In Afghanistan, as in Iraq, both the U.S. Defense Department and Agency for International Development (USAID) are struggling to find ways to use aid resources to promote the goals of development and security. The effort involves a considerable amount of money: If Afghanistan's volatile Helmand province were a country, it alone would have been the fifth-largest recipient of USAID funding in 2008. Meanwhile, aid organizations and NGOs complain that military programs such as the $1 billion Commander's Emergency Response Program build infrastructure that will not be maintained and will provide little long-term development impact. The military, for its part, complains that civilian development efforts are too focused on secure areas at the expense of winning hearts and minds in other places where it would actually make a difference to reduce violence.
Both sides are probably at least half-right: Despite many successes in improving Afghan citizens' quality of life, it seems quite likely that aid flows are failing to deliver economic development or security. A recent review of reconstruction in Helmand province by Stuart Gordon of the London-based Royal Institute of International Affairs (Chatham House) concluded that aid "may have as many negative, unintended effects as positive ones and, at the very least, is not a panacea." Gordon's interviews with people in Helmand suggested a widespread feeling that aid was only entrenching local tribal and criminal elites while doing little to improve the lives of ordinary people. But perhaps there is a way to meet both security and development goals at once. Just giving money to poor people turns out to be a powerful tool to improve lives and foster opportunity. And making that money conditional on security could provide a big incentive for local communities to turn against the Taliban.
The latest rage in the development industry is paying people to develop: to go to school, to get kids vaccinated, and so on. Conditional cash transfers hand over money to families if -- and only if -- they ensure junior is in school or has his shots. Mexico's conditional cash program, Oportunidades, reaches more than 25 million people; Brazil's Bolsa Familia reaches 12 million households. The programs work and have dramatic impacts. Not only have they considerably increased vaccination and enrollment rates -- Mexico's program increases the chance that children will complete grade nine by 23 percent -- but the money also has a number of other positive effects in areas like nutrition and income generation.
Growing evidence suggests that even unconditional cash transfers to poor people -- just giving them money, no strings attached -- can have a big development payoff as well. A pilot of a universal grant program in the Otjivero-Omitara area of Namibia found that within a year of program launch, child malnutrition fell from 42 to 10 percent, the proportion of adults involved in income-generating activities increased from 44 to 55 percent, school attendance rose considerably, savings expanded, and crime rates fell.
Meanwhile, in Afghanistan, we are struggling to spend considerable resources in a manner that achieves peace and development. Why not use cash transfers to promote stability? Here's one way it might work: In districts that are free from violence against Afghan forces or NATO's International Security Assistance Force, every adult is paid $20 every other month, with no conditions at all. If violence resumes, payments drop by a widely advertised amount. Too much violence, no cash transfer. If the Taliban or related groups keep fighting or attempt to extort payments, then a whole district population has a strong personal incentive to snitch. And to incentivize the security of those involved in the payments system, deaths of payment agents would also lead to a reduction or curtailment of payments at the district level.