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Foreign Aid Under Siege

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Nothing would seem to lull a writer into a creative slumber more effectively than the process of flogging a book. But a recent article by famed economist and aid polemicist Bill Easterly (The White Man's Burden --( a compelling and worthwhile read) invited a response.

Easterly's essay on America's foreign aid is right on the donated money. Americans are more generous in absolute dollar terms when it comes to foreign aid spending than any other nation in the world. But that's because individual Americans give, not because of government policy. In fact, as a percentage of its national wealth (GDP), the United States government spends far less on Official Development Assistance (ODA) than other industrialized countries, coming in at 0.21 per cent. And in 2010, Congress made deep cuts to American ODA, taking $8.4 billion from aid contributions even as defence spending continued its upward creep. Obama has vowed to reduce defence spending over the next decade, but this will prove politically challenging as long as American unemployment remains high (more than one million Americans are on the public payroll as active duty soldiers) and Iran continues its nuclear folly.

Despite America's economic woes, it's hard to see the logic in Obama's decision to reduce its aid budget. Aid cuts are easy politics, but bad foreign policy. They ultimately deepen global inequalities and are inherently destabilizing, especially to the communities and courageous civil society organizations operating in impoverished corners of the world that rely on them. Even Bush -- and it is painful to eat these words as I write them -- was more of an aid enthusiast than Obama has proven to be. And this is to say nothing of Canada, which has not suffered the same degree of economic turmoil as its southern neighbour and yet still opted to freeze aid levels for the next five years while, with decisive irony, brokering a deal valued at between two and six times (no one knows for sure) the country's annual aid budget on American F-35 fighter jets. Oh Canada, indeed. And such reductions in aid are rarely temporary. Canada has still not returned to its mid-1990s aid levels, as a percentage of GDP, since the last round of recessionary cuts blamed on the dot-com implosion.

But the biggest threat to ODA -- as Easterly and many others in the aid community have pointed out -- is its retooling over the past decade to service military policy. I write about this in more detail in Damned Nations, but since 2001, aid spending has been essentially hijacked by defence departments in both Canada and the United States. Hearts and Minds initiatives have transformed aid into a blunt weapons system, one in which funding for essential services such as schools, hospitals and other aid projects is dangled in front of vulnerable communities as kickbacks for compliance and co-operation. Over the past decade the Pentagon, for example, has controlled between 15 and 23 per cent of the United States Agency for International Development's (USAID) budget. This aid money -- in some cases farmed out to private contractors and corporations, as well as local warlords -- has been misappropriated at an astonishing rate, amounting to tens of billions of wasted dollars in Iraq and Afghanistan alone. It has also focused on volatile but militarily-important areas where the prospects of success were abysmal. And even aid spending that has not been outwardly co-opted by defence departments has been reoriented to suit military priorities. For years, Kandahar was the order of the day for any organization seeking Canadian International Development Agency (CIDA) funding for Afghanistan, despite the greater potential that existed in other provinces.

Easterly's argument, however, that failed or fragile states should be written off when it comes to aid spending contradicts his assertion that aid ought to "return to its origins of poverty relief." I couldn't agree more that aid should focus, as a priority, on poverty relief and not be tied to military or trade agendas. But it's impossible to ignore war-ravaged countries in that equation, because war and low levels of human development are inextricably linked. Over the past 23 years, half (54 per cent) of the countries rated "low" on the Human Development Index experienced armed conflict within their borders. The greatest ODA needs can, irrefutably, be found in the world's hell holes. And while there are enormous obstacles to delivering aid in such corrupt and insecure environments, that does not mean it can't work.

What matters, in such cases, is how it works: through consistent partnership and investment in local civil society organizations, and in programs that build their capacity and promote social stability. Empty platitudes? Not at all. I've seen highly successful aid programs operating in places like the eastern Democratic Republic of Congo, where locally-driven initiatives resulting from modest aid spending have returned tens of thousands of children and youth to community schools (and away from militias), and in Afghanistan, where quiet but industrious women's organizations are slowly overcoming the barriers to oppression and inching forward.

Aid is critical to the protection of human rights and greater gender equality around the world. It must be de-linked from defence objectives in order to ensure that a neutral, humanitarian space is preserved. And I agree that bilateral aid to corrupt and abusive regimes is both wasteful and irresponsible. But let's not forget that other options in such environments can and do exist. If aid is, as it was intended, aimed at reducing human misery, we cannot overlook the world's war zones.

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