Aid Reform Within Reach: Time for the President to Lead

Since the Foreign Assistance Act of 1961 (FAA) was signed by President Kennedy in the first decade of the Cold War, the American foreign aid system has yet to undergo a major overhaul, despite various attempts and a vastly changed world. In the last few weeks, however, we have come closer than ever to comprehensive reform of our inefficient apparatus for promoting development.

To put it bluntly, the United States is falling short in getting the most bang for its development buck. Even our best aid projects often fail to both use resources strategically and maximize the benefits for either effective development or national interests. This is inexcusable, especially since the President and the Secretary of State have articulated that fighting global poverty is at the heart of U.S. moral and strategic interests.

At a policy level, the administration should be commended for its approach to development -- it has emphasized development as a national priority, its recent food and health initiatives are well designed, and Dr. Rajiv Shah has already begun important reforms at the United States Agency for International Development (USAID).

Progress on actual nuts and bolts of turning policy into action has been less forthcoming. It is time to act on the broad recognition that multiple agencies carrying out similar or inconsistent programs is not good practice; that assistance programs need greater transparency and accountability; and that the legislative foundation for our foreign assistance system, a 500-page Cold War-era statute, lacks clear goals and objectives and is bursting at the seams with outdated, overlapping, and duplicative and conflicting provisions.

Fortunately, solutions are in the making. At the recent G8 Summit in Canada, President Obama endorsed "A New Approach to Development," one of the most significant statements about U.S. development efforts since the enactment of the FAA. And, House Foreign Affairs Committee Chairman Howard Berman (D-CA) recently released a new working draft of the FAA, which, if passed, would create a new framework for U.S. foreign assistance programming in the 21st-century.

The President can take three immediate steps to build on these major developments and overcome political and bureaucratic obstacles to reform:

  • First, he should follow the vision he laid out in the G8 paper to create America's first-ever Global Development Strategy, in time for the Millennium Development Goals Summit at the UN in September when the eyes of the world will be on this issue. In order to achieve success, the strategy must address the issues at the heart of the current debate. Is achieving broad-based, sustainable development a goal in itself for U.S. global engagement, or is it merely a tool for diplomatic or defensive objectives? Furthermore, will development experts, rather than diplomats or soldiers, have the authority and resources to lead our foreign aid programs?
  • Second, he should let it be known that he is ready and willing to work with Congress on foreign aid reform. Delay in working with Congress to reach a new "Grand Bargain" to govern our assistance policies means resources are used less strategically and loss of hope and precious time for those living in poverty and in dire need of our assistance. Last year, 126 Representatives and 23 Senators from both sides of the aisle supported foreign aid reform legislation, but the President's push is needed to make larger strides.
  • Third, he must empower USAID with clear authority and the mechanisms to work collaboratively with the State Department and other relevant agencies, and finally move ahead on the appointment of senior officials by filling key vacancies at USAID.

The President must take decisive action on these issues if he seeks a restoration of U.S. leadership on development that once drove the Marshall Plan to rebuild Europe after WWII; the agricultural Green Revolution that helped put Asia on a path to long-term economic growth in the 1950-70s; the Campaign for Child Survival that raised immunization rates from 15% to nearly 80% in the 1980s; and the efforts to increase access to clean water and fight HIV/AIDS, tuberculosis, and malaria in the 1990s and 2000s, respectively.

With our signatures on a new Open Letter, we call on President Obama to show much-needed leadership on foreign aid reform and set us on the right path for development policy.

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