USAID Challenges Reflect Greater Problems at State

USAID Challenges Reflect Greater Problems at the State Department

By Matt Armstrong

Cross-posted at MountainRunner

A primary pillar of US engagement with the world in the modern era is foreign assistance. Institutionalized under the Marshall Plan and later the Foreign Assistance Act of 1961 that created the US Agency for International Development, development aid was and continues to be a means of denying ideological sanctuary to our adversaries that prey on poverty and despair as well as focusing on developing the capacity for self-governance through economic and other development.

In March 2008, General Anthony Zinni (ret.) and Admiral Leighton Smith (ret.) told Congress:

… the ‘enemies’ in the world today are actually conditions — poverty, infectious disease, political turmoil and corruption, environmental and energy challenges.

USAID’s mission today is as important as ever and yet it remains leaderless with declining morale and shrinking funds as increasingly America’s foreign development aid wears combat boots, just like its public diplomacy.

As a valuable resource in the struggle for minds and wills, it is not coincidental that what we call public diplomacy and foreign assistance have led parallel ups and downs. The January 1948 signing of the legislation authorizing America’s international information programs and expanding America’s educational and cultural exchanges was passed in a large part because of the Communist reaction to the declaration of what would become the Marshall Plan six months earlier. The decline (or even the temporary elimination) of foreign assistance in 1972 mirrors the decline in public diplomacy (e.g. Fulbright’s statement that the “Radios should take their rightful place in the graveyard of Cold War relics.”). Much like the meddling in the public diplomacy budget (while at $900b, over half supports exchanges and only a fraction of the remainder is discretionary), the foreign assistance budget is subject to Congressional earmarks that limit flexibility and effectiveness.

While everybody says development — like public diplomacy — is an imperative, little has been done to strengthen and empower the agency in charge. Also like public diplomacy, one of USAID’s problems is a lack of awareness within the US, including in Congress. At the Smith-Mundt Symposium, the Assistant Administrator for USAID remarked he had only $25k to inform the American public about what it was doing overseas. Perhaps the budget does not matter because AID “pays homage” to the same “firewall” that limits taxpayer and Congressional knowledge of public diplomacy. The result is not surprisingly a lack of understanding the effectiveness of AID.

Back in January 2009, Secretary Clinton vowed to make development once again one of the pillars of America’s engagement as she said it would be an “equal partner” with diplomacy and defense. The so-called “3-Ds” would need AID to be “strengthened”, “adequately funded”, and ultimately given leadership after a decade of neglect and intentional weakening under the previous Secretary.

Just as we’ve seen a militarization of public diplomacy in the absence of effective leadership and Congressional support, we have a militarization of development assistance. According to a CSIS report published June 2009:

…foreign assistance funds are more frequently being implemented by the military. The Pentagon now accounts for over 20 percent of U.S. Official Development Assistance (ODA). Between 1999 and 2005 the share of official development funds channeled through the Department of Defense increased from 3.5 percent to 21.7 percent. In that same period, U.S. Agency for International Development’s (USAID) share of ODA decreased from 65 percent to less than 40 percent of total American development funds.

The decline of USAID is more pronounced in terms of staff. The number of permanent American employees in 2008 was nearly half that of 1998.

But as three former USAID administrators declared in a November 2008 article in Foreign Affairs, money alone can’t solve the problem.

The reduced staff and loss of expertise has limited the agency’s technical competency and its managerial control over projects, making USAID increasingly dependent on larger and larger grants and contracts to spend its budget. This has transformed USAID from a creative, proactive, and technically skilled organization focused on implementation to a contracting and grant-making agency…

On a policy level, meanwhile, large presidential initiatives and congressional earmarks for health care, HIV/AIDS, K-12 education, microfinance, and the environment have in recent years crowded out other development interventions, such as anticorruption measures, agricultural assistance, democracy-promotion programs, and infrastructure-enhancement measures…

Strategic needs on the ground should dictate the nature of the programs, but currently, allocation decisions are determined by earmarks, presidential initiatives, or diplomatic pressures.

Money alone can’t solve this problem. The Agency requires strong leadership and strong support and an updated mandate.

Adam Graham-Silverman reported in Congressional Quarterly on August 5, 2009, both the House and Senate are pushing to rewrite the 1961 law authorizing foreign assistance, Public Law 87-195.

Last month, Clinton announced a quadrennial diplomacy and development review (QDDR), which the USAID administrator would co-chair, modeled on the Pentagon’s Quadrennial Defense Review. Clinton has called for staffing boosts to rebuild USAID and a closer coordination of diplomacy and development work.

Both the House and Senate are considering changes to overseas aid programs. House Foreign Affairs Committee Chairman Howard L. Berman, D-Calif., is circulating a blueprint for a complete rewrite of the 1961 law that governs foreign aid spending. Senate Foreign Relations Chairman John Kerry, D-Mass., expects to mark up a bill (S 1524) after the August recess that would take more modest measures to strengthen USAID as a first step to broader change…

Lugar, a coauthor of Kerry’s bill and a supporter of a stronger, overhauled USAID, said the department has not been enthusiastic about the Senate’s legislation.

“They gave the impression that our action was less timely than we had thought,” he said diplomatically. The department has been telling Congress “we have our own discussion going on,” he said.

Whatever the discussions are within State, they are certainly hampered by the failure to find leadership for USAID. The loss of Paul Farmer, the latest candidate to pull out before nomination, is a blow to Agency and to US national security. The immediate impact will be the continued militarization of foreign aid as Congress and Defense cannot rely on the hope State will step up in the area of development or public diplomacy by itself despite the capable leadership of the Secretary.

Between this issue with USAID, the recent report by State’s Inspector General on the dysfunction in the Africa Bureau, and State’s absence in the current imbroglio over the militarization of public diplomacy, the Administration, State and Congress must take a very close look at a Department that is successful in limited areas despite itself.