Scott Alexander responds to Tyler Cowen about USAID funding, correcting his own previous claims about overhead costs while maintaining that Cowen's criticism of USAID was misleading and potentially harmful. Longer summary

Scott Alexander responds to Tyler Cowen's criticism of his previous post about USAID funding. He addresses several points: whether Cowen endorsed Rubio's claims about USAID waste, the true nature of overhead costs in USAID-funded organizations, and the broader debate about foreign aid effectiveness. Scott shows that actual administrative overhead in major USAID partners like Catholic Relief Services is much lower than previously thought (around 6-7% rather than 30%), admits his mistake on this point, but maintains his criticism of Cowen's original post as misleading. He argues that USAID's work is predominantly focused on essential humanitarian aid rather than wasteful programs. Shorter summary