Virginia Gov. Terry McAuliffe (D) joins Kojo in the studio, fresh off the conclusion of the Virginia General Assembly's 2015 session.
One year ago this week, President Obama elevated global development as a “core pillar” of U.S. foreign policy, alongside diplomacy and defense. But as Congress and the White House struggle to find billions to cut from the federal budget, some advocates worry Washington’s commitment to reducing global poverty is wavering. We explore the future of American foreign aid.
- Jim Kolbe Co-Chair, Modernizing Foreign Assistance Network (MFAN); Member, U.S. House of Representatives (R- AZ, 8th District) (1985-2007); Senior Transatlantic Fellow, German Marshall Fund of the United States
- Paul O'Brien Vice President for Policy and Campaigns, Oxfam America
MR. KOJO NNAMDIFrom WAMU 88.5 at American University in Washington, welcome to "The Kojo Nnamdi Show," connecting your neighborhood with the world. It's one of Washington's most cost effective foreign policy tools. Last year, the federal government spent $30 billion on international development assistance, money that went to combat poverty, eradicate disease and help build democratic institutions around the world.
MR. KOJO NNAMDIIt's a huge number for sure, but it's still a drop in the bucket compared to the $700 billion we spend on defense. In fact, America spends less than one percent of its budget on foreign assistance and many advocates and NGOs worry that Washington's commitment to international development is wavering. After all, Congress and the White House are scrambling to lock billions off the federal budget.
MR. KOJO NNAMDIAnd it's hard to make the case for fighting poverty abroad when poverty is spiking on our shores. Just last week, the senate defeated an amendment that would have paid for disaster assistance in the U.S. by cutting off funding to the department of state and U.S. aid. This hour we're exploring the future of U.S. assistance abroad.
MR. KOJO NNAMDIAnd joining us in studio is Jim Kolbe. He is co-chair of the Modernizing Foreign Assistance Network, MFAN. He's a former member of the U.S. house of representatives, a republican representing the eighth district in Arizona, from 1985 to 2007. He is senior transatlantic fellow with the German Marshall Fund of the United States. Congressman Kolbe, thank you for joining us.
MR. JIM KOLBEThank you very much for having us, Kojo.
NNAMDIAlso in studio is Paul O'Brien. He is Vice President for Policy and Campaigns which -- with Oxfam America, which is a member of the Modernizing Foreign Assistance Network. Paul O'Brien, good to see you again.
MR. PAUL O'BRIENGreat to be here, Kojo.
NNAMDIAnd, of course, you're invited to join this conversation by calling 800-433-8850. Is international development, in your view, in the national interest? Do we have a moral imperative to fight poverty abroad, 800-433-8850 or you can go to our website kojoshow.org, join the conversation there or send us a tweet @kojoshow, e-mail to email@example.com. One year ago, this week, the Obama administration elevated foreign aid and development to the same level as defense and diplomacy as a pillar of our foreign policy.
NNAMDISpeaking before the special session in the U.N. on the Millennium Development Goals, the President said, he was outlining a new approach to development.
PRESIDENT OBAMAWe're changing how we define development. For too long, we've measured our efforts by the dollars we spent in the food and medicines that we deliver. But aid alone is not development. Development is helping nations to actually develop, moving from poverty to prosperity. And we need more than just aid to unleash that change. We need to harness all the tools at our disposal. From our diplomacy to our trade policies to our investment policies.
NNAMDIPaul O'Brien, tell us about the Presidential policy directive on global development.
O'BRIENWell, it's a great time to ask that question because it is the one year anniversary on Wednesday. And I -- Kojo, just let me say this one thing about this one percent thing because it does come back, a lot of the time, what do Americans really want to see money being spent on? The one campaign asked folks if you knew that we only spent one percent of our budget on foreign aid, would you be okay with that?" And more than 70 percent said, actually, they want to keep it at least at that level and more.
O'BRIENIf they actually knew that information. So just getting that information out there is really important. The PPD, as we talk about it in the development world, the Presidential Policy Directive, was ground breaking. And perhaps one of the most important ways in which it was ground breaking is -- it was different from previous Presidential announcements. It wasn't about adding a lot of new money, a big new signature initiative.
O'BRIENI mean, some of those have been great but they do come with a budget line item. It was about asking the question that President Obama put in his speech, how do we make our foreign aid funding much more cost effective by aligning all of the tools at our disposal toward shared ends? I went to a presentation last week that talked about the PPD.
O'BRIENAnd there were folks from treasury there, there was from USAID, they were there from state, they were there from -- they weren't there from the administration. This has been supported by the administration. But what I was stunned by is how all of these folks were actually talking to each other, not just in that meeting but all the time to make this thing work.
O'BRIENSo I think what we've seen with the PPD is a government that is actually trying to work together more coherently and spend the money that we are going to spend, more cost effectively, that's probably its biggest achievement.
NNAMDIBut given that rational for making global development a pillar of our foreign policy, already some people have accused the United States of, often, giving aid based on short term foreign policy aim, such as bolstering a shaky ally, rather than long-term questions about sustainability and impact. Isn't there a danger of using aid as a tool for explicitly foreign policy goals, Jim Kolbe?
KOLBEWe -- yes. Kojo, there is that danger. And I don't know if I'd call it a danger, but there is that reality. Aid is given for different reasons. We've been talking, here, about long-term development assistance. That's certainly what Paul and I are very much into and interested in, is how can we alleviate poverty? How can we bring about sustainable economic growth?
KOLBEBut clearly, there are other things that we do with our foreign aid and all you'd have to do is look at the billions, tens of billions of dollars over the years that we've spent in Egypt and Israel as a result of the Camp David accords. Those were done for national security reasons. And the same, you could say, in Pakistan, today. And people swallow hard with that because we see a lot of it either going to waste, not being spent well or we see Pakistan, certainly, not helping us in the way that we would like to see them help us.
KOLBEBut there are different purposes of foreign assistance. There's the development, there's your national security objectives, there's humanitarian objectives -- assistance. So there's different purposes.
NNAMDIFifty years ago, this month, Congress passed the Foreign Assistance Act of 1961. At the time it was a pioneering piece of legislation. But today, it's widely seen as an obstacle, to necessary changes in the way we spend our development dollars. Why has the Foreign Assistance Act lasted so long?
O'BRIENIt's a great question. I will say that when President Kennedy launched the new Foreign Assistance Act, at that time, he talked about precisely the question you just raised early on. He said "Money spent to meet short term political on a security objectives, rarely achieved their stated goal. We need an act that is designed for the longer term strategic challenges that we face in the world. That's what he said then.
O'BRIENAnd at the time, we had a great act. We created USAID and the U.S. became the global development leader in fighting poverty. But 50 years of not reforming the act in the kinds of ways to keep it modern, left us with a bill that is now -- an act that is now 2,000 pages long and is so contradictory, that if you're a development professional trying to use it to say, what does my government want me to do, which is the purpose of legislation, it's impossible to use.
O'BRIENSo we're now facing the question is there enough political will in this government to create the kind of legislation that will allow the U.S. to lead a 21st century fight against poverty? And I do think the key in that challenge is the earlier question that you raised, if you've only $1 to spend and you have to spend it on a short term political objective which is often a strong political imperative.
O'BRIENOr the long term challenge of achieving our national security and our global standing by fighting poverty in the right way. You need good legislation and good leadership to make sure that's a real choice and that we make the right call.
KOLBEKojo, it's worth noting that in 1961 when it was created, was the height of the Cold War. So there were national security objectives that were in mind for Congress and the President, at the time, we created the Foreign Assistance (word?) .
NNAMDIBut the other reality is that, back in 1961, the world could be divided more neatly...
NNAMDI...and poor developed and developing. But that's not quite the case anymore. Countries like India and Brazil are home to millions of people living on less then, oh, $2 a day. But they are also global economic powers investing billions of dollars in other developing countries. And the field has also been transformed by multi-billion dollar philanthropies, NGOs and other private sector players. You're both part of the Modernizing Foreign Assistance Network. What is MFAN?
KOLBEGood question. MFAN, as the words imply, Modernizing Foreign Assistance Network. It goes right back to the question you asked before, 1961 to today, there's been no real substance of overhaul to the Foreign Assistance Act. And yet the Cold War is ended, you have these countries that were in poverty then, like, South Korea, that are now economic powers and very wealthy countries.
KOLBEYou have other countries that have -- are coming out of poverty like India and Brazil. You have other countries like China which are becoming major players on the stage. So there's no question that the Foreign Assistance Act needs to be brought up to date to the kind of world we live in today. And that's what hasn't been done. Over the years, it's like a Christmas tree, we've added various things onto it. I think of two very good initiatives, when I was in Congress, that I'm very proud of, actually, having played a part in.
KOLBEOne, the PEPFAR, Program on Aids in Africa, the other, the Millennium challenge corporation. But they're all just additives and ornaments onto the act and not actually brought in or made in any kind of a coherent part of the Foreign Assistance Programs we have.
O'BRIENAnd can I just add, there is -- that's entirely right. There's a good piece of legislation on the floor now, Congressman Berman introduced the Global Partnerships Act to try and modernize the '61 Act. We'll see if it garners the political support it should. But we hope that it's going to be seriously debated in the months to come. If I could just answer your other question, a little more from my own experience in the field.
O'BRIENWe recognize, those of us in the development game, who are engaging from the U.S. perspective, that the world is a very different one now than it used to be. It's a multi polar world. And the powers that are out there, that weren't out there 10, 15 years, come to the environments we work in with very different agendas and are investing huge amounts of money in many of the places that we want to work in.
O'BRIENSub-Saharan Africa is a good example. For me personally, I lived and worked in Afghanistan for five years. And here's what I saw, when I started working there, this was in the early 2000s, right after 9/11, the U.S., on the ground in terms of development, was essentially blind, essentially, in the sense that it had a lot of money to bring to the equation because it was such a politically important environment.
O'BRIENBut USAID had been so cash strapped and under capacitated for so long, that you had single program officers who are being asked to program hundreds of millions of dollars in a really complicated environment. And not an awful lot of capacity to find out where -- what did local people think? Where should folks be investing more? What kind of relationships did we need to build? They just literally couldn’t get out there because there were so few of them.
O'BRIENWhat you've seen in this reform agenda, over the last while, and by the way, as a consequence, a lot of the money went to contractors who did the best they could but they were often writing strategy by themselves because USAID didn't have the capacity to do it for them.
O'BRIENWhat you've seen in this reform agenda and with initiatives like the development leadership initiative, is to bring in, what I think is a very cost effective program, to get some expertise into USAID, not back at headquarters, signing off contracts and counting beans, but out in the field so that you can listen better, you can build relationships, you can talk to folks about what's actually relevant. So that when you are spending money on the ground, you're doing it knowledgably and cost effectively.
O'BRIENAnd so I saw, even in the period of time that I was there what happens when you don't have that capacity and I see what's happening in Afghanistan now where they do have that capacity and you're seeing much more considered judgments. It's not that the people are necessarily better than they were in 2001, but there's more of them with better training and better resources. That's what the reform agenda has tried to deliver to try and save money. And we're concerned with some of these ideas that are coming out now about budget cuts. You could lose that ability to watch where your dollars are going in the field.
NNAMDIIf you have already called, stay on the line. We will get to your call. We're discussing the future of American foreign aid and taking your calls at 800-433-8850. If the lines are busy, you can go to our website and join the conversation there. Send us a tweet @kojoshow or e-mail to firstname.lastname@example.org.
NNAMDIJim Kolbe, before I get to the phones, I wanted to get to the issue of austerity, which is the buzz word in Washington these days and the pool of money available may be stagnating or shrinking. But you say this is not necessarily a bad thing. Sometimes a little scarcity forces us to prioritize in ways we wouldn't if there was more money available.
KOLBEThat's true. And that's one of the reasons why it's important for people to understand we are talking about 1 percent of the budget, not more than that. So, it's a very small part of it. It's a necessary part of our national security budget, going along with our military, going along with our diplomacy, going along with our democracy programs, our development programs are part of it. They're all part and parcel of the same kind of things.
KOLBEBut the reform process that we're talking about the Modernizing Foreign Assistance Network, MFAN, is saying, you know, there's got to be --- we got to spend these dollars better. And we have an archaic act that's old, that really needs to be updated, and we really don't have the kind of accountability. We don't have the kind of transparency that we really should have for these programs.
KOLBEThe American taxpayer has a right to know 1 percent or 10 percent or 100 percent of their dollars, that every one of those dollars is being spent wisely. And that's really what we want to do is get better transparency, better accountability and better programming for the dollars that we're spending. And that's what the reform process is all about. And just -- while we're talking about austerity, we shouldn't lose sight of the reform process.
NNAMDISo here's Jeff in Arlington, Va. Jeff, you're on the air. Go ahead, please.
JEFFHi, Kojo. So, in answer to your question, yes, it would be immoral if you were stealing the money, of course, then give it to people in other countries. I guess if you're talking about voluntarily giving it, that would be okay. But if you're interested in helping people in other countries, I guess you'd have to ask, how did we become wealthy here in the first place and why are they so poor? So, that was because of the capital system we have here, individual rights, freedom, property rights that allow us to produce and do things like that.
JEFFAnd certainly if you were to pragmatically steal money from someone here and give it to someone else, yeah, assuming the money even got to them. Yeah, they might be for a day, but they're always going to be poor. So what you want is you want to get them to a state where they can produce for themselves. And that means teaching them about capitalism, individual rights, freedom, organizations like the Atlas Network which we have in D.C. which teach about these economic things. So, taking a pragmatic approach of just giving someone money like that when the underlying political system is the problem that's causing the poverty in the first place is a much more deep and fundamental issue.
NNAMDIHere's Paul O'Brien on that precise topic.
O'BRIENWell, I actually agree with Jeff in lots of ways. But I think if he took a little bit of a deeper look at some of these new reforms, he might find there's a lot to agree with in there. I'll give you an example. Under the presidential policy directive, the Obama administration launched something called a Partnership for Growth. Now they recognize we're on austere times. They said, we're just going to look at four countries. But in each of those four countries, what they're basically saying is very close to what Jeff said.
O'BRIENWe're not going to be able to ever provide enough aid to lift any country out of poverty. But if we want to see economic growth in those countries, if we bring the various things that we do in those countries together and aligning them in the way President Obama talked about, get our trade policies aligned with our aid policies, with our investment policies and bring companies into those environment who are acting out of their capitalists instincts, we could actually unlock what they call the binding constraints to growth.
O'BRIENAnd so when you see a country like Ghana, Ghana is one of the four countries they're in, which is now achieving 18 percent growth and I think it's the highest global growth right now. You see that this is a country that could, like South Korea did, go from being a low-income country to being a driver of the regional economy there. And that's a very powerful argument.
NNAMDIJeff, thank you very much for your call. We've got to take a short break. If you have called, stay on the line. We will get to your call. We still have a couple of lines open, 800-433-8850. Do we have a moral imperative to fight poverty abroad? Or do you see a strategic or economic rationale for helping other economies? 800-433-8850. I'm Kojo Nnamdi.
NNAMDIWelcome back to our conversation on the future of American foreign aid. We're talking with Jim Kolbe. He is co-chair of the Modernizing Foreign Assistance Network, MFAN. He's a former member of the U.S. House of Representatives and he's senior transatlantic fellow with the German Marshall Fund of the United States. Paul O'Brien joins him in studio. Paul is vice president for policy and campaigns with Oxfam America, which is a member of the Modernizing Foreign Assistance Network.
NNAMDIIf you have called, stay on the line. We'll try to get to your calls. If the lines our busy, go to our website, kojoshow.org. Join the conversation there. A bipartisan group of members of Congress are trying to hammer out a new framework to replace the Foreign Assistance Act. Last week, Democratic Congressman Howard Berman presented a new framework. What's the idea here?
KOLBEWell, the idea is essentially what we were talking about a few moments ago and that is a foreign assistance act that are pretty archaic. It hasn't been really reformed or overhauled since 1961 while the world has changed incredibly in that time. And it just simply needs updating, modernization. And that's really what it's all about. And it's bipartisan, I'm happy to say. It's not one of these things that is just one side or the other.
KOLBEThere is a new reform caucus in the Congress which has Republican and Democratic members involved that are saying: Yes, let's -- we know foreign assistance is important, but let's make sure we're doing it the right way. And so, they're a part of trying to help to reform this process. So, I'm encouraged that in the long run -- frankly, I don't think we're going to see it happen this year, perhaps not in this Congress. But in the long run, there is a growing awareness out there of the need to update the Foreign Assistance Act and make it more workable.
NNAMDIPaul O'Brien, what aspects, what parts of the reform initiative that we are talking about in broader terms now you think deserve more attention?
O'BRIENWell, I think one of the good things you'll see in this act, if it ever becomes law, is that it really tries to position the U.S. as a better partner in development. For too long we've been trying to make sure that all the beans are counted and that we can sort of check off the box because people are scared that dollars will get wasted. But in the end of the day, development in this context requires good people on the ground to be able to listen and to partner well.
O'BRIENAnd the act tries to do that. I do think that some of the things in the reform agenda that are also really important, I think the administration and those who care about international development in Congress are focused on selectivity and they're focused on prioritization. So, for example, when the partnership for growth announced and this is economic growth. It's a good idea. It has lots of global support. They just said they were going to do it in four countries. They didn't say they were going to try and do it globally.
O'BRIENAnd I think that's probably, in these times, the right way to approach it. And when you asked people in the administration what are you focused on in terms of real concrete issues that matter, are you trying to cover all of the items that are in the millennium development goals, for example. Most of them will say, no, we're not. Right now, we're focused on food and hunger. That's why Feed the Future is so important.
O'BRIENWe're focused on global climate change, because we're seeing what weather is doing to poor communities. And we're focused on health. And that's why the global health initiative is getting such attention. Those three things and building up the capacity of USAID to actually be better at listening and to be more cost effective on the ground by having good people are the areas that they're prioritizing most. And I think there should be a lot of receptivity to that because these are not designed to add big new numbers to the budget, but to spend the money we have more cost effectively.
NNAMDIThis was a bipartisan group that is trying to hammer out this new framework. But Congressman Kolbe, is there still a bipartisan consensus? For a long time there has been on the issue of international development. But last week, Senator Rand Paul, Republican of Kentucky, introduced an amendment to a disaster assistance bill proposing to offset the cost of cleanup from this season's hurricane season by cutting fiscal year 2011 funds for USAID and the State Department. But 20 Republicans senators voted for that amendment. Obviously it was voted down, I think 78 to 20. But are we losing consensus here?
KOLBEThere is a collision that's going on between the austerity debate, which is a very real one when you're looking at better than a trillion-and-a-half-dollar deficit each year. That's a very real concern that people have. So there's a collision going on between that austerity debate. And what has been a bipartisan consensus for development. I think it's important to keep that consensus there, understanding the small amount that's there and that we continue to support foreign assistance for all the reasons that we talk about, the moral reasons, the national security reasons, the democracy reasons.
KOLBEIn the long run, this has helped the United States over the years. All you have to do is -- I always site countries like South Korea and Taiwan, which were very poor countries at one time and now are very wealthy countries and we do a lot of trading with them. A lot of American jobs are created as a result of that. So it's something where it's clearly been to our benefit to have given a small amount of support years ago.
O'BRIENI'll tell you what I really didn't like about that amendment. It was the way it's set up. We can either help people here in the United States who suffered a disaster or we can help people overseas. But guess what, we can't do both. And that to me is a really false dichotomy and really unhelpful in terms of what is America's global role ought to be about. If you look at the economics of this, if you look at the countries in which we've been investing for years with our development assistance, places like India, Indonesia, Poland, as the congressman mentioned, South Korea.
O'BRIENExports to developing countries by the United States represents about half of all our exports. And those aren't just sort of big corporations giving money to those context. These are small and medium-sized U.S...
NNAMDIIndeed President Obama has made economic growth the stated goal of U.S. development efforts, the basic idea being that economic growth in developing countries raises all boats and creates markets for American goods.
KOLBEWhich it clearly does. And one of the things that I would get when I was chairman of the Foreign Operations Subcommittee was put a lot of emphasis in USAID and other agencies on what we call trade capacity building, helping to develop the capacity of these countries to trade, whether it was technical capacity or the infrastructure. If they're able to trade, they're able to buy our goods and we can buy their goods and they can sell goods in other countries. So it's absolutely an essential part of the whole development program.
NNAMDIA lot of callers want to get in on this conversation. We will start with Kevin in Washington, D.C. Kevin, you're on the air, go ahead please.
KEVINHi, my original question was simply about the distribution. How much of that is slightly less than 1 percent is dedicated to military assistance leaving what percentage for non-military? But I couldn't let that other caller's comment go unchallenged since nobody else is going to. Our wealth is, because of the way we structured our capital system and not because 400 years of slavery and 200 years of labor exploitation and the fact that society in countries that have done very well and so they were colonized and all of the resources sold out and now all of the capital sells out. That has nothing to do it. It's because we have a special kind, I guess maybe we need some of those excellent teachings, though.
NNAMDIThe ideological battle of socioeconomic systems obviously continues. But, Kevin, did you have a more specific question?
KEVINAgain, the original question was how much of that one..
KEVIN...is dedicated to...
NNAMDIHere's Paul O'Brien on that.
O'BRIENOkay, and I won't be able to resist saying something on the second thing. Actually, the less than 1 percent is non-military assistance.
KOLBEThat's the development assistance, right.
O'BRIENBut let's put that a little bit more in perspective. The normal measurement for whether a donor is actually a generous donor or not is how much of its gross national income does it actually spend on poverty, in real poverty. An organization called the OECD measures that the U.S. comes 19th out of 20 major donors in terms of the size of what it gives about 0.21 percent of its gross national income.
NNAMDIIf that gives the most in absolute numbers.
KOLBEThe Nordic countries give the most, Norway, Sweden...
NNAMDIIn terms of percentage of...
NNAMDIBut in terms of...
KOLBEOh, in terms of gross dollars...
O'BRIENAnd that's why this conversation is so important because even though it does give a small amount in terms of gross national income, it's still spending about 1 in every 4 aid dollars globally. So what the U.S. decides to do affects everybody. Just on the second thing, I want to be clear that those of us who believe that economic growth is a key driver of poverty reduction and has watched the amazing journey and has been a participant in the amazing journey the United States has been on for so long believe that the way you make economic growth fight poverty is by making it broad based and sustainable.
O'BRIENAnd that's what a lot of the aid dollars are spent on doing, both stimulating economic growth, but doing it in a way that reaches the poor. And I would hope the last caller like to see those kinds of policies apply just as much to the American poor as to the global poor.
NNAMDIJust after we finish ideological debate over socioeconomic system, here is Chaka (sp?) in Fort Washington, Md. Chaka, you're on the air. Go ahead, please.
CHAKAGood afternoon. How are you, everyone?
NNAMDIWe're all well.
CHAKAI have a question. First, I have a suggestion. The caller who called earlier, Jeff.
CHAKAMay I suggest to Jeff that he read the book, "Confessions of Economic Hit Man" by John Perkins and another book called, "Overthrow: A Century of American Regime Change from Hawaii to Iraq." That might explain a few things to him. Now the question that I have here, this 1 percent that America gives in foreign aid, I read something where it says that of all the foreign aid that the United States gives, about 85 percent of that go, a large chunk of it goes to Israel.
CHAKAAnd with a sizable amount going to Egypt and to Jordan. Now, if aid -- if 875 percent goes to all these countries, that means that 15 percent left for the rest of the world. So, I mean, how effective is that going to be?
KOLBEWell, let me try to answer that by saying it's not 85 percent. But there's no doubt a large amount of aid over the years has gone to Israel and to Egypt. That came about as a result of 1979 Jimmy Carter, President Carter and the Camp David Accords where Israel said if we are -- Egypt said, if we're going to sign this peace agreement with Israel, we are going to be cut off from any -- by all of our Arab friends that have the oil.
KOLBEAnd we said, we will make you -- we will continue to provide assistance to you as we have been to Israel. So those two countries, over the years, have gotten a lot of assistance. It is gradually wound down. We have wound down the amount of military assistance that we give to Egypt and increased -- this is before the Arab Spring -- increased the amount of development assistance and vice versa with Israel. It's a rich country. We're not giving development assistance to them now. It's just military assistance. So the number is coming down, but it's been a large amount. I'll certainly grant you that.
NNAMDIChaka, thank you for your call. Here's Stephanie in Gaithersburg, Md. Stephanie, your turn.
STEPHANIEHi, thanks for taking my call. I am a foreign service officer with USAID and a former foreign service officer with the Department of State. Earlier, your guest, Kojo, had talked about USAID's role, whether or not we're doing short-term policy objectives or are we conducting long-term sustainable program. I'd like to invite your guest to consider a dilemma that I see right now on the ground as we try to implement programs.
STEPHANIEAnd it goes back to really a question of language. Are we conducting foreign assistance programs or are we doing development? And right now, from my experience, a lot of my colleagues with USAID would argue our goal is to do development, which implies long-term sustainable economic growth and related. Unfortunately or fortunately, depending on your perspective, other colleagues at USAID and my other colleagues at the Department of State would suggest, no, we're doing foreign assistance.
STEPHANIEForeign assistance usually implies that we're conducting assistance that is in correspondence with our immediate short-term political goals. I can't express to you the challenge of dichotomy, this dilemma, because in effect it means that we have a hard time to know what it is that we're supposed to do, and what in fact Washington or any of us as an American public that cares about these kinds of things wants us to do, particularly as you pointed out earlier that we have our own problems here at home.
STEPHANIEI invite your comments on that, and I want to emphasize that this truly is a significant problem, this question of language. Are we doing foreign assistance, or are we doing development?
NNAMDIThank you very much for your contribution, Stephanie. Obviously, this is a dilemma that you are facing on the ground, and I suspect Paul O'Brien and Jim Kolbe, that's one of the things that these reforms are trying to address.
O'BRIENAbsolutely. And it is a very real one. And, you know the only way I think you address this is well, you need a good policy framework. You need clear leadership from the top that long-term development matters. I think President Obama has been good on that although he hasn't spoken enough about it recently. But I got the opportunity to ask Secretary Clinton precisely this question when she launched the Quadrennial Diplomacy and Development Review.
O'BRIENHow was she gonna balance those difficult challenges the U.S. faces, and she conceded it's tough. We need good people to make considered judgments every day, and that's why we want to bolster USAID's strength and bolster their profile so that they have a seat at the table that is real and meaningful. And I do think one of the key things that the reform agenda has achieved over the last three years is this idea that development is actually one of the indispensible tools and one of the indispensible voices.
O'BRIENIt doesn't make the problem go away because the short term is always gonna compete with the long term, and dollars are limited. But if you have a serious development voice at the policy table in Washington, in the field where they're trying to make tough choices with soldiers and diplomats about what they should be doing, you have a much better chance of taking the longer term view.
O'BRIENI'll just say one last thing. Good long-term development is not just the morally right thing to do, which most Americans want to do, but it's also in our long-term national security and political interests because it raises U.S. standing in the world, and makes societies safer and more stable over time. So those are key priorities that you want to achieve, even if you care about security.
NNAMDIJim Kolbe, is that an effective argument in the Congress of the United States for international development money when budget cutting is on the agenda?
KOLBEIt's a hard one, but I think increasingly there are people that do understand that it's part of our long-term national security objectives. My answer to the caller isn't gonna make her terribly happy, because it's both I think. You do have short-term and you do have long-term. The economic assistance ought to be long-term development assistance that's sustainable.
KOLBEBut take the country of Haiti, when there was that catastrophic hurricane --or earthquake, the first thing we did is you go in and you try to feed people. You try to give them shelter, you try to give them fresh water. That's humanitarian assistance. It's immediate. Then you have to have a plan for longer term development to reconstruct the country and part and parcel with that are the institutions that make that happen, and so there's democratic reforms that go along with that as well. So it's all of those that go into this.
NNAMDIGot to take a short break. Thank you very much for your call, Stephanie, and more importantly good luck to you. You too can call us at 800-433-8850. You can send e-mail to email@example.com. We're discussing the future of American foreign aid. You can also send us a tweet @kojoshow or e-mail to firstname.lastname@example.org. I'm Kojo Nnamdi.
NNAMDIWe're discussing the future of American foreign aid with Jim Kolbe. He is co-chair of the modernizing foreign assistance network, MFAN. He's a former member of the U.S. House of Representatives, and a senior transatlantic fellow with the German Marshall Fund of the United States. Paul O'Brien is vice president for policy and campaigns with Oxfam America, which is a member of the Modernizing Foreign Assistance Network.
NNAMDIYou can call us at 800-433-8850. Do you think international development is in the national interest? 800-433-8850. And there's the question of just who is this foreign assistance helping anyway? We got an e-mail from Chris who says, "I would like to know how much percentage of the aid money goes for the overhead expenses. Time magazine last week reported that some of the UN officials responsible for handling aid money were paid exorbitantly high salaries.
KOLBEWell, let me take a stab at that. Paul is probably better at answering some of the specifics of it, but again, it depends on where you're talking about and what do you include in as overhead? For example, if you're talking about in Afghanistan, an almost obscene amount of the money goes for security. You can't put an aid worker out there without a whole retinue of security following and going with that person. So there's a huge amount of security costs that are involved.
KOLBEI'd have to say that our foreign assistance by and large, we have a lot of agencies around, but if you talked about USAID, our primary agency, the amount of overhead is relatively small compared to the amount of money that's actually getting out into the field. There are other agencies I think that have much higher overhead, but again, it depends on what country you're operating in and the degree of security, for example, that you -- the degree of difficulty of operating in that country that you have, but Paul might be able to add something to that.
O'BRIENWell, I agree with that. I do think that a certain amount -- you can go overboard on this. You need a certain amount of funding, and a certain amount of capacity on the ground to make sure that people are actually able to partner with locals, because we were so focused on cutting the overheads for so long, you ended up with the skeletal capacity of USAID, and basically it became a pass through handing out money to contractors who then went around with very little oversight from USAID, so I think you need some.
O'BRIENBut I do think if you look at programs like the Millennium Challenge Corporation or PEPFAR or some of the new initiatives of USAID, there's a very clear focus on getting value for money. So you've seen hundreds of thousands, millions of people helped addressed with HIV/AIDS in the PEPFAR initiative. The MCC has a relatively tiny staff. It's actually capped I think at 200, and they are making grants around the world that are very large sized with a heavy focus on making sure the money isn't stolen, by partnering with governments and making sure that as much of the money that is spent is done using local capacity, make sure there's no corruption, it's only done in the more transparent and effective countries, and most of the money is spent to focus on economic growth.
O'BRIENSo I think a lot has been learned over the last 20 to 30 years around how to make sure that the monies that U.S. taxpayers are giving for aid is not wasted, and you're seeing a lot of that play out in the reform agenda too.
KOLBEAnd you do want to make sure you reserve enough money that you're doing evaluation -- good evaluation to know what program's working and what program is not working. If you don't have any of that in your overhead, you really don't know whether you've accomplished anything.
NNAMDIYou heard Paul mention the MCC, that's the Millennium Challenge Corporation. He also mentioned PEPFAR, that's the Presidential Emergency Plan for AIDS Relief. Back in the late '90s, we saw a wave of protest movements against multilateral organizations like the World Bank, the IMF, and the World Trade Organization. One of the main complaints besides disagreements about certain policies was the lack of transparency about how decisions were made at large development institutions.
NNAMDIBut the development world has not apparently become an interesting innovator in the field of government transparency and open data. Today the World Bank and OECD make a huge amount of data open to third parties. Has that way changed the way that groups like Oxfam operate?
O'BRIENIn some levels we're often being pushed now, by the larger bilateral donors. You'll get more information -- I'm not sure I should say this, my boss might not like it, but you'll probably get more information about what USAID and MCC are doing now on their website in terms of the specific spending of dollars. You can search it in different ways than you'll even get on the Oxfam website, and we try pretty hard because we get asked where are our dollars gong.
O'BRIENBut I'm glad you mentioned the issue of transparency more generally, because I think this is another one of the big reform things. It doesn't cost a lot of money, it helps educate people. I'm going tomorrow to New York to an open government partnership initiative which the U.S. has led along with Brazil to get other governments to be much more open with their budgets around where monies for development are going, and it's -- it is a role that the U.S. has been playing a strong leadership role on. I'll come back to you if I may, Kojo, around this multilateral support issue, because I think that's also under threat at the moment.
NNAMDIAnd Jim Kolbe, 33 countries now have some sort of international development program. You say we need to coordinate better with those countries.
KOLBEWell, we do. We do need to have better coordination. I can tell you, I remember a visit to Tanzania, and meeting with the health minister there, and asking her about her -- the health program she had in her own country, and she pretty much just sighed and said, I really don't have much time to do anything about health in this country. I'm too busy filling out reports for all the donor countries.
KOLBETanzania is I think one of the highest number, there were at that time something like 58 or different countries that were operating, and different -- and international agencies operating inside Tanzania, and each of them, of course requires a reporting requirement to it. So yeah. We're stepping on each other's toes and we too often decide this is what we think needs to be done in Tanzania, so we -- I'm just using that as an example.
KOLBEWe decide this is what needs to be done in Tanzania, so we go and initiate the program. Meanwhile, another country over here, Britain, or Germany, or the United Nations decided this is what we think needs to be done in health care, and they go and initiate something that might be similar or be even at odds, but they're not coordinated in any way. So we need to clearly have been coordination for the dollars we're all spending.
NNAMDIHere's Steven in Arlington, Va. Steven, your turn.
STEVENThank you, Kojo. Good afternoon, and hello to your guests as well. I had one perspective I'd like to add to this. I've worked both in Afghanistan and in Iraq, and I found that, unfortunately, we frequently go in with the attitude that we take the attitude that people we're dealing with -- we're saying them, well, look, you've got six months. Now, we want to have -- women will have to have the vote, we want to have a democratic government, mark of the beast economy.
STEVENNo more of the squabbling between you Sunnis and Shiites and whatever the local groups happen to be. But, however, if the people we're speaking to have an understanding of American history, they might question, you know, the urgency with which we're requesting some changes. For example, we went from 1776 to 1791 before we had a Bill of Rights. We went -- we had that fracas from 1869 to 1864 where we resolved a number of questions, but we didn't have slavery abolished until 1865.
NNAMDISo you're saying we are imposing an unrealistic timeline on a lot of these developing countries?
STEVENI think that we are, and if we could in addition to coordinating our efforts among the various agencies, in addition to the international groups that are involved, just to have a perspective, a healthy appreciation, so sadly we might be talking here about two or three generations of people before they even come full flower with market economies and democratic societies.
STEVENThat's my point.
NNAMDIPaul? Oh, I'm sorry.
KOLBEI think that point's very well taken. I mean, Americans by their nature, and this is one of our strengths as well as weaknesses, we're very impatient people. We say this is what we want to get done, we want to do it and we want to do it now. But we need to remember our democracy didn't develop over night. In fact, it's still in development. We're still a work in progress, and these countries that have no background, no experience in this, no history of this, it takes a long time for this to happen. So I think we do need to have that perspective of time that we sometimes don't give.
O'BRIENI agree with that, and it goes back to this tension between the short and the long term, and we want investment in the long term. Though when you look at the rate in which these new emerging economies are investing in places like Africa, how much money China is putting into subsidy in Africa, when you see the change in what Brazil is doing, you realize that the world is changing around us quickly now, and the United States -- the real debate here is, is the United States going to be globally engaged and effective by being a force for its values on the ground, or is it going to withdraw, focus internally, try and build higher walls, and top that the world doesn't hurt it.
O'BRIENAnd that's the debate that's going on right now. It is a multigenerational task, but it's the American dream that many folks in the world still aspire to, and the question is, is does the country still believe that that's an export worth sharing?
NNAMDIThank you very much for your call, Steven. We have time for one more, and that will be Iman in Chantilly, Va. Iman, you're on the air. Go ahead, please.
IMANThank you for taking my call, Kojo. I just wanted to tell your guests last weekend we spoke to so-called government of Somalia, one of the prime minister, and we ask the question and what he told us that in Somalia they're spending billion dollars in Somalia, but the government of Somalia is (unintelligible). He said we only operate $1 million for the government, and when we ask the international community where is the rest of the monies going, he told us that (unintelligible) living in Kenya enjoying all of this money and doing nothing about Somalia.
IMANAnd as you see in Somalia what's going on, I don't think needs a billion dollars, they can operate less than that, but the money is not going direct to what international...
NNAMDIYou raise a fascinating question, Iman, even though we're almost out of time, and that is how do you send foreign assistance to a place like Somalia which is essentially a failed state which technically has a government, but the government only controls a very, very small area of the country. That is a major challenge.
KOLBEIt is a failed state, and there's not a lot you can do under those circumstances except try to gain enough headway if you can with the government to try to begin to establish the institutions of government. Paul, I'll let you...
O'BRIENWell, I just want to say, even in a difficult context like that, U.S. government aid has saved millions of lives around the world, and in places like Somalia. You have to operate differently. You have to often work through partners. You have to have different kinds of security processes, but let there be no mistake. The monies that have been spent on aid in those kinds of contexts, Sudan, there are many others, we have seen literally lives saved in the rate of millions with U.S. foreign assistance over the last decades. And so that is at stake too.
NNAMDIAnd I'm afraid that's about all the time we have. Paul O'Brien, thank you for joining us.
NNAMDIPaul O'Brien is vice president for policy and campaigns with Oxfam America, which is a member of the modernizing foreign assistance network. Jim Kolbe, thank you for joining us.
KOLBEThank you very much, Kojo, for having us.
NNAMDIJim Kolbe co-chair of the modernizing foreign assistance network, MFAN. He's a former member of the U.S. House of Representatives representing the 8th District in Arizona as a Republican from 1985 to 2007. He's a senior transatlantic fellow with the German Marshall Fund of the United States. And thank you all for listening. I'm Kojo Nnamdi.
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