saving a life for far less than a tenth of what is spent to save a life in rich countries.
In total, foreign aid from the richest countries in 2008 was $121 billion. Specific data is available at stats.oecd.org/qwids 
, and it’s something I watch closely because the generosity of these governments is key to long-term success.
Because of budget deficits, there is significant risk that aid budgets will either be cut or not increase much. In the table below, I show some countries’ budget deficits as a percentage of gross domestic product (or GDP, a measure of the overall size of the economy). Many of these percentages represent unprecedented peacetime deficits.
The public may not prioritize keeping foreign aid at high levels because so many of them have not heard how effective it is. Some formed their image of foreign aid during the Cold War, when money was sent to buy the allegiance of a dictator with very little control to make sure it was well spent. We need to get the successes to be far more visible than they are today. The organization
ONE is a key partner in helping with this, and they have Bono’s brilliance as well as a strong staff. In October Melinda and I did a presentation we called
“LIVING PROOF: Why We Are Impatient Optimists” to show how well government investments in health are working. You can watch it at
www.livingproofproject.org. This version was focused on U.S. giving, but the message is even more appropriate for the rich countries that are even more generous than the United States.
The best way to measure aid generosity is to look at it as a percentage of GDP. The most generous countries—Denmark, the Netherlands, Norway, Sweden, and Luxembourg—give 0.72 to 1 percent of GDP to foreign aid, which is phenomenal. Most other European donors give between 0.3 and 0.5 percent, and a majority have committed to get to 0.51 percent by 2010. France has traditionally been the strongest giver of this group, but in the mid-2000s their aid actually decreased a bit. Germany, Spain, and the United Kingdom have all made significant increases over the last few years and are now close to or ahead of France. Italy was at the low end of European givers even before the Berlusconi government came in and cut the aid by over half, making them uniquely stingy among European donors. These cuts will show up in Italy’s 2009 aid figures. Bob Geldof put it well when he said the Italian government is suggesting “they want to balance their budget on the backs of the poor—how shameful.” In June, I met with Prime Minister Berlusconi personally to make the case for more support, but I was unsuccessful. This is a huge disappointment since I still think the Italian public wants to be as generous as people in other countries.
Canada and Australia are significant givers, at about 0.32 and 0.29 percent, respectively. Japan used to be a generous giver and has made some strong promises, but they are down at 0.20 percent. Unless the new government changes things for the better, they will fall short of their commitments.
There has been an effort to get Russia, China, and the rich oil countries to do substantial giving, but so far the numbers have been modest. South Korea, however, has become a significant giver, providing over $800 million last year, which is 0.09 percent of its GDP, with a commitment to increase to 0.25 percent by 2015.
The United States is the biggest giver in absolute terms, but in percentage terms gives only 0.19 percent. In recent years, a significant portion of this assistance went to reconstruction in Iraq, Afghanistan, and Pakistan. If Congress passes President Obama’s proposal to double giving, however, the United States will get up into a very respectable range.
Deficits are not the only reason that aid budgets might change. Governments will also be increasing the money they spend to help reduce global warming. The final communiqué of the Copenhagen Summit, held last December, talks about mobilizing $10 billion per year in the next three years and $100 billion per year by 2020 for developing countries, which is over three quarters of
all foreign aid now given by the richest countries.
I am concerned that some of this money will come from reducing other categories of foreign aid, especially health. If just 1 percent of the $100 billion goal came from vaccine funding, then 700,000 more children could die from preventable diseases. In the long run, not spending on health is a bad deal for the environment because improvements in health, including voluntary family planning, lead people to have smaller families, which in turn reduces the strain on the environment.