Foreign Policy

The public cannot afford to ignore foreign aid spending

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Foreign aid is not a regular topic of conversation for most Americans. When it is discussed, the public’s understanding of the subject is often mocked as clueless. The most common target of this criticism is that Americans severely overestimate the amount their government spends abroad.

{mosads}President Obama’s fiscal 2017 foreign assistance budget requested $26.1 billion in foreign aid funding for USAID and smaller civilian agencies such as the Peace Corps and the U.S. African Development Foundation. In addition to this considerable sum, the 2017 budget included $9.6 billion for foreign aid from Overseas Contingency Operations funds, a peculiar budgetary device created in 2002 to fund war-related spending in Iraq and Afghanistan that is conveniently exempt from sequestration cuts.


All told, the 2017 foreign aid budget request amounted to $35.7 billion. While this figure was a decrease of $670 million from fiscal 2016, foreign aid is hardly inexpensive. The 2017 federal budget as a whole is $4.247 trillion. Given this, foreign aid amounts to only .86 percent of the overallfederal budget — less than 1 percent.

Less than 1 percent is still a lot of money

Too often when reviewing budgetary considerations the analysis devolves into a series of hyperbolic comparisons. President Trump’s plan to secure our southern border has been particularly subject to such colorful criticisms. It would be easy, for example, to point out that $35.7 billion in foreign aid amounts to nearly $500 per taxpayer, or that it is enough to give every veteran in the United States a check for $1,500 each year, or that this sum could be used to fund Pennsylvania’s annual budget and still have enough to buy every man, woman and child in the city of Pittsburgh a new Ford Focus. But such comparisons have a tendency to sensationalize spending, removing debate from the realm of rational criticism and into that of humorous bullet points. 

A better — though less entertaining — method of framing the size of budget figures is to compare amounts with similar programs. When this approach is employed, it seems apparent that foreign aid spending— even when it comes in at less than 1 percent— is hardly insignificant.

Department of Labor (2017) — $63.5 billion (approximately 1.5 percent of the federal budget)

Foreign aid spending (2017) — $35.7 billion (approximately .86 percent of the federal budget)

Department of Energy (2017) — $32.5 billion (approximately .78 percent of the federal budget)

Department of Interior (2017) — $13.4 billion (approximately .32 percent of the federal budget)

It is critical to understand that this $35.7 billion is only foreign aidspending — that is, the amount spent by USAID and smaller agencies. This number does not represent the price of running the Department of State. State, which administers more traditional diplomacy, costs the taxpayers around $16.9 billion more each year. The total of these two amounts — the “International Affairs” budget — is $52.6 billion.

When compared to the larger federal budget and presented as “less than 1 percent,” it is tempting to dismiss foreign aid spending as inconsequential. But American generosity in this area is significant — so much so that we are, by a wide margin, the single biggest contributor of foreign aid in the world.

Federal spending abroad is a gamble 

Not only are embassies expensive, the incidental benefit of spending all of this money benefits foreigners more than it does Americans.

There is a critical difference between spending abroad and spending at home. While in some instances projects overseas are administered by U.S. corporations or nongovernmental organizations, much if not all local work is carried out by in-country laborers who in turn spend their pay locally. This self-induced capital flight is indisputable. 

Foreign aid apologists will submit that such funding spurs foreign growth and new markets for American businesses. That is a position that has been argued and disputed for decades. But what is absolutely unquestionable is that when the federal government spends domestically, it benefits the American economy. When it is spent overseas, the potential benefit is a mere gamble.

Foreign aid hurts real diplomacy

A less demonstrable cost of foreign aid is the price we pay for concentrating our diplomatic capital on nation-building. Foreign aid professionals are quick to characterize these expenditures as “investments.” But a hidden price of these investments is the distraction created by such programs away from other foreign affairs priorities. Often embassies that administer foreign aid become too focused on giving stuff away, rather than servicing the needs of Americans — be it issuing a lost passport, facilitating the visit of a foreign business partner, or reporting on political developments that affect the security of the homeland.

This is visible in the command structure of an embassy. An embassy is always led by a chief of mission — usually an ambassador — who represents the United States abroad and sets the mission’s agenda. Second in the chain of command is the deputy chief of mission, who functions as the chief administrator of the embassy itself, as well as a sort of vice ambassador. While traditionally a senior political officer or the senior consular officer would be third in command, this role is now often filled by the USAID mission director. In fact, consular officers in particular have become so secondary that it is not uncommon to find an embassy where the ambassador meets with the USAID mission director multiple times per week but with their consular section chief monthly, if at all. In the pecking order of American employees at an embassy, foreign aid officers have leapfrogged to the front.

This elevated authority allows the foreign aid agenda to dominate the work of an embassy. Political work, and even more so consular work, frequently involves confrontation with the host government. Even where we donate to causes that are well intentioned and do good, we insert the United States into the domestic politics of a foreign state. That sort of intervention can lead to consequences ranging from loss of trade to terrorism.

Traditional diplomacy limits American engagement to protecting our citizens, negotiating for improved commerce and enhancing our understanding of foreign lands. Foreign aid pursues these goals by turning diplomacy into a more kinetic endeavor: telling nations how to run their systems and subverting those who counter this idea by funding their opponents. This is not a neutral approach: it yields not just friends but foes.

Time for a fresh look

None of this is to say that the ground level administrators of foreign aid are not diligent government employees. Both the overt foreign aid officers of USAID and the more subtle facilitators of foreign aid in the U.S. military are almost without exception hard-working, patriotic Americans intent on doing what is best for their country.

There is even something to be said for increasing international affairs spending in certain areas. The Department of State’s main office building in Washington, D.C., for example, is an abomination. Its crumbling infrastructure and overstuffed offices are a consequence of funding shortfalls. No one in Congress wants to fund improvements to a building full of diplomats.

Taxpayers deserve a fresh look at foreign aid, both its levels of funding and the ultimate question of whether it works or does not. President Trump’s budget is that fresh look. Critics are skeptical because his budget questions the “less than 1 percent” and associated foreign aid orthodoxy. Such a review is necessary, though, to examine the issue clearly for the best way to help America, and if possible, other parts of the world.


Scott Uehlinger is a retired CIA Operations officer who spent more than 12 years with the agency working in the former Soviet Union. He has wide experience working with U.S. Embassies abroad, as well as working against the Russian, Iranian and proliferation targets. A Russian speaker, Scott retired from the CIA’s Clandestine Service and Naval Reserve in late 2014. He currently teaches an Intelligence course at NYU and frequently appears on television, radio and online discussing intel and national security issues. Scott’s weekly podcast can be found at He is on Twitter as scott uehlinger@thestationchief

The views of contributors are their own and are not the views of The Hill.

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