Foreign aid is too often misidentified as charity, with the implication of a one-way relationship. Like other myths surrounding aid, such as its depletion of the federal budget, a reality much different than popular belief silently survives. In truth, only one percent of the U.S. federal budget goes toward foreign aid and shrouded in much the same circumstances lies the fact that foreign aid gives back just as much, and more.
Who Gives to Whom?
According to an article by Jason Hickel, Global Financial Integrity (GFI) and the Centre for Applied Research at the Norwegian School of Economics completed a study in which they found that a much larger amount of money travels from poor countries to rich countries, rather than the other way around. As of 2015, cumulative foreign investment in the U.S. totaled more than $3 trillion.
Beyond the quantitative, the proof of return on investment manifests in countries like South Korea, Japan and Germany. All having once depended on U.S. aid in their times of need, these nations now play major roles in the global economy.
How Foreign Aid Gives Back to Developed Nations
Consider the fact that half of U.S. exports now go to developing countries and that developing countries’ economies grow three times faster than our own. The economics speak for themselves—with more new consumers to trade and do business with, more growth opportunities arise both at home and abroad. In Tennessee alone, more than 22 percent of jobs are supported by trade—that’s 830,000 reasons to continue investing in developing nations.
Beyond the wallet, though, foreign aid gives back in ways that cannot be measured. Potential new markets keep the U.S. competitive on the world stage, allowing its reputation and influence to spread. As Bill Gates points out, foreign aid even helps to keep the U.S. safe. By its nature, aid fights poverty, promotes development and largely focuses on foundational areas like healthcare, nutrition and education, which provide for a strong infrastructure.
The ultimate goal of this infrastructure-building rests in the ability to form a middle class, and by extension, find some stability. Countries that achieve this are more capable of preventing global health epidemics and are less likely to go to war. Stabilizing these nations by promoting democracy and human rights and by helping to install strong governance has far-reaching effects.
What Drawbacks Exist for Foreign Aid?
While some would argue that corruption and misuse of aid render the process futile, the results drown out the argument. Programs are in place to fight against this kind of criminality and are finding success. Foreign aid gives back in ways never thought of before now, such as:
- Stopping diseases before they gain global reach.
- Promoting U.S. exports.
- Countering violent extremism.
- Combating climate change through education.
- Supporting overseas embassies and new allies.
Foreign aid gives back despite the stigma that claims otherwise. Experts say that cutting the U.S. foreign aid budget would do very little to reduce the federal deficit anyway. If the strongest argument against the use of foreign aid remains money, then it is time to take out the wallet and make a change.
– Daniel Staesser