Britain increases aid to the Indian space program. Seriously?!

As Britain continues to reel from the massive cuts proposed last week, some economists challenge funding choices, like continuing aid to rapidly-developing countries like India.

Babu / Reuters / File
India launches its first unmanned moon mission near the southern city of Chennai, Oct. 22, 2008. It may be noble for Great Britain to step up foreign aid even while invoking austerity at home, but a country with its own lunar missions doesn't need increased contributions when Brits are facing streets with fewer cops.

The Comprehensive Spending Review has made some of the necessary cuts to government domestic spending (although they don’t go far enough), but it also will raise the budget of the Department for International Development (DfID) by 37% over the course of the current government.

As an example of the imbalance in cuts, the Treasury’s figures show a shrinkage of 23% in cumulative real terms for the Home Office between now and 2015, while at the same time showing an increase in DfID’s budget of 37% in cumulative real terms.

Budgetary cuts are sorely needed, and to increase spending overseas while cutting spending in Britain beggars belief. As with the NHS, ringfencing any department’s budget is reckless. But unlike the NHS, UK taxpayers will not reap any benefit at all from this hike in aid. And, in fact, neither will most citizens of recipient countries – development aid is a colossal waste of money that at best helps countries that are already growing and at worst helps governments that ruthlessly oppress their citizens.

Large amounts of overseas aid go to countries like India. Though much of India’s population is poor, the country’s economy has grown by nearly 8.8% in 2010 and it has its own space and nuclear weapons programmes. Aid to India subsidizes these costly projects by allowing the government to levy high taxes on its population without having to spend as much money on welfare programmes to offset these taxes.

The British taxpayer is going to be spending less on British police and more on Indian rocketry. Why the Chancellor thinks that this is a good idea is unclear.

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