Foreign Aid President?

How much will the U.S. promises of more development aid really matter?

May 30, 2003

How much will the U.S. promises of more development aid really matter?

Just in time for the G-8 Summit on June 1-3 in France, President Bush put his signature on legislation for his "$15 billion Emergency Plan for AIDS Relief."

The obvious purpose: To use it to challenge European countries to make similar commitments. Despite much fanfare, however, not a dime of the President's biggest new aid proposals has yet been spent — and not a single life has been saved.

The last thing developing countries need are more hollow pledges.

In some ways, the Bush Administration's post-September 11 emphasis on foreign aid is positive. The use of the White House bully pulpit is welcome.

The administration has also backed up the president's speeches with policy documents — from the National Security Strategy to a USAID document entitled "Foreign Aid in the National Interest."

Their conclusion: Development assistance must be considered a key part of U.S. national security. In addition, President Bush's interest in the area has also re-energized the debate outside of the executive branch, in think tanks, NGOs and on Capitol Hill.

But there is a long list of other problems with the President's aid commitments that reinforce the notion that the President's rhetoric is not matched by reality.

Fourteen months after he endorsed increased aid levels at the UN Summit on Financing Development, the President has only signed an authorizing bill that outlines his HIV/AIDS plan — an important step, but only one step in a longer process.

He still does not have Congressional agreement for his new $5 billion "Millennium Challenge Account".

Now the actual dollars need to be provided through an appropriations bill for both initiatives. And this bill is probably months away from being signed.

Will these new funds be enough to make a difference? President Bush repeatedly asserts — whether talking about funding to address climate change or to feed the starving — that the United States is providing more than any other nation.

This is true. But he isn't seeking from Congress anywhere near what is needed to get the job done — or what the United States can afford. Instead, he is making small increases to the tiny share of the federal budget devoted to aid (less than 1%).

A closer look at President Bush's new aid plans reveals more problems. Funding for the largest initiatives is spread out over several years.

That way, the actual amount spent per year will be considerably smaller than the total that was announced publicly in pomp-filled ceremonies.

For FY 2004, the Bush Administration's budget includes about $2 billion in new initiatives for development aid. That contrasts quite starkly with the larger numbers of $10 to $15 billion featured in newspaper headlines.

In some cases, existing aid programs have been re-packaged as new initiatives.

The initiatives announced at the Johannesburg Summit, the Education for Africa initiative, the Climate Change package announced in February 2002 and the Middle East partnership with Arab countries announced this January all use funds that are already part of the U.S. federal budget for international aid.

And the Bush Administration has repeatedly moved the biggest increases into the future. This is true, for example, for the crucial ramp-up in spending for the Millennium Challenge Account.

Big increases for replenishment of World Bank funds likewise have been pushed into the future.

All of this makes it much less certain that the generally impressive, headline-grabbing aid numbers to be offered by the United States are going to be met.

Already, the significant increase in the U.S. budget deficit, the military increases for the war and reconstruction in Iraq and the tax cut signed into law on May 28, 2003 threaten funding for the various aid announcements.

Mr. Bush's FY 2004 Budget proposal requested 22% less for the first year of the Millennium Challenge Account than originally proposed. And first-year funding for the HIV/AIDS initiative is being whittled down, too.

But the troubles with Mr. Bush's foreign aid strategy do not end there. In allocating foreign aid, President Bush continues to pander to conservative and other political constituencies.

Arguments over abstinence versus condom usage nearly derailed the HIV/AIDS bill and have resulted in limits on how these funds may be spent.

Anti-abortion groups have already succeeded in cutting U.S. contributions to the UN Population Fund (UNFPA).

The President seems particularly eager to reach out to fundamentalist Christian groups. A new office of faith-based initiatives is being created at USAID to help religious organizations compete for grant money.

This is taking place even though USAID already directs 35% of its development assistance through private voluntary agencies, including ones that are faith-based.

Even the President's language in discussing his aid programs is filled with biblical references. Signing the HIV/AIDS Act at the State Department, the President said, "I want to thank all of you who have heard that call to love a neighbor just like you'd like to be loved yourself….May God continue to bless your work."

Another characteristic of the Bush foreign aid policy is an insistence on a "business-like" approach to aid. That concept is actually nothing new — public-private partnerships like the ones being pushed by the Bush Administration have been around for a while.

A larger concern is that the White House seems to want to reinvent without really knowing what works in current programs.

A new government-sponsored corporation is proposed to oversee the new Millennium Challenge Account — although key Senators are threatening to kill plans for this wholly redundant new government agency.

Bush's new approach to aid relies on the use of incentives to spur recipient countries toward adopting policy reforms and away from waste.

It is an intriguing concept, but devoting significant aid dollars to an unproven experiment will do nothing to save lives now.

U.S. development aid is already tightly micro-managed by a complex web of laws and regulations to prevent misuse of aid.

While no one is in favor of wasting taxpayer dollars, this "get tough" approach will not address "hopeless poverty," or the failed states, like Taliban-era Afghanistan, that turn out to be terrorist havens.

This gives rise to a potentially cynical view: That the Bush Administration is mainly concerned about creating positive headlines that signal its good intentions.

It is less concerned about backing its announcements up with the funds needed to take effective, quick action against the very real problems that confront developing countries.

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