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USAID Fights Poverty, Addresses Criticism

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For over fifty years, USAID has been addressing the needs of those living in extreme poverty overseas, promoting stable, self-sustaining democracies and advancing security and prosperity on a global scale.

Founded by President John F. Kennedy in 1961, USAID, or United States Agency for International Development, works in over 100 countries to address a wide array of prosperity goals. These include advancing food security and agriculture, improving global health, providing humanitarian assistance and protecting human rights, among other objectives.

Despite its humanitarian efforts, USAID has garnered some criticism over the past few years. First and foremost, critics and watchdogs have claimed that USAID policies and actions are often more focused on advancing U.S. policy interests than global humanitarian interests.

In particular, a 2010 study by two Harvard and Yale economics professors found that the size of U.S. food aid shipments are determined more by the size of U.S. crops than they are by recipient need. Moreover, the study found that about half of the funding for food aid was allocated for shipping, often for American cargo ships.

Additionally, a 2012 study by the Center for Economic and Policy Research examined contracts issued by USAID for the 2010 relief effort in Haiti. It found that only .02 percent of these contracts went directly to local Haitian firms, while over 75 percent of the contracts went to American firms. One of these firms has received up to $173.7 million from USAID since the Haitian earthquake. However, the data provided does not track local subcontracting and grant making, which may or may not be significant.

Amidst these and a variety of other allegations against USAID involving wasteful or misplaced spending, the U.S. government has made some concerted efforts in the past few years to reform USAID.

Beginning in 2010, President Obama and former Secretary of State Hillary Clinton launched USAID Forward, an ambitious reform effort aiming to increase USAID’s transparency and provide more efficient, effective service.

In particular, USAID Forward incorporates rigorous evaluations for each new program undertaken, investments in new innovations to aid in sustainable development, better risk assessment tools and transparent fiscal reports.

In addition, USAID Forward has significantly increased its public-private partnerships and is working more directly with local governments, the private sector, civil society and academia.

The Agricultural Reform, Food and Jobs Act of 2013, passed in early 2014, also included some major food aid reforms. Specifically, the bill placed greater emphasis on improving the nutritional quality of food aid products, ensured that sales of agricultural commodity donations do not adversely affect local markets and created a new local and regional purchase program, among other reforms.

The Obama Administration has additional food aid reform goals in mind, including reducing the volume of commodities subject to cargo preference legislation, increasing cash donations and “providing greater flexibility in procuring commodities in local and regional markets.”

– Katrina Beedy

Sources: USAID, Reuters 1, Reuters 2, FAS, Reuters 3, Hagstrom Report, CEPR, Business Week, GovTrack
Photo: Flickr

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For Agencies, Foreign Aid Transparency is Key

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The Obama Administration released data on United States foreign aid earlier this week while Congress is pushing legislation that will make such transparency law. These efforts seek to make aid more effective and to create a more open government. This is by no means, a recent occurrence.

For the past decade, the U.S. has moved toward making foreign aid accountable and transparent, which was started in 2004 with the creation of the Millennium Challenge Corporation. Initiated during the Bush Administration, it sought to generate publicly available data on foreign aid and selected which countries to give aid grants to based on how well they do in areas such as rule of law, trade policy and civil liberties.

USAID is revamping a self-audit program that seeks, in addition to being extensive and impartial, for the evaluations to be a spring of learning that the agency can build from. In this vein, they have named their first major series of evaluations USAID Forward.

The benefits of this transparency are multifold, but one of the major boons is that citizens have the ability to become better informed on what the government is doing to combat global poverty. This could do untold good since the majority of Americans vastly overestimate the amount that the United States contributes to foreign aid. The general public believes the U.S. spends 25 percent of the Federal Budget on international aid, when, in actuality, expenditure is only a paltry 0.2 percent.

In the Philippines, the Department of Budget and Management launched the Foreign Aid Transparency Hub, anagrammed as FAiTH, which provides information on what is being done with the aid received in the aftermath of Typhoon Haiyan. This is likely in response to allegations of corruption scandals in relation to foreign aid.

The accountability of aid is a high priority, and Benigno Aquino III, President of the Philippines, says that this accountability stems from gratitude: “Ultimately, FAiTH is more than a hub of information: it is an expression of appreciation for the kindness of those who stand in solidarity with our countrymen.” The pair of accountability and appreciation seems a strong one in winning further donations.

With 3,976 people dead, 1,600 missing, and another 4 million displaced and in need of basic amenities, there is great need for aid. More than $270 million has been donated thus far, and FAiTH is helping ensure further aid does not diminish amid the graft. An oft-used excuse for not donating is that the money never makes its way to those in need. Transparency is an active foe to this pernicious way of thinking, and one that is dramatically making ground.

– Jordan Schunk 

Sources: Brookings, Ingram and Adams, Huffington Post, Inquirer News

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USAID Increases Attempts To Put Itself Out Of Business

USAID Increases Attempts To Put Itself Out Of BusinessUSAID holds a unique position in that its main objective is to put itself out of business. In order to achieve this goal, USAID established USAID Forward.

Shortly after Rajiv Shah became president of USAID in 2009, USAID Forward was created. USAID Forward is a group of measures implemented to strengthen the effectiveness of the Agency’s performance in areas such as budget management, project implementation, and monitoring and evaluation.

Recently, USAID has issued a progress report and infographic containing the progress USAID Forward has made in maximizing transparency and delivering better results. This report not only catalogs the current progress being made but also hints at future developments and the future direction of USAID.

As an agency, USAID is moving away from establishing individual missions around the world and moving toward establishing partnerships with foreign nations. During the presidency of Rajiv Shah, USAID has cut its global footprint by 11 missions. Rather than establishing missions, USAID works to aid nations monetarily and help them establish a sustainable infrastructure created with its own people. This is a result-oriented tactic that centers around providing data and technical support as well as goal-oriented monetary aid with a focus on accountability.

USAID is one of the United States’ largest nonprofits and was established by President Kennedy in 1961. It is currently one of the largest nonprofits in the United States and operates directly under the guidance of the President of the United States and Secretary of State.

Despite the changes in strategy and tactics, the main goal of USAID remains the same: creating conditions where aid is no longer needed.

– Pete Grapentien

Source American Enterprise Institute