foreign aid

1. Why does the U.S. give foreign aid?

The U.S. gives aid for several reasons: economic interests, national security and American values. Economically, aid builds trading partners and supports the demand for U.S. goods. For national security, U.S. aid can sustain efforts to reduce injustice and poverty, which can contribute to instability and social tensions. Providing aid can also validate the kindness of the American people, advance democracy and human rights and build a better world.

2. What types of U.S. assistance does foreign aid include?

Foreign aid is a very comprehensive term. It incorporates several types of assistance, from the international affairs budget to poverty-focused assistance. The international affairs budget includes the resources to finance U.S. endeavors abroad. For example, it provides funds for USAID and the Department of State’s diplomatic costs and expenses that are sustained in protecting the interests of U.S. citizens and businesses abroad. In addition to helping people in poor countries, foreign aid provides money to allies for strategic purposes. Poverty-focused assistance concentrates on promoting economic growth and providing services like education and health care.

3. How much does the U.S. government spend on poverty-reducing foreign aid?

The U.S. government spends around $80 per taxpayer on foreign aid. To put that into perspective, compare that number to what Americans spend on other items: $204 per person on soft drinks, the $126 per person on lawn care and $101 per person on candy.

4. What is Americans’ understanding of how much the U.S. spends on foreign aid?

Americans think the U.S. spends more money on foreign aid than Medicare and Social Security – as much as 30 percent. However, only 0.7 percent of the U.S. federal budget is spent on poverty-focused foreign aid.

5. How can we ensure development aid is not wasted by corrupt governments?

Most poverty-reducing foreign aid is not actually provided directly to foreign governments. Around 85 percent goes through NGOs and U.S.-based government contractors. Foreign aid may actually force governments to increase transparency and accountability.

6. What is the U.S. doing to make foreign aid more effective?

The U.S. is doing many things to make foreign aid more efficient, such as defining aid’s purpose, modernizing USAID, developing new models of providing aid and making foreign aid more transparent. In 2010, President Obama put forth the first U.S. Global Development Policy which clarifies that the main purpose of U.S. development aid is to pursue global economic growth to fight global poverty. For modernizing USAID, USAID Forward is a new reform agenda that is working to make USAID more efficient, transparent and accountable. President Bush introduced the Millennium Challenge Corporation (MCC) during his presidency. MCC is a “United States foreign aid agency that is applying a new philosophy towards foreign aid.” The MCC model demands that countries to meet criteria in three areas: investments in people, economic freedom and good governance.

7. How can the U.S. improve foreign aid to better fight poverty?

There are a few ways. The United States could focus aid more on combating poverty worldwide, provide more transparent information about their foreign aid and give more aid to effective local leaders.

– Colleen Moore

Sources: Alliance for Peace Building, Oxfam America, The Borgen Project
Photo: The Spectator