Ethiopia is one of the countries caught in the grip of the global hunger crisis.
A ride across Ethiopia’s vast countryside does not reveal the endless patches of parched earth that one might expect to see in a country struggling to feed its people. In many areas of the country, the soil is rich and farmers have a surplus of crops on their hands. Corn, the country’s principal cereal crop, grows as tall as anywhere in Iowa.
What one finds in Ethiopia that one doesn’t see in Iowa are broken road networks and no way to transport the food from crop-rich areas of the country to those where food is scarce. Ethiopia also has enough water to irrigate the entire country, but irrigation systems are expensive to build and the cash-strapped government does not have the capacity to build enough of them. Most farmers water their crops the way their ancestors did a millennium ago, by waiting for the rains to come—rains that are more erratic in the new millennium due to the vagaries of climate change.
All roads in Ethiopia lead to Addis Ababa, the bustling capital where antiquity meets modernity at almost every intersection. Herders with their livestock walk down city streets as buses careen around corners with American pop music blaring from the windows. For urban poor people, many of whom have migrated from rural areas, the reality is that jobs are scarce and life is no easier.
In an unobtrusive glass building, the Ethiopia Commodity Exchange (ECX) is another example of where antiquity meets modernity. The ECX, which opened in April 2008, is attempting to provide Ethiopia’s 10 million small farmers, who produce 95 percent of the country’s crops, with more reliable information about prices and access to much broader markets for their products.
The ECX was started with $21 million, most of it provided by donors. Inside the ECX trading pit, where buyers and sellers gather to make deals, with electronic screens pulsing updates of commodity prices, one could forget that crops in this country mostly get to market on the backs of donkeys. “The biggest revolution of the exchange is that our farmers will start to think national and global instead of local,” the head of the ECX, Eleni Gabre-Mahdin, told the Wall Street Journal on the eve of its opening.1 Gabre-Madhin, a former World Bank economist, saw her country’s future on a visit to the Chicago Board of Trade. Just as the Chicago Board of Trade transformed U.S. agriculture, Gabre-Mahdin believes the ECX can do the same for Ethiopia’s. The country is Africa’s second-largest producer of corn, but only 30 percent of what is grown in Ethiopia gets to market. In a normal year, Ethiopia produces enough food to feed itself and more. But because of the impediments to internal marketing, like impassible roads, the country struggles annually with food shortages and regularly receives U.S. food aid.
From 2006 to 2008, U.S. food aid shipments to Ethiopia were worth $708.5 million.2 The United States also provides Ethiopia with development assistance, but in 2008 approximately 80 percent of U.S. poverty-focused development assistance—roughly $400 million—is going to fight HIV/AIDS. Only 6 percent supports agriculture programs.3
A country like Ethiopia, one near the bottom of the global Human Development Index, can and will develop if it gets the support it needs. To make the ECX pay off for small farmers, a lot still needs to happen: repairing the country’s infrastructure, recruiting technical expertise, and educating farmers about how to do business in a new way. These are not small steps, but in the long run they could reduce and eventually eliminate the need for those massive food aid shipments.
Addis is a long way from Chicago in many respects, but innovative development strategies have a knack for reducing the distances between vastly different countries. The United States benefits, as does the entire world, when a poor country like Ethiopia finds its own path to progress. In a troubled part of the world like the Horn of Africa, the ECX is a reminder that good things are also happening there, and that real progress on development is often closer than it appears.
Uses of Foreign Assistance
Dramatic spikes in food and energy prices and the escalating effects of climate change have heightened awareness of the plight of more than 1.4 billion people living in extreme poverty. In a little less than two years, the number of people in poverty has increased by a hundred million and the number who are hungry by 75 million.4 Getting by on a diet of basic staples, such as corn, rice, or sorghum (and very little else), poor families were spending half or more of their income on food even before the jump in food prices.
By any definition, an extra hundred million people plunged into poverty is a humanitarian emergency that demands an immediate response. Rich and poor countries as well as U.N. food agencies and international financial institutions such as the World Bank have all begun to mobilize, and the right response must go beyond simply providing food.
The global hunger crisis might have been averted by greater investments over the years in improving agricultural productivity in developing countries. Both intentionally and by default, rich countries, poor countries, and multilateral institutions made choices not to invest in agriculture. As we saw in Chapter 2, not investing development resources in agriculture is a sure way to miss the Millennium Development Goal (MDG) of cutting hunger in half. The vast majority of the world’s poor people live in rural areas and depend on agriculture either directly or indirectly for their livelihood.
The United States has always responded generously to emergencies and crises abroad (e.g. providing relief after the 2004 Indian Ocean tsunami), and our country continues to provide essential lifesaving humanitarian assistance. But equally important in responding to the global hunger crisis—and preventing it from happening again—is to refocus U.S. foreign assistance programs and provide better development assistance. U.S. development assistance could have taken a proactive, preventive approach over the years by addressing the root cause of the global hunger crisis—poverty.
Too much of the non-emergency assistance the United States gives is driven not by the goal of reducing poverty but by U.S. political and security objectives. These objectives may be important in their own right, but their pursuit does not always benefit poor people, and their effectiveness should not be judged as if that were their purpose. No one would argue that peace in the Middle East is unimportant, for example, but of the billions of dollars of assistance the United States has provided to Egypt, most has not been used to help the vast majority of Egyptians escape from grinding poverty.
U.S. foreign assistance has three main purposes: humanitarian, political, and development. Humanitarian assistance responds to natural and man-made disasters (e.g. the Indian Ocean tsunami) and ongoing crises like Darfur. U.S. national security interests drive much of the political aid (e.g. counter-narcotics in Latin America, peace in the Middle East, the war on terror, military training). Development assistance programs, designed to reduce poverty and encourage economic growth in low-income countries, include programs for agriculture, health, family planning, education, the environment, and democracy and governance. By and large, the development component of U.S. foreign assistance has been effective, particularly where there has been a long-term commitment of resources and a partnering relationship with the host government. South Korea and Taiwan, formerly recipients of large amounts of U.S. development assistance, are now economic powerhouses and partners in global security. India, another recipient of U.S. development assistance, has gone from chronic food deficits in the 1960s to food exports and sustained economic growth in recent decades. U.S. development assistance was instrumental in the eradication of smallpox. Through PEPFAR—the President’s Emergency Plan for AIDS Relief—the United States has placed more than two million people on lifesaving anti-retroviral medication. Despite these and other successes, in recent years U.S. development assistance has lacked a coherent strategy. Put simply, the overarching goals of U.S. development assistance are unclear. While UN agencies, multilateral agencies like the World Bank, and donor countries such as the United Kingdom have adopted the MDGs as the framework for their assistance, the United States has been reluctant to do so. Yet the MDGs are widely understood and accepted targets of human development—e.g. reducing the number of people in poverty, reducing mortality rates for children under five, increasing girls’ enrollment in school—and could serve as an unambiguous indicator of aid effectiveness.
By the same standard, non-emergency foreign assistance given primarily for political reasons should have its own measures of effectiveness. Have the billions of dollars in aid given to Egypt since the Camp David accords been effective? Maybe not by developmental standards. But absolutely if measured by the absence of war between Egypt and Israel. Much of the criticism of foreign assistance as ineffective and wasteful is because political and development goals are intermixed. Such confusion erodes public support for spending tax dollars on international development.
U.S. Prerogatives on Development
U.S. assistance to Pakistan is a good example of how conflating political and development goals undermines development efforts. Pakistan is an important ally of the United States in the war on terror, receiving a generous share of total U.S. foreign assistance. Non-military assistance to Pakistan has totaled almost $1.9 billion since 2001.5
Such a large amount of U.S. assistance since 2001 is consistent with the history of U.S. engagement with Pakistan. The early 1970s saw a relatively high level of U.S. assistance because the Nixon administration needed Pakistan as an intermediary for its China opening and a counter to Soviet influence in India. When the geopolitical need passed, assistance levels fell. U.S. assistance spiked again in the 1980s as Pakistan served as a base for efforts to oust the Soviets from neighboring Afghanistan. When the Soviets departed, U.S. assistance plummeted and dried up completely after Pakistan successfully tested a nuclear weapon in 1998. Now it’s back up. Although clearly a number of other factors have prevented Pakistan from making sustained progress on development, one contributing factor is the “on again, off again,” politically-based nature of U.S. assistance.
A comparison with Bangladesh, a much poorer country, makes the point about consistency very clearly. Both countries have enjoyed roughly similar rates of per capita economic growth (4.9 percent in Bangladesh vs. 4.1 percent in Pakistan during 2005-2006), but Pakistan’s infant mortality rate, 84 per thousand, is 60 percent higher.6 Pakistan’s rate of child malnutrition remained constant between 1990 and 2006, while Bangladesh reduced its rate by almost one-third. Bangladesh has more girls in school and a higher primary school completion rate.
Unlike in Pakistan, U.S. engagement in Bangladesh has been based almost entirely on a development rationale—reducing hunger and poverty by ensuring adequate health care and family planning services, improving access to education, increasing agricultural productivity, supporting rural infrastructure development, and promoting gender equity. The United States has maintained a stable, consistent development assistance program in Bangladesh virtually since the country’s independence in 1971. Assistance over the past 10 years has averaged $75 million annually and has never fallen below $23 million.
It is extremely difficult for assistance programs to make progress on development challenges in the absence of a long-term commitment, something that has largely been absent in Pakistan. Given the history of dramatic increases and cuts in U.S. assistance, all governed by political considerations, Pakistani policymakers and the public might well be justified in concluding that our “assistance” is really more about us than them.
Who Gets Assistance?
The largest recipients of U.S. foreign assistance tend to be countries where U.S. political interests are centered. Table 1 shows the top 10 recipients of U.S. assistance in fiscal year (FY) 2007, along with their per capita income and per capita assistance measured in dollars. One could certainly argue that Afghanistan, a desperately poor country, merits generous development assistance. But in spite of its poverty, Afghanistan was “off the radar screen” for foreign assistance until it became a security interest in 2001.
As shown in the table, Iraq reconstruction is a high priority. Sudan makes the top 10 primarily because of a massive humanitarian program underway there, but there are also U.S. political interests: the country is sitting on large oil reserves.
Forty-four percent of U.S. foreign assistance spending goes to just six countries, all allies in the war on terror or the war on drugs.7 The top 10 include some relatively high-income countries (Jordan, Egypt, Colombia).
Elevating national security to the top of the priority list skews foreign assistance in the direction of immediate crisis situations and/or governments that support U.S. security priorities. Development and poverty reduction are clearly not the main objectives.
Development Assistance: Background and Structure
U.S. foreign assistance in its current form dates back to the Foreign Assistance Act (FAA) of 1961. At the height of the Cold War, the Kennedy administration used the FAA to lay out U.S. national security and development objectives. In 1961, the nexus between security and development was viewed in simple terms: countries marked by poverty and hunger were breeding grounds for communism.
Development assistance gave the United States another foreign policy instrument to prove to countries on the fence that capitalism was superior to communism. Even in 1961, this was not a brand new way of thinking. This was a primary motivation for the U.S. reconstruction of most of Western Europe and Japan after World War II, and it paid off: U.S. development assistance created strong allies, thriving markets for American goods, and a broad reflection of our democratic ideals.
The FAA established the U.S. Agency for International Development (USAID) as the principal office to implement development assistance. USAID brought together disparate programs from various agencies and departments, with the U.S. State Department providing overall policy guidance. This structure remained largely intact through the end of the 1980s. In addition to USAID, the Peace Corps channeled the idealism of young Americans into the most remote areas in the world. Indeed, these were heady times for American idealism and America’s image abroad.
One of the main issues for U.S. development assistance through the 1960s and early 1970s was widespread fears of persistent famine in the developing countries of Asia. This led to the effort known as the Green Revolution, discussed in Chapter 2. Latin America presented a different set of challenges, Africa yet another, but wherever one turned, it was possible to find U.S. development assistance making a difference in the lives of poor people. In some cases, the United States supported countries headed by dictators or others with poor human rights records and weak accountability, and U.S. diplomats seemed to turn a blind eye to many of their unsavory practices, but U.S. development workers continued to have the respect of the people they served.
With the end of the Cold War came a new wave of U.S. assistance programs designed to support economic stabilization and democracy in Eastern Europe and the former Soviet Union. Once again, it made good sense to offer help to former enemies. These programs were implemented primarily by USAID but also by other departments and agencies. U.S. foreign policy—and thus development assistance—was entering a new age. Without the clear focus provided by the Cold War, development was being reinvented. The changes were reflected in a decline in funding, a preference for short-term reactive approaches, and a growing number of actors doing work that had formerly been under USAID jurisdiction.
This proliferation of actors doing work related to development has continued through the eight years of the George W. Bush administration. As Brookings Institution scholar Lael Brainard points out, there are now roughly 50 “foreign assistance objectives” and 20 U.S. departments that provide assistance (with many more agencies and fiefdoms within those organizations), resulting in an organizational chart of stunning complexity.11 The fragmentation of responsibility for development not only limits the effectiveness of assistance but also makes it extremely difficult for the United States to coordinate and collaborate with the rest of the donor community.
Because there is no single agency or person responsible for all U.S. development programming, it is unclear who speaks on behalf of U.S. development assistance. Is it the Secretary of State, the Administrator of USAID, the Global AIDS Coordinator (the head of the single largest U.S. government program), or the Treasury Secretary (who oversees U.S. relations with the World Bank)? Who represents the U.S. government in negotiations with other development agencies? The United States has agreed to work with other donors to achieve “more harmonized, transparent, and collectively effective” programs.12 But the prospects for doing this are remote if there is no way to determine basics like who is responsible for which development priorities.
Development Assistance at the Dawn of a New Century
After the terrorist attacks of September 11, 2001, the Bush administration articulated a national security policy that named development as one of its “3 Ds,” along with defense and diplomacy. Once again there was recognition that poverty and hunger are catalysts of instability. Overall foreign assistance funding more than doubled between 2001 and 2007. However, inserting development into a national security policy did not improve the structural problems noted above. Nor did it address the disproportionate focus on defense among the “3 Ds.” In fact, defense outweighs development in the federal budget by a staggering 50:1.13
9/11 showed Americans that we ignore failed states at our peril. In Afghanistan, for instance, the development challenges are daunting but the stakes couldn’t be higher. The dynamics are not the same as during the Cold War. The disaffected people that the United States needs to reach—for our own security—do not have another world power or economic model to turn to. Rather, resentment and bitterness boil over among people who have been spurned by global capitalism and shut out of the great growth in global wealth. They may feel as if the world does not respect them, treating their culture, politics, and economy as irrelevant. Fragile states, vulnerable to extremist ideologies, are the result. We understood this before 9/11, but many Americans didn’t see clearly how the consequences affect us until that tragic day.
Under the Bush administration, development has increasingly been seen through a military and security lens. This is sometimes referred to as the “securitization” of foreign assistance.14 For example, the U.S. Department of Defense (DOD) managed only 6 percent of U.S. development assistance in 2002—but more than 20 percent in 2007.15 While much of this increase is for operations in Afghanistan and Iraq, there are indications that DOD is also moving to fill what it sees as a vacuum in development activities in other countries deemed fragile or at risk. Most of these countries are in Africa. Here, DOD is carrying out activities that have traditionally been the responsibility of USAID, such as building schools, clinics, water systems, and roads.
Who is doing development work is not an insignificant matter. Given the history of many developing countries, the image of people in military uniforms coming into villages to build a well or extend a road does not always elicit trust or cooperation. Again, though, in many cases DOD is doing development work by default, in the absence of USAID capacity to take on these responsibilities. This has been pointed out by Defense Secretary Gates on several occasions, perhaps most notably in his remark that there are presently more musicians in military bands than foreign service officers in USAID and the Department of State.16 USAID has lost one-third of its Foreign Service officers in the past 10 years, meaning that its capacity for country-level analysis and collaborative work with host country institutions is vastly diminished. Such expertise takes years to develop, in addition to specialized training, and cannot simply be outsourced to contractors or conveyed in short training sessions.
While DOD is expanding its work in the traditional development arena, USAID programs appear to be increasingly driven by security concerns. As an indication of how entangled development and security have become, the Department of State/USAID Joint Strategic Plan FY 2007-12 defines Strategic Goal 1 as “Achieving Peace and Security,” and includes such strategic priorities as counterterrorism, weapons of mass destruction, security cooperation, conflict prevention, and transnational crime.17 All of these are important foreign policy objectives, but not what one would usually consider development. “Investing in People” and “Promoting Economic Growth and Prosperity,” the traditional goals of development, are relegated to Strategic Goals 3 and 4.
Two Steps Forward for Development—and for Global Security
The Bush administration has added two major new programs to the U.S. development assistance portfolio: The Millennium Challenge Account (MCA) and the President’s Emergency Plan for AIDS Relief (PEPFAR). These came in the wake of 9/11 and reflect the administration’s heightened awareness about the interconnectedness of poverty and global security.
In launching the MCA, the president explicitly made the connection between poverty and fighting terrorism: “We also work for prosperity and opportunity because they help defeat terror. Yet persistent poverty and oppression can lead to hopelessness and despair. And when governments fail to meet the most basic needs of the people, these failed states can become havens for terror.”18
Through PEPFAR, the United States has helped more than two million people, most of them in Africa, to get on lifesaving anti-retroviral medication. In Africa, neither the burden of HIV/AIDS nor the threat the disease poses to the stability of the continent can be overstated. The establishment of PEPFAR reflects the U.S. government’s recognition of the transnational threat posed by global pandemics. “The surest long-term strategy for addressing transnational threats is to promote the health, stability, and economic well-being of developing nations, and confronting HIV/AIDS is at the heart of this strategy,” explained Mark Dybul, U.S. Global AIDS Coordinator, in 2007 congressional testimony.19
The Millennium Challenge Account (MCA) is an innovative program and a pronounced break from the way the United States has traditionally provided development assistance. It is designed to respond to good governance, promote country “ownership” of projects, and ensure a reliable stream of funding for three to five years. The MCA meets most of the components of effective development assistance as discussed in Chapter 2, and which are so often lacking from other U.S. development programs. At a time when the MDGs and numerous independent studies of aid effectiveness call for greater country and local level “ownership” of foreign assistance, with the exception of the MCA, the U.S. government has been moving in the opposite direction.
Countries that receive MCA funding are selected based on a set of independently established social, economic and governance indicators. Those that meet the criteria are invited to submit proposals for major grants, or “compacts,” that are designed to have a transformative effect on reducing poverty. So far 16 countries have signed compacts and funding has averaged roughly $1.5 billion per year over the past four years.
A new organization, the Millennium Challenge Corporation (MCC), was established to run the program. MCC procedures call for proposals to be developed in consultation with civil society, including non-governmental organizations and the private sector. Upon approval, the recipient countries are then responsible for implementation. In return, the MCC demands greater accountability for achieving results.
This innovative program got off to a slow start, and the process of putting developing countries in the driver’s seat in planning and implementation is taking longer than originally anticipated. Despite delays, the MCA is being closely watched for its potential relevance as a new model for development assistance.
The President’s Emergency Plan for AIDS Relief (PEPFAR) was announced in the President’s 2003 State of the Union Address and enacted later that year. The initiative resulted in an increase in U.S. funding for international HIV/AIDS from $5 billion to $15 billion over five years, with a focus on 15 countries suffering high-infection rates. Most of the countries are in sub-Saharan Africa, but also includes programs in Haiti and Vietnam. PEPFAR, unlike other development assistance programs, is highly focused, with reliable funding, clear objectives and verifiable indicators of effectiveness (e.g., number of people receiving anti-retroviral therapy). PEPFAR is administered by a special Office of the Global AIDS Coordinator in the State Department.
The concern with PEPFAR is that its approach is overly narrow, and that in the Washington budget battles it has served to “crowd out” funding for other complementary programs, for example, economic development, water and sanitation (the absence of which claim many more lives each year than HIV/AIDS) or governance.
More and Better Development Assistance
The United States spent $21.753 billion on official development assistance in 2007, more than any other country in the world. When measured as a percentage of Gross National Product (GNP), however, the United States ranked second from the bottom among rich countries. The share of GNP spent on development assistance in 2007 was just 0.16 percent. U.S. official development assistance hovers around this level from year to year.
An increase in U.S. development assistance is essential to help meet the urgent needs of the poorest countries. Countries struggling with extreme poverty do not have the resources to adequately finance their own development. Around the world, U.S. development assistance has made a tremendous difference by helping to improve the lives of millions of people in poverty, and it can do still more good. Every dollar spent has the potential to go a long way. One well dug to provide clean drinking water to a village may cost a few hundred dollars, but the benefits far exceed that sum in terms of improving people’s health, increasing the productivity of workers, and allowing girls to attend school rather than walking hours each day to find other sources of water. The United States can’t end global poverty on its own, but it shouldn’t underestimate how much good it can do.
Just as important as more spending on development is better spending. Naturally, it makes sense to focus on doing a better job with the resources we have. But what does “better” development assistance mean? One key element is allowing developing countries to have more of a say in how U.S. assistance is used. Currently, priorities are largely determined in Washington rather than through dialogue with the recipient countries. When given the opportunity to express their own development priorities, poor countries almost invariably opt to put resources into agriculture and infrastructure.
Dictating program priorities from Washington runs counter to what we know about how to deliver effective assistance (see pp. 50-52). “We know what’s best for you” doesn’t help countries move toward self-reliant, sustainable progress on hunger and poverty. Ensuring that recipient countries can participate in deciding where and how their assistance is used will get better results.
It is understandable that U.S. policymakers and the public worry about corrupt governments absconding with resources meant to help poor people. But there is little chance of this happening the way U.S. assistance is currently administered: project-focused (e.g. building a school, providing HIV drugs) and implemented through contractors, international nongovernmental organizations (NGOs) such as CARE, Catholic Relief Services and World Vision, or the many qualified local NGOs that have been equally well vetted. Recipient governments are generally not involved, except that they are expected to guarantee sustainability once the NGOs step aside. Cutting out the host country at the start may help ensure that corruption is minimized, but also makes it difficult, if not impossible, to achieve sustainability and scale up successful development projects.
Working with and through governments, while it can be more time-consuming and difficult to coordinate, is much more effective in building up needed capacity and ensuring that the results are greater than the sum of individual efforts. Of course there will be exceptions—for example, countries with urgent humanitarian needs whose governments have indeed proven corrupt. But by and large, full consultation and participation of host governments should be the goal.
Better assistance also means accepting more flexible uses of resources. U.S. development assistance is structured to address specific issues and accomplish projects with set parameters, so budget accounts are set up to channel program funds into specific line items. Examples of these accounts are Food Aid, MCA, PEPFAR, and Child Survival and Health. The rules are rigid: once money goes into the PEPFAR account, for example, it can only be used for expenditures that fit the PEPFAR criteria for fighting HIV/AIDS. PEPFAR does good work, but one of its shortcomings is this lack of flexibility. As one doctor explained, “Once we get people on medicine, we’re able to get them out of bed and back on their feet. But soon we realize they haven’t got any food, and the success of the drugs depends on good nutrition. We do what we can to get them some food, but then we realize they haven’t got any income to purchase food on their own.” In a perfect world of development assistance, there would be programs with the mandate and resources to work with people with AIDS to help them earn income to buy food and other necessities. But this isn’t the case: right now, PEPFAR funding dwarfs all other development accounts. We could simply lament the lack of money for nutrition assistance and income-generation activities, or we could press for U.S. development assistance programs to become more flexible. HIV/AIDS is incontrovertibly a serious threat in Africa and around the world. But treating it strictly as a health problem misses its multiplicity of impacts.
Throughout this chapter we’ve been using the term development assistance broadly to describe the breadth of U.S. development programs, but Development Assistance is also a specific account in the budget, a catchall that may be used for a range of issues, including agriculture. The problem is that the funds in the Development Assistance account are completely inadequate for the task of promoting broad-based, sustainable development.
The Development Assistance account has been hobbled by indiscriminate earmarking by members of Congress. Earmarks are used to direct assistance to specific programs or countries. They turn the budget process into a struggle over which program or country can get the biggest and strongest earmarks. The earmarks are invariably well-intentioned and perhaps individually justifiable. No one would argue that assistance for potable water, microfinance, childhood immunization, women’s education, or biodiversity is not worthwhile. But there is an “opportunity cost” to every earmark. Because the Development Assistance account is so limited, mandating more funding for microfinance, for example, means that other worthwhile programs have to make do with less. Thus, earmarks interfere with implementing a coherent strategy for development assistance, with competing needs and priorities taken into account.
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A Model for a U.S. Department of Development
In 1997, the incoming Labor government in the United Kingdom (UK) established a new, cabinet-level Department for International Development (DFID), with responsibility for all aspects of UK development policy under the leadership of a designated cabinet minister. DFID’s status as a full member of the cabinet ensures that development issues are considered in the formulation of other policies. Where and how UK development funds are disbursed is now entirely the responsibility of DFID.
By law, all UK development assistance must either further sustainable development or promote the welfare of people and contribute to the reduction of poverty. Political and economic considerations are not part of DFID’s decision-making. Instead, the MDGs figure prominently as an organizing framework for country and regional programming. Currently, 90 percent of DFID funding is spent in poor countries.
All U.K. development assistance is now “untied” and non-earmarked. This gives DFID an extraordinary amount of flexibility. For instance, when procuring food aid, DFID can buy food from sources much closer to the country where it is needed—delivering the food more quickly and cheaply while benefiting the food-supplying country as well. The contrast with the United States couldn’t be starker: almost all U.S. food aid must be purchased in the United States and delivered on U.S.-flagged ships. In some cases, this slows the delivery time to countries facing hunger emergencies by months.
DFID has the authority to channel its funds through other donors, thus eliminating the need for maintaining an in-country presence in every sector. For instance, if DFID and another donor are pursuing complementary programs in the same country, DFID is able to pool its funds with the other’s resources, reducing duplication and demands on the time of development workers on the ground. Meeting the reporting requirements of multiple donors is often a heavy burden for recipient countries. In Vietnam, for instance, officials held 791 donor meetings in 2005 alone, more than two per day, all requiring time that could have been spent on development work.20
The development/security nexus is addressed through other consultative mechanisms. There are pooled funds for specific issues, such as a conflict prevention fund jointly controlled by Defense, the Foreign Office, and DFID, in which all parties have a say in how the funds are disbursed. This guarantees that the development voice gets heard. In the United States, by contrast, there are inter-agency consultative mechanisms, but funds are channeled though specific agencies and departments. There is no way, for instance, to compel the Defense Department to respond to development concerns.
Though challenges remain, DFID is now widely praised as one of the world’s best-run and most focused and capable development agencies. Both developing and donor countries look to it as a model of effective aid administration.
Elevating Development to be a Primary Goal of Foreign Assistance
The challenges of the 21st centry argue for a fresh approach to U.S. foreign assistance. To achieve this, Congress and the new administration should consider establishing a new cabinet-level department for global development. A department that draws in all of the development assistance programs currently scattered throughout the government bureaucracy would produce a greater degree of policy and program consistency, and ensure that the development voice is heard at the highest level of foreign policy deliberation.
As more than one observer has noted, “Just as there can be no development without security, there can be no security without development.” Development assistance needs to be a national priority, receiving more than lip service alongside defense and diplomacy. As long as poverty and hunger persist, peace and security are tenuous. Effective development assistance that enables poor people around the world to escape debilitating malnutrition, illiteracy, and disease should be a component of a sophisticated national security strategy.
Elevating development as suggested here would be a vital step forward for the United States in responding more effectively to global hunger and poverty. Making a serious effort to address the root causes of persistent poverty is not only the right thing to do but would improve the United States’ international standing and advance U.S. national interests by improving security around the world. Development assistance must be focused on poverty reduction, with resources equal to the task.
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