What should we expect from the President’s 2013 assistance budget?

See below for a guest post from MFAN Principals John Norris, executive director of the Center for American Progress’ Sustainable Security and Peacebuilding initiative,  and Connie Veillette, director of the Center for Global Development’s Rethinking U.S. Foreign Assistance initiative.

It would be a mistake to think that the budget crisis has passed for America’s foreign assistance programs and institutions. Although the 2012 international affairs budget dodged the proverbial bullet, and the president’s 2013 budget request will likely be reasonably robust, this is all something of a mirage. The administration appears eager to keep its powder dry in advance of what will eventually be a high stakes showdown over sequestration at the end of the year, after considerable election-year dust has settled. The administration does not want to put significant assistance cuts or USAID Mission closures on the table now and give up that advantage later.

It is a reasonable negotiating strategy, although it may prove to be a poor management decision. Looking at our relative fiscal health as a country, it seems almost inescapable that eventually there will be steep cuts in our foreign affairs spending as part of some grand bargain (however begrudging) that includes both spending cuts and revenue increases. We will likely see few signs of this in the President’s budget request, which will  read very much as a status quo request where we see shifts in emphasis, but no dramatic headlines. For those of us who care about effective assistance programs and the health of the U.S. economy, this amounts to whistling past the graveyard and hoping for the best.

For those who care about selectivity and focus in our aid programs, the budget will likely be something of a disappointment. Officials at USAID have argued, including in this blog post, that they are being more selective and catalytic in their approach to assistance. These are important but insufficient steps. USAID continues to be spread too thinly across too many countries and over-represented in places like Latin America and Eastern Europe that should be on a faster track for graduation. USAID can only take a share of the blame for the slowness in adapting to new realities. Both Congress and the State Department have been slow to assent to USAID pulling up stakes in Latin America, and no ambassador ever likes to lose a USAID Mission under his or her general command.

These arguments may have been fairly esoteric during periods when the U.S. assistance budget was flush in the post-9/11 period. But if the administration is not more aggressive about putting money into fewer places where development is more likely to succeed in the immediate term, it could be left to deal with some wrenching and very disruptive changes when a top-line budget agreement is finally brokered.

As Connie noted in this recent post, U.S. economic assistance, including the major health, development, and humanitarian response accounts, goes to 102 countries.  One country – Afghanistan – accounts for about 10% of the total.  The top 15 recipients account for 40% of the total, leaving about $12 billion to be distributed to 88 countries. Very small sums are allocated for countries like Belize ($20,000) and Micronesia ($490,000), which begs the question of whether it costs more to administer the funds than the value of aid provided. Ambassadors argue that such aid buys political influence, but one is only left to wonder what exactly we as a country get from Micronesia on the political front that would not lead to the conclusion that this money is better spent on development programs that have a chance of securing real and lasting development progress in a higher priority country.

From all indications, we will see a real push in the budget to provide more support for the Arab Springcountries. How exactly this effort will be affected by the Egyptian government’s hidebound determination to shoot itself in the foot and prosecute American democracy activists remains to be seen. But if we are to glean any lessons from the disastrous assistance programs in Iraq, Afghanistan, and Pakistan over the last decade, it is that money should follow reform, not the other way around.

This is the year in which, more than any in recent memory, the wisdom behind our assistance will be judged most harshly.  The President’s budget should reflect an understanding that Congress will be scrutinizing aid partners, goals, and effectiveness, and that anything that doesn’t pass muster could drag the best of these programs down.


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