Can Less Be More? A Radical Rethinking of Foreign Aid
Throughout this series, we have dissected the development delusions—the $200+ billion industry built on contradictions, fueled by imperatives to spend, obsessed with control, staffed by transient expatriates, and locked in a symbiotic trap with recipient governments. We have seen how it generates processism, how it ignores the vast informal economies where most people live and work, and how it fundamentally struggles to catalyze the deep, politically contentious transformations that genuine development requires. The question that remains is: can this industry reform? Can less, indeed, be more? This final post confronts the implications of our anatomy.
The Inescapable Trap: Why the Industry Cannot Self-Correct
A central, sobering conclusion of Sims’ anatomy is that the dysfunctions of the aid industry are not incidental flaws that can be fixed with better management or new initiatives. They are systemic and self-perpetuating, embedded in the very DNA of the industry’s organizational logic.
The Circular Logic of Self-Justification
The industry justifies its existence by constantly raising new challenges and complexities that require more aid:
Mission Creep: The list of development issues that the industry addresses has expanded infinitely—from infrastructure and agriculture to governance, gender, climate, fragility, and resilience. Each new challenge justifies larger budgets and more elaborate institutional structures.
The Perpetual “Needs Assessment”: Donors perpetually conduct “needs assessments” that, unsurprisingly, always find a need for more development assistance.
Fads and Fashions: The industry constantly cycles through new approaches (capacity building, ownership, political economy analysis), each promising to finally unlock development, but none fundamentally addressing the underlying systemic issues. These fads provide justification for continued spending and activity.
This circular logic ensures that the industry is always in motion, always expanding, always finding new reasons to exist, regardless of its actual impact on development outcomes.
Structural Impediments to Change
Beyond the self-justifying rhetoric, deep structural factors prevent meaningful reform:
The Spending Imperative is Immutable: As long as donor agencies are judged by their ability to disburse earmarked funds within budget cycles, the pressure to “move money” will override all other considerations. Rewarding staff for spending, not for withholding or for achieving difficult, long-term outcomes, is a design feature, not a bug.
Risk Aversion Prevents Transformative Action: Donor obsession with “squeaky-clean control” and avoiding political controversy means that development cooperation will continue to steer away from the politically sensitive issues that are often the root causes of underdevelopment. The safest path is always to fund superficial, technical interventions rather than to challenge vested interests.
The Knowledge Gap is Unbridgeable: The transient nature of expatriate staff, combined with the structural incentives to ignore or suppress uncomfortable findings, means that genuine, accumulated knowledge about specific countries and contexts rarely translates into sustained, effective action. Each new project cycle starts afresh, repeating past mistakes.
Recipient Government Interests Are Aligned with the Status Quo: Recipient governments have learned to navigate the donor system to maximize financial inflow while minimizing disruptive change. As long as donors need to spend money, recipients have leverage to keep the aid flowing without undertaking the difficult domestic reforms that would genuinely threaten existing power structures.
The result is an inescapable trap: both donors and recipients are rewarded for maintaining the current system, even if it produces suboptimal development outcomes. Neither side has a strong incentive to fundamentally alter the dynamics.
What Would “Less Is More” Actually Look Like?
If the current system is structurally incapable of genuine reform from within, what alternatives exist? Sims does not offer a detailed blueprint for reform, but the implications of his anatomy point towards several radical possibilities:
1. Dramatically Reducing the Scale of Aid
If the primary function of the aid industry is to keep itself afloat rather than to catalyze development, then reducing its scale might paradoxically improve outcomes. Less money to move means less pressure to spend on ineffective projects, less incentive for recipient governments to adopt postures of feigned compliance, and less crowding out of domestic policy space.
This is the core of the “less is more” hypothesis: that the sheer volume of aid is part of the problem, not the solution. Smaller, more targeted assistance, channeled outside the industrial bureaucracy, might achieve more.
2. Shifting from Projects to Direct Transfers
One radical alternative, increasingly discussed in development circles, is to bypass the project apparatus entirely and provide direct cash transfers to individuals or communities. This approach eliminates the costly overhead of the aid industry, respects the agency of recipients to decide how to use resources, and avoids the processism and conditionality traps. Evidence from various pilot programs suggests that direct transfers can be highly effective in improving welfare outcomes.
3. Focusing on “Doing No Harm”
Given the documented ways in which aid can distort recipient economies, undermine local capacity, and postpone difficult reforms, a more modest goal might be simply to “do no harm”. This would involve rigorously assessing the potential negative consequences of interventions and refraining from actions that could worsen outcomes.
4. Investing in Genuine Knowledge (Not Processism)
If knowledge about specific contexts is the scarcest and most valuable resource, then reforming the industry might involve a radical shift away from formulaic processism towards genuine, long-term investment in understanding. This would mean supporting local researchers and institutions, valuing deep expertise over project management skills, and allowing findings to genuinely inform policy—even when they challenge donor assumptions or expose uncomfortable realities.
The Unlikely Path to Reform: External Shocks
Sims’ analysis suggests that the aid industry is unlikely to reform itself from within because the incentives for all actors favor continuation of the status quo. Meaningful change, if it comes, is more likely to result from external shocks:
Fiscal Pressures in Donor Countries: Economic downturns or shifting political priorities in Western capitals could reduce aid budgets, forcing a shrinkage of the industry. The COVID-19 pandemic and subsequent fiscal constraints have already raised questions about future aid spending.
Rise of Alternative Donors: The emergence of China and other non-Western donors with different operational models challenges the established architecture of the aid industry. This competition might force traditional donors to reconsider their approaches.
Recipient Country Assertiveness: As some countries in the rest achieve greater economic independence and policy autonomy, they may become less willing to tolerate the conditionality and control mechanisms of traditional aid, forcing donors to adapt or be sidelined.
Public Skepticism in the West: Growing skepticism among Western publics about the effectiveness of foreign aid—fueled by persistent questions about impact—could translate into political pressure to reform or reduce aid programs.
Conclusion: The Delusion Remains
The development industry, despite its genuinely humanitarian origins and the sincere dedication of many individuals within it, has evolved into a self-perpetuating system whose primary achievement is its own continuation. The “delusions” explored in this series are not just mistaken beliefs; they are functional myths that sustain the industry’s legitimacy and justify its existence.
The delusion that aid is primarily about helping the poor, rather than about spending budgets and maintaining institutional relevance.
The delusion that more money and more projects will solve problems that are fundamentally political and institutional.
The delusion that donors can “partner” with recipients while simultaneously dictating terms and outcomes.
The delusion that short-term expatriate staff can understand and transform complex societies.
The delusion that processism—logical frameworks, compliance metrics, and risk management—is a substitute for genuine engagement with the messy realities of development.
The anatomy is stark, but understanding these dynamics is the first step towards a more honest conversation about what foreign aid can and cannot achieve. Perhaps, in the end, recognizing the limits of the industry—and the delusions that sustain it—is itself a form of progress.
The foreign aid industry is like a massive fire brigade that has been fighting the same fire for decades. The fire never goes out, but the brigade keeps growing—more trucks, more equipment, more firefighters—all justified by the fact that the fire is still burning. The brigade has become an institution in its own right, with career ladders, procurement departments, and annual reports celebrating the number of hoses deployed and the volume of water sprayed. Occasionally, someone points out that the fire might actually be getting worse, or that perhaps the real problem is faulty wiring in the building. But such observations are dismissed as unhelpful. After all, the brigade must keep fighting. The alternative—admitting that the current approach isn’t working and might even be making things worse—is simply unthinkable for those whose livelihoods depend on the continuation of the effort.
Perhaps it is time to consider whether less firefighting and more rewiring might be the answer. But that would require dismantling the very institution that has been built to fight the fire—an institution that has become very good at sustaining itself, if not at extinguishing flames.
Thank you for reading this series on Development Delusions. The aim has been to provoke critical reflection on a vast industry whose impact on the lives of billions remains deeply contested. Whether or not the aid industry can reform, an honest reckoning with its structural dysfunctions is essential for anyone serious about the challenge of global development.