Nobel Laureate Abhijit Banerjee on USAID cuts: ‘Trump is right, Europe surrendered global leadership’

Nobel Laureate Abhijit Banerjee said it's time for Europe to step up and "lead the world" as US President Donald Trump slashed nearly all the United States Agency for International Development (USAID) contracts. Banerjee said Trump is right in saying that Europe has "surrendered its leadership in the world."

In an interview with NDTV World on Saturday, Banerjee talked about a recent article in The Financial Times, in which he, along with fellow Nobel laureate and wife Esther Duflo, argued that the world doesn't need the US to be the sole source of aid funding.

They wrote in the article, “The rest of the world should take the lead, demonstrating its ability to raise and effectively spend aid money.”

During the latest interview, Banerjee was asked where he intends to get this money. He started by saying that “it's a great moment for Europe to step up to the plate.”

Banerjee, however, said he believes, “President Trump is right in saying Europe has sort of, in some ways, surrendered its leadership in the world.”

He told NDTV World, "It's not taken a lot of initiatives to kind of lead the world. I think it's a moment to lead the world...The aid's money is still a drop in even — Europe's economy is bigger than the US' and it's not a huge amount of money.

"If they [Europe] really want to get leadership, this is a way to get leadership," Abhijit Banerjee said.

USAID cuts

In February this year, the Trump administration announced significant cuts to USAID's foreign aid contracts, eliminating over 90 percent of them, amounting to $54 billion. "At USAID, Waste and Abuse Runs Deep," a White House release read.

Abhijit Banerjee's global research centre, which works to reduce poverty, was among those affected by the USAID cuts.

Trump said he wants overseas spending to be closely aligned with his "America First" approach. Banerjee was asked in the interview, "What do you have to say to those who believe that America needs to take care of its own first before helping the rest of the world, be it for, say, transgender clinics in China or, say, disaster relief elsewhere?"

He responded by calling the claim that "most of the money was going to transgender clinics in China" as "ludicrous".

"I think most of the money was going for purposes that most American people support, which is saving lives of... PEPFAR is a Republican initiative. Americans support saving lives. Americans support feeding the hungry. Americans support saving the people in disaster situations," Abhijit Banerjee said.