Who Needs Foreign Aid?

November 2002
Lochrane A. Gary - Hardee County Extension, Director/Livestock Agent

The United States has a long history of extending a helping hand to those people overseas struggling to make a better life, recover from a disaster or striving to live in a free and democratic country. It is this caring that stands as a hallmark of the United States around the world - and shows the world our true character as a nation.

U.S. foreign assistance has always had the two-fold purpose of furthering America's foreign policy interests in expanding democracy. Since 1961, the U.S. Agency for International Development (USAID) has implemented America's foreign aid programs. Spending less than ½ of 1 percent of the federal budget, USAID works to promote democracy, free markets and America's foreign policy objectives around the globe.

Every president since World War II, both Democrat and Republican, has strongly endorsed foreign aid. Over the years, ten high-level national commissions set up by the White House or by Congress to review the program have given it solid backing. What has been clear to these experts is that foreign assistance programs are an investment, and that these programs benefit every American.

Most polls indicate that American's think that foreign assistance programs are the single largest item in the federal budget and make up close to 20% of total government spending. The reality is far different: Economic and humanitarian assistance abroad makes up less than ½ of 1 percent of the federal budget.

When told the actual percentage of the budget spent of foreign assistance, an overwhelming majority of Americans say that those spending levels should be maintained or increased. The foreign assistance program is a sound investment in creating the markets of the future, preventing crises and helping advance democracy and prosperity. Foreign aid creates U.S. jobs and advances American economic well- being. It is far less expensive for the United States to carry out development programs that prevent crises than to pay the costs of military operations, peace keeping efforts and emergency humanitarian relief.

What is USAID?

USAID is an independent government agency based in Washington, DC, with field missions abroad. USAID staff work with teachers, farmers, small business people, nurses and other members of the local community in four regions of the world; Africa, Asia and the Near East, Latin American and the Caribbean, and Central and Eastern Europe and the New Independent States of the former Soviet Union.

Close to eighty percent of USAID's grants and contracts go directly to American firms and non-governmental organizations.

Two such firms with which I have had experience include Land O' Lakes International Division and Winrock International. These two firms have recruited me as a volunteer through the Farmer to Farmer Program where I have been privileged to serve as a Livestock Consultant on five volunteer assignments.

Development is Good Business

Economic and humanitarian assistance programs constitute a critical investment in the future of the American economy. Like any investment, we shouldn't simply look at the cost of foreign assistance; we should also look at the returns. During the last two years, American exports to developing countries have represented nearly 40% of total U.S. exports.

Productivity growth in developing nations contributes to the economic development of those nations, which, in turn, stimulates imports of a wide range or products, including agricultural commodities. Poor countries are poor customers; countries moving up the development ladder are much better customers.

Investments in foreign assistance by the United States have often resulted in a huge payoff in terms of creating export markets for U.S. goods and services. For example, we now export more to South Korea in just one year than we ever gave to that country in foreign assistance during the 1960's and 1970's.

Advancing Democracy

Because democratic regimes contribute to peace and security in the world and because democracy and respect for human rights coincide with fundamental American values, the promotion of democracy has been a primary objective of U.S. foreign policy. Foreign assistance is a natural vehicle for achieving this goal. Democratization is an essential part of sustainable development because it facilitates the protection of human rights. Faltering democracies and persistent oppression pose serious threats to the security of the United States. Stable democratic nations make the best trading partners and help promote international security. USAID is helping promote the democratic ideals that the United States has been built upon.

Protecting the Environment

Environmental problems increasingly threaten the economic and political interests of the United States and the world at large. America's own well being is directly threatened by world-wide environmental degradation. In the long run, we cannot escape the effects of global climate change, bio-diversity loss and natural resource depletion.

USAID-sponsored energy efficiency experts working in Almaty, Kazakhstan, helped local officials put in place improved systems that drastically reduced pollution and led to more than a million barrels of fuel oil being saved in just a three month period.

Common Misconceptions

Despite the good work America's foreign assistance programs do around the world, these programs have often been misunderstood by the American public. Many American's think that foreign aid makes up a larger part of the federal budget than defense spending or social security. Economic and humanitarian assistance abroad amounts to only ½ of 1 percent of the federal budget.

Consider these statistics:

  • The US foreign aid budget as a percentage of the U.S. gross domestic product is .117%, the lowest percentage of the U.S. GDP in history.
  • In terms of gross national product, the United States provides the least foreign assistance of any major industrialized nation.
  • U.S. foreign assistance programs are at the lowest levels, in real dollar terms, that they have been in over 50 years.

The United States has come to realize that the price of peace and stability is far less than the cost of war and reconstruction. Development is an investment in America's future and a better world.

cows
Peasant girl milking family camel, in Qyzylorda, Kazakhstan.

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