Tom Leary's Blog

FP: So you are saying that the United States can do well by doing good?

RS: In the coming years, Africa is going to be a 900 million-plus person common market that is growing three times faster than the global economy. China has been making a big investment in Africa, and we’re going to want to make sure that American enterprises are part of the picture as well.Ten of the largest 15 trading partners we have were foreign aid recipients. South Korea was a major recipient of U.S. aid for decades, and today we have more jobs created in the U.S. because of our trade relationship with South Korea than we do with France.

In this episode of The Stream, we speak to TMS “Teddy” Ruge (@tmsruge), Co-Founder of Project Diaspora and Joel Charny, Vice President for Humanitarian Policy at InterAction (@interactionorg). 

He said aid has helped with governance, quoting a report released on Monday by the global campaigners ONE, which said that by 2015, UK aid alone will have helped 44.9-million more people to vote in freer and fairer elections.

The big unresolved question for the new donors, argues Duncan Green, head of research at Oxfam, an NGO, is how far they adopt the policies and institutions of Western donors or how far they go their own way, blurring boundaries between aid and investment. There have been one or two nods towards Western ideas recently. The BRICs are giving more through multilateral channels, moving away from their usual government-to-government help. China’s white paper uses Western-style language about “increasing recipient countries’ capacity”. But by and large the new donors think their model of giving aid is better. As their contributions soar and Western ones stagnate or shrivel, the aid world is seeing genuine competition.

State, USAID, and MCC manage about 1% of the U.S. Government’s federal budget for foreign assistance activities.

Top 10 Things You Should Know

The Dashboard
 The goal of the Foreign Assistance Dashboard is to make all U.S. Government foreign assistance investments available in an accessible and easy-to-understand format. The Dashboard is still in the early stages of development. Future versions will incorporate budget, financial, and program data from all U.S. Government agencies receiving or implementing foreign assistance. Read more about the Dashboard here. 

 The foreign assistance data on this site may be different from data presented on other websites due to different funding timeframes and reporting parameters. It’s important to understand the data presented on this site. 

 The Foreign Assistance Dashboard currently contains Department of State and USAID budget planning data and Millennium Challenge Corporation (MCC) budget planning, obligation, and expenditure data. Other U.S. Government agencies that receive foreign assistance funds and additional funding and programmatic details will be phased into the Dashboard over time. To learn more about the data click here. 

The Budget
 The President submits to Congress, in February of each year, a detailed budget request for the federal government for the coming fiscal year. This annual budget request includes a request for foreign assistance funding. Click here for more information about the budget process. 

 After receiving the President’s budget request, Congress considers the President’s budget and passes an appropriation that is signed by the President, which permits the actual expenditure of funds. Read more about the budget process here. 

 MCC provides well-performing countries with large-scale grants to fund country-led solutions for reducing poverty through sustainable economic growth. MCC grants complement other U.S. and international development programs. There are two primary types of MCC grants: compacts and threshold programs.

• Compacts are large, five-year grants for countries that pass MCC’s eligibility criteria.
• Threshold programs are smaller grants awarded to countries that come close to passing these criteria and are firmly committed to improving their policy performance.

 An appropriations bill authorizes the expenditure of public funds to a certain limit for a specified purpose. Therefore, appropriations amounts do not represent funds actually spent on programming. Expended funds are not yet included on the Dashboard. Click here for more information on the budget process. 

Countries and Sectors
 At the time the request is submitted or an appropriation is passed, only a portion of the funds can be disaggregated by country. Some funds are allocated to Washington based offices for subsequent allocation to overseas offices or to worldwide programs. 

 All foreign assistance data is classified into one of several distinct sectors that describe what the program does and enables the aggregation, comparison, and analysis of data without double counting. For a complete list of sectors, click here. 

 Budgets and programs are classified within the sector framework according to “what” they are doing and not “why” they are doing it. This preserves sector classification consistency and prevents funds from being double counted. For more information on sectors, click here.

Is there a cost to taxpayers? Of course. But all of our foreign aid programs and foreign policy initiatives— from sending diplomats to Afghanistan to helping reverse the HIV/AIDS epidemic in Africa—barely make up 1 percent of the annual budget. It is a relatively small investment for such a great return. This year alone we will spend approximately $700 billion on our military. The entire international affairs budget is less than one-tenth of that. As former Secretary Gates once pointed out, if you took the entire Foreign Service roster, you could barely staff one aircraft carrier.

The prime minister said that when states were broken and mired in conflict, the UK suffered from a surge in illegal immigration, asylum seeking and even terrorism. “That’s why by 2015 we’ll be putting nearly a third of all our aid into conflict states. So the aid sceptics are wrong. Aid is essential.”

Jamie Drummond, executive director of the campaign group One, said: “David Cameron was right to identify trade and democracy as crucial pillars for development but he also recognises they are supported by smart strategic aid. Countries can only prosper if they have a healthy and educated workforce. We see this now as aid can help both get food aid through to those in desperate need, as well as help build up conditions whereby food aid won’t be needed in the future.”

So the pragmatic view based on solid analysis is that aid supports countries through tough times, helps them build up systems and expertise, and as soon as possible puts itself out of business. In fact, if there’s one thing that both the sceptics and those that support evidence-based spending on aid can agree on, it is that a world without aid is the ultimate goal.

Last night, with 120 days ticking before ballot boxes open in Liberia, the president set another ambitious target for her little country that could: She wants Liberia to wean itself off aid by the decade’s end.

“There’s no reason why we cannot build upon the successes of today to ensure that ten years from now, Liberia should no longer require foreign assistance,” she told a crowd of hundreds of Africa watchers in London.

It’s hard to under-state the importance of that goal. An aid-recipient state since 1819 when James Monroebankrolled its founding, Liberia has risen and fallen by the whims of donors, raking in 771 percent more aid than revenue in 2008.

…the ODI says; development works best when effective leadership, smart policies, strong institutional frameworks and international partnerships mesh. In those circumstances, it is possible to see “remarkable progress” even in countries that have been blighted by war or famine in the recent past.