I just added the "EDIT" section before I saw your question. That was what made me start questioning my beliefs. Here's a few things the letter said that eroded away the assumptions I had built regarding:
POVERTY:
> There are still slums and pockets of poverty, but by and large when I visit there now I think, “Wow, most people who live here are middle-class. What a miracle.”
> There is a class of nations in the middle that barely existed 50 years ago, and it includes more than half of the world’s population.
AFRICA:
> “Sure, the Asian tigers are doing fine, but life in Africa never gets better, and it never will.”... Seven of the 10 fastest-growing economies of the past half-decade are in Africa.
> The percentage of children in school has gone from the low 40s to over 75 percent since 1970.
AID:
> Also remember that healthy children do more than merely survive. They go to school and eventually work, and over time they make their countries more self-sufficient. This is why I say aid is such a bargain.
> Here is a quick list of former major recipients that have grown so much that they receive hardly any aid today: Botswana, Morocco, Brazil, Mexico, Chile, Costa Rica, Peru, Thailand, Mauritius, Botswana, Morocco, Singapore, and Malaysia
The above one made me realize I can think of foreign aid like student loans. I needed the financial aid to afford college education. My loans are now paid off and I am significantly better off thanks to them.
CORRUPTION:
> Suppose small-scale corruption amounts to a 2 percent tax on the cost of saving a life. We should try to reduce that. But if we can’t, should we stop trying to save lives?
> On the other hand, four of the past seven governors of Illinois have gone to prison for corruption, and to my knowledge no one has demanded that Illinois schools be shut down or its highways closed.
Basically, don't throw the baby away with the bathwater.
> The horror stories you hear about—where aid just helps a dictator build a new palace—mostly come from a time when a lot of aid was designed to win allies for the Cold War rather than to improve people’s lives. Since that time, all of the actors have gotten much better at measurement. Particularly in health and agriculture, we can validate the outcomes and know the value we’re getting per dollar spent.
This was another big seller for me. Gates is brilliant and everyone who has ever worked with him ends up calling him the smartest guy they know. It was naive of me to think that he didn't have measures in place to measure the impact of his investments and make sure waste was minimized.
And then pretty much everything in Myth #3. I was a fool.