The Invisible Hand Axe

At this week’s Clinton Global Initiative Annual Meeting, in every keynote speech, panel discussion, breakout session, and line in the ladies’ room a phrase that was uttered over and over again was “public-private partnerships.”

Given the nature of the panels and their varied makeup, it makes sense. During a panel on rebuilding Haiti that includes representatives of Haitian NGOs, the Prime Minister of Haiti Jean-Max Bellerive, and the head of Royal Caribbean cruise lines, the topic of private investment in Haiti’s future is going to arise. Bellerive, in fact, made the point that aid dollars alone will not rebuild Haiti. The Royal Caribbean guy, not surprisingly, agreed and said more resort hotels can help. Fact. Overall, Bellerive’s point was that the private sector must be involved if Haiti’s economy is to recover and eventually grow. (More coverage on Haiti forthcoming, naturally. Even a Wyclef Jean sighting to go with it!)

Even during a panel about empowering women and girls, the magic words were uttered. So it goes when you’ve got Muhtar Kent, the chairman and CEO of Coca-Cola, on said panel talking about all of the women holding leadership positions within his company. Empowerment! Shattered glass ceilings! Diversity! Unfortunately, the panel was supposed to be about empowering women and girls who didn’t have the privileges most of us had that would allow us to rise within the ranks of Coca-Cola.

More unfortunately, there were few opportunities at CGI for the assembled movers and shakers to hear from those women and girls everyone kept talking about empowering. They were missing among the hobnobbing, apricot danish nibbling, bicoastal elites. Professor Seay at Texas in Africa elucidates this point over at her blog.

What wasn’t missing were bottles and bottles of Coca-Cola. Clearly the Clinton Foundation was benefiting from a public-private partnership itself. The little aluminum bottles were everywhere. Everywhere. Unending supplies. Regular, Diet, or Sprite. Pick your poison. Except for “those people.” The ones who don’t drink soda (or “pop” for you non-coastal-elite types.) What horrible indignities did we—I mean they—have to suffer? Well, there’s a drinking fountain around the corner and a water cooler over there…. hope you weren’t too thirsty!

I think corporations have a role to play in international development. Corporations drive economic growth and if “economic growth” is the new buzzword in the United States’ official international development policy, then it seems like Rajiv Shah of USAID and President Obama agree with me.

That doesn’t mean we shouldn’t be suspicious of big corporations, though. Just like we question the policies of our government and aid agencies, we should question the policies of corporations. We should ask if the benefits of educating future generations in schools built by Shell/Chevron/PetroChina are greater than the costs of the environmental damage their derricks will wreak on generations to come.

Ideally, the choices corporations make are determined by the choices consumers make. If Obama’s crazy plan for economic growth in the developing world works, more and more people globally will have a voice in the market.

We can’t let corporations drive international development to the point where the consumer’s choice is dictated by the corporation. Where only a Coca-Cola product is available and the people who just want clean water are out of luck. That Coca-Cola is already implementing just such a dastardly plan at a venue like the Clinton Global Initiative does not bode well for their respect for consumers’ choices, but it also doesn’t mean I’m giving up on this whole economic growth thing.

The invisible hand of the market might not like picking beans, but it really does like squeezing a little orange slice into a Blue Moon, sitting back, and axing programs and projects that don’t work. That’s more than we can say for some of the aid agencies operating right now. If bad programs don’t get cut, there’s less space in which new and innovative ones can seed, grow, and expand.

No one in Congress or at the State Department is willing to give Rajiv Shah a hand axe, but Muhtar Kent wouldn’t have made it to the top of Coca-Cola without one. Just two words: “New Coke.”

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4 thoughts on “The Invisible Hand Axe

  1. Pingback: A compilation of articles about the Clinton Global Initiative and UN Week | Good Intentions Are Not Enough A compilation of articles about the Clinton Global Initiative and UN Week | An honest conversation about the impact of aid

  2. thanks for a balanced perspective on the whole private-public partnership debate. having worked within the machinery of both the un and a large multinational corporation, i am still not sure that either are going to ‘solve’ any development problems, but they will certainly be closer to innovative solutions to overcoming barriers to socioeconomic development if the two are at least speaking to one another.

    just as i get frustrated when people write off the un, ngos and all development projects, i also get irrirated when people assume that all corporations are evil, always up to no good, and only interested in making more money.

    yes, they are private companies responsible first to their shareholders (if publicly traded), but those shareholders are sometimes interested in their community investment and social responsibility performance and public image is often critical to maintaining share price.

  3. I was just directed to your blog from a friend on twitter. Just wanted to say that I think it’s great, balanced, young & fresh – what we need more of in the aid sector! Keep writing!

  4. Pingback: Informations intéressantes sur l’aide au développement | Blogueuse sur le Net

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