By Sarah Bahn and Manuel Montes
In the 1980s and 1990s, the pressure on developing countries to embrace economic liberalization was overwhelming. They were bullied by global aid and trade organizations, such as the World Bank, into adopting reforms whose benefits were questionable and many argue hurt the poorest. Through its International Economic Policy portfolio, the Ford Foundation supported civil society organizations and academia to devise counter-arguments, which have ultimately led to changes in many of those damaging policies and the way that we think about economic development in general.
Despite overwhelming pressure in favor of economic liberalization, critical analysis of these policies was emerging in the economics departments of universities, particularly in the United States. At Ford, we decided to fund this critical research, bring together those doing it, and support civil society organizations who could facilitate joint work and present it to government agencies and international organizations. How did the International Economic Policy portfolio fit in with Ford’s overall direction and focus? Ford already had an academic international economics program in place for decades and the idea of training a generation of economists in transition economies was very much part of our approach to development Additionally, in an effort to increase the staff diversity they decided to recruit me, an academic economist from the global south, to lead the global economics program and bring a different perspective to the table.
Once the decision to go ahead had been taken and I was hired from outside to take the lead for the program working with other peace and social justice program officers and program officers based in overseas offices, the first task was to find a strategy to ‘implement’ the “solution”. As an initial step, we spent about a year surveying the field, talking to academics and activists, and attending key events where discussions on development policies would take place. The consultation period culminated in early 2001 in a three-day ‘convening’ of academics, activists and civil society organizations, organized by Ford jointly with the Rockefeller Foundation. Three key propositions came out of this meeting:
- It was important to support work that produces historically accurate economic analysis that can contribute to policy design.
- Domestic actors – government officials, academics, civil society organizations – were needed in developing countries that could contribute to the design of economic policies in a way that engaged with the analyses and ideas coming from the Washington think-tanks and international funding agencies.
- There was an influential view in international bodies such as the WTO and the IMF that the less discretionary space governments in developing countries had, the easier it would be for them to integrate into the international economic system.
In starting to address these points, the most effective intervention we discovered was to support not just individual scholars or even academic centers but knowledge-building networks, often based in universities. We found this approach to be very successful. In a book entitled How Rich Countries Got Rich … Why Poor Countries Stay Poor, published in 2007, the portfolio is credited with ‘single-handedly’ changing the field of development studies. From my point of view, the main achievement was fostering a number of large networks of analysts and activists that could engage critically with the economic policies associated with globalization. Thanks to these networks, some new fields of study were created and important analytical standards developed, including gender and trade and gender and macroeconomics. These networks survive today, which is another indicator of the success of the program.
One thing that partners in the portfolio consistently predicted – that the preferred economic integration approaches would result in enormous increases in inequality – is now a significant political and policy issue. As a large funder, the Ford Foundation was able to help groups disrupt the march towards the ‘liberalization’ of economies that harmed the poorest, through the creation of an alternative narrative. The portfolio’s funding strategy was critical to its success: there was a willingness to fund over a long period of time; humility about not knowing the solution and a willingness to learn; and an inclusive effort to determine the problem and identify possible solutions. Ford brought together two very different groups, academia and civil society, whose strengths complemented each other and were both crucial to the success of this initiative.
This post first appeared on the blog of GrantCraft, a service of the Foundation Center.
It is the final post in a series of 11 posts being released by the Working Group on Philanthropy for Social Justice and Peace and GrantCraft, since September 2016.
The post is derived from the recently published Effective Philanthropy: Another Take, a collection of stories describing a philanthropic intervention against some form of injustice (socioeconomic and/or political) at a local, national or global scale. Each story addresses key questions grantmakers wrestle with in order to effect systemic social change and the blog posts in this series highlight certain details that feed into the bigger story. Through this blog series, the partners hope to raise awareness of some of the most effective examples of philanthropy in tackling injustice and achieving lasting structural change. By sharing knowledge in philanthropy and being willing to learn from one another’s experiences and perspectives, we can improve our practice together.