Katherine A. S. Sibley
The United States government first recognized the usefulness of foreign aid as a tool of diplomacy in World War II. Such a program, policymakers believed, would fulfill three goals: it would furnish humanitarian assistance to needy peoples, it would promote liberal capitalist models of development in other countries, and it would enhance national security. The U.S. commitment to foreign aid since has amounted to well over $1 trillion in current dollars—not counting hundreds of billions more donated through the International Monetary Fund, World Bank, and other multilateral agencies. Always a controversial program, foreign assistance drew its broadest support in the early Cold War era. At that time, the effort to undermine communism permeated all other aid considerations, including the plight of the poor, the expansion of democracy abroad, and U.S. economic goals that might be served by foreign assistance, such as stimulating private investment and opening up markets to American products. All of these objectives, however, generated wide support from members of Congress, ranging from those whose chief focus was U.S. security to those who were most interested in developing the Third World.
In the Vietnam era, however, the consensus of support began to unravel. Like the war itself, foreign aid programs were variously attacked as imperialistic, paternalistic, harmful, wasteful, or just plain useless. (Indeed, these imperialistic attributes of aid had contributed to the United States's own birth—without the assistance of the empires of France and Spain, the nascent republic would hardly have survived.) Although American foreign aid has changed its emphasis frequently since the Vietnam era in response to such criticisms, the flow has never stopped and has continued to generate calumny from all sides of the political spectrum. Notwithstanding these attacks, foreign aid has undoubtedly racked up some solid achievements. Third World residents have experienced great advances in their standard of living since the 1960s. The eradication of smallpox, the halving of poverty, the doubling of literacy from 35 to 70 percent, and the sharp rise in life expectancy from forty-one to sixty-three years, are evidence of this. Unfortunately, such improvements have not headed off a broadening economic gap between the rich and poor nations. For instance, Africa's average annual income in adjusted dollars in the 1990s was about the same as it had been in the 1960s, approximately a dollar a day. There, too, the AIDS epidemic has proved as devastating as smallpox. The great ambitions of President John F. Kennedy for foreign aid (see sidebar) were not met in the 1960s "decade of development," nor have they been realized since.
During the Cold War era, bilateral assistance (on a government-to-government level, including that channeled via nongovernmental organizations) broke down in unadjusted dollars to $139 billion in military and economic assistance to the Middle East and South Asia, $70 billion to East Asia, $48 billion to Europe, $29 billion to Latin America, and $23 billion to Africa. In the 1990s, both the demise of the Soviet Union, whose influence U.S. foreign aid was long designed to check, as well as the spectacular economic growth of such former aid recipients as South Korea, led the United States to adopt new targets. Indeed, as Secretary of State Madeleine Albright declared in 1999, "traditional notions of 'foreign aid' have become virtually obsolete." The 1997 State Department strategic plan outlined the following goals for foreign aid: creating "institutions that support democracy, free enterprise, the rule of law and a strengthened civil society"; providing humanitarian aid; and "protecting the United States from such specific global threats as unchecked population growth, disease, the loss of biodiversity, global warming, and narcotics trafficking." At the turn of the twenty-first century, U.S. funds were defending peace in Kosovo, East Timor, and the Middle East, dismantling Soviet nuclear weapons, disarming drug dealers in Central America, democratizing Nigeria, and developing the armies of America's erstwhile enemies, the former socialist countries. Yet, as Albright herself acknowledged in 2000, the programs continued to support very traditional aims, such as "promoting U.S. exports, spurring overseas development and helping other countries to achieve viable market economies"—in other words, expanding the adoption of liberal capitalist norms of development. While recipient countries have certainly changed, the United States continued to spend about the same amount as it had at the end of the Cold War, utilizing Cold War foreign aid instruments like the Foreign Assistance Act and the Agency for International Development. According to the State Department, in 2000 the United States spent $16.5 billion on foreign operations, ranging from the Peace Corps ($244 million) to the foreign Military Training Program ($4.8 billion).
See also CONTAINMENT; ECONOMIC POLICY AND THEORY; GLOBALIZATION; INTERNATIONAL MONETARY FUND AND WORLD BANK; TARIFF POLICY.