Why We Need a New Foreign Assistance Act. (Hint: It’s Déjà Vu All Over Again.)

With the planned release this Thursday of a draft Foreign Assistance Act (FAA) from Ranking Minority Member Howard Berman, I began to reflect on how to explain the need for revisions to the current law.  After all, some folks in the Administration would rather stick with what we have than expend time and effort in writing a more up-to-date act.  So with the help of a former president, here’s my first attempt at an explanation.What exactly is the FAA and why should anyone care?  The Foreign Assistance Act of 1961 is the main legislative framework for U.S. foreign assistance.  Most current aid programs derive their authority from this document.  Since 1961 Congress has regularly updated the FAA via reauthorizations, but the latest revision occurred in 1985.  Not that attempts haven’t been made in the intervening years, but moving foreign aid legislation to the floor of both the House and Senate has become increasingly problematic.Instead, single issue bills – PEPFAR, Freedom Support Act – have become the norm; some have been made a part of the FAA while others have not.  More often than not, the appropriations bill for aid carries the authorization, the Millennium Challenge Corporation bill being one example.In the intervening years, the detritus of good, bad, and outdated provisions continue to litter the act.  Out of curiosity, I went back and looked at President Kennedy’s statement when he submitted draft legislation (that became the FAA) to Congress in 1961.  I’ve always liked the idea of time travel, but this was downright eerie.  You can read the entire statement, but here are a few gems.

For no objective supporter of foreign aid can be satisfied with the existing program – actually a multiplicity of programs.  Bureaucratically fragmented, awkward and slow, its administration is diffused over a haphazard and irrational structure covering at least four departments and several other agencies.  The program is based on a series of legislative measures and administrative procedures conceived at different times and for different purposes, many of them now obsolete, inconsistent and unduly rigid and thus unsuited for our present needs and purposes.  Its weaknesses have begun to undermine confidence in our effort both here and abroad.

Hmm…sound familiar?  Or how about this?

The program requires a highly professional skilled service, attracting substantial numbers of high caliber men and women capable of sensitive dealing with other governments, and with a deep understanding of the process of economic development.  However, uncertainty and declining public prestige have all contributed to a fall in the morale and efficiency of those employees in the field who are repeatedly frustrated by the delays and confusions caused by overlapping agency jurisdictions and unclear objectives.

And then we have this.

In addition, uneven and undependable short-term financing has weakened the incentive for the long-term planning and self-help by the recipient nations which are essential to serious economic development.  The lack of stability and continuity in the program – the necessity to accommodate all planning to a yearly deadline – when combined with a confusing multiplicity of American aid agencies within a single nation abroad – have reduced the effectiveness of our own assistance and made more difficult the task of setting realistic targets and sound standards.  Piecemeal projects, hastily designed to match the rhythm of the fiscal year are no substitute for orderly long-term planning.

Those were the problems identified by President Kennedy; here are his recommendations. 

If our foreign aid funds are to be prudently and effectively used, we need a whole new set of basic concepts and principles:

Unified administration and operation - a single agency in Washington and the field, equipped with a flexible set of tools, in place of several competing and confusing aid units.

Country plans - a carefully thought through program tailored to meet the needs and the resource potential of each individual country, instead of a series of individual, unrelated projects. Frequently, in the past, our development goals and projects have not been undertaken as integral steps in a long-range economic development program.

Long-term planning and financing - the only way to make meaningful and economical commitments.

Special emphasis on development loans repayable in dollars - more conducive to business-like relations and mutual respect than sustaining grants or loans repaid in local currencies, although some instances of the latter are unavoidable.

Special attention to those nations most willing and able to mobilize their own resources, make necessary social and economic reforms, engage in long-range planning, and make the other efforts necessary if these are to reach the stage of self-sustaining growth.

Multilateral approach - a program and level of commitments designed to encourage and complement an increased effort by other industrialized nations.

A new agency with new personnel - drawing upon the most competent and dedicated career servants now in the field, and attracting the highest quality from every part of the nation.

Separation from military assistance - our program of aid to social and economic development must be seen on its own merits, and judged in the light of its vital and distinctive contribution to our basic security needs.

With the exception of number 4 (the U.S. aid program is virtually all in grant form), these recommendations are pretty similar to current thinking.  It seems then, in the last 50 years, we have come full circle to confront once again the problems that beset U.S. aid programs near their beginning.In the end, writing a new act allows policymakers to reach agreement on what U.S. priorities are and how they should be implemented.  Never an easy process, but it would help to focus U.S. aid programs on what works and in areas that support U.S. foreign policy goals.For your reading pleasure, here is the original 1961 FAA and the current FAA (amended through 2008).