By: Haider A. Khan

The western world witnessed in disbelief the   fall of the U.S.-backed government in Afghanistan with what can only be called stunning speed to a rag tag army of Taliban extremists without any air support or even high caliber advanced  heavy weaponry. Showing remarkable honesty conspicuous by its absence in the previous US regimes President Joe Biden has  defended his decision to withdraw U.S. forces. His main  argument in front of the American public has been that Americans should no longer continue to fight and die for an Afghan government that can not draw support from its own military, much less the majority of the  Afghans. Whether there has been an intelligence failure about the military prospects or not can be debated but Biden was still correct to follow through with Donald Trump’s agreement to withdraw U.S. forces. Most polls show that this decision has the support of nearly three-quarters of the American public.

We must not ignore the U.S.government’s and its allies’ as well as private companies and even some NGOs’ longtime role in the creation of the humanitarian and political crisis in Afghanistan. The current chaos and violence have been more than 20 years in the making. The invasion of Afghanistan for a regime change led only to a cesspool of corruption and seemingly endless suffering for the ordinary Afghans.

Indeed, there may be a sober reality-based way of looking at the true picture and draw out the plausible geopolitical scenarios. Recently, I  used the best available data from the World Bank, the IMF and other national and international sources about the Afghan economy to do precisely this exercise. My results pertain both to the overall effects for the  Afghan economy, and specific sectors. More importantly, they also give us some rough insights into why the failure has to do with the corruption by the US and NATO forces and their cronies.This corruption was indeed promoted both in the civilian and the military sectors with the active connivance and participation of the Westerners. Once we grasp this simple truth, the mystery about the governments quick collapse disappears quickly.

Officially, the Afghan army had  about 300,000 troops, four times the number of Taliban soldiers. This army also had air force support, many heavy weapons. The personnel were trained by the US and its allies. The Afghan government and its generals received hundreds of billions of dollars’ much of which ended up in foreign banks. Apparently, all the costly training, weaponry and equipment from the world’s military superpower and its allies have been in vain. The Taliban had no significant foreign backing except from the Pakistani ISI, no air force at all, and only light weaponry but triumphed within days after the US military departed. More than the standard military calculations, the politics of anti-imperialism favored the Taliban who are also rooted among the long-suffering ordinary Afghans.

On the civilian side of corruption,we can just look at NGO corruption. Just to illustrate how corrupt the US supported humanitarian organizations have been, let me cite a study I did with my then Ph.D. student Dr. Najim Dost from Afghanistan. We based our findings on ground level data supported by sophisticated mathematical modeling.

In our paper which is available on line, we present some novel findings on wage differentials between state and NGO (Non Government Organization) employees in Afghanistan. We find that high wages offered by NGOs, as high as 35 times those offered to civil servants, have strong distortionary effects on the local labor market and threaten the future fiscal sustainability of the state which sadly has now been borne out. 

To complete the argument at a theoretical level, we also present a general equilibrium model with multiple equilibria that captures the deeper implications of the empirical finding. Among the most significant features of the model is the fact that the wage-gap feature can become permanent and lock the economy in a suboptimal social equilibrium. In reality it did become permanent.In light of our empirical finding and theoretical model consistent with the empirics we ask what the appropriate policy measures are. We consider, short of the extreme and implausible case of shutting down the state sector, three recommendations to address the issue and assess the strengths and weaknesses of each. Firstly, the host country could cap NGO wages. This, however, may be the hardest for the NGOs to adhere to given their internal salary scale policies and the need to maintain horizontal and vertical equity. Alternatively, government wages could be raised by a factor to arrive at a less distortionary gap. This would require substantial financial resources, which lie beyond the capacity of the state and the aid community. Thirdly, the NGOs could make contributions proportional to the size of the wage gap to a stabilization fund, earmarked to support future wages and redress current distortions. We argue that this qualifies as the most desirable policy choice given the conditions on the ground.

I tried to persuade the US policy makers to follow the voice of reason but to no avail. Our findings also supported the analysis of the University of Michigan professor Juan Cole who described the U.S.’s policy in Afghanistan as essentially a Ponzi scheme based on an unsustainable system utterly dependent on foreign support in which an eventual collapse was inevitable. Biden has belatedly pointed out the corruption and ineptitude of the Afghan government. But he or anyone else in a responsible position in the US government or vast NGO networks’ upper echelon never acknowledged how the United States was largely responsible for setting up and maintaining that corrupt system. 

In this setting, is there any room for optimism for Afghan people? What We Need to Learn: Lessons from Twenty Years of Afghanistan Reconstruction is the 11th lessons learned report issued by the Special Inspector General for Afghanistan Reconstruction. This report examines the past two decades of the U.S. policies  in Afghanistan. It points to some successes such as lower child mortality rates, increases in per capita GDP, and increased literacy rates, and many failures. It offers some critical lessons that the US government needs to learn. 

It is important to confront this past honestly. But it is even more important to ask what the future might bring. The Taliban past does not inspire confidence, to say the least.The silver lining—if there is one— might be that they and the Afghan people are in dire need of external assistance. Furthermore, whoever wants to stay in power for long in Afghanistan must address the real problems of enhancing peoples capabilities and functionings—to use terms for measuring people’s well-being introduced by the Nobel Laureate Amartya Sen— in crucial areas such as nutrition, health, education, housing etc. Ultimately, a system where people can have the right to associate and discuss issues freely and feel that they have representation in the polity will be necessary. We can not be sure that any of this will happen but we must work towards these goals with the Afghan people and help them keep corruption at bay.

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Haider A. Khan, John Evans Distinguished University Professor

Distinguished Senior Fellow, Policy Research Institute

Distinguished International Advisor, BRAC University and North-South University

Distinguished  International Advisor, European Economic and Social Committee

Professor of Economics

University of Denver

Josef Korbel School of International Studies

2201 South Gaylord Street, Room 4014

Denver, Colorado 80208

phone 303-871-4461
fax 303-871-2456

http://www.du.edu/korbel/faculty/khan.html

https://ideas.repec.org/e/pkh22.html

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