by José Niño
Mises.org
Some myths in politics die hard.
We are constantly reminded by the managerial classes that foreign aid is crucial to lifting the developing world out of poverty. With the magic wand of public spending, money is sent to the developing world in hopes of pushing these countries out of their economic stupor. We’ve seen this story play out domestically when politicians call for wealth transfer programs with the purported intent of “investing” in economically beleaguered sections of America. With the universalist ethos of American politics, inevitably the domestic redistributionist logic is taken to the international level.
The mythos of foreign aid lives on in politicians’ constant appeals to the Marshall Plan as a source of inspiration for pushing new foreign aid ventures. The Marshall Plan refers to the economic recovery package sent to western European countries after World War II. Per conventional wisdom, Europe’s ability to bounce back from the devastation wrought by World War II is largely attributable to the Marshall Plan’s disbursements of aid, which totaled more than $100 billion in 2018 dollars.