Developing strategies to end hunger
 

Foreign Assistance Myths and Reality

Most Americans believe foreign assistance comprises a much larger percentage of the federal budget than it actually does. What is your guess? Twenty percent? More? Less? In reality, poverty-focused development assistance (PFDA) comprises less than 1 percent of the budget. If you include all types of foreign assistance, the amount is slightly higher.

  FederalSpending_piechart

Few people understand what foreign assistance fully entails, and international issues are not often talked about during these tough financial times. But foreign assistance saves millions of lives and is an important component of U.S. national security.

PFDA programs were reduced by 7 percent in this year’s budget deal, and the House Budget Committee’s proposal would cut all categories of foreign assistance substantially by the year 2016. Some new members of Congress who arrived in Washington, DC, with a domestic economic focus support additional drastic cuts and the elimination of entire programs.

According to a recent editorial in The Washington Post by John Norris, there are a number of common misperceptions about the cost and effectiveness of foreign aid. He writes about some of the biggest myths about foreign assistance:

  • Republicans Hate Foreign Aid. Members of Congress have said it is harder to explain assistance to Ghana than assistance to grandma. But every Republican president since Dwight Eisenhower and a majority of Republican representatives and senators strongly support foreign assistance. From creating foreign aid legislation under Gerald Ford, to initiatives by Ronald Reagan to launch democracy programs, to George Bush’s global war on HIV/AIDS, these conservative leaders saw the importance of supporting overseas assistance.
  • Foreign Aid Costs Too Much. Americans think foreign aid costs more than our national defense, Social Security, Medicare, Medicaid, and domestic infrastructure projects. The amount the government spends on foreign assistance has remained steady at around 1 percent of the budget since the 1970s and has approached 5 percent only once, during the Johnson administration.
  • Foreign Aid Makes Countries Do As We Say. The desired outcome of foreign assistance programs is to build stable partners and reliable allies in the long term. The U.S. relationship with India during the Cold War and with Costa Rica during the 1980s was testy during the period when assistance was provided, but today these countries are strong regional allies, important trade partners, and stable democracies.
  • Foreign Governments Waste the Money We Give Them. Corruption is a serious concern in foreign assistance, but our own government’s inefficient policies are also contributing to waste.. For example, U.S. shipping requirements for food aid state that 75 percent of all food aid must be shipped on carriers registered in the United States. These requirements have cost American taxpayers $140 million in unnecessary transportation costs in a single year, according to the Government Accountability Office. During 2006-2008, where funding for food aid increased by more than 50 percent, actual shipped quantities declined by 5 percent because legislation required the use of American goods and services, instead of those that would maximize the amount of food aid provided.
  • Recipient Countries Never Graduate from U.S. Assistance. This claim has dogged the foreign assistance program for years, and yet Europe, Asia, and Latin America are full of countries whose economies have expanded to the point where they are viable and valued trading partners with the United States. According to the Commerce Department’s International Trade Commission, 10 of the 15 largest importers of U.S. goods and services are former foreign assistance recipients. Recent government initiatives such as the Millennium Challenge Corporation, which was established under the Bush administration, stipulate that recipient countries must meet requirements combating corruption, institute better governance practices, and tackle economic reforms in order to receive U.S. assistance.

Foreign aid is more than a line in the federal budget. It is an investment in the future—not entirely risk-free—that can eventually provide tremendous economic benefit. The United States needs to stay the course with this long-term investment, and improve successes by providing aid in the most efficient and practical ways possible.

A “dashboard” of U.S. foreign assistance funding allocations can be found here for information and resource purposes.

 

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