Democracy’s Decline Raises Questions About Aid Funding

    "Democracy progress in the world has ebbed and is beginning to reverse," said Larry Diamond, a senior fellow at the Hoover Institution, Dec. 3 at Johns Hopkins SAIS development roundtable, summing up his sentiments about the last decade.

    The reverse follows 25 years of growth, he said. In 1974, only 27 percent of countries had a democracy. By 1999, that percentage had reached 63 percent. But since then, 25 countries had breakdowns of democracy and many countries like Russia are tolerating more totalitarian regimes.

    The breakdown of the world's financial system hasn't helped democracy's decline. The Washington Consensus might be on its last breath as the free market principles it celebrated have led to excesses that threaten to hold the global economy in a prolonged recession.

    So what does the decline of democracy mean in terms of development? According to Diamond, countries must take a hard look at who they are giving aid to to ensure that corrupt governments and politicians are not using development dollars to get rich. He said development assistance must come with conditions: only countries that foster good governance should be eligible for foreign assistance, assistance should aim to strengthen democratic institutions, good performance should be rewarded.

    Conditional aid and, more precisely, using a country's democratization as a condition for aid, is an idea that is often tossed around the development community, but it raises a chicken-and-egg question: What comes first, an economy or a democracy? Strong arguments can be made on both sides. But, to Diamond, it is increasingly important how development decisionmakers answer this question - especially in the Obama administration. Many countries need assistance to develop, and inevitably some of these countries are not going to be democracies. Should that disqualify them from aid? Or should the development community give aid anyway, believing that some help is better than none

    About the author

    • David Francis

      David is a Washington-based journalist and former Devex staffer who spearheaded Devex's "Obama's Foreign Aid Reform" blog. He has written for the Christian Science Monitor, Pittsburgh Post Gazette, SportsIllustrated.com, San Francisco Chronicle, Foreign Policy magazine, and the Washington Monthly. David holds an undergraduate degree from the University of Chicago and a graduate degree from Georgetown University.