The Optimist

Forget the Aftershocks

Forget the Aftershocks

Haiti marks a grim anniversary this month: It’s been one year since a catastrophic earthquake struck the island nation, leveling whole neighborhoods of the capital city of Port-au-Prince and killing upwards of 230,000 people. Twelve months later, much of the rebuilding and recovery remains undone. Only 40 percent of the rubble in Port-au-Prince is scheduled to be cleared by next August, complained former U.S. President Bill Clinton, the United Nations’ special envoy to Haiti, at a recent meeting of the Interim Haiti Recovery Commission. But it is not too early to ask what the long-term impact of the quake will be on the development prospects of the Caribbean’s most troubled country. The answer — for good and ill — is likely to be “not much.”

This is not to say, of course, that the earthquake wasn’t an immense human tragedy. In absolute terms it was by far the largest natural disaster of the last several decades. According to research by Eduardo Cavallo and his colleagues at the Inter-American Development Bank, the most catastrophic natural disaster between 1970 and 2008 — measured in deaths as a percentage of country population — was Nicaragua’s 1972 earthquake, in which four out of every 1,000 Nicaraguans died. The death toll from the Haiti earthquake was five times that — and 3,000 times the per capita toll that Hurricane Katrina took on the United States.

Initial estimates suggested that in the short term, this tragic human loss would be an economic one as well, costing the country as much as $8 billion in terms of lost infrastructure — equal to about 120 percent of the country’s gross domestic product (GDP). But in the long term, this economic impact could be far more muted, if history is any guide. Cavallo’s analysis of previous catastrophes suggests that economic performance of countries in the decade after a natural disaster is indistinguishable from that of countries that didn’t suffer comparable misfortunes. Even for countries suffering the largest earthquakes, floods, and hurricanes, Cavallo found, GDP per capita was the same three, five or 10 years after the disaster — as it would had there been no disaster at all.

Cavallo’s study jibes with what we know about the long-term impact of wars on economic performance. For example, by 1960 Germany was back to where you’d expect its income to be based on long-term growth trends from 1850 to 1910 — two World Wars and the Great Depression notwithstanding. All the bombing that the United States carried out on Japan in World War II didn’t alter city growth in the country over the medium run. And University of California, Berkeley, economists Edward Miguel and Gérard Roland argue that the American bombing of Vietnam — which totaled 7.5 million tons of explosives — hasn’t impacted long-run performance in that country, either.

That’s because the things that determine long-term growth can’t be blown up. It isn’t factories or schools, or even individual people. Mounting cross-country evidence suggests that what separates poor countries from rich is differing paths of institutional development.

But this isn’t the best of news for Haiti. Indeed, the country’s history involves virtually all the features that economists have correlated with weak institutions and slow growth over the long term, from its history of slavery and colonial rule to its post-independence succession of coups, U.S. invasion, and some of the Americas’ worst dictatorial misrule under “Papa” and “Bébé Doc” Duvalier. The country’s weak institutions were tragically on display in the aftermath of the earthquake. One reason the death toll was so high was that building and land-use codes were patchily written and almost completely unenforced — so when the earthquake struck, buildings collapsed and slid down hillsides, trapping or killing those inside. In 2006, Transparency International declared Haiti the world’s most corrupt country. Poor institutions of governance help to explain why, between 1950 and 2002, Haiti’s average income actually fell, from $1,051 to $752 per capita. If, as it recovers from the earthquake, Haiti merely manages to stay as poor as it is today, that would count as an improvement.

Still, there is some real good news to report regarding the benighted country’s broader development prospects. While Haiti’s income per capita dropped over the second half of the last century, infant mortality also fell dramatically, dropping from 22 percent to 8 percent of children under age 1. Meanwhile, life expectancy climbed from 42 to 61 years between 1960 and 2008. The progress in health in the country over the last 20 years is one reason why in the post-quake period, epidemics of infectious disease were limited to a cholera outbreak that was reasonably quickly contained. Similarly, adult literacy increased from 11 percent to 50 percent, and the primary school completion rate from 27 to 47 percent, between 1980 and 1997.

That progress reflects a considerable rollout of services central to the quality of life in Haiti over the last 30 years. For example, immunization rates against diphtheria, tuberculosis, and whooping cough climbed from 3 to 59 percent between 1980 and 2006. Schools were built and staffed. Children turned up. Some of them even managed to learn something.

This performance is particularly impressive given that Haiti has a central government that only spent around $530 million a year for 9 million people before the quake, or less than $60 per citizen. This is a little less than 1 percent of what New York City spends per capita on city services alone. Even though the general quality of the country’s governance could only be described as grim and the record of donor assistance mixed at best, Haiti has seen some innovative approaches to providing for basic needs. For example, the U.S. Agency for International Development financed payments on delivery for basic health services covering half of Haiti’s population. Contractors were paid on the basis of services performed — the number of children they had immunized or mothers tested for HIV, for example. The program has had a dramatic impact on immunization coverage and infant deliveries in the presence of skilled attendants.

Haiti still has a long way to go, of course. Harvard University medical anthropologist Paul Farmer, whose Partners in Health organization has been an important player in the post-quake recovery, reports that the quality of service provision in refugee camps is often considerably higher than what the camp dwellers had access to prior to the quake, for example. As of 2008, the country’s infant-mortality rate had dropped 1.5 percentage points to 6.5 percent since the start of the decade, but that’s still worse than rates in Zimbabwe and Burma — and three times the rate in a number of other developing countries. Half of Haiti’s children weren’t completing primary school before the earthquake, and the figure surely climbed dramatically last year.

The good news, however, is that progress prior to the quake was happening, even if it was slow. Considering Haiti’s crumbling economy and constant political instability, that’s nothing short of a miracle — and evidence that there is hope after all for this most unlucky of countries.