FOREIGN AID REFORM
The Urgent Need to Ensure Effective Implementation of United States Foreign Assistance
"One of Global Action for Children’s top priorities is to ensure that our precious foreign aid resources are used effectively and that they actually reach those on the ground who desperately need them and for whom they were intended."-Leila Nimatallah, Policy Director, Global Action for Children
With over a billion of the world’s people struggling to subsist on less than $1 a day, it is imperative that the United States make the best use of resources devoted to foreign assistance. Global Action for Children works to encourage the U.S. government to prioritize successful interventions proven to save and improve lives in poor countries with the least amount of waste and inefficiency. Much improvement is needed in this area.
Oxfam America recently released a report on the overwhelming need for U.S. foreign aid reform (click here to read Foreign Aid 101). According to their research, "a government commission investigating foreign aid interviewed hundreds of people - a list that included members of the foreign aid establishment, aid contractors, and aid recipients - and not a single one of them defended the status quo".[1] The complexities and intricacies of the current United States foreign aid system greatly dampen aid effectiveness and its opaque, impenetrable bureaucracies are difficult for the most seasoned professional to grasp.
President Kennedy attempted to simplify U.S. aid operations with the 1961 Foreign Assistance Act and the creation of our United States Agency for International Development (USAID). The intention was for all foreign aid operations to be coordinated by this umbrella organization however, today, only 45 percent of U.S. foreign aid is overseen by USAID. In recent years, foreign assistance has been scattered between the Department of Defense, the Department of State, the Department of Labor, Health and Human Services and other agencies. Although the aid monies and assistance emanating from President Bush’s foreign aid initiatives such as the President’s Emergency Plan for AIDS Relief (PEPFAR) and the President’s Malaria Initiative (PMI) are widely accepted as positive contributions to the aid budget, they have exponentially multiplied the number of offices and paperwork, thus further complicating the efforts of aid organizations on the ground. Further, arguments have been made that these newer "vertical" initiatives have resulted in foreign assistance being channeled away from other critical interventions, such as child survival and maternal health programs, which are implemented by USAID.
As Oxfam America recently noted, "the Foreign Assistance Act is more complicated than ever, featuring 33 different goals, 75 priority areas, and 247 directives, and being executed by at least 12 departments, 25 different agencies and almost 60 government offices. This mix of agencies with different missions has made the efficient delivery of aid increasingly difficult."[2] Click here or visit the following website (http://www3.brookings.edu/global/foreign_reform_chart.pdf) to see the tangled web that is the current U.S. Foreign Assistance legislation, objectives and organizations.
The United States provides foreign aid for a multitude of reasons: to promote national security, national economic interests and national values, to name a few. While the U.S. gives the largest dollar amount for bilateral assistance in absolute terms out of any other country (at $23.5 billion in 2006), based on our level of wealth, we are far outpaced by as many as twenty other nations. Only .18 percent of the United States’ national income is spent on foreign aid, which amounts to 1.3 percent of the federal budget. Half of that 1.3 percent, 0.6 percent of the U.S. Federal Budget, actually goes towards sustainable poverty reduction development aid with the vast majority of foreign assistance going to U.S. "strategic" and political priorities. For example, the U.S. provided $3 billion in military aid to Israel in 2007 and $1.8 billion in aid to Egypt and $750 million to Colombia for counternarcotics programs.
In addition, United States contractors benefit greatly from that 0.6 percent slated for humanitarian and development programs. According to an Oxfam America report, in 2005, the U.S. tied 93 percent of its foreign aid to the purchase of U.S. goods.[3] A Ugandan respondent to an Oxfam Great Britain survey stated that "USAID is notorious for using U.S. inputs, especially consultants. ‘All the money goes home’ is a popular saying with USAID."[4] Unfortunately, it is not an uncommon occurrence for the majority of aid funding to never make it outside the Washington Beltway. The familiar story of an Afghan NGO was detailed in the aforementioned Oxfam report: "Villagers described how the agency in Geneva that was meant to oversee the project took 20 percent of the $30 million for administrative costs, then subcontracted to an NGO in Washington, DC, that took another 20 percent, which in turn subcontracted to an Afghan NGO that took another 20 percent. Then they paid money to a trucking company in Iran to haul the timber. Once the timber arrived, it was found to be of no use as roofing timber to the villagers. It was too heavy for the mud-brick walls of their homes, so the villagers chopped the wood up and used it as firewood."[5]
All of this being said and regardless of actual dollar amounts, without proper coordination, monitoring and evaluation, the aid monies are far from reaching the scope of their targeted goals. As Dr. Paul Zeitz of the Global AIDS Alliance noted, "Our experience on HIV/AIDS has shown that, while effective aid can save millions of lives, the overall system of foreign aid is not well-coordinated and often the response to problems like AIDS is not holistic,"...."You wouldn’t set up twenty different checking accounts to pay your household bills, but that’s what we are doing in foreign aid; the time has come to put someone in charge of making foreign assistance work," said Zeitz. "We and our colleagues in a broad range of organizations, including many religious groups, are calling on the U.S. to establish such an agency to streamline the bureaucracy and establish clear principles of accountability." Global AIDS Alliance is one of many organizations advocating for the creation of a Cabinet-Level Department of Global Development in order to better coordinate aid efforts and to provide the necessary monitoring and evaluation needed to produce effective programs. For specifics of the GAA Global Development proposal please click here.
Global Action for Children is working with GAA and RESULTS to promote this proposal within the next administration, while simultaneously continuing to push the U.S. Congress for better use of taxpayer dollars during the implementation of current foreign aid programs.
Click here to read about the Modernizing Foreign Assistance Network Proposal Launch on Capitol Hill on June 10, 2008.
Links:
Read about "tied aid" and why it is bad practice
[1] Oxfam America, http://www.oxfamamerica.org/newsandpublications/publications/briefing_papers/foreign-aid-101/Foreign-Aid-101.pdf
[2] Ibid, 1
[3] http://www.oxfamamerica.org/newsandpublications/publications/briefing_papers/smart-development/smart-development-may2008.pdf
[4] Ibid, 3
[5] Ibid, 1
