THE END OF U.S. AID?

By William Fisher

Foreign affairs experts agree that the Bush Administration is quietly using the Chinese water-torture method to slowly engineer the death of America’s traditional system for delivering foreign aid ? and some of them think it ?s not such a bad idea.

They point to the creation of the Millennium Challenge Account (MCA) and the U.S. Global AIDS initiative outside the U.S. Agency for International Development (USAID), where such programs would normally be located. And, as further evidence of a shift away from USAID’s traditional international development mandate, they cite the creation of a new democracy promotion apparatus within the State Department and the appointment of the current AIDS coordinator — who has no development experience ? as the new USAID administrator.

The MCA was created in 2004 to provide assistance countries that rule justly, invest in their people, and encourage economic freedom. It has been criticized for the slow pace of its process for approving country applications.

A retired senior USAID official, who spoke on condition of anonymity, told us, “This is simply another iteration of the longstanding power struggle between USAID and the State Department, which wants to use development money and leverage to further President Bush’s political agenda, and make democracy promotion and the war on terrorism the centerpiece of America’s foreign aid efforts.”

But the comment of another retired diplomat echoes the sentiments of a number of other foreign aid experts we interviewed. Ludwig Rudel, who spent more than 25 years with USAID, said, “My take on USAID is that it really makes no difference what is being proposed — except for humanitarian assistance and emergency relief the agency has lost its effectiveness anyway”.

He added, “The bulk of USAID money is used for political purposes, such as in Israel, Egypt, Palestine, and Jordan in the Middle East, and Bolivia, Peru, and Colombia for the drug war. During the Marshall Plan days and for about ten years after, the USAID program had a clear development focus. Now, the political types have full control of the funding and development work occasionally is a serendipitous by-product. So what difference does it make if AID gets absorbed into State?”

Efforts to downgrade USAID are not new. Until 1999, the agency reported directly to the president. During the administration of President Bill Clinton, USAID was ordered to report to the Secretary of State. Periodically there have also been efforts in Congress to totally absorb the aid agency into the State Department.

USAID works in more than 100 countries with a 14-billion-dollar annual budget. Its portfolio is massive, ranging from anti-poverty programs to education to health to private sector development and export promotion to policy reform to disaster and humanitarian relief.

The State Department now says that U.S. money should be used to empower developing countries to strengthen security, consolidate democracy and increase trade.

Secretary of State Condoleeza Rice, outlining a plan she called “Transformational Diplomacy” last week, also said that Washington should further link its aid to defeat terrorist threats. She invoked the attacks of 9/11 and noted that the terrorists used the previously failed state of Afghanistan to launch their attacks.

"In the final analysis, we must now use our foreign assistance to help prevent future Afghanistans — and to make America and the world safer," she said.

She named terrorism, weapons proliferation, diseases, and trafficking in persons and drugs as global threats that require the U.S. to develop new diplomatic strategies. She said that without the new changes, U.S. foreign assistance may be ineffective.

"The current structure of America’s foreign assistance risks incoherent policies and ineffective programs and perhaps even wasted resources,” Rice warned.

But some outside the government have warned that Rice’s proposals could result in a greater politicization of foreign assistance. “We’re concerned that the same priority won’t be given to long-term development as resources are siphoned to support shorter-term diplomatic or military objectives,” said Jim Bishop, a senior officer of InterAction, the largest coalition of non-governmental U.S. aid groups.

Veteran foreign policy experts offer various other recipes to improve U.S. development assistance policy and delivery.

Dr. Jack N. Behrman, emeritus professor at the University of North Carolina who served as a senior official in the administration of President John F. Kennedy, told us, “USAID’s 30-plus programs should be separated and put where the primary interest is. For example, all assistance (Israel, Egypt) that is security-based should be put in the Defense Department, economic-private sector aid should be in the Department of Commerce, and should recruit volunteers to do its work, disaster and humanitarian aid should be in the State Department, and all efforts to ‘alleviate poverty’ should be terminated, since there is no evidence that USAID antipoverty funds have been effective anywhere.”

Behrman, a founder of the USA MBA Corps, a private organization of volunteers with advanced business degrees and private sector work experience, adds, “Assistance to democracy and institution building should be in an independent agency, funded directly by Congress, to avoid the ‘smell’ of intervention; programs should be conducted largely with local NGOs assisted by American and European Union volunteers.”

He concludes, “I would eliminate USAID, unless someone can find a serious purpose that is not more effectively put in either independent agencies that fund volunteers or Cabinet departments.”

But Samer Shehata, Assistant Professor of Arab Politics Center for Contemporary Arab Studies at the Edmund A. Walsh School of Foreign Service at Georgetown University, thinks the absorption of USAID into the State Department “certainly sounds problematic, if not simply a bad idea.”

He told us, “Most bilateral aid is certainly somewhat political and our USAID program is not the exception by any means — in fact, it is much more political than the bilateral aid programs of most European countries. But absorbing USAID into State or making USAID the place of ‘democracy promotion’ ? which is not so well thought of when it is the objective of the U.S. government in the Middle East ? will only damaage other less political USAID efforts and programs.”

Prof. Shehata adds, “It is one thing to declare democracy promotion a foreign policy goal, but it is quite another to come up with actual policies that promote democracy — effectively.”

But U.S. Foreign Service veteran Dr. Richard T. Arndt, President of Americans for UNESCO and author of “The First Resort of Kings: American Cultural Diplomacy in the 20th Century”, thinks the paramount issue is not government organization but a continuing commitment to education through technical assistance and exchange programs.

He told us, “In the post-Cold War world, educational-cultural issues matter more than ever in history. Nothing could be more useful than a totally coordinated and carefully calibrated program of U.S. educational outreach around the world, carried on by strong government and private-sector leadership and targeting all levels of education, from K through the universities, technical and professional schools, and in continuing education. The idea of the U.S. giant sharing its educational wealth with the world might help the world forget Shock and Awe and begin refilling the reservoirs of goodwill that have been so fatally drained.”

Most educational exchange programs are currently conducted by the State Department and Secretary of State Condoleeza Rice says she is committed to expanding them. But Dr. Arndt points out the “historic disconnect” between USAID-run education programs and those of the State Department, which include the Fulbright scholarships.

The U.S. plan to link security to democracy and development overseas has also drawn criticism from development activists, who fear the new overhaul could be ideologically motivated.

They are particularly critical of the appointment of Randall Tobias as the new USAID administrator, who will also carry the title of Deputy Secretary of State for Development. He previously served as chairman, president and chief executive officer of the pharmaceutical giant Eli Lilly and Company.

"Under his direction, HIV prevention programs have shifted from being based in public health science to being dictated by the abstinence-only-until-marriage ideology of the Bush administration," said James Wagoner, president of the Washington-based Advocates for Youth.

"As head of USAID, Ambassador Tobias will not only be responsible for AIDS funding, but also in charge of population and family planning programs," concluded Wagoner. "How will his anti-science ideology impact programs vital to protecting the health of women and young people around the world?"

Tobias’ record in the fight against AIDS has also been marked by accusations he has favored drug companies by displaying a preference for using more expensive, brand-name drugs instead of cheaper, safe generic versions that could have reached many more people in impoverished countries.

The funeral of USAID is nowhere near a done deal. And until the Bush Administration comes up with a coherent plan to replace it, the chances are its resources will shrink gradually and it will simply be allowed to starve to a slow death.

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