Agency For International Development

MISSION

OVERVIEW

USAID was established during the presidency of John F. Kennedy pursuant to the Foreign Assistance Act of 19611 to promote the foreign policy, security, and national interests of the United States. At the height of the Cold War with the Soviet Union, it sought to halt the spread of Communism by assisting peoples in the developing world in their efforts to advance economically, socially, and politically. The agency helped to transition Central and Eastern Europe from socialism to free market–based democracies. Today, USAID leads the U.S. government’s global development and humanitarian disaster assistance responses. Over the years, USAID expanded the number of countries assisted, the scope and size of its activities, and especially its budget. The Trump Administration faced

The U.S. Agency for International Development leads the U.S. government’s international development and disaster assistance programs. USAID helps com- munities to lead their own development journeys by reducing the impact of conflict; preventing hunger and the spread of pandemic disease; and counteracting the driv- ers of violence, instability, transnational crime, and other threats. In alignment with U.S. national security interests, the agency promotes American prosperity through initiatives that expand markets for U.S. exports; encourage innovation; create a level playing field for U.S. businesses; and support more stable, resilient, and democratic societies that are less likely to act against American interests and more likely to respect family, life, and religious liberty.

an institution marred by bureaucratic inertia: programmatic incoherence; waste- ful spending; and dependence on huge awards to a self-serving and politicized aid industrial complex of United Nations agencies, international nongovernmental organizations (NGOs), and for-profit contractors. Once started, programs continue almost indefinitely—in many countries, for decades. USAID’s multibillion-dollar humanitarian programs that were once 80 percent in response to natural disasters are now 80 percent in response to violent, man-made crises and have become a permanent and immiserating feature of the global landscape. Under the Trump Administration, USAID focused on ending the need for for- eign aid by placing countries onto a Journey to Self-Reliance.2 The Administration restructured the agency to reflect this strategic approach to development, stream- lined procurement procedures to diversify its partner base, increased awards to cost-effective local (including faith-based) organizations, and improved inter- nal governance. It instituted pro-life and family-friendly policies. It promoted international religious freedom as a pillar of the agency’s work and built up an unprecedented genocide-response infrastructure.

The Biden Administration has deformed the agency by treating it as a global platform to pursue overseas a divisive political and cultural agenda that promotes abortion, climate extremism, gender radicalism, and interventions against perceived systemic racism. It has dispensed with decades of bipartisan consensus on foreign aid and pursued policies that contravene basic American values and have antago- nized our partners in Asia, Africa, and Latin America. It has decoupled U.S. assistance from free-market reforms that are the keystone of economic and political stability and has teamed with global institutions to impose central planning diktats on an unprecedented scale. Wasteful budget increases requested by the Administration and appropriated by Congress have outstripped USAID’s capacity to spend funds responsibly, and U.S. foreign aid has been transformed into a massive and open- ended global entitlement program captured by—and enriching—the progressive Left. The next conservative Administration should scale back USAID’s global foot- print by, at a minimum, returning to the agency’s 2019 pre–COVID-19 pandemic budget level. It should deradicalize USAID’s programs and structures and build on the conservative reforms instituted by the Trump Administration. This will require working closely with the U.S. Congress to make deep cuts in the interna- tional affairs “150 Account” while granting USAID greater flexibility in spending its appropriated funds to achieve better developmental outcomes.

KEY ISSUES

Aligning U.S. Foreign Aid to U.S. Foreign Policy. U.S. foreign aid is too often disconnected from the strategy and practice of U.S. foreign policy. Its coordination is made difficult as the aid budget is divided among approximately 20 offices, agen- cies, and departments that provide some form of foreign assistance.

Inaugurated a robust counter-China response called Clear Choice3 that contrasted America’s development approach based on liberty, sovereignty, and free markets with China’s mercantilist authoritarianism that pursued predatory financing schemes and economic and political subordination to Beijing.

The USAID Administrator should be authorized to take on the additional role of Director of Foreign Assistance (DFA) with the rank of Deputy Secretary at the Department of State in charge of all U.S. foreign assistance. The DFA role would empower this person to align and coordinate the countless foreign assistance programs across the U.S. government and carry out the agenda of the next con- servative President more effectively. A version of this role existed during the last two years of the George W. Bush Administration, but the Obama Administration eliminated it in 2009.

Countering China’s Development Challenge. Through its trillion-dollar Belt and Road Initiative (BRI), the Peoples Republic of China (PRC) has directed billions of dollars in loans and investments to advance its geostrategic objective of displacing the United States as the premier global power. The PRC leverages its transactions—termed “debt traps” by many critics—to strengthen its global influence, extract natural resources, isolate Taiwan, win political support at international fora, and access ports and bases for its military. In Latin America, 25 of 29 countries participate in the BRI, and the PRC ranks as the region’s largest trading partner. Since 2005, Chinese state-owned banks have issued $138 billion in loans to Latin American countries, and other Chinese entities have invested an additional $140 billion. In Africa, China has issued $160 billion in loans and dominates the continent’s rare earth mining sector, which is critical to global energy development.

The World Bank estimates that 60 percent of all BRI loans are in financial distress, leading many countries to seek emergency financial help from Western donors. Chinese-funded projects are known for employing substandard labor and environmental practices, fueling corruption, promoting wasteful financial deci- sions by governments, advancing China’s geostrategic interests, and creating an unequal trade relationship in which China secures raw materials from developing countries and sells those countries manufacturing products. For example, Brazil, a world leader in shoe production, saw its industry collapse under a flood of cheap Chinese imports. China’s mercantilist penetration of the developing world and the negative consequences for developing countries’ healthy economic growth have undercut U.S. strategic relationships in those countries and wasted billions in U.S. foreign aid.

During the Trump Administration, USAID:

Struck bilateral development relationships with Japan, Israel, Kuwait, Qatar, the United Arab Emirates, and Taiwan to support projects in sub-Saharan Africa, Asia, Latin America, and the Middle East. Established an office in Greenland to help counter China’s claims of being “a near Arctic state” and reoriented its programming across Asia—including establishing a USAID Mission to Central Asia—in line with America’s Indo- Pacific strategy.5

Joined with the U.S. Department of Homeland Security and National Oceanic and Atmospheric Administration to help coastal countries detect and halt illegal, unreported, and unregulated fishing and confront criminal activities practiced by state-run Chinese fishing fleets that violate international norms, ravage fishing industries in developing countries, worsen food insecurity, rob vulnerable communities of their livelihoods, and deplete maritime resources.

Launched its first Digital Strategy4 to promote safe 5G access in emerging markets and combat Beijing’s efforts to equip regimes with tools to stifle democracy.

USAID built an organizational infrastructure to carry out its multiple lines of counter-China operations. An agencywide Clear Choice Executive Council and USAID–U.S. International Development Finance Corporation Working Group reviewed all proposed assistance programs and proposals through a counter-China lens. A senior executive–level Clear Choice Coordinator, reporting to the Adminis- trator, advised the agency’s leadership on initiatives to counter China, supported by a fully dedicated six-person Secretariat.

The Biden Administration discontinued these programs and allowed USAID’s counter-China architecture to waste away, subordinating our national security interests to progressive climate politics in which Communist China is viewed as a global partner.

The next conservative Administration should restore and build on the Trump Administration’s counter-China infrastructure at USAID, end the climate policy fanaticism that advantages Beijing, and assess bilateral aid through the lens of U.S. national security interests, rewarding those countries that resist China’s debt diplomacy. It should finance programs designed to counter specific Chinese efforts in strategically important countries and eliminate funding to any partner that engages with Chinese entities directly or indirectly. USAID’s Bangkok-based Regional Development Mission for Asia should focus its strategic attention on supporting cross-border initiatives designed to counter Chinese influence.

Climate Change. Upon taking office, President Biden issued executive orders to “put the climate crisis at the center of U.S. foreign policy and national security” and mitigate “the devastating inequalities that intersect with gender, race, ethnic- ity, and economic security.”6 USAID subsequently declared itself “a climate agency” and redirected its private-sector engagement strategy—teaming with America’s corporate sector to wean countries off foreign aid through private investment and trade—to support the Administration’s global policy to “transition from fossil fuels to renewable energy.”

The Administration has incorporated its radical climate policy into every USAID initiative. It has joined or funded international partnerships dedicated to advancing the aims of the Paris Climate Agreement and has supported the idea of giving trillions of dollars more in aid transfers for “climate reparations.” The Biden Administration’s extreme climate policies have worsened global food insecurity and hunger. Its anti–fossil fuel agenda has led to a sharp spike in global energy prices. Inflation has hit the poor the hardest as they expend a higher proportion of income on food purchases. Farmers in poor countries can no longer afford to buy expensive natural gas–based fertilizers that are key to achieving high yields of food production. Under advice from climate radicals, the government of Sri Lanka even banned chemical fertilizers entirely without having any replace- ments in place. The result has been hunger and violent political instability.

The aid industry claims that climate change causes poverty, which is false. Enduring conflict, government corruption, and bad economic policies are the main drivers of global poverty. USAID’s response to man-made food insecurity is to provide more billions of dollars in aid—a recipe that will keep scores of poor countries underdeveloped and dependent on foreign aid for years to come. The impact on Africa is especially acute. South Africa, for example, relies on coal-powered plants to generate 80 percent of its power needs. It would need $26 billion in foreign aid to make the full transition away from coal. Multiplying this amount by dozens of other countries on the continent, the financial resources needed to transition away from fossil fuels are unachievable. In Latin America, countries that are global leaders in oil and gas production have sharply curtailed their energy production in line with climate activists, upending the hemisphere’s major source of export revenues and condemning it to years of economic and polit- ical instability.

USAID should cease its war on fossil fuels in the developing world and support the responsible management of oil and gas reserves as the quickest way to end wrenching poverty and the need for open-ended foreign aid. The next conservative Administration should rescind all climate policies from its foreign aid programs (specifically USAID’s Climate Strategy 2022–20307); shut down the agency’s offices, programs, and directives designed to advance the Paris Climate Agreement; and narrowly limit funding to traditional climate mitigation efforts. USAID resources

are best deployed to strengthen the resilience of countries that are most vulner- able to climatic shifts. The agency should cease collaborating with and funding progressive foundations, corporations, international institutions, and NGOs that advocate on behalf of climate fanaticism.