Ethiopians receiving sorghum food aid from the U.S. Agency for International Development. (Photo: USAID)

Budget cuts, aid and American national security

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By Kevin Watkins, director, Education for All Global Monitoring Report

There’s nothing quite like a fiscal crisis to secure the triumph of short-termism over the long-term national interest.

The United States stands to gain a great deal from using its aid budget to promote education in developing countries. More education in poor countries not only means less poverty. It also means better prospects for economic growth, improved health and the development of societies that are more inclusive and less prone to war. America stands to gain not just from bigger markets but from better prospects for peace.

That’s not how many Republicans view it. In January, the Republican Study Committee (RSC), a self-identified group of 165 members of the House of Representatives, unveiled a plan for slashing the $1.6 billion budget of the U.S. Agency for International Development (USAID). It was presented as a heroic effort to trim America’s $3.8 trillion budget. But do the math: the RSC wants to take the axe to around 0.5% of the total budget.

Debate is now focused on efforts by the Republican-controlled House and the Senate to cut President Barack Obama’s proposed 2011 budget. The process and numbers are complicated. But the House of Representatives is pushing for deep cuts in (you guessed it) foreign aid. Compared with 2010 levels, it wants development assistance cut by $746 million and international disaster assistance by $415 million. At stake are programmes for child survival nutrition and education, as well as UN operations. The U.S. Global Leadership Coalition estimates that the proposals would also cut humanitarian aid by 41%.

All of this strikes at the heart of the Obama administration’s strategy for providing leadership on the Millennium Development Goals. You might remember a strong speech made by President Obama at the MDG summit last autumn: “We will not abandon those who depend on us for life- saving help. We keep our promises, and honor our commitments.”

Secretary of State Hillary Clinton and the USAID Administrator, Raj Shah, have made a compelling case against cutting the aid budget. They point out that US national security is intimately bound up with prospects for poverty reduction and the expansion of opportunity in developing countries. That message reflects some of the central themes in this year’s Education for All Global Monitoring Report, The hidden crisis: Armed conflict and education, released on Tuesday.

Cutting development assistance for education and other aid budgets is a classic example of dime-wise, dollar-dumb economics. The effects will barely register on the budget deficit account. But you can confidently predict that cuts in aid will generate security threats that lead to future increases in military spending and humanitarian aid. Slash-and-burn approaches to development assistance programs may play out well in gatherings of Tea Party enthusiasts – but they pose a hidden threat to America’s national security.

None of this is to suggest that defending the aid budget will be easy. As Paul Krugman has argued to devastating effect, behind the bluster there is an emerging bi-partisan consensus on the fiscal crisis.

Both sides have effectively ruled out cuts in major entitlement programs and defence, which means that almost all of the cuts will fall on 12% to 15% of the overall budget that is not ring-fenced for protection – including aid.


1 comment

  1. In any case, American aid is fragmented and fixated with neoliberal conditions that harm rather than improve development. Not that I agree with aid cuts, but aid increases or maintenance of aid levels will not improve development unless you change the ideas that come with it.

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