The conversation continues

Branko Milanovic has another idea: This change would take care of the major cause of aid leakage: governments, and other agencies, intermediation which often result in useless projects. If a global aid agency can deal directly with poor people and give them aid in cash, there would be no leakage at all, except for possible mistargeting, i.e. giving cash to the people who are not poor. (Cato) This sounds a lot like microfinance to me. My question is why set up yet another beaurocracy in the form of a global agency? Why not enable small donating organizations (with local knowledge) to spearhead this? They need less overhead and administrative costs, not more, and small, dynamic groups of people minimize those. International and world organizations should be working with governments to minimize the friction for loan agencies to reach their people and for companies to enter their markets. If governments can't handle that responsibility, then perhaps they should be ignored.