Q&A on Foreign-aid Reform and H.R. 2139

May 12, 2009

What is foreign assistance and how does it work? Foreign assistance, also called foreign aid, is money provided by the United States to other countries for a variety of purposes, some strategic, some humanitarian. Fighting poverty and disease, and promoting economic development and growth, are among the chief objectives of foreign assistance. In many cases – particularly where poverty alleviation is concerned – foreign assistance is not sent directly to another country’s government, but rather is delivered by non-governmental organizations, including faith groups like Episcopal Relief and Development, Church World Service, or Catholic Relief Services. They, in turn, work with churches and other faith communities in low-income countries (like the many Anglican and Episcopal churches in Africa, Asia, and Latin America).

Does U.S. aid work? Yes, U.S. foreign assistance works. It puts children in school, helps women start businesses to provide for their families, prevents the spread of malaria and HIV, and assists farmers working to improve their crops local economies. This leads to results. In the past six years alone, for example, the number of people in poor countries receiving antiretroviral medicines to treat HIV/AIDS has increased tenfold to almost three million. In the past two decades, more than a billion people – a fifth of the world’s population – have gained access to clean water. This assistance is critical to achieving the Millennium Development Goals (MDGs), a mission priority of our church.

When was the current U.S. foreign-aid system designed, and what purpose was it intended to serve? The current American system of distributing foreign aid was designed by Congress in 1961 through legislation called the Foreign Assistance Act and has not been updated comprehensively since. In 1961, most foreign aid was given for strategic purposes like supporting the growth of democracy in free markets at the height of the Cold War. Today’s world is very different, and congressional efforts to supplement the Foreign Assistance Act have led to a behemoth bureaucracy that now sees U.S. aid managed and distributed through 12 different cabinet departments, 25 different agencies, and almost 60 government offices. While foreign aid works, it clearly can work better in the 21st Century.

What is H.R. 2139, and how does it fit into the process of reforming foreign aid for the 21st Century? H.R. 2139, the “Initiating Foreign-Assistance Reform Act” is a bipartisan bill introduced by the chairman of the House Foreign Affairs Committee, Rep. Howard Berman (D-CA) and Rep. Mark Kirk (R-IL). Intended to be a first-step in a broad congressional effort to update the 1961 foreign-aid law comprehensively, the bill establishes congressional principles for reform and requires President Obama to immediately develop and maintain a comprehensive national strategy for global-economic development. It also initiates several steps to improve the efficiency and efficacy of our nation’s foreign-aid programs, and to make them more transparent both to American voters and to the poor communities served by U.S. development programs.

How, specifically, does the bill do this? In addition to a series of congressional “findings” on the importance of rewriting the foreign-aid system and the principles that should guide the process, the bill has four major sections:

1) National Strategy for Global Development: The legislation requires the President to develop and implement a comprehensive strategy to define and streamline the roles of each department and agency engaged in U.S. global-development efforts and prioritize the fight against deadly poverty. The Administration must include, in this strategy, specific objectives for U.S. development programs, with the goal of elevating economic development alongside diplomacy and defense in our nation’s foreign policy, and prioritizing the fight against deadly poverty in the developing world.

2) Monitoring and Evaluation: The bill requires the President to develop and implement a rigorous system to monitor and evaluate the effectiveness and efficiency of our nation’s foreign-aid programs. Each U.S. department and agency involved in the process is required to establish measurable performance goals, the capacity to conduct monitoring and evaluation activities, and a process to incorporate lessons learned into future efforts.

3) Transparency and Accountability: The legislation requires the U.S. government to make available detailed country-by-country information on all aspects of the foreign-aid system, and to make this information easily accessible both to American taxpayers as well as recipients of U.S. foreign aid. This must include information on how foreign aid is planned, allocated, disbursed, contracted, monitored, and evaluated.

4) Repeals: The bill repeals several outdated provisions of the 1961 foreign-assistance law that are technical in nature and no longer relevant.

Is H.R. 2139 the final step in the process? No. On the contrary, it is only a first step, but a critical one. Chairman Berman has expressed publicly his desire to initiate, later this year, the detailed and intricate work of rewriting the Foreign Assistance Act of 1961. This will require numerous legislative and policy steps. H.R. 2139 is intended to place the endorsement of the full Congress behind such an effort, as well as to prompt the Administration to take a necessary step – the development of a national global-development strategy – to help drive the process.

Given the current economic crisis, shouldn’t lawmakers be focusing attention on people hurting here at home rather than those living overseas? This should not be an either/or question. Congress certainly should be, and is, focusing attention on the economic needs of Americans, and the Episcopal Church and other faith communities have been strong advocates for this work. As difficult as problems in American communities are, however, on sheer scale, poor people in developing countries are facing even greater levels of poverty and hunger – poverty that kills. Approximately 1.4 billion people – more than a fifth of the world’s population – live on the less than a dollar a day, and experts forecast that this number will grow by 50 million as a result of the economic crisis. As need is rising, so does the U.S. responsibility – as part of a single human family – for responding to that need. A couple of other things should be kept in mind too. First, foreign-aid reform would mean that limited resources would be spent in a smarter way and with greater accountability and impact. That means that results will increase even if resource allocation stays the same. Additionally, foreign-aid reform is in our own nation’s interest. In an increasingly interconnected world, investments in global development increase security and prosperity here in the U.S. by creating more stability, as well as lasting and long-term solutions to problems, around the world. The impact of fighting poverty and building more prosperous communities today will be felt for generations to come.

What does this mean for the MDGs?
The Millennium Development Goals currently are just six years from their completion point, and even as dramatic progress has been made in some goal areas, others – like the fight against AIDS – have been slower overall despite enormous numerical successes in some places. Part of the reason is a lack of coordination and cohesion between the many different donors, including rich countries, private institutions and nongovernmental organizations, and multinational-development programs. Reforming U.S. foreign-assistance programs will allow better focus and cohesion in the world’s efforts to meet the MDGs by 2015.