Divining (or Inferring) the Objectives of U.S. Foreign Aid

March 10, 2011
This is a joint post with Rita Perakis. What are the objectives of U.S. foreign aid programs?  Development itself?  National security?  Improving diplomatic relations?  Humanitarian response to emergencies? One answer to that question comes from what Congress and the Administration say  – in the Presidential Study Directive, President Obama’s development speech at the United Nations, what Secretary Clinton said in her development speech last year, and what Administrator Raj Shah has been saying in recent speeches.  And of course what the Congress says in authorizing legislation --- but oops the Foreign Assistance Act is 50 years old (and hasn’t even been reauthorized since 1985), as lamented in this 2-minute video. Jean Arkedis in a recent CGD paper (done when she was seconded from the State Department two years ago) says that the U.S. government isn’t very clear about those objectives – and why not clarify by assigning spending lines in the federal budget to one or more of those objectives above?  Recently Connie Veillette has also weighed in. But another way to answer the question is to infer what the Congress and the Administration have in mind from how they actually plan to spend U.S. taxpayer money in developing countries around the world. Here’s our result based on the 2011 and 2012 Obama Administration requests. The 2012 request includes the amount proposed for the Overseas Contingency Operations account, which is proposed to fund temporary and exceptional costs as they relate to civilian operations in Afghanistan, Iraq and Pakistan.  (In FY2010, U.S. foreign assistance actual spending in Iraq was about $1.1 billion, in Afghanistan $4.1 billion, and in Egypt about $1.5 billion (from the U.S. Foreign Assistance Dashboard)). The table below explains line by line how we allocated the proposed budget for FY2011.  Of course we may have gotten it wrong and welcome your comments and complaints.  The table comes from the 150 Account representing the federal international affairs budget, which includes money spent at home on State Department activities that are not foreign aid, and programs like the Peace Corps (which we did not include in our total). Our calculations of the total spent on development, security, and humanitarian aid from various accounts amounts to about $39 billion. The total 2012 budget request for the entire 150 Account of $58.8 billion covers many activities, e.g. State Department operational costs abroad (embassy security and maintenance, the Peace Corps, etc.) that are not foreign aid in the usual sense. The pie charts represent Obama administration requests; we promise a comparison of the final Congress-approved appropriations for 2011 and 2012 as soon as they are agreed. All values in are thousands of U.S. dollars and come from the FY2011 requests. *Note: Some accounts have multiple purposes. These figures are based on an analysis by Connie Veillette which estimates the development portion of the ESF to be 83.5% of the total, the security portion to be 15%, and the remaining 1.5% to be for humanitarian activities. AEECA also funds activities in all three categories; based on a breakdown of the FY2011 request, security consists of 23% of this fund, development 76%, and humanitarian aid 1%.


CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.