Reforming Foreign Assistance
The Washington Post
Tuesday, January 3, 2006; A16
THE BUSH administration has done more to expand foreign assistance than any administration since John F. Kennedy's. According to the measures used by the Organization for Economic Cooperation and Development, U.S. government aid came to more than $19 billion in 2004, nearly double what it was in 2000. But the government's competence in dispensing this aid is questionable, and the Bush administration knows it. The president's team deserves support from Congress in its efforts to improve aid's efficacy. Unfortunately, it may come up against suspicion and resistance fueled by self-interest.
The core problem in foreign aid is to strike a balance between legitimate oversight of how tax dollars are spent and counterproductive overregulation. In the 1980s a congressional backlash against corruption in aid triggered an increase in Washington oversight that went too far, causing a new form of waste more pernicious than the old sort. Because some aid money routed through government ministries in poor countries had gone astray, Congress insisted that future aid be routed through nongovernmental organizations with good accounting capabilities. In practice, this meant the money went to U.S.-based groups with high overheads. Many did good work, but their costs exceeded those of ministries and aid groups in the developing world, even allowing for some corruption. Moreover, the reliance on U.S. organizations undermined poor countries' sense of ownership of their development programs, damaging the long-term struggle to foster self-sufficiency.
This error led directly to a second one. Having decided to route aid money through U.S.-based groups, Congress began to micromanage how that money would be spent, depriving recipient countries not only of managerial control but also of a say in their own development priorities. The new cohort of U.S.-based aid contractors encouraged this process by lobbying Congress to protect their programs with budget earmarks; this undermined the priority-setting power of the administration as well as of recipient countries. The result was an aid program not only high on contractors' head-office costs but also low on flexibility. As if to parody its own mania for control, Congress went so far as to mandate that U.S.-financed building in developing countries should comply with the Americans With Disabilities Act. The result is that remote clinics in Afghanistan have wheelchair ramps; never mind that there are no wheelchairs in the vicinity.
This mess was compounded by a final mistake during the 1990s. Faced with a Congress that had grown more skeptical of aid even as it had seized minute control over its disbursement, the Clinton administration smuggled foreign-assistance cash into other parts of the federal budget. The result is a U.S. aid program that's split among more than a dozen spending accounts, some of which duplicate efforts and some of which may even work at cross-purposes.
Secretary of State Condoleezza Rice wants to rationalize this situation. Her team talks mainly about setting priorities for aid rather than letting a patchwork of earmarks and scattered spending accounts putter along without central coordination, but Andrew S. Natsios, the outgoing administrator of the U.S. Agency for International Development, is also eloquent on the case for local ownership of aid programs. The administration should be encouraged to turn its tentative discussions into a robust reform initiative. But already there have been complaints that the administration is trying to "politicize" U.S. assistance by asserting State Department control -- an odd objection considering how political aid is already. These suspicions of politicization are likely to be compounded by obstruction from U.S.-based aid contractors, who will resent a threat to their earmarks. This resistance must be understood for what it is: special-interest lobbying that hardly serves the interests of poor countries.
Tuesday, January 3, 2006; A16
THE BUSH administration has done more to expand foreign assistance than any administration since John F. Kennedy's. According to the measures used by the Organization for Economic Cooperation and Development, U.S. government aid came to more than $19 billion in 2004, nearly double what it was in 2000. But the government's competence in dispensing this aid is questionable, and the Bush administration knows it. The president's team deserves support from Congress in its efforts to improve aid's efficacy. Unfortunately, it may come up against suspicion and resistance fueled by self-interest.
The core problem in foreign aid is to strike a balance between legitimate oversight of how tax dollars are spent and counterproductive overregulation. In the 1980s a congressional backlash against corruption in aid triggered an increase in Washington oversight that went too far, causing a new form of waste more pernicious than the old sort. Because some aid money routed through government ministries in poor countries had gone astray, Congress insisted that future aid be routed through nongovernmental organizations with good accounting capabilities. In practice, this meant the money went to U.S.-based groups with high overheads. Many did good work, but their costs exceeded those of ministries and aid groups in the developing world, even allowing for some corruption. Moreover, the reliance on U.S. organizations undermined poor countries' sense of ownership of their development programs, damaging the long-term struggle to foster self-sufficiency.
This error led directly to a second one. Having decided to route aid money through U.S.-based groups, Congress began to micromanage how that money would be spent, depriving recipient countries not only of managerial control but also of a say in their own development priorities. The new cohort of U.S.-based aid contractors encouraged this process by lobbying Congress to protect their programs with budget earmarks; this undermined the priority-setting power of the administration as well as of recipient countries. The result was an aid program not only high on contractors' head-office costs but also low on flexibility. As if to parody its own mania for control, Congress went so far as to mandate that U.S.-financed building in developing countries should comply with the Americans With Disabilities Act. The result is that remote clinics in Afghanistan have wheelchair ramps; never mind that there are no wheelchairs in the vicinity.
This mess was compounded by a final mistake during the 1990s. Faced with a Congress that had grown more skeptical of aid even as it had seized minute control over its disbursement, the Clinton administration smuggled foreign-assistance cash into other parts of the federal budget. The result is a U.S. aid program that's split among more than a dozen spending accounts, some of which duplicate efforts and some of which may even work at cross-purposes.
Secretary of State Condoleezza Rice wants to rationalize this situation. Her team talks mainly about setting priorities for aid rather than letting a patchwork of earmarks and scattered spending accounts putter along without central coordination, but Andrew S. Natsios, the outgoing administrator of the U.S. Agency for International Development, is also eloquent on the case for local ownership of aid programs. The administration should be encouraged to turn its tentative discussions into a robust reform initiative. But already there have been complaints that the administration is trying to "politicize" U.S. assistance by asserting State Department control -- an odd objection considering how political aid is already. These suspicions of politicization are likely to be compounded by obstruction from U.S.-based aid contractors, who will resent a threat to their earmarks. This resistance must be understood for what it is: special-interest lobbying that hardly serves the interests of poor countries.
posted by Hanan Elbadry at 10:31 AM
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