Engagement Amid Austerity - Or How the United States Stays in the Game Despite Budget Pressures

May 08, 2012
This is a joint post with John Norris of the Center for American Progress. Budget concerns will almost certainly put downward pressure on federal spending across a host of government programs for a number of years.  Although some think it is almost heretical to point out the obvious, the international affairs budget will not be immune from this dynamic. In fact, international spending could take a disproportionate hit compared to domestic spending – despite the fact that discretionary international spending is a very small part of the overall budget puzzle. International affairs, and more specifically foreign assistance, have rarely been popular budget items among the public or on Capitol Hill – despite consistently comprising only about 1 percent of the total federal budget.  Even so, foreign aid and international engagement make good political targets for elected officials out on the stump. It is far easier to demonize foreign aid than to explain how relatively modest programs to improve living standards in the developing world have consistently proven to be in the national interest over the long-term. The central question then becomes how do we maintain U.S. global leadership in development and improve the effectiveness and efficiency of aid programs at a time when the international affairs budget is surrounded by so much uncertainty? Last fall, we set up a bipartisan working group to think through this question and look at how to reorient the international affairs budget during this current period of austerity. The resulting report, Engagement Amid Austerity, is now available. This report outlines four big ideas as a framework for reorienting the foreign affairs budget:
  • Be more selective and focused on what types of economic and security assistance are provided to which countries.
  • Put PEPFAR programs in upper middle income countries on an increased cost-sharing trajectory.
  • Reform U.S. food assistance programs by eliminating monetization, cargo preference, and allowing more local and regional purchase of emergency food aid.
  • Create an International Affairs Realignment Commission to examine and redesign programs and architecture.
While we are not advocating for cuts to the foreign affairs budget, it is abundantly clear that the United States is spread far too thinly in its assistance programs. The United States currently provides economic assistance to 103 countries and security assistance to 143 countries.  U.S. assistance programs are trying to do too many things in too many places without clear objectives.  In addition, the United States continues to provide aid to far too many countries that are simply poor partners. If a country’s leadership is unwilling to embrace reform, democracy, and more open markets, there is little reason to think that U.S. aid programs will make much of a difference over the long haul. We believe that programs can be better focused for greater impact.  In short, we should be directing more resources into fewer countries. Such a footprint would be far easier to manage, entail fewer operational costs, and help shape countries into partners that no longer require U.S. assistance five to ten years from now. Based on a data-informed process assessing a country’s need, capacity, governance, and commitment to development, as well as subjective judgments, our report rates every single one of the 146 countries receiving U.S. assistance as to the likelihood that U.S. aid will be effective. We recommend focusing economic assistance in 53 countries, and focusing security aid in 72 countries. Others may reach alternative conclusions using this same data, and we have provided as much information to readers as possible so that they can do so.  We do not expect universal agreement about our conclusions. But amid all the debates that will take place over the next year on how much we spend on international affairs programs, it is equally vital to engage in an overdue conversation on how we spend it.


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.