Barbara Ward, the distinguished writer for the Economist and a close friend of Robert McNamara, told me back in 1972 that McNamara “bled inside for what he’d done in Vietnam.” Ward was cross with me for using this quote, and insisted that over time people would judge McNamara more for his (then relatively new job) as president of the World Bank.
Judging from last week’s obituaries she was wrong about that. Vietnam, the Cuban missile crisis and his flip-flopping on nuclear weapons dominate contemporary attitudes to McNamara. Yet it is true that what he did at the World Bank is worth remembering, especially his efforts to turn aid in the direction of small farmers. Under his tenure the World Bank spent 30 per cent of its budget on helping small third world farmers be more productive. Today, as pre-McNamara, it spends about 10 per cent.
McNamara argued that there was enough knowledge available to raise the output of small farmers by 5 per cent a year—far in excess of population growth. If that had been done, it is probably safe to say that today there would be no significant poverty or hunger, as most people in the poorer third world countries still live on the land.
Instead, as the G8 said last week, the number of hungry is up near the one billion mark and too much of western budgets is spent on food aid not long term rural development. The G8 said they were committed to reversing that.
In its research the World Bank has shown that the intensity of land use diminishes as farm sizes rise. A smaller than average farm holding and a low concentration of ownership produce an increase in output per hectare. Taiwan, South Korea, and Egypt all achieved rapid success in their rural development because they had vigorous land reform and emphasised, as the backbone of their highly successful economic development, the role of the small peasant farmer. The Bank showed that in countries as diverse as Argentina, Brazil, Chile, Colombia, Ecuador and Guatemala output per hectare was between three and fourteen times greater on the smaller farms than the larger ones.
For years supporters of large, highly mechanised farms have argued that land reform will end up creating a depressed peasantry, too ignorant…