Discussion: (0 comments)
There are no comments available.
A public policy blog from AEI
This is part of a series that poses five important questions seeking to give clarity to any would-be president's stance on key issues.
The United States is generous, giving upwards of $30 billion annually in foreign aid. While critics point out that other countries give more in terms of percentage of GDP, the sum total that the United States gives is not only the highest in the world, but it also does not incorporate Defense Department, Justice Department, and even some State Department funding, nor does it include the incredible generosity of individual Americans who anecdotally give to charity far more than their non-American peers, nor does it count the cost of the US military’s humanitarian missions, for example, in the wake of the 2004 Indian Ocean tsunami or the 2010 Haitian earthquake.
The billions of dollars the United States spends has fueled a Byzantine industry and few, inside or outside the aid community, believe that the system as currently designed functions well. Still, Americans believe in helping others, and few beyond perhaps the most libertarian candidates would suggest dispensing with foreign aid. Nevertheless, there are a number of issues which should be on the agenda of the next president and his team. Here are five questions that might guide them:
The United States gives foreign assistance to almost every country in Asia, Africa, and Central and South America. The United States spends tax payer money not only in the world’s poorest countries, for example, Haiti, Congo, or Timor-Leste, but also in oil rich kingdoms like Saudi Arabia, hubs of technology and modernity like Singapore, and even rival powers like China. According to the Congressional Research Service, there are five main categories of foreign assistance: development aid, economic assistance to support political and security goals, humanitarian aid, American components to multilateral assistance, and military aid.
However one categorizes assistance, however, there seems to be little rhyme or reason for what the United States government and its agencies choose to fund, nor is there any sense of how it fits into a coherent strategy. If US policy goals center around counterterrorism, counter-proliferation, stopping aggression, and perhaps democracy promotion, then how does sponsoring a gay film festival in Bulgaria advance key US interests? And if it is the job of US foreign aid to alleviate poverty, ensure clean water, provide housing, and “do good,” could foreign aid actually be corrosive to those goals by undermining a government’s accountability to its citizens? After all, why should the recipient government spend its own money addressing its citizens concerns if it knows that the outside world will bail them out?
Conversely, if outsiders build schools and health clinics, might the fungibility of money mean that regimes can actually invest more in conflict? More broadly–and harkening back to debates left unresolved during the George W. Bush administration–should it be the policy of the United States to promote democratization? Was the Obama administration correct to cut this dramatically? And when aid is given, how much is too much? After all, the legacy of billions of dollars spent in Afghanistan and Iraq may be corruption more than physical improvement.
There is no one stop shop for Congressional oversight of foreign aid. Agricultural committees in the House and Senate supervise authorization of food aid, the Senate Foreign Relations Committee and the House Financial Services Committee supervise authorizations of contributions to the World Bank and International Monetary Fund, and various Senate Foreign Relations Committee and House Foreign Affairs Committee subcommittees oversee authorizations of economic and military assistance. Then the Foreign Operations Subcommittees have jurisdiction over appropriations. The whole process is so convoluted that there remains little coherence to the end product.
Is it possible to streamline supervision of aid? Should that mean streamlining aid itself? And while Congress is often vilified for earmarks, does the end of earmarks end serious congressional and public management of US assistance dollars? After all, it is Congress rather than the State Department which directly answer to the taxpayer. There’s perhaps a larger problem, however, once Congress approves aid. In Egypt and elsewhere, some ambassadors anecdotally have sought to channel political, capacity building, and democratization aid to organizations essentially approved by the ruling party so as not to complicate ties to a government with which the United States must work.
While some aid is channeled through organizations like the National Democratic Institute or the International Republican Institute, is there a better way to distribute aid to avoid this conundrum, preserve relationships while still maintaining the efficacy of democratization aid? There is also a problem with how to address fraud and abuse. In recent years, Congress has enabled a cult of the inspector general, in which Congress funds accountants to look for waste, which they then do little to correct. Is there a more effective way to conduct oversight?
While the United States has given billions of dollars in foreign aid, the White House, the State Department, and the US Agency for International Development (USAID) would be hard-pressed to prove any success for their efforts. According to the Congressional Research Service, “success or failure of US foreign aid programs is not entirely clear, in part because historically, most aid programs have not been evaluated for the purpose of determining their actual impact.” You read that right: billions spent and no idea if the programs were successful. Even recipients of the aid notice the waste caused by lack of metrics. Afghanistan’s first lady Rula Ghani recently quipped, “I do hope that we are not going to fall again into the game of contracting and sub-contracting and the routine of workshops and training sessions generating a lot of certificates on paper and little else.”
The need for metrics and accountability was the reason why the US Congress created the Millennium Challenge Corporation (MCC) in 2004. The concept was simple: Countries would have to compete for aid, identify and voice their own priorities, and manage implementation. Before qualifying for aid, recipient countries would have to exceed the median score of their peer group on 17 factors, ranging from civil liberties, to girls’ primary education, to economic freedom enabling business start-ups. The MCC would administer its program separately and without interference from either the State Department or USAID. And while independent assessments have shown that MCC-supported programs have shown measurable return and improvement, the US Congress has repeatedly underfunded the MCC. Given the MCC’s ability to measure and demonstrate success and USAID’s difficulty in doing so, should the MCC model be expanded at the expense of more traditional aid programs?
Washington is notoriously myopic, and US policy is riven with chronic attention deficit disorder. Often, the aid agenda is set not by the Presidential Daily Brief, but rather by pressure drummed up by television anchors and Hollywood activists. Hence the moral outrage at the massacres in Darfur or the exploits of Joseph Kony, but the relative silence to the more deadly Congo conflict and kidnappings by the Fuerzas Armadas Revolucionarias de Colombia (FARC). Sometimes, simply, the trouble spots get more, to the detriment of those utilizing aid well.
In 2001, for example, the US provided Mali $33.7 million in development assistance; Lebanon, a country with one-third the population and host to numerous terrorist groups, received $50 million. At the time, Mali was one of the poorest countries on earth but yet, according to Freedom House, the most democratic, Muslim-majority country. A decade later, Mali’s democracy collapsed. Perhaps had it received more aid than Lebanon, it might have solidified its democracy beyond the point of no return. Perhaps, there is no better example of the squeaky wheel getting disproportionate grease than the Palestinians who, be it through United Nations agencies or through direct assistance from donor countries, have received more per capita than any other people and yet have little to show for it (beyond the palatial villas of their leaders). Is there a better, objective way to determine need than simply who happens to be in the press at any given time? If so, what would that be?
On an individual level, Americans are perhaps the most generous people on Earth. They keep many aid organizations and NGOs afloat with their charitable contributions. Many of the NGOs which Americans support are relatively streamlined, with low overhead and high bang for the buck. The same cannot be said for the United Nations or USAID. USAID funds contractors who in turn flip contracts to subcontractors, each of whom take their cut for overhead, staff, and consulting fees. USAID regulations, meanwhile, have become so Byzantine that only seasoned USAID employees understand them. This had led to the development of a USAID mafia, in which USAID employees retire to contractors who use their expertise to win contracts.
Foreign assistance, however, should not be about creating a layer of consultants and contract kingmakers; rather, it should be about augmenting US policy goals via soft power. When it comes to the basic issues of feeding the hungry, helping the sick, or sheltering the poor, might it be better simply to get the US government out of the aid business in favor of private NGOs which, arguably, do a better job anyway? Why should the government ever replicate what the private sector can do?
Follow AEIdeas on Twitter at @AEIdeas.
There are no comments available.
1789 Massachusetts Avenue, NW, Washington, DC 20036
© 2017 American Enterprise Institute