This year, Americans — through taxes and philanthropy — will spend more than $90 billion in humanitarian aid for the rest of the world. This huge sum helps transform lives in poor countries. But Americans can do better by spending more smartly.
Much of the world’s spending on aid and development ends up being shaped by the global list of goals that the world committed to achieve by 2030, called the Sustainable Development Goals. Due to a misguided attempt at radical inclusion, the SDGs are a sprawling agenda of 169 wordy targets promising literally everything to everyone: eradicating extreme poverty and hunger; ending AIDS, tuberculosis and malaria; fixing climate change and corruption; improving education; saving biodiversity; reducing inequality; and promoting sustainable tourism and increasing urban parks for the disabled.
Because of the failure to prioritize, money has been spread thinly across all these areas. Consequently, the world is falling short on every SDG goal. This year marks the midpoint between the start of the goals in 2016 and 2030 when they are supposed to be achieved. The world is at halftime but we are far from halfway.
This week, world leaders are meeting in New York to discuss how to do better. The United Nations wants at least $500 billion annually for the rest of the decade as a stimulus package. Utterly implausibly, this would mean tripling global development aid — yet, it would still be 20 times short of the full cost to achieve all the SDG promises.
Instead of promising fantasy trillions, we should marshal real billions and spend them on the most effective investments. Working with Nobel laureate economists, the Copenhagen Consensus has combed through the 169 targets to identify the 12 most efficient policies that would deliver at least $15 of social benefits for every dollar spent.
One such crucial investment is in improving educational quality. Almost universally, schools put all 9-year-olds in one grade, 10-year-olds in another and so on. At each level, some children struggle and want to give up, while others are far ahead and bored. Technology can help. Put each student in front of a tablet with tailored learning software for one hour a day, and the software quickly identifies the right level and teaches from there.
For each student, sharing the tablet and infrastructure with many others — even when allowing for incompetence, corruption and theft — the cost comes out to just $31 per year. Many large-scale studies have shown that over one year, the student learns what normally takes three school years. Entire societies become much better off in the long run. Each student’s future income increase will reach almost $2,000 in today’s money.
To get this and similar smart educational solutions to all pupils in low-income countries, a realistic total cost per year would be almost $10 billion, but it would make the world’s poorest people better off by more than $600 billion every year.
Investment in maternal and newborn health is another incredible investment. Each year, almost 300,000 mothers die of pregnancy-related complications, and 2.3 million newborns die within the first month of their lives. We can encourage more women to give birth in health facilities and make sure these have basic staff, training and resources to treat the most typical complications around birth.
Allowing for real-world failure and corruption, the total financial cost will come to just $2.8 billion annually. This expenditure could save 166,000 mothers and 1.2 million newborns yearly. Each dollar spent will deliver a breathtaking $87 of social good.
Education and maternal health solutions are just two of the 12 policies where our research identifies incredibly powerful investments. We could also almost entirely end tuberculosis, very cheaply reduce the death toll of chronic diseases, and do much more. Across 12 smart policies, for a total cost of $35 billion yearly, the world could generate returns worth 52 times the investment. These 12 policies can save 4.2 million lives annually and generate economic benefits worth $1.1 trillion for low- and lower-middle-income countries.
At the U.N. discussions about the failing 2030 promises, the United States should focus on what works and highlight how an investment of just $35 billion could deliver the very best things for the world.
