August 2008: Ask your representative to cosponsor House Resolution 1268 to reform foreign aid
America’s foreign assistance could be addressing today’s global poverty challenges much more effectively and efficiently. Aid programs often lack bold, measurable outcomes and are not guided by a coherent global development strategy focused on poverty alleviation. Requiring development aid to be spent on U.S. products and services and failure to invest in cost-effective, local capacity building undermine U.S. leverage and impact. Inadequate tracking and evaluation limit the opportunities to build on success and learn from failure. And the amount and allocation of aid dollars does not reflect a clear priority to fight poverty and achieve the Millennium Development Goals, which the U.S. committed to in 2000. Reforming U.S. foreign assistance programs will require the political commitment of a new presidential administration and bipartisan support in Congress. Representative Howard Berman (D-CA), the chairman of the House Committee on Foreign Affairs, has stated his intent to rewrite the Foreign Assistance Act of 1961, the body of law governing foreign aid programs. In a committee hearing on foreign aid reform, Rep. Berman stated, “I strongly believe that America’s foreign assistance program is not in need of some minor changes, but, rather, it needs to be reinvented and retooled in order to respond to the significant challenges our country and the world faces in the twenty-first century.” The long road to meaningful foreign aid reform will not be easy. The first steps need to be taken now to let members of Congress know this should be a priority for their legislative agenda next year. To galvanize political commitment, members of the House of Representatives have introduced a resolution capturing the broad consensus that foreign aid, as currently structured, is ill-equipped to fight global poverty, and must be reformed. Ask your representative to cosponsor H.Res.1268 and help build Congress’ commitment to reform foreign aid!
Principles for Foreign Aid ReformFocus on Fighting Poverty Foreign assistance should maintain a clear focus on fighting poverty, rather than myriad goals. Only about half of U.S. development assistance is primarily for the purpose of reducing poverty.[2] Much of U.S. assistance is directed to strategic allies for political reasons, regardless of their economic and social need. The U.S. directs a total of just 5 percent of its foreign aid to the world’s 10 poorest countries combined.[3] A focus on poverty means not only directing aid to the poorest countries, but helping the poorest and most vulnerable people within those countries. Fees charged for school and health services are a major obstacle for the very poorest families who cannot afford to pay them. In Kenya, the elimination of school fees brought over a million more kids into the school system almost overnight, many of them girls and children orphaned by AIDS. In Africa, an estimated 285,000 children’s lives could be saved each year by eliminating health care user fees.[4] Reform efforts should ensure that the U.S. targets the biggest barriers to ending the cycle of poverty — barriers that trap the very poorest. Maximize Effectiveness through Multilateral Funding and Local Capacity The U.S. should increase aid through multilateral funding mechanisms, which currently account for about 18 percent of U.S. foreign assistance.[5] Contributions through multilateral channels, such as the Global Fund to Fight AIDS, Tuberculosis and Malaria, allow for greater coordination and help the U.S. leverage commitments from other donor countries. Pooled funding also reduces the burden on recipient countries by streamlining the process for receiving assistance and minimizing the number of different donors to which they must report. The U.S. should also “untie” its aid, meaning eliminate requirements that aid must be spent on U.S. goods and services. Many donor countries are moving to untie their aid, but the U.S. continues this inefficient practice. While the average donor country provides 82 percent its aid untied, the U.S. provides a paltry 7 percent of its assistance without burdensome “buy America” restrictions.[6] Tied aid limits opportunities to build local capacity, and erodes the value of each foreign aid dollar. U.S. food aid — almost all of which must be purchased from domestic suppliers and transported on U.S. ships — is perhaps the most egregious example of tied aid. The GAO found that these restrictions resulted in long delays in food delivery, and 65 percent of food aid being spent on “non-commodity expenses” like transportation and processing, rather than actual food.[7] This situation will only worsen with rising fuel costs. Untying our aid will stretch our foreign assistance dollars. Demand Accountability for Specific, Measurable Achievements Even when aid is well intended, funding will not be used effectively unless clear, measurable outcomes are established. In 2004 and 2005, the U.S. allocated $675 million for maternal and child health programs. However, in a review of those programs, the U.S. Agency for International Development (USAID) was unable to track precisely where and how the funds were spent.[8] Between 2001 and 2006, $2.3 billion was allocated for basic education in developing countries, but the actual impact on children’s learning was not measured.[9] The result of unclear objectives and poor monitoring systems is that aid programs are difficult to evaluate. Without a clear picture of what’s working and what’s not, it is difficult to improve programs and make them more effective. The lack of transparency and accountability also undermines public and congressional confidence in foreign aid, jeopardizing support for badly needed funding. Regular reporting of progress against clear objectives will help keep aid programs on track. Provide Our Fair Share to Meet Global Goals The U.S. should provide a level of development assistance that reflects a clear priority to achieve the Millennium Development Goals. Despite repeated commitments by donor countries to direct at least 0.7 percent of their total economic production to global development, the U.S. spends just 0.16 percent of GNP (Gross National Product) on foreign aid. Even when generous private donations are considered along with official development assistance, the U.S. ranks near the bottom in donor country contributions.[10] Foreign assistance should be commensurate with the challenges of global poverty. [1] HELP Commission. Beyond Assistance: The HELP Commission Report on Foreign Assistance Reform. December 2007. [2] Lerner M, Uphaus C. Development assistance: Quantity and Quality. Bread for the World; 2006. http://www.bread.org/learn/background-papers/2006/Development-Assistance-Quantity-and-Quality.pdf [3] Oxfam America. Smart Development: Why US foreign aid demands major reform. February 2008. http://www.oxfamamerica.org/files/smart-development-may2008.pdf [4] Keith R, Shackelton P. Paying with their Lives: The cost of illness for children in Africa. 2006. http://www.savethechildren.org.uk/en/docs/paying_with_their_lives.pdf [5] HELP Commission 2007. [6] Oxfam America 2008. [7] United States Government Accountability Office (GAO). Various Challenges Impede the Efficiency and Effectiveness of U.S. Food Aid. April 2007. http://www.gao.gov/new.items/d07560.pdf [8] United States Government Accountability Office (GAO). Global Health: USAID Supported a Wide Range of Child and Maternal Health Activities, but Lacked Detailed Spending Data and a Proven Method for Sharing Best Practices. April 2007. http://www.gao.gov/new.items/d07486.pdf [9] United States Government Accountability Office (GAO). Foreign Assistance: Enhanced Coordination and Better Methods to Assess the Results of U.S. International Assistance for Basic Education. March 2007. http://www.gao.gov/new.items/d07523.pdf [10] Hindrey L. Testimony before the Senate Committee on Homeland Security and Governmental Affairs. July 2008. http://hsgac.senate.gov/public/_files/HinderyTestimony073108.pdf |