On February 26, the House International Relations Committee held the first in a series of hearings to examine U.S. foreign assistance since September 11. Future hearings will focus on the Millennium Challenge Account (MCA), the Global HIV/AIDS Initiative, and reconstruction efforts in Afghanistan.
In his opening statement, Chair Henry Hyde (R-IL) addressed the need to restructure the current U.S. foreign assistance strategy. “At times, it does seem that U.S. foreign aid is incoherent and fragmented. There are an increasing number of agencies and players involved in the provision of foreign assistance, such as the Departments of Education, Labor, and Health and Human Services. There are an increasing number of appropriations and authorizing committees getting involved in foreign aid as well. And there is an ever-expanding list of Presidential foreign aid initiatives more than twenty at last count,” he stated.
Steven Radelet of the Center for Global Development pointed out shortcomings in the current foreign assistance system and the president’s new initiatives: the MCA will provide funds to 15-20 low-income countries, but there are no plans for assisting those countries that don’t qualify; the Global HIV/AIDS Initiative will focus on 15 countries with the highest HIV/AIDS prevalence rates in the world, but leaves out a number of countries struggling to contain the epidemic; there is no strategy to help consolidate democracy and ensure political stability in key states around the world; there is no strategy for working with failed and failing states; and U.S. foreign assistance programs are scattered across several departments and agencies with little coordination and communication. Mr. Radelet argued that the real problem with the current system is that the funding allocated for foreign assistance is too small to meet key foreign policy objectives. “Even if the MCA and the Global HIV/AIDS Initiative are fully funded, the United States will remain 22nd out of 22 [Organization for Economic Cooperation and Development] OECD donors in official foreign aid as a share of national income,” he stated.
Helle Dale of the Heritage Foundation presented the written testimony of Marc Miles, who was unable to attend the hearing. In his testimony, Dr. Miles called U.S. foreign assistance a failed system, noting, “Throughout the past 50 years, the United States has given more than $500 billion in foreign assistance to less-developed countries. Yet the people in many of these countries are no better off today in terms of per capita gross domestic product (GDP) than they were decades ago; some, in fact, are actually poorer.” He argued that the purpose of U.S. foreign assistance should be “to help countries wean themselves from dependency on foreign aid by encouraging them to establish strong rule of law and policies of economic freedom to foster growth. The traditional foreign aid system that the United States employs does not advance such values.”
Dr. Miles said that the MCA is “a step in the right direction” because it “will link development assistance with economic reforms and good governance to move poor economies toward self-dependency.” He also disputed claims that the MCA would replace existing development assistance programs, noting that the FY2004 Consolidated Appropriations Act (P.L. 108-199) included a new appropriation of $650 million to fund the MCA.
Testifying on behalf of InterAction, Mary McClymont suggested that the MCA might have too narrow a focus. “If development assistance is tied only to short-term narrowly defined national interest objectives, or if it is channeled through ineffective or unaccountable means, certain specific political or foreign policy objectives may be met, but it is not likely to achieve the broader development…on the other hand, we know that programs which work to reduce poverty, meet basic needs and build self-sufficiency in people such as providing basic education, healthcare, work and farming skills, reducing hunger, promoting women and girls lead to more peaceful, prosperous, democratic and stable nations which in turn leads to greater security for the United States,” she stated.
Focusing her comments on the president’s foreign assistance initiatives, Lael Brainard of the Brookings Institution pointed out that a number of “populous and needy and in some cases promising countries” would not be eligible for the MCA. “Despite administration promises that MCA funding would not come at the expense of existing bilateral assistance, the recent budget request would cut Development Assistance the primary assistance program for the preponderance of poor African countries that will not meet MCA performance criteria by 3.5 percent next year alone and 22.4 percent in real terms over the next 5 years,” she stated. Ms. Brainard argued that programs to combat HIV/AIDS should be “integrated into broader poverty strategies for each country to ensure resources are used to maximum effect, recognizing the pandemic leaves its mark on all dimensions of development from education to productivity to demographics.”
Warning that the United States must not oversell what foreign assistance can accomplish, Patrick Cronin of the Center for Strategic and International Studies (CSIS) stated, “We do need to devote more resources to assistance, but how we spend our money remains more important than how much we spend. Correspondingly, we need to manage expectations for development efforts because aid is only one instrument and it depends on a range of other factors, such as stability, a hospitable policy environment and political will, for success.”
