Study Finds Cash Transfers Reduce Childhood Deaths by Nearly Half as Trump Cuts Threaten Direct Aid

With newly embraced direct cash assistance programs a casualty of the Trump administration's slashes to foreign aid, a study released Monday showed that such direct transfers had a "showstopping result" in reducing child mortality rates in low-income families in the Global South.

The National Bureau of Economic Research (NBER) on Monday released a study of cash transfers given to more than 10,000 households in Siaya County, Kenya between 2014-17 by the nonprofit group GiveDirectly.

The group provided $1,000 in three installments—without conditions on how it would be spent—over eight months to the families, covering about 75% of their expenses.

Researchers examined the effects over a decade, completing census surveys and collecting data on households that received the funds versus those that didn't.

Unsurprisingly, and as numerous previous studies have shown, the NBER found that the cash transfers dramatically improved the families' lives, helping them to sustain themselves even amid a drought and the coronavirus pandemic. Economic activity in the 650 villages the researchers examined also improved.

But the dramatic decline in infant and childhood mortality rates "became obvious almost immediately," the New York Times reported, and surprised the researchers and other observers.

"This is easily the biggest impact on child survival that I've seen from an intervention that was designed to alleviate poverty," Harsha Thirumurthy, an economist at the University of Pennsylvania who was not involved in the study, told the Times.

NBER found that the unconditional cash transfers led to 48% fewer deaths before a child reached age 1 and 45% fewer deaths in children under the age of 5.

The transfers appeared to help mothers take parental leave, with a 51% decline in women performing hard labor in the last months of their pregnancies and the three months after giving birth.

The direct infusion of cash also helped women receive prenatal care they might otherwise not have received.

"I have seen firsthand what it means when an expectant mother can't access timely care," said Dr. Miriam Laker-Oketta, a senior research adviser for GiveDirectly, in a video posted on YouTube by the group about the project's results. "I remember a time when a woman arrived after being in labor for three days. Sadly, by the time she arrived, her baby had already died. Our clinic was nearby, but she never had a prenatal visit where her condition might have been caught early."

Laker-Oketta told the Times that "when you come across an intervention that reduces child mortality by almost a half, you cannot understate the impact."

The research was released four months after US State Department spokesperson Tammy Bruce said in a press briefing that the Trump administration was terminating a number of foreign assistance awards "because they provided cash-based assistance, which the administration is moving away from given concerns about misuse and lack of appropriate accountability for American taxpayers here at home."

That announcement came just six months after the US Agency for International Development (USAID) signaled a long-awaited shift and said it would "include direct monetary transfers to individuals, households, and microenterprises... as a core element of its
development toolkit."

"Critically, transfers respect the dignity of individuals, households, and microenterprises by allowing them to make spending and investing decisions, while also promoting efficient markets such that entire communities and regions, not just recipients benefit. In sum, direct monetary transfers provide USAID with a flexible and localized programming approach to achieve development objectives," said the agency in a position paper last October.

As Daniel Handel, a policy director at the foreign aid think tank Unlock Aid, told NPR this month, the embrace of direct monetary aid at the agency "was largely unheard of" a decade earlier.

"There was an amazing amount of handwringing about the idea," Handel told NPR, with officials concerned about families "misspending" the money. The shift last year was "a real sea change," he added.

As Common Dreams has reported, experts have warned that President Donald Trump's cuts to foreign aid will be a "death sentence for millions of people" in the Global South.

According to a study published in The Lancet last month, "projections suggest that ongoing deep funding cuts—combined with the potential dismantling of the agency—could result in more than 14 million additional deaths by 2030, including 4-5 million deaths among children younger than 5 years."

A federal court ruled last week that Trump can move forward with the cuts, including nearly $4 billion in funding for global health programs and more than $6 billion for HIV and AIDS programs.

NBER's study suggested the State Department's plan to abandon cash transfers could be a driving cause of the "death sentence" caused by the cuts; the researchers found that "infant and child mortality largely revert to pre-program levels after cash transfers end."