Poverty is a problem of politics, not just resources, but the MCC’s approach to data and rigorous analysis gives them an edge in pushing back.

A new paper from the Millennium Challenge Corporation (MCC) contains some interesting lessons from MCC’s seven years of experience trying to build real poverty-fighting partnerships with developing countries and make investments based on objective evidence. I recommend the report, by MCC ‘s Director, Department of Policy & Evaluation, Sarah Lucas. It’s chock full of terrific stories of how both the MCC and their local partners adapted to changing circumstances in the course of compact design, sometimes completely rethinking objectives in the face of new data. But, perhaps most interesting about the report is what’s NOT written in there—how even the most objective approach to development never strays too far from politics.

The MCC is doing some great work fighting global poverty. Despite the name, it’s actually a US government agency, created by the George W. Bush administration and Congress in 2004. The mission of the MCC is to fight poverty by investing in economic growth. But what really makes MCC special is HOW it invests. MCC selects countries based on evidence of their capacity and will to invest in their people. They then work with the country to identify investments that promise the best rate of return and let the country lead on delivering the results.

The hallmarks of this process are evidence and local leadership; while the country government and non-governmental stakeholders are asked to lead, their decisions are meant to be guided by rigorous analysis provided by MCC. The whole thing is designed based on the principle that once you get hard data in front of both donors and recipients, everyone can agree on the right decision.

Yet, the true insight of this paper is that, in fact, politics still often trumps data. MCC knows that extending compact deadlines would allow more time for learning, and more time for partner countries to augment their capacity to lead. But this collides with US political realities; Congress demands quick, measurable results and often gets itchy, even with five year time horizons.

Similarly, MCC from the beginning has required partner countries to conduct consultations with local stakeholders before proceeding with projects. The idea was that these consultations would resolve issues and build local support for projects, and would be composed of groups and people impacted by the project. But in fact, these ad hoc arrangements sometimes didn’t result in true buy-in, as they didn’t ask targeted questions and created skewed expectations. MCC found over time that they couldn’t bypass local politics; rather than trying to figure out who needed to be in the room, it was better to focus on what feedback was needed and work to solicit it through ongoing dialogue.

MCC’s paper reinforces something we say a lot at Oxfam (note the name of this blog); poverty is a problem of politics, not just resources. And development, therefore, requires making peace with the realities of politics. Too many of us in the development world sometimes are seduced by the idea that data can free us from politics, whether here at home (“why can’t Congress see the measurable value of foreign aid?”), or abroad (“why can’t those people see their leaders are corrupt?”). MCC, to their credit, has never themselves claimed their approach can be divorced from politics. Their approach to data and rigorous analysis gives them an edge in pushing back on the worst features of politics, i.e. prestige projects that don’t deliver lasting returns. But, that’s tempered with the understanding that if local people don’t feel the investment serves their interests, it won’t actually deliver its full promised potential.