Modernization theory, sometimes called development doctrine, supplied the working concepts through which the United States understood its obligations to unindustrialized, newly independent nations in the last half of the twentieth century. Described as both an ideology and a discourse, modernization comprised a changeable set of ideas and strategies that guided policies toward foreign aid, trade, nationalism, and counterinsurgency. Among its core precepts was the idea that the state of economic and political advancement enjoyed by the United States and the industrialized West was normative, and that it was in the U.S. national interest, as well as the general interest of all people, that steps be taken to bring the other two-thirds of humanity up to a comparable level. Social science theories explained the causes of Asian, Latin American, and African backwardness and suggested appropriate remedies.
Historians have traced modernization theory's intellectual lineage back to Aristotle, who first suggested that states followed a natural pattern of growth, like plants. But while linear progress is a recurrent theme in Western thought, it existed alongside Christian doubts about man's fallen state. Americans in the early Republic believed (as did Aristotle) that if societies grow naturally, they also decay. The idea that the process of human progress could be understood and controlled dates to the early nineteenth century, when France and Britain were struggling to reestablish their mercantile empires on a secular, commercial basis, and just before technology and scientific racism ushered in an era of guiltless imperialism. Since then it has tended to recur at times and places where systems of dominance required justification and explanation.
Progress Becomes Modernization
European liberals reconciled universalism and imperialism by arguing that although all men were not yet equal, they were ruled by universal economic laws and followed a common historical path. The philosophers Jean-Baptiste Say, John Stuart Mill, and Auguste Comte each contended that societies passed through successive stages from savagery through barbarism to finally reach a developed state that resembled industrial Europe. "Whoever knows the political economy of England, or even of Yorkshire," Mill claimed, "knows that of all nations, actual or possible." Comte called the science of human evolution "sociology" and proposed that the highest stage would be a "positive" society governed by science. American scientists similarly concluded that their own society was advanced relative to the surrounding peoples, who might with help "catch up." Lewis H. Morgan, a founder of American anthropology, speculated in 1877 that "American Indian tribes represent, more or less nearly, the history and experience of our own remote ancestors."
From this perspective the United States, as well as Germany—among the youngest of countries—could be seen as the oldest of societies, advanced beyond India or China in the arts of civilization. Seniority implied a duty to instruct and uplift, and a concept of trusteeship was integral to liberal developmentalism. In the latter part of the nineteenth century, German social theorists—George Friedrich List, Karl Marx, and Max Weber—debated the obligations and causes of economic progress. List asserted that the state held the primary developmental role; its true mission was to "furnish the economical education of the nation." Marx authored one of the boldest theoretical statements of the developmental vision, describing the "iron necessity" of historical laws that required the successive destruction of feudalism and bourgeois capitalism to make way for communism. He attacked the liberal developmentalists' assumption of trusteeship, which subordinated colonial subjects and domestic labor and furnished a disguise for exploitation. Marx's and later Lenin's critiques of imperial trusteeship were so appealing to anticolonial insurgents that Cold War–era modernization theorists would conceive their project as an attempt to devise an alternative to communist developmentalism.
Nationalists in the subject states constructed their own visions of modernity, and by the 1920s development was the subject of a global debate among disparate factions of anticolonial modernizers, primitivists, jingoes, and reformers. Two members of the Indian National Congress, Dadabhai Naoroji and Romesh C. Dutt, wielding British statistics and a historical perspective, demolished claims that the Raj acted for India's economic welfare. Dutt (using what would later be called a structuralist or dependency approach) showed that imperial taxes and terms of trade systematically milked India for England's benefit. "When I read Mr. Dutt's economic history of India," Mohandas Gandhi wrote, "I wept…. It ismachinery that has impoverished India." Indian nationalists drew different conclusions as to the proper response. For Gandhi, development was the antithesis of community, and he urged a restoration of a preindustrial village economy. But Jawaharlal Nehru, insisting there was "only oneway traffic in Time," ruled out a return to communalism or Islamic theocracy. He represented a majority of Congress Party members who wanted to build an industrial India by wresting development planning from British control. In China, too, development became a principal rationale for the nationalist struggle. Sun Yat-sen authored an elaborate scheme that promised to cure China's backwardness as well as the global crisis of over-production by using Western technology to dam rivers, build cities, and overlay China with a modern transport grid.
In the United States, "development" came into official use at the beginning of the twentieth century to distinguish the American civilizing mission from European colonial policy, which it resembled. "The Philippines are not ours to exploit," President William McKinley asserted, "but to develop, to civilize, to educate." Woodrow Wilson attested that the Allies were "fighting for the liberty, the self-government, and the undictated development of all peoples." In practice, the line between exploitation and development was porous. Gifts of science and technology facilitated economic and imperial penetration. Commodore Matthew C. Perry had presented the Japanese shogun with machinery and seeds, and by 1900, American agricultural missions, mining surveys, and sanitation experts made frequent stops in Japan and China. Professor Edwin W. Kemmerer circulated through South America in the 1920s modernizing currency and banking systems while opening new ground for U.S. investment. Educational and medical establishments, including the early work of the Rockefeller Foundation, were an extension of Christian evangelical missions.
An evangelical sensibility distinguished the American approach to development from the high-modernist ambitions of European colonizers and Asian nationalists. Early technical missions found their work "was not merely a matter of transferring scientific principles and factual data," Merle Curti observed, "it was more largely a problem of developing attitudes." Rockefeller initiatives in China in the 1920s and 1930s emphasized the transplantation of institutions and ways of thinking. American social science supported a perception of modernity as a kind of conversion experience. John Dewey, who defined American pragmatism in the 1920s and 1930s, conceived of freedom as development, as the realization of latent potential. The anthropologist Robert Red-field, writing in 1930, was the first to use the term "modernization" to describe linked processes of urbanization, literacy, secularization, and familial dismemberment. Although these were all concomitants of economic disruption, Redfield noted that modernization was fundamentally a cognitive, even spiritual event: A peasant, encountering a city for the first time, "develops a correspondingly new organ, a new mind." From the start, American modernization initiatives would measure achievement not by kilowatts or gross national product but by hearts and minds.
A Tool for Managing Decolonization
New techniques devised during the 1930s and 1940s gave the sociology of modernization a harder, scientific edge. Demographers discovered the "demographic transition," a sudden drop in birthrate that served as a statistical marker of the arrival of modernity. National incomes accounting, invented by economists during World War II, measured the economic efficiency of nations relative to one another and across time. Talcott Parsons, a Harvard sociologist, served as advocate and symbol of the statistical, comparative turn in the social sciences, sometimes called the "Parsonian revolution." To Parsons, societies and nations were integrated systems that could be disassembled and compared. The results of empirical observations, fed into theoretical models, would allow social scientists to predict the trajectory of a society, and to plot alternate outcomes given the introduction of variables like industry, mass communications, the cash nexus, or Western contact.
Thinking in Washington moved along a parallel track. The experiences of the New Deal and World War II, particularly the Tennessee Valley Authority (TVA) and the Manhattan Project, reinforced confidence in the ability of science and planning to transform whole societies. Many in the Roosevelt administration believed such work would be essential to achieving a stable peace. David Lilienthal, co-director of the TVA, noted "a definite sequence in history from primitive or non-industrial conditions to more highly developed modern industrial conditions." American assistance could help societies avoid "wasted steps" in the transition. By the end of World War II, a number of suppositions about the nature of modernization were widely shared in academic and philanthropic communities and were gaining attention in government, although they had yet to be codified as theory or policy. Among these were the following precepts:
Development begins from a stable, uniform state of tradition. Since, as Redfield observed, peasants in Tepoztlan, Mexico, Melanesian islanders, and "the southern negro" are fundamentally identical in out-look and relationship to modernity, their developmental problems (and the solutions) would also be the same, regardless of geographic or historic differences.
All societies follow a common, linear path to modernity, passing through recognizable stages along the way. The final destination (known to development economists as "convergence") is a high plateau of industrialism and consumerism enjoyed by the urban societies of North America and Europe. Regardless of their point of origin, all cultures have the same trajectory. Nations with tragic histories could be assured they would not have a tragic destiny.
The journey can be accelerated in a number of ways but chiefly by contact with developed societies and through state interventions. Centralized planning was the essential feature of development work.
The most difficult part of the transition is psychological. Once the comforts of custom and old patterns of thought are rejected progress would follow its natural course. Development is thus not a process of accumulation but of release, the freeing of restrained energies and resources.
Development is above politics but has the capacity to create political gains and risks. Since states, regardless of political form or ideology, share an impulse to modernize, there would be a chance for the United States, as well as for rival powers, to take the lead in the global movement.
These ideas served as a template for the management of the decolonizing world. The sudden collapse of the European and Japanese empires following the Allied victory confronted the United States with the immense problem of redirecting the political and economic alignment of two-thirds of the world's population. The Soviet military triumph displayed the fruits of Stalin's industrialization drives, and newly independent regimes looked to the USSR as a model of rapid modernization. New international organizations—the United Nations and the World Bank—lent expertise and institutional backing to the development of postcolonial areas. Nonetheless, the United States faced its greatest problems in Europe and Japan, where reconstruction took first priority. Although the Marshall Plan was often mentioned as the inspiration for later modernization schemes, no attempts were made to duplicate its formula elsewhere. American officials felt its reliance on heavy industry, labor unions, and the welfare state could not be adapted to Asia or Latin America, where more fundamental issues—education, health, low productivity—had to be dealt with. These issues became more imperative as the Cold War intensified. Nationalist China's sudden collapse, despite a hastily arranged aid package, revealed the dangers of failing to address the poverty and corruption that seemed to accelerate the communist advance.
President Harry Truman's dramatic announcement in January 1949 of Point Four, a "bold new program … for the improvement of underdeveloped areas," placed development at the top of the national agenda and simultaneously galvanized a worldwide movement. Like McKinley, Truman contrasted development against "the old imperialism," but he was the first world leader to apply the term "underdeveloped" to the subjects of the modernization process. The confrontation between colonizer and colonized, rich and poor, was, with one rhetorical gesture, replaced by a world order in which all nations were either developed or becoming so. Point Four affirmed the fundamental equality of nations recognized by the United Nations Charter while at the same time licensing interventions on an unprecedented scale.
Truman explicitly linked Point Four to American strategic and economic objectives. Poverty was a threat not just to the poor but to their richer neighbors, he argued, and alleviating misery would assure a general prosperity, lessening the chances of war. Moreover, the "triumphant action" of development superseded the merely ideological conflict of the Cold War. Communism and democracy were different routes to the same destination. Development in this sense was a hegemonic idea, presented not as the best but as the only possible course of action. (David Riesman observed in 1958 that alternatives to the Western and Soviet paths were simply unimaginable.) The response was startling. Truman "hit the jackpot of the world's political emotions," Fortune magazine noted. National delegations lined up to receive planning and assistance that a few years earlier might have been seen as a colonial intrusion.
The assignment of a World Bank technical assistance mission to Colombia in November 1949 reveals how this paradigm shift enabled an entirely new approach to managing the internal affairs of another country. Fifty years earlier it would have required gunboats for European and American creditors to seize Colombia's customhouses, but this delegation of European and American economists took charge of much more—foreign exchange, finance, banking, agriculture, transport, health, education, social welfare, and oil exploration—all at the invitation of the Colombian government, which assured implementation of the delegation's detailed plans. Development justified interventions on a grand scale and made accepting the instructions of foreign advisers the duty of every responsible government.
Point Four officials expected sudden, dramatic results from the introduction of American advice and technology. Norris Dodd, a Point Four agriculture adviser who later headed the UN Food and Agriculture Organization, described the sensation he created in northern Thailand by dispensing a few commonsense suggestions. "If I had been able to stay in that village another few hours," he believed, "we might have changed the fundamental agricultural methods for hundreds of miles around." Truman claimed there were "untold resources" in the underdeveloped regions needing only "somebody who knows the technical approach." He emphasized technology because of its mystique and the absence of alternatives. High rates of return on domestic investment and the chronic imbalance of payments known as the "dollar gap" made it nearly impossible to mobilize private capital for development, but engineering talent could easily be dispatched abroad. Point Four began by sending American engineering firms to Iran, Indonesia, Taiwan, and Korea, where they acted as purchasing agents, identifying applications for American technology and designing industrial, hydroelectric, and chemical plants and public works.
In these early, untheorized foreign aid projects, American advisers worked out an impromptu strategy that came to be called import substitution industrialization (ISI). Engineers in Taiwan, noting that fertilizer imports consumed a large share of the island's scarce foreign exchange, imported equipment to manufacture artificial fertilizers domestically. They constructed hydroelectric dams to fuel the plants, and one by one they substituted domestically made articles for imported ones, freeing more capital for industrial expansion. In the Philippines and Turkey, U.S. financial missions imposed tax and exchange laws that accomplished the same result by placing barriers on the importation of products that could be made domestically. Import substitution policies shifted imports toward capital goods, equipment, and technologies and away from consumer goods and commodities, and in the process they enlarged state control over the economy. The success of such strategies often depended on the state's ability to administer controls effectively and without corruption.
Import substitution suited many new nations' vision of a gleaming industrial future. Nehru famously remarked in 1954 that dams were the temples of modern India and industry its religion. Surveying the immense Bhakra-Nangal canal, he observed that "when we see big works our stature grows with them, and our minds open out a little." Modernity was the goal and justification for many independence movements, and the erection of a new steelworks or railway span hailed the arrival of full nationhood. The Olympian planning commissions that met at the Yojana Bhavan in New Delhi or at the Central Bank in Manila exercised an authority over the national economy that few colonial viceroys could equal. Import substitution policies also partially counteracted international trade patterns that kept newly independent states in the subordinate role of exporting raw materials to the industrial nations and importing finished goods.
In the early 1950s, structuralist theories located the causes of underdevelopment in lingering colonial trade patterns and recommended import substitution as a solution. Raul Prebisch, secretary-general of the UN Economic Commission for Latin America (ECLA), pointed to the deterioration of the terms of trade between the industrial and nonindustrial areas. Beginning in the 1930s, the value of commodity and raw materials exports declined steadily relative to the value of manufactured imports. Left unchecked, the "Prebisch effect" would widen the gap between rich and poor nations. Gunnar Myrdal, a Swedish economist who had worked with the Rockefeller Foundation, delivered a series of lectures in 1955 at the Egyptian Central Bank in Cairo in which he explained that market expansion would cause inequality to increase, both internationally and within nations, unless counteracted by comprehensive planning and European-style state welfare programs. In Truman's usage, "underdevelopment" was a noun describing an age-old condition to be remedied with modern technology. Structuralists changed it into a transitive verb. Underdevelopment was a process; it was what the rich nations were doing to the poor nations.
Although the structuralist formula originated abroad, the United States endorsed the import substitution approach until the late 1950s. The State Department sympathized with nationalist ambitions short of expropriation or discrimination against U.S. investment, and preferred Prebisch's doctrine to the "extreme" economic nationalism of Argentine president Juan Perón. American support for import substitution stemmed from concern about the overdevelopment of U.S. heavy industry as a result of wartime mobilization. Capital goods purchases by industrializing nations provided a badly needed outlet for American production and a stimulus to European recovery. Import substitution aroused considerable opposition within the United States from congressional conservatives, adversely affected industries, and the Wall Street Journal, but the economic and strategic benefits outweighed the political costs, at least until 1958. When criticism prevented the Eisenhower administration from participating directly in drafting economic plans, private companies and foundations stepped in. A U.S. engineering firm drafted Taiwan's first four-year plan, and the Ford Foundation dispatched a team of economists to advise India's planning commission. As the United States turned against import substitution, structuralism survived as a critique of American development policies that ignored the built-in inequities of the world system.
Development and the Social Sciences
In few places did Truman's bold new program generate as much excitement as in American universities, and by the end of the 1950s an enormous body of homegrown theory was poised to replace Point Four's ad hoc strategy. For social scientists in the 1950s, the economist John Kenneth Galbraith remembers, "no economic subject more quickly captured the attention of so many as the rescue of the people of the poor countries from their poverty." The federal government's growing defense and intelligence establishments opened a new sphere of activity for researchers skilled in statistical and comparative methods. As prominent practitioners rotated between federal appointments, foundation boards, and faculty positions, professional codes adapted. Government collaboration, and even direction, aroused few concerns about objectivity. Faculties adopted the Area Studies organizational scheme devised by the wartime Office of Strategic Studies and took on an agenda of applied research useful to government. Much of this work focused on the "Third World," a term coined to describe a new academic division of labor that segregated work on industrialized democracies (First World), problems of communism (Second), and the underdeveloped (Third) world.
Political as well as professional motives drew academics to the Point Four mission. The social sciences came under particularly heavy attack from McCarthyite inquisitions, as did their institutional sponsors, such as the newly capitalized Ford Foundation. A 1954 congressional investigation accused the Ford Foundation of financing "the promotion of Socialism and collective ideas" in the United States. Development provided a safe outlet for social engineers whose New Dealism had become suspect. Sanctioned by development's anticommunist agenda, economists, planners, and researchers could apply abroad practices they were afraid to advance at home. The United States, in effect, exported its liberalism in the form of the energy and ideas of its best social thinkers and the funds of its largest philanthropies.
Within the national security establishment social scientists enjoyed prestige of a kind accorded in a later era only to software designers. Military and intelligence officials expected modeling techniques to be able to forecast the intentions and capabilities of foreign actors with increasing reliability. Psychology offered a particularly useful set of conceptual tools for engineering bloodless revolutions. Nuclear deadlock guaranteed that the Cold War would be fought largely in the Third World through techniques of subversion, propaganda, and attraction. In this atmosphere of expectancy and risk, government agencies and private foundations enlisted researchers to learn the secrets of modernization.
Foundations, government agencies, and universities jointly created institutional arrangements for generating theories of modernization. In 1953, with Ford Foundation assistance, the Social Science Research Council created a Committee on Comparative Politics among whose members Gabriel Almond, Lucian Pye, and George Kahin would make significant contributions to the modernization canon through the publication of the "Studies in Political Development" series. At the Massachusetts Institute of Technology, a State Department–sponsored research program on psychological warfare, Project Troy, evolved into the Center for International Studies (CENIS) in 1951. Its founder was Max Millikan, an economist in the new field of national incomes accounting who had just returned to the Massachusetts Institute of Technology after a year as assistant director of the Central Intelligence Agency. Millikan recruited an interdisciplinary team that featured Paul Rosenstein-Rodan and Walt W. Rostow (economics), Edward Shils (sociology), Daniel Lerner (communications), Clifford Geertz (anthropology), and Lucian Pye and Ithiel Pool (political science). Millikan also designed a budget formula that channeled State Department money funneled through the CIA into studies on the Second World, while research on the Third World was financed by the Ford and Rockefeller foundations.
CENIS mimicked the institutional style and "problem-oriented" work habits of the Manhattan Project in its development of the atomic bomb, breaking into teams to devise specific solutions that would then be subject to general discussion and criticism by the whole group. Millikan put an emphasis on finding answers to the practical problems of policymakers, and CENIS's work product typically appeared first as classified memoranda distributed to federal agencies and later as book-length monographs. Benjamin Higgins described it as "a community of scholars arriving at the same broad analytical framework." Its principal achievements were the creation of a rationale for an enlarged foreign aid effort, along with a set of concepts—"technology transfer," "takeoff," the "expectation gap," "self-help"—that informed aid policy and scholarship for the next two decades.
The Rostovian Revolution
If Millikan was CENIS's organizer, Rostow was its inspiration, its "shining light," according to Higgins. The son of Jewish immigrants from Russia, Rostow went to Yale at age sixteen, finished in three years, and went to Oxford on a Rhodes scholarship. While still in his teens he decided with characteristic prepossession to devote his life to "two large ideas: one is the application of modern economic theory and statistical analysis to economic history; and the other is the relation-ship between economic factors and society as a whole." The force of his ideas was magnified by his gusto for expressing them. "Walt can write faster than I can read," President John Kennedy quipped.
As an army captain in World War II, Rostow had participated in an operation that foreshadowed his later work in development. Along with Charles P. Kindleberger and Carl Kaysen, both of whom would also be leading figures in postwar economics, he served as a bombing targeter in the Economic Warfare Division of the London embassy. There the young economists debated how best to dismantle the German economy from the air, whether the whole system had to be taken down together or if there might be specific points—a ball bearing factory or a refinery—that could be removed, bringing the entire war machine to a halt. "We sought target systems where the destruction of the minimum number of targets would have the greatest, most prompt, and most long-lasting direct military effect," Rostow later remembered. In the run-up to the Normandy invasion, the targeters oscillated—just as development theorists later would—between a "systems" approach and a "bottleneck" approach, with Rostow on the systems side arguing for a comprehensive attack on German oil refineries and bridges. He lost the argument when General Dwight D. Eisenhower opted to hit the railroad marshaling yards in northern France. CENIS gave him a chance to prove his original judgment. Development was simply the opposite of bombardment, involving dropping in ingredients that would produce the quickest and longest-lasting economic (and political) gains.
Through CENIS, Rostow forged a consensus behind a developmental strategy known as the Big Push, "a development effort on all fronts," according to Higgins, "on a scale large enough to bring increases in productivity that would outrun population growth and promote structural change." Instead of targeting the industrial sector as import substitution did, large amounts of aid should go into "social overhead capital" such as education, administration, transport, and law. Properly timed, aid could generate a systemwide disruption that would shake a society from its traditional torpor and lift it into the modern age. The Big Push, sometimes called "balanced" development, was also a critique of President Eisenhower's aid programs, which were regarded as piecemeal efforts aimed at frontline states and with political strings attached. Development had to be an unconditional, massive, sustained effort, conveying the message, Rostow argued, "that we are in Asia to stay, not merely in a military sense, but politically and economically as well."
In memoranda and articles during the 1950s and in two seminal books, The Process of Economic Growth (1952) and The Stages of Economic Growth (1960), Rostow elaborated a vision of development rooted in American history and national interest. Updating Comte's formula, he observed that each society passes through five identifiable stages. In the opening phase, tradition, society's tranquil rhythms are regulated by the harvest and disturbed only by natural calamity. As pre-Newtonian attitudes give way to a scientific under-standing of the natural world, societies enter a stage of accumulation. The fund of social overhead capital grows unevenly. Social investments are "lumpy," he argued, and private investors are unwilling to tolerate the high initial costs, long gestation periods, and indirect returns. The state, therefore, has the primary role in nurturing social capital, as state and local governments did in the United States between 1815 and 1840.
As obstacles to growth are cleared and modern habits and attitudes gain momentum, the society reaches a stage Rostow memorably named "takeoff." "During the takeoff," he wrote in Stages, "new industries expand rapidly, yielding profits a large proportion of which are reinvested in new plant…. The new class of entrepreneursexpands; and it directs the enlarging flows of investment." Modernization planes along the lumpy surface of social overhead capital, bearing itself aloft on the force of its own acceleration. Rostow's aeronautical image highlighted not only his sense of the sharpness of the transition, a change in both the kind and direction of growth, but the dangers of this stage, for it is at the moment of takeoff that crosswinds, mechanical flaws, or pilot error are most likely to prove fatal. Takeoff, for Rostow, was a period of cultural, technological, and political upheaval, and its forward trajectory could either continue toward maturity (the fourth stage) or suffer a violent interruption or diversion onto a dysfunctional nationalist or communist route to modernity.
By measuring the ratio of investment to national income, Rostow could calculate when a nation would reach takeoff and how much aid it could usefully absorb. Within a few years the National Security Council used "absorptive capacity" as its principle criterion for aid. The United States passed into takeoff just prior to the Civil War, and it appeared to Rostow in the 1950s that both India and the People's Republic of China were entering this stage. He anticipated that the contest between the two nations, "the one under Communism, the one under democratic rule—would constitute a kind of pure ideological test of great significance" for the United States and the world. Rostow's theory redefined the Cold War as a contest fought on the terrain of development, and he advanced a number of arguments for a stronger American effort. By easing the transition to modernity, he told CIA director Allen Dulles, the United States could steal a march on history by creating an "environment in which societies which directly or indirectly menace ours will not evolve." Failing to do so would concede "to Moscow and Peking the dangerous mystique that only Communism can transform underdeveloped societies." The cost would also be limited. By targeting nations just reaching takeoff, the United States could exercise a decisive influence without incurring an indefinite obligation.
The United States own level of development provided another imperative for action. Rostow concluded that the United States had reached the terminal stage of the modernization process, the stage of high mass consumption, but its position there was insecure. High population growth, a deficit of social overhead capital, and the cost of the arms race created drags that might cause it to lose altitude. A steady flow of raw materials was essential. Preserving the U.S. fragile forward momentum required expanding world trade and energizing external markets for U.S. products. Rostow warned policymakers not to draw a false dichotomy between humanitarianism and selfishness. In development, the national interest and the interest of mankind were inseparable.
Rostow assigned an important role to soldiers during the transitional period. Assembling the preconditions for takeoff, he believed, required the efforts of an elite coalition of landowners, merchants, and politicians who favored centralization and were "prepared to deal with the enemies of this objective." Military men were the natural leaders of this movement, and throughout his career Rostow argued that military regimes could supply the stability and administrative competence needed for development. The Mann Doctrine of 1964, which made stability rather than democracy the prime goal of U.S. policy in Latin America during the Johnson administration, would later echo Rostow's reasoning.
Extending the stages-of-growth framework to the Soviet Union, Rostow refuted assumptions that Soviet development presented an alternative to the model of the capitalist West. By his reckoning, Stalin's forced modernization resembled the path taken by the United States some thirty years earlier; the principal difference was in its "abnormal" emphasis on the military and industrial sectors. To Rostow, communism was not the agent of modernization but a side effect of it. It was a "disease of the transitional process" likely to spread in any nation during the early, difficult stages of development. Instead of accelerating growth, it disfigured it, producing an unbalanced and dysfunctional modernity. Rostow's avowed aim was to supplant Marx as the inspiration for revolutionary intellectuals (the subtitle of Stages is A Non-Communist Manifesto), and he presented his doctrine as a universal theory of history.
Rostow's syntheses standardized the vocabulary used by the CENIS and Social Science Research Council groups, and the theories they produced are appropriately referred to as "Rostovian," although other members contributed significant innovations. Lucian Pye placed newly independent regimes on the psychoanalyst's couch and interpreted Southeast Asian communism in light of Erik Erikson's concept of "identity crisis." Both nationalist leaders and their constituents suffered from incoherent, immature identities that made them resentful of their modernized elders. Because "individuals can become reasonably acculturated far faster than societies can be reconstructed," modernizing societies underwent a "revolution of rising expectations," allowing communists to recruit impatient young men. The psychoanalytic perspective, Nils Gilman has pointed out, "positioned the social scientist as a dispassionate physician, lording his wisdom over a post-colonial nation bereft of legitimate subjectivity." CENIS and Social Science Research Council studies borrowed across disciplinary lines in ways that disregarded the objectivity standards of any single discipline. The medley of terminologies threw a protective screen around political or cultural presuppositions and tendentious reasoning.
The format of CENIS dialogue encouraged participants to theorize from an interlocking set of reified concepts. Much like the Marxist doctrine it responded to, Rostovian theory achieved its plausibility and explanatory power from the tight fit between its conceptual parts, rather than from the correspondence between any of the parts and the actual conditions they were meant to describe. David Lerner's pithy Passing of Traditional Society reveals the appeal and versatility of the CENIS schema. Lerner framed his study in a parable of modernization in the Turkish village of Balgat, where in 1950 a U.S. Information Agency interviewer recorded the opinions of several hundred villagers. Of these, three stood out: the village chief, a grocer, and a shepherd. The very act of soliciting opinions disturbed the chief and the shepherd, who balked at stating their views of distant leaders and nations. The grocer, on the other hand, was brimming with opinions, particularly regarding other people's business. Moreover, the interviewer learned that villagers sought out the grocer's opinions on such issues as what movies to watch when they visited Ankara. The chief and the shepherd, at opposite ends of the social spectrum, were pious, contented, and cautious; the grocer, a marginal figure, was skeptical, self-conscious, and with an eye for the main chance.
Lerner's theme is the psychology of the "transitional personality," the grocers whose rest-lessness would unsettle established orders and lifeways, hastening the advent of modernity. When Lerner first visited Balgat in 1954 he found the village transformed. A new road and bus line, as well as municipal water and electricity, made it a suburb of the capital. The shepherd and his sheep had moved on, the chief's sons were now grocers, and the original grocer was dead but remembered as a prophet. For Lerner, the human instrument of modernization was the "mobile personality," the individual with a capacity to envision himself in another's place, a place better than his own. "Empathy," as Lerner called this quality, stirred people from traditional apathy, leading them to question old ways and hierarchies and making them full participants in the economic and political life of the new nation. Lerner's theory later provided a conceptual foundation for the strategic hamlet program and the forced depopulation of the Vietnamese countryside as a counterinsurgency measure. Pacification specialists expected relocation to generate mobile personalities among the refugees, stimulating them to discard village loyalties in favor of participation in national life.
With interviews and charts, Lerner established a relationship between the spread of mass media and the proliferation of the mobile psyche, but his empirical observations actually contradicted the implied link between psychology and material improvement. Lerner noted that neither the grocer nor anyone in Balgat had a hand in decisions about the bus service, water lines, or electricity. Balgatis ratified the changes by voting for the new ruling party and by preserving social hierarchies within the village and between the village and the center of power. Modernization came without help or hindrance from mobile personalities. Such discrepancies, however, did not disturb the model or its conclusions, which concern correlations among abstract variables (mass media, participation, satisfaction). The Rostovian approach answered structuralism by making structural inequities into one variable among many and eliding questions of causation and proportion. The result was a uniquely resilient theory, capable of absorbing and explaining away nearly any failure or challenge. Even nation building in Vietnam, Rostow later wrote, was a developmental triumph marred by "a difficult war."
Rostovian doctrine drew fire within social science disciplines (Stages got hammered by reviewers in economics journals) and from some generalists and policymakers who saw political agendas beneath the elaborate taxonomies. Ambassador to India John Kenneth Galbraith noted that claims of aid's ability to induce takeoff were "convenient" considering that "once we admit that it is not the case, we become trapped in a series of previously complex problems." Louis Halle, a former State Department planner, found Stages to be "one long boast" about an idealized America leading the world into the future. It also evoked a suspiciously tidy vision of history: "this great, multifarious, fluid, and largely unknown world of ours is conceived as a child's plaything made up of a very few building blocks, all square and solid."
The CENIS framework gained the status of an orthodoxy almost overnight, an achievement that can be attributed to factors other than its strengths as theory. First, it furnished academic analysts and policymakers with a common language and a set of criteria for evaluating foreign aid as something other than a bribe offered in exchange for cooperation with U.S. policies. Second, it was a culmination of the social scientific enterprise initiated by Mill and Comte. While academics were eager to point out its imperfections, they were reluctant to question its perfectibility, because to do so was to challenge fundamental parts of the social scientific method (the comparability of societies, the application of reason to social change, the nature of progress). Finally, Rostovian theory resonated with American myths of national mission. It gave the United States the power and privilege of stepping in at the decisive moment in each nation's history to dispense the vital ingredients of progress. By touching societies that mirrored its own past, the United States could rescue itself from the decay and boredom of mass-consumption society. Two slogans Rostow contributed to the Kennedy campaign—the New Frontier and Let's Get America Moving Again—carried this message of regeneration. Development, in this formulation, was able for the first time to capture the popular imagination.
The Development Decade
The new science of modernization arrived in Washington's hour of need. Following Stalin's death in 1953, Soviet leaders eagerly pursued diplomatic overtures toward uncommitted nations. Premier Nikita Khrushchev theorized a division of the world between a "zone of war," comprising the industrialized states, and a "zone of peace," the principle arena of Cold War competition. In December 1955 he captured the international spotlight with a bold tour of Afghanistan, India, and Burma, the first visit by a Soviet leader outside of the communist bloc. In Calcutta the Soviets were greeted by a throng of more than two million. Along the way he offered trade and aid, and India accepted Soviet assistance in the construction of the Bhilai steel works, its flagship development project. The Soviet move stunned the Eisenhower administration, which concluded that Soviet aid would create bandwagon effects that would draw the rest of Eurasia into the communist orbit. Having made "neutralism" a dirty word, John Foster Dulles was chagrined at the resistance in Congress to any American-aid counteroffensive directed at nonaligned nations. To its growing alarm, the administration found itself faced with a new danger against which it was powerless to act.
The deadlock was broken in 1958 with the appearance of The Ugly American, a book that has been described as the Uncle Tom's Cabin of the Cold War. It was the work of William Lederer, a publicist working for the U.S. Navy and the CIA, and Eugene Burdick, a University of California political scientist. At Lederer's home in Honolulu in 1957, the two men decided that a novel was the best device for warning the American people that the Soviets were gaining an upper hand in the poor countries of Asia. The narrative is a collection of vignettes set in a fictional Southeast Asian nation where communist economic and political offensives are winning the allegiance of a disgruntled peasantry. Sophisticated Americans, diplomats with Boston accents and courtly manners, are pouring U.S. aid into dams, roads, and colossal engineering projects that alienate the local populace. Meanwhile, the ugly American, Homer Atkins, an agricultural adviser and the hero of the story, is making a genuine connection. The simple presence of Homer and his wife, two mobile psyches, in an Asian village creates a productive stir. Women come to marvel at the tidy home kept by Mrs. Atkins, and men watch as Homer applies his instrumental view of nature to ancient problems. Homer soon finds a counterpart, Jeepo, an empathetic, mechanically minded native, and the pair harness a bicycle to a pump, creating an irrigation-driven economic takeoff. Atkins offered readers a counterpoint to Pyle, the guileless title character of Graham Greene's The Quiet American, who was "like a dumb leper who has lost his bell, wandering the world, meaning no harm." Lederer and Burdick reassured readers that "average Americans, in their natural state … are the best ambassadors a country can have." The Ugly American bitingly attacked the administration's inaction and import substitution–style development aid, but its real achievement was to enfold Rostovian theory in myths of national identity and innocence.
Defying expectations that it would drop into an ocean of public indifference, The Ugly American remained on the New York Times best-seller list for seventy-eight weeks, sold an astonishing four million copies, and was made into a block-buster movie starring Marlon Brando. The ensuing media frenzy put development on a par with the space race and created a new strand of populist internationalism that Senator John F. Kennedy seized to boost his presidential bid. Kennedy sponsored legislation to increase aid to India and announced the existence of an "economic gap" in Asia that was being filled by Soviet aid. In February 1958, Kennedy first met Rostow, and the modernization theorist moved into Kennedy's inner circle of advisers. Kennedy was drawn to the diagnostic precision of the CENIS model, and he adopted its language in his own critiques of foreign aid. The alliance of Rostovian theory and Kennedy-Johnson foreign policy ushered in the golden age of modernization theory in the 1960s. George Ball, undersecretary of state from 1961 to 1966, recalled in his memoirs the vogue for development economics in 1961 and "the professors swarming into Washington" who "talked tendentiously of 'self-sustaining growth,' 'social development,' the 'search for nationhood,' 'self-help,' and 'nation building.'"
In the first year of his presidency, Kennedy launched the Alliance for Progress, the Peace Corps, Food for Peace, and the Agency for International Development (AID). He declared the 1960s the "Development Decade" and substantially increased the budget for foreign assistance. Modernization theory supplied the design, rationale, and justification for these programs. Stages had called for an expanded foreign aid effort organized exclusively around the development mission. Rostow implied and Kennedy had declared during the campaign that State Department bureaucrats used aid for short-run diplomatic advantage, making the separation of the Agency for International Development from State an essential first step. Likewise, Food for Peace took established agricultural surplus disposal programs and organized them around a develop-mental mission. Rather than dumping the excess produced by federal price supports (or using the surplus to alleviate famine), the program's primary purpose was the generation of "counterpart" funds that could be steered into social overhead investment. At the administration's urging, the United Nations put food assistance on the same basis in its World Food Programme.
The Peace Corps institutionalized a belief (traceable through The Ugly American to Lerner and Redfield) that exposure to modern personalities could induce change. Kennedy announced the Peace Corps during the campaign and asked Rostow and Millikan to draft the proposal. Volunteers were expected to create a catalytic effect by introducing ideas from a higher point on the developmental arc. The Peace Corps sought not specialists but "representative Americans" who could transmit values by example. Theory informed expectations of what volunteers should achieve. Performing their assigned jobs as teachers or agronomists was considered secondary to the task of catalyzing community involvement in a spontaneous project. Many volunteers experienced at first hand the chasm between the theory and reality of development.
The most ambitious of Kennedy's development schemes, the Alliance for Progress, was planned along rigidly Rostovian lines. In anticipation of imminent takeoff in the Latin American countries, the Alliance for Progress called for a Big Push to raise investment rates, foster social capital, and induce thorough reforms in institutions, land tenure, and distribution of income. Once plans and institutions were in place, the alliance would ride a wave of rising expectations into the next stage of growth in which the Americas would be safe from the temptations of the Cuban model. Rostow predicted a transition to self-sustaining growth within the decade, allowing the administration to keep the problem of underdevelopment "off our necks as we try to clean up the spots of bad trouble." The anticipated follow-on effects, however, failed to materialize, and $20 billion in aid disappeared into the continent without leaving a noticeable accumulation of social capital. After the first year, growth rates were far below the ambitious target figures, and the press and Congress grew impatient with the alliance. As Michael Latham points out, Rostovian theory was never held to account for the alliance's failures. Instead, setbacks only reinforced the validity of concepts that provided explanations and remedies for failure. Theorists chalked up the alliance's problems to bureaucratic ineptitude, personnel problems, and stubbornly antimodern Latin leaders who refused to carry forward the reforms. Since the theory was rooted in the historical experience of the industrial core, it could not be invalidated by contradictory experience in periphery nations. Modernization funneled dissent into its own framework, where it could challenge the execution but not the conception of the plan.
Throughout the 1950s and 1960s, academic theorists continued to dispute within the overall consensus a number of issues that affected policy design. The balanced or Big Push approach saddled government with an almost unreachable standard for effective policy and encouraged a revived effort to identify "bottlenecks" that could be removed to stimulate disproportionate returns. Albert O. Hirschman reconfigured this debate with a theory that gained popularity after 1964 as the Johnson administration faced tighter budgets. In The Strategy of Economic Development (1958), Hirschman explained that small inputs, "inducement mechanisms," could push one sector into the lead, forcing others to catch up. Rather than using aid to advance an economy to a new equilibrium, as in classic Rostovian theory, aid programs should try to create disequilibria that, like loose electrons in an atomic pile, would trigger chain reactions. The difference between the two approaches can be seen in the Ford Foundation's efforts to reform agriculture in India. In the 1950s and early 1960s, the foundation sponsored a "package program" to improve conditions in fifteen rural districts on a broad front, including advances in education, health, farm equipment, irrigation, and crop diversification. Disappointed with the results, the foundation shifted in the mid-1960s to a strategy built around development and dissemination of dwarf wheat and rice varieties (the inducement mechanism). Since the new plant strains required chemical fertilizer, irrigation, and modern transport and distribution networks, other sectors would be pulled along by success, stimulating a "green revolution."
Another controversy concerned whether there was a single route to modernity and whether the experiences of Europe and the United States, the "first movers," represented the best model. Alexander Gerschenkron, William Lockwood, Clark Kerr, and others argued that the requirements of "late" developers differed and that cultural proclivities, particularly an authoritarian tradition, might dictate alternative paths. At the height of his influence, Rostow felt he was fighting a rearguard battle against those who esteemed China's Great Leap Forward. But the "developmental state" school, while persistent, lacked policy clout until the 1980s, when the manifest success of Japan, South Korea, and Taiwan (and the clear disparity between their strategies and development orthodoxy) led the World Bank to endorse an alternate "export-led" growth model.
Population was a third contested area. In both classical and Keynesian theory, a growing population accelerates economic development. Adam Smith noted that it was the industrious poor who "generally bring up the most numerous families, and who principally supply the demand for useful labor," and John Maynard Keynes attributed the Great Depression of the 1930s partly to a catastrophic decline in births. This view prevailed among economists through the 1950s in no small part because of the coincidence of the baby boom and high growth rates in the United States. But a dissenting view articulated by John D. Rockefeller III and the Population Council gained influence toward the end of the decade. In 1958 a presidential review of foreign aid led by Theodore Draper concluded that rapid population growth threatened to cancel the effects of any aid infusions. Rostow argued in Stages that population posed a serious but not insurmountable obstacle to takeoff. Kennedy made population control part of the Agency for International Development's mission, and Lyndon Johnson intensified the emphasis, eventually making aid contingent on action to reduce fertility. In the 1970s both theory and policy swung back from that extreme position as a number of studies connected population increases with expansions in consumption and accumulation of social capital. By the 1980s, economic opinion was mixed, and the Reagan administration had repositioned population control as a moral issue.
The Decline of Modernization Theory
The Vietnam War afforded rich opportunities for the application of theory, and association with the pacification effort accelerated the splintering of the Rostovian consensus. Pacification proceeded under a succession of modernization buzzwords—"rural construction," "revolutionary development," "civic action," "three-machine revolution," "Operation Takeoff"—and repeated failures sapped the enthusiasm of the modernizers. After Saigon and the modernizing regime of the shah of Iran fell in rapid succession, policy-makers ceased to regard development as a counterinsurgency weapon. It had once been believed, according to Henry Kissinger, "that there was a sort of automatic stabilizing factor in economic development. That has turned out to be clearly wrong." But events in the industrialized world had already undermined the modernization paradigm. The rising tempo of urban riots following the Watts uprising in Los Angeles in the summer of 1965 disturbed the idealized image of the United States as the end point in the develop-mental process. In 1967 ghettoes in forty cities erupted. The Eighty-second Airborne had to be diverted from deployment to Vietnam to quell violence in Detroit. As the riots called American economic and political maturity into question, the belt of smog settling over the eastern seaboard and Los Angeles aroused fears that the United States had become dangerously overdeveloped. A growing environmental movement questioned the desirability of economic growth. Meanwhile, the student movement opened an attack on the "action intellectuals" whose theories sustained the Vietnam War.
Rostovian theory also came under intellectual attack from abroad. In 1968 the French sociologist Claude Lévi-Strauss was in Vogue, as well as on the pages of the New Yorker and New York Times, proclaiming that there were no superior and no inferior societies, and that supposedly apathetic primitives "possess a genius for invention or action that leaves the achievements of civilized people far behind." In an NBC television interview, the newscaster Edwin Newman pressed J. George Harrar, president of the Rockefeller Foundation, on whether "the Western nations, the richer nations" should impose their standards on the poorer countries if "we are simply presenting them with a different set of problems." Harrar replied that he could offer no justification for modernization "in terms of what we have done to ourselves" but that he was "afraid" that there was no turning back. This standoff characterizes discussions of modernization in the post-Rostovian age. In the early 1970s, social scientists on the left and the right toppled premises and tautologies at the heart of the theory, leaving an unsupported shell of prescriptions that policymakers continued to use. The academic study of development migrated outward from the pure social science disciplines to schools and institutes of applied policy studies. Policymaking bodies no longer relied on universities but on in-house experts and think tanks to supply justifications and strategies for the use of aid.
The trauma of the 1960s split the discourse of modernization into two conversations, one academic, the other oriented toward policy. Occasionally, sounds from one conversation reached the other, but so indistinctly as to distort their meaning. "Civil society" became a fashionable term in both academic and policy circles in the 1990s, but while social scientists described it as a set of rituals for identifying and mobilizing the public, policymakers referred to support for nongovernmental organizations (NGOs) and religious and private institutions. More often, the two conversations were simply separate. Within the university, Rostovian theory was replaced by a new structuralism in the form of dependency theory. In the 1960s, Latin American scholars had deepened and widened Prebisch's critique of the "unequal exchange" between North and South. Whereas Prebisch, Myrdal, and other early structuralists saw meliorist solutions within capitalism (redistribution, planning, and import substitution), dependentistas identified the instigators of those solutions, the state and the national bourgeoisie, as the core of the problem. Drawing on the Marxist tradition in Latin American thought, they argued that economic dependency created class alliances between elites at the center and the periphery, reproducing culture, social relations, and systems of exchange under the guise of development. The only way out of dependency was a mass movement of "popular forces" that would rupture connections to multinational corporations and international exchange and organize a socialist future.
Dependency theory reversed the optics of Rostovian theory, viewing development inward from the periphery rather than outward from the core. It adopted, with modifications, the reified concepts used by Marx and development economics, but it focused on the processes of under-development rather than the dynamics of development. It recognized, as Rostovian theory did not, that local conditions are influenced primarily by a nation's subordinate position in the global economic hierarchy. To American scholars it offered the familiar typologies and analytic power of Rostovian theory but with a very different set of values. American consumers of dependency enlisted on the side of the Latin American popular forces. The principal texts, Andre Gunder Frank's Capitalism and Underdevelopment in Latin America (1967) and Fernando Cardoso and Enzo Faletto's Dependencia y Desarrollo en América Latina (1969), dominated the teaching and study of underdevelopment (especially of Latin America) at American universities in the 1970s and 1980s. Its influence extended to the history of U.S. foreign relations, both in its original form and as world systems theory, which has been described as dependency without the nation.
As an orthodoxy, dependency theory was open to attack, and in the 1980s and early 1990s scholars took it to task for reproducing many of the illusions of development theory. Socialist regimes displayed many of the patterns of cultural reproduction, class relations, and distorted development that dependentistas ascribed to capitalist nations. The hope that isolation and socialism would open a "way out" of dependency (the Myanmar model?) dimmed as scholars recognized the irresistible spread of global networks of culture and influence. The apparent movement of Japan, Taiwan, and South Korea from semiperiphery to core within a capitalist framework forced modifications in dependency theory, while some of the leading theorists (Cardoso became president of Brazil on a neo-liberal platform) abandoned the approach altogether. Finally, new approaches—postcolonial and subaltern studies and postmodernism—moved the study of power relations in Asia, Africa, and Latin America toward issues of culture and knowledge-creation and away from economic development. The newer approaches appealed to a narrower, almost exclusively academic audience. By the 1990s, social scientists had completed their withdrawal from the heights of influence over policy and public opinion they had occupied in the early 1960s.
Within the Agency for International Development, the World Bank, and UN agencies, development doctrine continued to evolve in response to institutional constraints and political currents in the developed world. In 1968, under a new president, former Secretary of Defense Robert S. McNamara, the World Bank "discovered" poverty much as the Johnson administration had four years earlier. Declaring poverty a security threat to the rich nations, McNamara targeted enlarged aid funds at poverty within countries, encouraging programs that ignored issues of national investment and growth. Breaking the customary link between development and the nation that had prevailed since List, he freed the World Bank of concerns about absorptive capacity and state planning and enlarged its mandate. It invested heavily in the green revolution, already under way in South and Southeast Asia, which promised (convincingly at the time) to eliminate hunger and alleviate rural poverty.
Development agencies were increasingly sensitive to concerns raised by the new environmental movement. Rachel Carson's Silent Spring (1962), Paul Ehrlich's The Population Bomb (1968), and Donella Meadows's The Limits to Growth (1972) grimly predicted that slow poisoning lay along the path of accelerating industrial growth and the chemical-dependent agriculture of the green revolution. E. F. Schumacher, a British economist and author of Small Is Beautiful (1973), another bible of the ecology movement, encouraged an "economics of permanence" that recognized that "there cannot be unlimited, generalized growth" on a planet with limited capacity. By questioning the very possibility of progress, environmentalism undercut the rationale and methods of development. In 1983 the United Nations assigned a commission on environment and development under Norwegian Prime Minister Gro Harlem Brundtland to reconcile the objectives of environmental health and economic growth. The Brundtland Report, issued in April 1987, popularized the term "sustainable development" to describe a strategy based on careful husbanding of resources, population control, and reduction of toxic wastes. Sustainable development (ecotourism, microenterprise, rain-fed agriculture) opened space for the collaboration of environmentalists and development experts. With some effort, dissent was once again funneled into the framework.
At the policy level, development doctrine continued to accept an idealized vision of the North Atlantic nations as normative, allowing theory to adapt to the political and economic sea change of the 1970s and 1980s. Reagan administration reforms supplanted the New Deal model, and when the collapse of the Soviet bloc opened a vast new field for development experts, they applied a set of prescriptions almost the reverse of the Rostovian formula. "Structural adjustment" called for the withdrawal of the state from the economy: privatization, the lifting of import and exchange controls, the "importation" of legal codes and standards, and the subjection of all sectors to "market discipline." Jeffrey Sachs of Harvard's Kennedy School of Government urged the Russian government to step aside and allow universal rules of the market to surface. Boris Yeltsin's administration in Russia issued vouchers giving the public a share in worthless state enterprises, while profitable natural resource monopolies were quietly grabbed up by party officials. With a seat in the legislature an "entrepreneur" could amass a fortune in windfalls from privatization and development aid. When the market failed to impose discipline, the Yeltsin administration followed a U.S.-prescribed course of "shock therapy," putting the ruble into free fall against the dollar and wiping out the savings of millions. As evidenced by poverty and suicide rates, Russia's barter economy ("Zaire with permafrost," according to one journalist) was in worse shape ten years after the Soviet breakup than it was under communism.
As ever, development doctrine dispensed advice but not apologies. Sachs admitted that he felt like a surgeon who had cut open a patient to find that nothing was where it was supposed to be, but apparently this was the patient's fault. Development experts accused a lingering "peasant" mentality and Russia's stubborn bureaucracy of undermining a theoretically sound plan. Structural adjustment schemes supported by the Clinton administration opened stock markets in Southeast Asian economies that until the early 1990s were clocking respectable growth figures. Portfolio investments poured in, inflating bubble economies in real estate and construction, then poured out, leaving a sticky residue of debt and unemployment. In a number of nations—Indonesia, Democratic Republic of Congo (Zaire), Sierra Leone, Mexico—the decline of state control, followed by collapse of the market, created criminalized or "narco-economies." In 2001, President George W. Bush added minor modifications to the structural adjustment formula, advocating more grants for education and health initiatives to allow poor nations to increase productivity and pull themselves out of debt. This was thought to represent a small step forward even if the links between education and productivity, and productivity and debt reduction, remained unproven.
Historians are of two minds on the legacy of modernization theory. On the one hand, it has mobilized humanitarianism on a global scale and given the poor an entitlement to progress. On the other, it has licensed self-interested and sometimes brutal forms of intervention while peddling illusions as scientific certainties. Development aid has become a fixture in international relations. Nations and international agencies will continue to use it and to need principles and standards to guide its use and measure its effectiveness. A careful study of past theories and the practices they inspired may enable them to approach these problems with self-awareness and a healthy skepticism.
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