Carol Lancaster: USAID and State = FEMA and Homeland Security

Carol Lancaster, a former US deputy assistant secretary of state and deputy administrator of USAID, who is currently a professor at Georgetown University and (full disclosure) a member of the CGD Board of Directors, has written for the Financial Times (subscription required) an Op-Ed about the Bush/Rice aid reorganization plan that deserves to be read by any American interested in global development or the U.S. role in the world. Voicing concerns similar to Steve Radelet's posting to this blog yesterday, she writes:

The day-to-day decisions on how USAID uses its funds for development - which countries receive the aid, how much they get and how it is used - can be very different from the priorities of the State Department, which often involve managing crises in foreign countries.

For example, she says, the campaign against terror can mean giving money to countries whose standards of human rights, democracy and free markets might not make them good prospects for development.

The planners in the Kennedy administration created USAID as semi-independent of the state department for this very reason - where two agencies have different goals and modes of operation, the mission of the bigger, stronger agency will almost always overwhelm that of the smaller agency and undercut its effectiveness. There are two recent examples of this very problem. The merger in the late 1990s of the US Information Service into the Department of State is widely regarded as a disaster for the effectiveness of US public diplomacy. And the merger of the Federal Emergency Management Agency into the Department of Homeland Security is another case of a once well-regarded, effective agency failing to respond to the Hurricane Katrina disaster after being absorbed by a much larger department.To make US foreign aid more effective in supporting development in poor countries, the two large aid agencies - USAID and the Millennium Challenge Corporation - should be merged into a new development agency. It is no secret that the MCC - set up by the Bush administration to provide aid to countries deemed "good performers" - has struggled to get up and running. USAID has also had its own problems of bureaucratic sclerosis. They are both in the development business and their work is complementary. Merging them in a new and streamlined development agency could strengthen them both - and in the process, greatly enhance America's development efforts abroad.

Carol's examples of USIS and State, and of FEMA and Homeland Security, should give the development community, and Congress, plenty of reason to wonder if pulling USAID into State is the right way to go.