Worldly Philosopher: The Odyssey of Albert O. Hirschman (60 page)

But there was a second, more important source of his rootlessness. The whole prospect of going to Harvard was nothing compared to the distress of events in Brazil. The coup of April 1, 1964, brought down the civilian government of João Goulart—an exemplar reformmonger—and installed some tight-fisted generals who would augur brutal dictatorships. The northeastern SUDENE reform was rubbished. Goulart’s minister of planning, Hirschman’s friend Celso Furtado, fled into exile, first to Yale briefly, then to Paris. Hirschman had a premonition that the coup was not just a passing event; a blight was now cast on radical reform. “I have been very depressed these weeks about events in Brazil,” he told Ursula, “which reveal the follies and crimes of the Right. Even in underdeveloped states they are at the height of those in industrial countries. It is such a shame because there were so many possibilities that Brazil might find its own and attractive way [
une voie propre et attrayente
], and this has all been ruined, at least for the moment.”
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The Brazilian coup was a sign of things to come. The hope for civilian reform was beginning to wane and seemed to be eclipsed by populist revolution and its antonym, junta. Vietnamese villages were becoming war zones, Brazilian officers patrolled the streets of São Paulo, and a year later President Johnson dispatched over 40,000 Marines to the Dominican Republic to thwart a “second Cuba,” while Indonesian generals wiped out the ranks of the country’s Communists. The seams of development and reform were starting to show. In places they came apart. Scarcely a few years into a Development Decade launched with such fanfare by the United Nations in 1961, it was coming apart. Suddenly, the rapturous tone of
Journeys
seemed out of key.

It was this concern that motivated the missive to the Ford Foundation. Ford was not the only pool into which he was casting. Hirschman wrote to Burke Knapp, the World Bank’s vice president, in March of 1963. He promised Burke a copy of the book—my “highly experimental venture”—when it appeared. But he confessed to now being overwhelmed by the feeling of “what it must be like to retire.” There is something vaguely manic in his reaction: instead of savoring accomplishment, “in the ensuing discomfort, my thoughts have naturally come to be occupied with the question: What next? And this is the subject of this letter.” He had two years’ leave forthcoming. He wanted to combine these into a twenty-seven-month run to fathom some of the troubles behind development. From thinking about how
policies
were made, he turned to their
projects
and their effects. Having thought about models and strategies, he wanted to get close to the ground, to study the giant dams, heroic roads, and massive irrigation plans that were earning pharaonic reputations. The specific question was, how did development projects perform?
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Some in the World Bank, an institution at the front lines of the growing criticism, had similar concerns. Knapp replied immediately—and invited Hirschman to Washington for further talks. Eager “to learn a great deal,” Knapp asked Hirschman to outline the issues and criteria for evaluating development in action. A proposal was on the desk of Hirschman’s old friend, Sandy Stevenson, now head of the Economics Department of the bank. From Sandy’s perspective, the organization’s mission creep from European reconstruction to Third World development revealed no overall assessment of, or method of assessing, the value of its work. Knapp and Stevenson had allies in the form of Richard Demuth, the director of development services, who would eventually assume stewardship of Hirschman’s enterprise. After the summer’s travels, Hirschman returned to Washington to hammer out the details of a scheme in Demuth’s office. All of this was unfolding as Hirschman was considering the move to Harvard.

Without these self-critical bank insiders, Hirschman’s ideas would have gone nowhere. Stevenson and Demuth insisted that something had to be done to remedy the situation—beginning with an external, objective
evaluator. They had to override the influential chief economist of the Projects Division, Robert Sadove, a firm believer of “change from within,” who had earlier turned the World Bank away from Program Loans (a staple of European financing that conferred more autonomy to borrowers) to Project Loans. Sadove wanted busybodies at a distance. Stevenson, who saw right through the circularity, advocated an outsider and thrust forth his old friend, now brimming with unimpeachable credentials.

From the start, Hirschman’s project brought out some seething resentment from some insiders. This was a delicate proposal; it was rare for the bank—by no means unique in this reluctance—to throw open its files for an observer to rifle through them. His backers were a tight-knit group whose influence bespeaks the relatively simple, if cliquish, way in which business was done in Washington in those days. Rather than get gummed up in an internal stalemate, Stevenson stepped outside the bank and consulted an old friend of his from the Marshall Plan days, Robert E. Asher, who was then working at the Brookings Institution overseeing the research on international trade and finance. Maybe Hirschman could do the work under the auspices of the Brookings. Asher liked the idea of Hirschman’s autonomy, his independence of mind, and what this would bring to his group. Hirschman’s stature, as Asher told the Brookings president, Robert D. Calkins, was sterling; perhaps it would help if Calkins had a word with the chairman of the Board of Trustees of the Brookings Institution, Eugene Black, who had recently stepped down as president of the World Bank and who would not have forgotten his sympathy for Hirschman from the early days in Colombia. Whether backroom conversations or a few phone calls helped grease the wheels, we do not know. By the end of 1963, Sandy called Albert to tell him the project was on.
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The Brookings’ Foreign Policy Studies Division cobbled together a proposal for the Ford Foundation and Carnegie Corporation to examine a set of World Bank projects with three aims: explore improvements in the selection and evaluation of development projects, illuminate the problems and potential of foreign aid, “and contribute to our knowledge of the process of development.” The candidate was touted as one of the world’s foremost thinkers of development; Hirschman’s experience examining
projects was ideal for directing this two-year undertaking. The criteria for the projects under review included those running for at least five years and focusing on the introduction of a
new
activity or facility into a particular region (a highway, a rail line, a hydroelectric dam, or an industrial plant) stretching across Asia, Africa, Latin America, and Europe. Stevenson, meanwhile, lined up bank staff to prepare the case files, with his eye trained especially on the South Asian precedents. As far as he was concerned, the Indian and Pakistani projects were the bank’s “problem children.”
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By June, Carnegie stepped forward with $31,340 to foot the bills. By July, Hirschman’s travel plans were set, by which time Hirschman was bound to Harvard, where he negotiated a first year’s sabbatical to conduct the travel and research for what would eventually become
Development Projects Observed
, published in October 1967. His itinerary and projects would eventually include:

El Salvador—electric power plant

Ecuador—roads in Guayas Province

Peru—San Lorenzo irrigation project

Uruguay—pasture improvement for livestock

Ethiopia—telecommunications and roads

Uganda—electric power transmission and distribution

Sudan—irrigation project

Nigeria—railway modernization and Bornu extension line

India—Damodar Valley Corporation and selected industries in Mysore

West Pakistan—Karnaphuli Paper Mills

East Pakistan—Karnaphuli Paper Mills

Thailand—Chao Phya irrigation project

Italy—irrigation in South

The choice raised some eyebrows. About the only coherence was that these were projects. Some found the scale, “the widely scattered” selection “around the fields of activity,” potentially superficial. Why not, asked Robert F. Skillings of the International Finance Corporation, a division of the World Bank, adopt “a more concentrated approach,” like looking at all
projects within a given sector (roads, energy, or irrigation, for instance)? Not only would this be more in-depth, it might avoid “the problems of random factors which unavoidably enter into a very small sample,” and it might yield “conclusions of more general applications.” Skillings was not alone in worrying about the practicability of any lessons.
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These questions would subsequently plague Hirschman’s findings.

The Hirschmans kept their base in Central Park West. Sarah would serve as an “uncompensated assistant” to the project—but all of her expenses were covered. Once Columbia’s classes were over, Albert and Sarah rushed “to work furiously in the files of the World Bank so that we are completely informed about the projects we are going to visit.”
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They partitioned the field work into three phases: the first trip would take them back to Latin America (July–October), the second to India, Pakistan, and Thailand (November–March), with a pause in Washington, and the third to Africa, ending with an Italian leg in the summer. Meanwhile, the girls, now undergraduates at Barnard, would take care of the apartment—which left a few friends wondering if Albert and Sarah were not just a bit too trusting.

Their bags bulging with Pan Am and BOAC plane tickets and folders of complex itineraries plotted out by a small army of staff, Albert and Sarah set off as economic explorers. There was no Kodak, but they had plenty of spiral-bound notebooks for diaries and for most places a guide provided by the bank. It helped that the first leg was the familiar terrain of Latin America, where the field work for
Journeys
had tutored them in an observational method. Beyond, it was all new. Of all the countries they visited, India and Nigeria left the strongest impressions. Travel by rail and Land Rover got them to remote, difficult-to-reach, hot parts, face-to-face with the ways in which big projects in poor countries were churning up social conflict.

There is no cache of postcards to retrace the Hirschman peregrinations, just an abundance of field notes, catalogues of words conveying a strong impression of basic confusion. Hirschman’s witnesses, mainly managers—agronomists and engineers mostly, the kind of men who made projects work—spoke of the frustrations and complications in-variably spawned by their works. Their running theme—told in the vocabulary of water that didn’t flow the way it was supposed to, regions that felt relatively deprived, and industries with growing stockpiles—was that their projects had “failed.” How could these poster children of technocratic change from above, curated by ambitious and empowered engineers, seem to be turning on their makers? Before long, it was the awesome hubris and downright naïveté that became the nub of the public criticism. None of the projects generated more unease—great hopes coupled with prodigious complaints—than the colossal Damodar Valley Corporation in India. Based heavily on the New Deal flagship, the Tennessee Valley Authority, the DVC had become an umbrella for the transformation of West Bengal and Bihar. Indeed, it was a symbol of independent India: the DVC and India were born almost simultaneously. With its high expectations came heightened problems. At first, the plan was to control flooding. Then irrigation was added to the purpose, then hydroelectric power, and finally it was expanded to promote inland navigation. The DVC was the archetype of planned, top-down development, which ran afoul because some peasants did not get the water they were promised, the energy went to some customers and not others, and some regions griped that they were cut out. And everywhere, implementation was more complex and costly than had been envisioned. The atmosphere in India crackled with uncertainty. Jawaharlal Nehru, the DVC’s fountainhead and political emblem of postcolonial India, had died in May 1964. All of the latent schisms—regional, class, and caste—came to the fore. What had started out as an effort to spare people flooding and create a water source for farmers had become an emblem of all that was wrong with the economy. Meanwhile, India was embroiled in conflicts with its neighbors China and Pakistan. The consensus was growing that India’s planned development was a “failure.”
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Lisa, Katia, Sara, and Albert at Katia’s graduation from Barnard, June 1966.

Hirschman was no fan of big plans, but neither was he about to go to the other extreme. Never an admirer of strong convictions, especially when they were baseless or overdrawn, he was even more skeptical of the view that development failed if it did not go as planned. As the needle swung from the euphoria of the 1950s to disenchantment by the mid-1960s, Hirschman’s temper moved the opposite way. His notes reveal him questioning prejudgements even as he was making observations and recording them. Stepping back from all the noise surrounding the arguments about India’s future, what impressed him was how the DVC
was
in a narrow sense a failure. This was how many of the engineers and financiers were starting to regard the overwhelming venture of dams, sluices, canals, and hydroelectric plants. Their most self-incriminating conclusion was of having underestimated the demand for the project’s fruits. But in a more general sense, he observed successes—achievements that escaped the technicians’ grids. All around the dam he saw activities popping up. What is more, there was evidence of regional rivals undermining the hegemony of the DVC—smaller irrigators and competing power sources creating “a second growing point in Eastern India in addition to Calcutta.” He wondered to himself: Maybe a narrow failure was
necessary
for a project to have wider effectiveness? Maybe projects “fail” because they induce competitors and imitators? They themselves might not be very efficient, but they stimulated efficiency and entrepreneurship among others. Having created a surge in demand, the project was a constructive “pressure point” sparking more activity. This was exactly the kind of destabilizer he extolled in
Strategy
. The DVC had mobilized people—but not in the ways planners foresaw, never mind wanted. The story of the DVC did not unfold as had been scripted in advance, as the heroic summoner of the nation around one integrative project. Rather, it was the source of turmoil. It was bound to “step on so many toes to get its job done … that it inevitably makes enemies,” Hirschman noted. Here was a familiar theme: resistances propel further pressure to adapt and change.
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