Breakdown in Pakistan: How Aid Is Eroding Institutions for Collective Action

A couple of decades ago in Kabul, a fellow aid worker on his third beer came up with a vivid simile for what American money was doing to the Afghan organizations implementing USAID projects. “It’s like gluing a rabbit mouth-first to a fire hose. You blast its guts right out of its ass…but as long as the water keeps running, it looks like you’ve taught the rabbit to dance.”

Oxford politics professor Masooda Bano uses less lurid language, but Breakdown in Pakistan addresses the same basic phenomenon: how Western aid donors and INGOs unintentionally eviscerate so many of the local institutions they try to “capacity-build.” The problem goes beyond the obvious mismatch of huge funds with small-scale organizations. Even low-to-moderate external funding can leave an organization hollowed out, bereft of local participants and the power it once had to motivate change on the ground.

Anyone who cares about the global effectiveness of rich-country altruism needs to grasp the dynamic Bano analyzes. From the Western perspective, many of us want to put charitable money into a mechanism that delivers certain measurable outcomes (lives saved, morbidity reduced, income increased above poverty levels, etc.) as efficiently and reliably as possible. So we do our well-intentioned best to shape local institutions into a delivery vehicle for our projects.

Readers of James C. Scott’s Seeing Like a State will recall how mid-eighteenth-century German “scientific foresters” treated forests similarly, as a mechanism to reliably yield the highest volume of lumber. They planted spruce in vast uniform grids, ordered for easy counting and harvesting, while stripping out other non-timber species. The resulting monoculture plantations seemed ideal for both commercial exploitation and experimentation; it’s much easier to control variables when you’ve removed as much natural variability as possible.

Within a few decades, the downsides became evident. The first generation of trees grew strong, sucking up the accumulated benefits of the previous forest’s soil ecology; later generations were stunted, as the lack of biodiversity left the soils nutrient-poor. Plantations packed with trees of the same species and same height were far more vulnerable to pathogens, pests, and extreme weather. Large-scale forest die-offs, Waldsterben, eventually forced foresters to drastically modify their approach.

That metaphor fits Bano’s story even better than my friend’s gutted rabbit. Over the last four decades, we’ve been systematically replacing diverse old-growth institutions with more legible NGO plantations worldwide. While we’ve been enjoying our increased ability to control outcomes and test hypotheses, the rot has been spreading, the impoverished ecology stunting more and more of the forest. And now the wind through those uniform, hollowed-out aisles has built into a storm.

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Bano’s ethnographic case studies, interviews, and surveys are mostly drawn from her homeland of Pakistan. The country is somewhat better off than it was a decade and a half ago when she was writing Breakdown, but the bottom quintile of its population can’t afford basic needs, and its middle class remains within shouting distance of the poverty line.

As Bano observes, this impoverishment largely results from the control of the Pakistani state by a small landholding elite and the military. With the interests of the powerful defended more robustly than the rights of everyone else, a stark income gap has opened up between the top quintile and the rest of the population. Spending on public services is minimal: only around 1% of GDP on health care and 2% on education (rates that have barely budged since Breakdown was published). Corruption is high, social safety nets meager.

Since Pakistan’s government is of limited use to much of its population, “a vibrant network of [non-state groups] emerged to meet the collective needs of the community and those of the poor.” They weren’t founded in response to availability of external funds, but as a response to disasters or a perceived need among some target population. Bano cites the example of Anjuman-Faizul-Islam, one of Pakistan’s oldest voluntary organizations (VOs), “set up in response to a famine in Bengal that left many children orphaned,” or the All Pakistan Women’s Association, created in 1948 to promote women’s rights, literacy, and economic opportunities.

With the dawn of the NGO era of aid in the 1980s, Western donors and charities began combing Pakistan for local nonprofit partners to implement their projects, and discovered this rich base of small-scale organizations already acting as an informal safety net. The way ahead seemed clear: train Pakistani VOs in grant management and project implementation, so they could tap into larger donor funds and take their good work to scale.

Grants were won; aid projects implemented; success declared. But as Bano relates, Oxfam^[1] soon discovered an unexpected dark side to its “capacity-building” work in Sindh province. It had trained six locally prominent welfare organizations in strategic planning and proposal writing, and got them started on implementation by giving them $1000 to work with.^[2] The VOs largely met their explicit project targets, and seemed ready to engage with international development funds on a scale much greater than they’d handled before.

Yet all six organisations were visibly more dysfunctional at the end of the project than they had been at the beginning. They were consumed by factionalism, accusations of favoritism, legal battles over control of funds. And they had lost virtually all of their volunteers—notably including the members whose monthly donations and contributions of time had for decades been the backbone of their work. An Oxfam official observed about one group: “From thirty active members, the size of the team shrank to three or four people who had become workshopias,” i.e. those who had gone to every training workshop and built the strongest relationships with the foreign donor. The kind of welfare work the VOs had previously done, based on mobilizing communities for mutual support, was now beyond their capacity.

Voluntary membership organizations, like these VOs had been, are the ideal type of what we call civil society: institutions funded by donations (rather than sales or taxes), operating based on people freely coming together for some shared cause (rather than to make money or obey a government mandate). The foreign aid industry uses “civil society organization” as a virtual synonym for NGO. In reality, aid-funded groups tend to operate rather more like corporate and/or government contractors: paid service providers with comfortably salaried staff, focused on the goals of faraway clients, whose main unifying cause is “whatever helpful thing they pay us to do.”

And as it turns out, that model severely demotivates volunteers. Oxfam’s “capacity-built” Sindhi organizations were certainly non-governmental, but they were no longer voluntary—NGOs, but not VOs. Bano found the same pattern in the 2000s, in a survey of forty successful Pakistani civil society organizations. Of the twenty that implemented foreign-aid-funded projects, none were able to mobilize local volunteers (beyond some interns hoping to graduate to paid employment) and none raised any significant amount of local funding (only three had managed to elicit a few sparse donations from Pakistani companies).

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So what? As long as the project achieves its outputs—the disaster relief or cash grants distributed, the latrines built, the agriculture training sessions delivered—why would we care what hair-splitting label gets put on the organization that did it? Shouldn’t we expect professionalism, the profit motive, and higher volumes of funding to yield better long-term results anyway, compared to unreliable, unscalable, harder-to-monitor voluntary work?

Bano is a rational choice theorist, and reminds her readers of the value of voluntary collective action through a recap of some classic theory by Garret Hardin, Mancur Olson, and Elinor Ostrom. Any community’s common interests require people to work together cooperatively; but it’s surprisingly difficult to sustain that cooperation, thanks to free-rider problems and inequalities of motivation and information. Shared resources, in particular, often collapse in a “tragedy of the commons” where individuals’ incentive to use as much as possible leads to overexploitation.

Coercive rules imposed by a state are one way to overcome this problem—but no state can generate all the cooperation we need for a functioning society, and in many countries the authoritarian, exploitative government is an unlikely source of public-interest regulation. That needn’t leave us in despair. Even management of common-pool resources (one of the thorniest collective action problems) can be done effectively through voluntary institutions.

In fact, local collective action often yields better results than either state coercion or the individualized incentive structure of competitive markets. In 1980s Nepal, a tragedy of the commons was visibly underway: the rapidly growing population was overharvesting wood from public forests, leading to soil loss, devastating landslides, and worsening rural poverty. The state couldn’t deploy anything close to enough foresters to keep the tree-poachers at bay. Reports from that era took it as a near-inevitability that Nepal would become a country of bald, fast-eroding hills.

That future was averted, largely thanks to the Ostrom-inspired shift to a community forestry approach: granting management responsibility (including, crucially, managing the benefits) to local forest user committees. Those village-level collective action groups proved far better able than the Nepali government to agree and mutually enforce limits on tree-cutting, while also ensuring steady planting. Between 1990 and the present, the country’s forest cover nearly doubled.^[3]

Bano shares a more sobering example from Bolivia, where a USAID project started encouraging quinoa farmers to maximize their individual yields for the market, using modern technology. The foreign experts ignored the informal fertility-regulating village institutions that had (to that point) coordinated voluntary limits on planting to avoid damage to the fragile hill soils. Quinoa yields initially increased for the farmers who ignored the limits…but then began to decrease, while soil loss and land scarcity sparked new feuds. Both ecologically and socially, the community ended up in a worse place than where it started.

And it couldn’t get back to where it had been. Once people saw their neighbors profiting at their expense, ignoring traditional norms and institutions, the fear of being exploited hung over every subsequent interaction. Local leaders trying to get people to limit cultivation for the community’s sake now attracted strong suspicions. Are they keeping to the limits themselves? Are they getting paid off by the norm-breakers?

At the end of the day, institutions for voluntary collective action always rest—not solely, but significantly—on social trust. And once trust is lost, it’s exceedingly hard to rebuild.

Even in countries with big market economies, the rule of law, and democratically accountable welfare states, we rely on organized voluntary cooperation for a pretty wide range of public goods. Volunteer fire departments and flood rescue networks. Parent-teacher associations. Neighborhood watch groups. Sports clubs. Open-source software communities. Blood banks, food banks, homeless or refugee support networks.

In cases like these, it’s not hard to recognize that if trust collapsed—if people felt others were free-riding on their sacrifice, and so only gave their time and resources when they were either paid to contribute or actively forced by the government—we’d all be poorer for it.

Sadly, even after Bano sounded the alarm, we’ve been far slower to recognize the effects of the foreign-funded NGO model on civil society in poor countries. Her survey found that even Pakistani VOs that hadn’t taken foreign aid now experienced “difficulty retaining volunteers or inducting new ones from the younger generation, and most of them attributed this difficulty to the rise of the ‘NGO culture.’”

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After I read Breakdown, I started noticing the damage too.

In Zimbabwe, there was the religious VO that had worked for a long time against rural poverty. Following a major drought, it accepted international emergency funds and worked intensively for two years on famine relief. It helped a lot of people get food, while its staff pushed themselves overtime to comply with the intense reporting, quality, and anti-fraud requirements of the EU and UK governments, with help from international “capacity-building” partners.

And after the disaster, when the VO went back to local supporters who’d always previously given to its work, it got the cold shoulder: “You’re an NGO now. Why do you want our help?” Caught up in the demands of big Western institutions, the VO had communicated less with its traditional members; it had barely noticed, but they sure had. They’d also noticed the VO’s staff moving around the community with visibly improved equipment, handing out high volumes of aid. For a couple of years, the VO had stopped looking and acting like an organization that needed local donations—and its local donors rejected it.

In Nepal, there was the network that had self-organized to help HIV-positive people find work, access government health care, and combat social stigma. It had a wide base of volunteers, mostly family and friends of people living with HIV. The group’s impressive outcomes attracted a capacity-building INGO that helped them tap into foreign funding. Everything seemed to be going great… until foreign donors realized that Nepal wasn’t going to have an AIDS epidemic on par with the worst-affected bits of Africa.

When the international HIV grants for Nepal dried up, the INGO suggested shifting to a mother-child health project, since that was the health-sector funding they still had available. The partner NGO said yes. They’d been “capacity-built” into seeing themselves as an implementer of externally-funded health projects, more than a support organization for people with HIV and AIDS.

When I met them a couple of years later and asked some Bano-inspired questions, they admitted, “We don’t really have volunteers anymore. They stopped joining a few years ago.” After the INGO eventually wrapped up work in that district, it left behind an institution no longer capable of the work that had attracted its “capacity-building” notice in the first place—and a lot of HIV-positive people with reduced support.

I witnessed enthusiastic community organizations mobilize the populations of their whole villages to repair local roads, build bridges, plant trees, pay poor kids’ school costs…and be labeled “low-capacity NGOs” because they weren’t good at writing monitoring reports about it. Those groups’ extraordinarily high capacity for mobilizing collective action either wasn’t recognized, was implicitly disparaged as unprofessional, or was just taken for granted. It wasn’t valued, so it wasn’t measured…and when we killed it, we weren’t looking at it, so we didn’t miss it.

Meanwhile, I saw NGO-implemented aid projects repeatedly try to gin up their own version of local collective action in the name of “sustainability” or “resilience.” Most of our altruistic interventions depended on some degree of community effort to last beyond the project period. Few projects could be handed over to state or market actors; governments weren’t willing to take on new responsibilities, and there wasn’t enough profit in most of our work to support even socially-conscious enterprises. But aid-funded NGOs were also pretty consistently terrible at generating local cooperation.

I passed hundreds of broken-down drinking water tap-stands and pipe systems, rendered useless within a year or two because the village water-user committee—the long-term collective action side of the project, the bit you couldn’t compellingly photograph—only convened as long as the donor was paying for lunch.^[4] I visited cyclone preparedness projects in Bangladesh whose expensive equipment was gathering dust in a locked shed, with no one practicing how to use it. The disaster management committee had stopped meeting without a salaried outsider in the village to chase them.

Overall, I came to recognize a global machine that systematically:

• sought out organizations with high capacity to mobilize local collective action;
• gutted them of that capacity, in exchange for a new role as professional project implementers and grant managers;
• tried to build new project-specific village committees as an artificial (and desperately inadequate) substitute; and finally
• withdrew funding, leading to the collapse of both the previous institutions and the ersatz ones we’d built up in their place.

We were late-stage German foresters, belatedly trying to import an ant colony or fungi after our monoculture had already devastated the soil ecology.

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Why should volunteers have such a strong tendency to abandon a local collective action group that reshapes itself to satisfy foreign funders? In theory, all that capacity-building is making the VO more transparent, more effective, able to reach more people. If local people had been willing to entrust time or money to the cause before, what changed their motivation?^[5] Bano points out several interlinked factors.

First: local membership-based VOs tend to exist for the purpose of solving local collective problems, and are highly responsive to their members’ understanding of needs and priorities. Notwithstanding a widespread aspiration to “participatory” or “bottom-up” design, the international aid machine rarely works that way. Most often, we extract information from communities, feed it through a complex filter of backdonor and head office priorities, development fads and RCT-tested best practices, and finally return with a suggested intervention that plays to our short-term, cash-intensive, apolitical strengths. Those might barely align at all with what local people consider their most pressing problems.^[6]

The brief, shifting, donor-driven nature of most international funding commitments also affects the willingness of NGOs to commit to work iteratively on a problem until it is solved. Bano quotes a foreign-funded NGO representative, “We will do the work while we are being paid for it. We can’t do it once the funding runs out,” in contrast to an education VO: “Entering into three-year contracts is the approach of the international donors, not ours. We believe in staying involved until the target is achieved.” When a VO becomes “NGO-shaped,” that typical shift in focus from long-term local problem-solving to donor priorities and short project timescales is disempowering and demoralizing for its volunteer members.

Second, the narrowing of funding sources has an impact on transparency. A VO founder who relies on contributions of money and time from many local members needs to be continually engaging with them, accountable for decisions and outcomes. For example, one of Oxfam’s partner VOs in Sindh had a longstanding practice of mailing a regular record to all of its members of all donations received and how they were spent.

Once the lion’s share of organizational funding comes from one or two foreign donors, though, that level of frequent, transparent community communication often no longer feels necessary to VO staff. (Or possible. As the Zimbabwe VO found out, one or two Western donors, with their extraordinarily labor-intensive and document-heavy forms of accountability, can easily end up demanding more time than a hundred local members.) Trust dries up along with communication.

Third, whenever people see that it’s possible to make money out of some collective good previously generated through voluntary action, many just stop contributing for free. Bano unsurprisingly finds that in VOs that suddenly got foreign funding for salaries, it led to conflict over “which members would be paid and which would continue to work voluntarily.” And cash incentives can have a major erosive impact even in cases where the opportunity for profit is plainly fleeting and unsustainable.

In Afghanistan, I worked on a one-year USAID project to pump money into the local agricultural economy through cash-for-work schemes. We ended up paying tens of thousands of people to clean irrigation drains, a task that usually would rely on hashar: a few days per year of unpaid labor by every family who shared the canal. I vividly remember a local warlord proudly showing off the “strength of our hashar,” with throngs of shovel-wielding volunteers from his demesne hauling silt up from deep ditches and tunnels.

But apparently even his semi-coercive version was no match for the power of a four-dollar-a-day USAID payment. In the years following our project, hashar was only spottily practiced across our working areas, thanks to the new hope that someone would at some point pay for drain cleaning again. As canal siltation and damage worsened, it threatened to affect farm yields—and also increased the plausibility of some outside force appearing to repair the system. Intensifying violence no doubt played some role in reducing volunteerism, but the hashar system had survived decades of civil war before the really serious blow came from our “peace dividend” cash project (and others like it). Bano records a nearly identical story from post-earthquake Indonesia, where aid work killed off a voluntary system of canal maintenance.

Finally, and somewhat counterintuitively, NGOs can be weakened by the increased visible material comfort of their personnel. Almost without exception, jobs at a grant-funded NGO pay better than whatever VO staff earned before the organization tapped into international funds. NGO workers also often enjoy highly visible side benefits like being driven to work and conferences in fancy hotels. Bano’s research confirmed that foreign-funded organizations in Pakistan generally worked from expensive offices with air conditioning and computers, and reached their project sites by four-wheel drive vehicle—in contrast with the VOs she surveyed, which often worked from basic offices in the communities they served, or from a room in the founder’s house or workplace.

An increase in compensation and comfort for aid workers may be well-deserved. It certainly fits with the commonplace idea that NGOs are strengthened by attracting full-time professional employees. At the same time, it removes one of the only reliable signals that gives local donors/volunteers confidence that they’re not being exploited by insincere fraudsters: visible signs of sacrifice on the part of an organization’s founder and staff.

This is a central theme of Bano’s analysis, because it emerged repeatedly in every aspect of her research: interviews, surveys, case studies. People who donate to a group only have so many ways to monitor the motivation, commitment, and trustworthiness of the group’s staff. In a West reshaped by centuries of formal institutions, we’ve trained ourselves to trust certain documents: show me an audit report, a procurement policy, a five-year strategy, your project success indicators arranged in a logical framework. But even in rich countries, few things hit donation rates as hard as headlines about a charity’s founder or staff paying themselves big salaries in the name of helping the poor.

In countries where audit reports are often wholly disconnected from reality, NGO staff behavior becomes the central indicator other people use to gauge the organization’s reliability and commitment to its ideals.^[7] Where’s your charitable skin in the game? If you and your team don’t believe in the cause enough to visibly sacrifice for it yourselves, but are rather using it as an opportunity to join the upper-middle class, why should I believe in it enough to freely give my time or donate money?

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Religious missionary organizations are one of the key Others against which the contemporary Western humanitarian enterprise has defined itself. The parallels between the two types of civil society thus go pretty vehemently ignored, and well-meaning INGOs trying to promote change in people’s deep-rooted beliefs around e.g. menstrual contamination, witches, or caste hierarchy keep perpetrating the kinds of insensitivities and manipulations that missiologists have been self-consciously avoiding for a half-century or more.

Because of this divide, even among Christian humanitarian workers you’d be pressed to find anyone who’s read John L. Nevius’s seminal 1895 Methods of Mission Work, a critical evaluation of thirty years of attempts to convert China to Protestantism. I recently came across it while looking up some Korean history,^[8] and was struck by the familiarity of the mess Nevius describes: a bunch of foreigners realizing with dawning horror that the big offices of salaried staff they’d set up had been massively counterproductive in bringing about the social changes they intended.

Nevius implored his fellow proselytizers “anxious for immediate results” to stop taking the shortcut of turning local converts into paid agents. Time and again, the missions had damaged the credibility of their most influential Chinese evangelists: “The man employed has lost very much the character he bore as a disinterested worker for the spiritual good of others, and is now likely to be regarded by many as a kind of employ-agent who ought to use his influence to get them places.” By extracting the converts from their previous jobs and community relationships, Nevius argued, the missions were severing the connections that had made them effective agents of change.

He would have been wholly unsurprised by Bano’s finding that organizations that try to pay their employees a market-competitive salary tend to lose all their volunteers: “the two systems are mutually antagonistic, and whenever an attempt is made to carry them on together, the voluntary system labors under almost insurmountable difficulties.”

And as he’d warned, the Chinese churches whose salaried staff made them institutionally dependent on foreign funding proved brittle. The Protestant church that survived the storms of the mid-twentieth century calls itself “three-self,” a reference not to the Christian Trinity but to three principles promoted by Nevius: congregations should be self-supporting, self-governing, and self-propagating. Those features are signs of health in any movement promoting local collective action, not just one aiming to generate changes in religion or worldview.

One of the strengths of Bano’s work is her recognition of the continuities between religious institutions and other forms of civil society. Pakistani VOs and their members generally use language drawn from religious obligation, rather than the rights-talk of international agencies (another feature that can alienate local volunteers, immersed in a new world of jargon when their VO becomes NGO-shaped).

Madrasas whose primary goal is the propagation of Islamic knowledge face similar fundamental challenges to welfare VOs when it comes to keeping their “joiners” inspired and contributing. An imam who lives simply, advertising his motivation by not enriching himself materially, has an advantage in raising money to support the work of his mosque. By contrast, prosperous Sufi pirs living lavishly off their sainted ancestors’ reputation are spending legitimacy as well as money, and risk abruptly discovering the limits of their mobilizing power—as they did during the British Raj, and again in the Afghan-Russian war.

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Happily, Breakdown in Pakistan isn’t just a disheartening litany of voluntary collective action capacity destroyed by external forces. The book includes extensive case studies of alternatives: four very different Pakistani civil society institutions that have thrived without reliance on foreign aid.

The first is straightforwardly religious, the Jamiat ul Uloom al-Shariah (JUS), a madrasa and mosque which relies on voluntary contributions to feed and house its four hundred students. Beyond its core mission of Islamic education, the JUS mosque also (at the time of Bano’s writing) ran a free clinic with basic operating theater. This community medical work relied entirely on doctors regularly coming in to donate their time—which they did reliably enough for the clinic to treat between 30 and 150 low-income patients a day.

The second institution is wholly secular: the People’s Rights Movement (PRM), a small leftist advocacy group. The PRM supported movements of Pakistanis claiming their rights against the state, like trade unions or urban slum-dwellers resisting eviction. Educated, professional PRM volunteers mobilized media attention, legal support, and demonstrations for movements whose leaders didn’t have the skills or connections. As a result, they repeatedly won policy concessions on behalf of those movements.

As a third case study, Bano devotes a chapter to one of PRM’s best-known partners, the Anjuman Mazareen-i-Punjab. AMP is a movement of landless tenant farmers on government-owned, military-controlled land. When the army tried to force them to give up their century-old rights in exchange for a less secure contract, over 100,000 tenants self-mobilized to nonviolently resist. A well-meaning INGO gave them a $33,400 grant to set up a professional full-time secretariat, but AMP eventually returned the grant (and expelled the leaders who had accepted it) after they found it a source of distraction, depoliticization, and dissension rather than effectiveness. They found PRM’s small volunteer team much more reliably helpful in advancing their goals.

Lastly, there’s the Edhi Foundation, Pakistan’s biggest VO focused on the welfare of the poor. In addition to operating the world’s largest volunteer ambulance fleet, Edhi runs clinics, orphanages, and shelters, provides disaster relief, and facilitates adoption of abandoned newborns. Its eight-digit annual budget is supported primarily by donations from Pakistanis around the world, and not by any foreign aid agency.

There’s no single model to imitate here. The case-study organizations not only have very different goals, but profoundly different structures and strategies. The common thread is that they pursued big goals through voluntary collective action; succeeded without foreign grants; relied on a core of regular skilled volunteers for vital functions; and never lost their capacity to inspire people around them to contribute money and time to the cause.

They also all illustrate Bano’s point about the power of visible signs of self-sacrifice. The PRM’s founder, Yale-educated Aasim Sajjad Akhtar, won the trust of the AMP and slum-dwellers by living alongside them and putting his own physical safety on the line in protests. Abdul Sattar Edhi, the saintly founder of the eponymous Foundation, was famous for dressing in ordinary gray salwar kameez, sleeping on the floor of his organization’s headquarters, and personally involving himself in the care of the people he helped.

We could mention durability as well; Bano’s case study institutions have held up pretty well over the past decade and a half. Today the JUS is teaching over 1,000 religious students annually, rather than 400. The PRM went fully political, co-founding the Awami Worker’s Party, an institution that hasn’t so far had much electoral success but offers an even higher-profile platform for PRM leaders’ continuing public advocacy on behalf of the landless and oppressed. The AMP defended and lastingly expanded the rights of tenants on military farms, even if it didn’t win full land ownership and was eventually weakened by internal conflicts. The Edhi Foundation survived a rocky stretch after the 2016 death of its founder, and continues to provide health and welfare services at an unmatched scale.

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Meanwhile, the foreign-funded NGO world is in crisis as much of its support melts away. Trump and Musk killing off USAID was the big visible shock—the Thwaites Glacier collapse, triggering waves of closures all around the world—but the retreat of the metaphorical ice sheet has been underway for much longer. European countries with aging populations and sclerotic economies were becoming less generous even before the Ukraine War forced widespread budget reprioritizations. NGOs have increasingly had to compete for Western aid money with contractors lacking any civil society fig leaf, like PriceWaterhouseCoopers or water engineering conglomerate Tetra Tech (for local governance and democracy initiatives, natch).

Recognizing the increasingly hostile climate, many NGOs have been trying for decades to switch at least partly to local donations. But as Bano confirmed in Pakistan, once you’ve adapted yourself to become a foreign aid contractor, it’s exceedingly difficult to attract local donors. Even in countries with a burgeoning middle class; even for organizations that once, years ago, supported themselves wholly through such donations.

Many one-time VOs barely try. Bano poignantly quotes a former Oxfam Pakistan official: “In my experience, the organizations that have taken money have never gone back to their original participatory work. They have now seen Islamabad and Karachi; they have seen three-star hotels. Now their motivation has totally changed. They spend whole days in writing proposals.” If they fail—as they usually do, in an era of ever more competitive and constrained grant funding—they close or go into indefinite hibernation, rather than give up the hope of “three-star hotels” by a return to community organizing.

To go back to my friend’s metaphor, as the fire hose of aid drops to a garden-hose volume, we see the rabbits stop dancing. It compounds the tragedy when we consider how many began as the best-organized fruit of some district’s capacity for collective action. When those VOs were seen to adopt the cultural template of “the NGO”—donor-driven, unaccountable, profiteering—it didn’t just hit their own credibility. It was a blow to the local system of trust and cooperation that had generated them, making it harder for other voluntary groups to rise in their place.

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But Bano doesn’t think the answer is to insulate local organizations entirely from international aid flows (still less to choke off those aid flows, DOGE-style). Instead, she calls on donors and INGOs to take deliberate steps to “minimize the negative impact” of their funding—to revise their ways of working so that we can still have the lifesaving, poverty-relieving impact of aid without the large-scale damage to collective action capacity.

She favorably cites the example of a UK-government-funded project in Kano, Nigeria. It aimed to broaden the range of secular topics taught in 140 Tsangaya (Islamic boarding schools) which rely heavily on voluntary engagement from parents, religious leaders, and the community. The project could easily have discredited the participating schools by giving the impression that their teachers were betraying their religious mission for foreign cash.

So the designers took care not to look like they were “[buying staff] cooperation through paying them large salaries” or cash incentives. They paid for elements that parents and teachers alike clearly called for—technical education, a student lunch program—but those elements were structured to avoid any school staff getting windfall profits from them. The designers also did all they could to avoid displacement or dilution of religious topics by secular ones, recognizing what motivated parents to stay engaged with the school. The result was positive: the participating Tsangaya schools kept their local credibility and support, while their students got a broader education.

If we took Bano seriously, the fundamental change we’d make is to treat a VO’s ability to mobilize local collective action like it’s gold dust. Vocally, publicly value it. Talk to everyone about its strategic importance. Actually measure it—track the capacity of VOs to retain members, attract volunteers, and raise local donations as a core indicator of institutional health. And if it starts to drop, treat that as a crisis on par with financial fraud. Investigate its context-specific roots—what religious, social, and/or political values are motivating people to give time and money to the VO in question—so that we’ll have some idea of how to respond if our work does begin to diminish it.

In our capacity-building work, we wouldn’t focus on turning local groups into part of the management chain for dwindling foreign grants. Rather, we’d primarily aim to give them the equivalent of a “three-self” vision, and the skills to back it up.^[9] We’d encourage them to keep a primary focus on the priority problems of their target communities; we’d take care not to overburden them with monitoring and reporting requirements. The vision wouldn’t be for local VOs to become the local implementing arm of a Save the Children franchise, but rather their country’s $13m per year Edhi Foundation or agile, transformative PRM.

We wouldn’t aim (either explicitly or implicitly) to replace the “psychosocial and religious incentives” that motivate community volunteers and VO members with material ones, in the name of formalization or professionalization. We’d drop the host of small, commonplace, deeply counterproductive incentives that too many NGOs use to get people to attend trainings and advocacy events—even if that means we have to revise our project events so that local people are actually willing to invest their own time in attending them.

We’d do all we could to avoid destroying the most common signal of commitment—material sacrifice—that reassures local donors and volunteers the VO isn’t exploiting them. Bano doesn’t think this requires everyone working in the aid sector to live like Abdul Sattar Edhi or Mother Teresa. It likely does involve paying below-market salary rates to staff; thorough consultation with all of a VO’s members before agreeing to pay anyone; and setting policies on e.g. vehicle use, office location, and travel per diems with due consideration to public perceptions of waste and wealth. It would require a readiness to adapt incentives over the course of a project or funding partnership, especially if there’s evidence of harm.

We’d prioritize the funding of activities, rather than staff salaries and benefits, and not fund those activities so lavishly as to discourage economy or innovation. Another book well worth reviewing is anthropologist Mark Liechty’s rich history of the development of Nepal’s indigenous hydropower industry, What Went Right. He describes several decades of frugal development—relying on foreign volunteers for key expertise; reusing secondhand equipment from Norway; insisting on locally affordable and appropriate technologies—and contrasts that approach’s positive achievements with later dysfunction and fragmentation. On Liechty’s account, the breakdown can’t be blamed on “‘corrupt Nepalis’ or ‘Third World incompetence’” but stemmed directly from the big-budget, highly-leveraged, and ultimately unaffordable approaches preferred by “commercially driven ‘development’ banks” (e.g. the World Bank) and their Western corporate partners.

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What does Bano’s work imply for the approaches most beloved of effective altruists? Some cost-effective interventions don’t rely very heavily on local collective action capacity. Households can generally make use of bed nets or cash grants even in a low-trust environment; those distributions can be well-handled by NGOs whose primary competency is grant and project management.

The picture shifts slightly as we move into high value-for-money public health measures: deworming, malaria treatment, vaccines. It might seem that a big, salaried state health sector is all that’s required to deliver those at scale, but in a host of countries, the key frontline personnel are actually community health volunteers. The more that “NGO culture” strains collective action, making local people feel like suckers for giving their time to the community without pay, the more friction we’ll be creating for these lifesaving interventions.

We’ll also inevitably encounter situations where people’s ill-health and poverty are grounded in beliefs and attitudes—e.g. the deep suspicion of polio vaccines in the Pashtun borderlands, or the conviction in western Nepal that selling milk to a dairy coop is an intolerable risk (because it might be sold to a low-caste person, angering deities who will kill you or your cow.) A local VO, embedded in its community, can be a powerful and effective ambassador for changes in belief. But as Bano and Nevius both relate, salaried staff with no significant signs of sacrifice often struggle to catalyze this kind of transformation. “You’re just bringing me this message because they’re paying you to,” is a natural discounting factor.

Any humanitarian effort will also quickly run up against politics. Giving a cash grant to landless tenant farmers in Pakistan won’t have much impact when their landlords can just nudge up rent levels to extract the added wealth. Changing that kind of systemic exploitation requires a local institution like AMP whose core competence is risky, politically-charged community organizing. If in searching for a local cash delivery partner, an INGO takes that kind of institution and distracts and depoliticizes it, we’ll ultimately have done more to reinforce than alleviate poverty.

Western altruists could try to invest their donations only in areas requiring minimal entanglement with beliefs and power dynamics. That’s a defensible choice—not solely a drunkard’s search, investing in the areas with the fewest factors confounding our efforts at evidence generation. There’s unquestionably lifesaving work to be done in that space.

The main implication of Bano’s work then becomes a “do no harm” one: channel your funds through an institution that never had much capacity in the first place to mobilize local collective action, so that delivering your preferred interventions doesn’t kill off that capacity. Or (much better) take the time and care to engage with local partner institutions in ways that preserves their capacity to mobilize volunteers. Either way, it requires giving extra consideration not just to EA’s usual core question, “which are the best-evidenced interventions?” but “what are the least damaging institutional pathways for delivering those interventions?”

For people attracted to more ambitious anti-poverty approaches with a higher risk of failure, we need to follow Bano’s recommendations for partnership that names, values, and invests in VOs’ capacity for local collective action. And we might also want to give some consideration to approaches that intentionally work at scale to regenerate that capacity.

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The most powerful anti-poverty movement I’ve personally encountered is a massive network of Self-Help Groups (SHGs) in Ethiopia. On the surface, it could look like just another village savings-and-loan approach, where small groups of neighbors save a certain amount of money every month until they have a collective pot from which they all take turns borrowing. The difference—learned by the Ethiopians from the Indian NGO Myrada, which pioneered this version—is treating the economic function of the group as secondary, in favor of a primary emphasis on building up social affinity and trust between members.^[10]

Based in extreme poverty and saving the equivalent of a few cents per member per week, the Ethiopian SHGs often need a full year before their pot grows big enough to be economically useful. But that first year of regular meetings is vital. Each group decides its own unique bylaws, through discussions about the common problems savings groups often face. They get accustomed to analyzing problems together and coming up with solutions—eventually moving beyond hypotheticals to actual problems faced by their families and village. By the time they’ve built up enough of their own money to begin investing, they’ve also built up trust in each other, and self-generated plans for what needs to change.

The facilitators who help them through that first year sometimes come from supportive NGOs or religious civil society networks, but the SHG movement also long ago reached a point of self-replication. Every 8-10 groups form a Cluster with roving facilitators to help new groups get started, and the Clusters form national level Federations that advocate for policies to help the SHG members. Over twenty thousand SHGs have been born out of this India-inspired Ethiopian movement—meeting voluntarily, saving voluntarily, analyzing and addressing community problems voluntarily.

The combination of robust social networks and slowly-but-steadily-growing capital has been bringing SHG members out of poverty across rural Ethiopia. An American economist commissioned to do a cost-benefit analysis of the approach—focusing just on the relatively quantifiable benefits around income and education—found ratios ranging between 1:58 and 1:173. She was so impressed that she promptly launched a new US charity to promote the approach more widely.

It understandably takes more than a lone CBA to get the attention of the gatekeepers of effective altruism. But there might be more interest in follow-up research if we belatedly took Bano’s evidence to heart, and recognized that the hollowing-out of local civil society is a major millstone dragging down our anti-poverty efforts. We need to build on the existing strengths of VOs where we find them; and we should be looking for replicable approaches, like Myrada’s, that could reseed a new, diverse social ecology over a dying NGO monoculture.

ENDNOTES

Maybe worth a caveat: while I’ve worked in a few different corners of the foreign aid industry in the past, and praise some organizations by name in this piece, I’m not hyping an employer or anyone else who’s in a position to benefit me. All opinions given in this review are the perspectives of a donor and volunteer, rather than a beneficiary. Until the veil of anonymity lifts, though, you’ll have to take my word for it.

And as this goes “to press,” the Guardian has just run an excellent piece by a former USAID governance specialist in Pakistan that confirms how little has changed since Bano’s book was first published..