The Best Thinking About Fixing America's Foreign Aid

I've had the chance to view America's foreign aid machine from a few different angles. First, hustling appropriations with a large lobbyist on K Street, then on the ground with USAID in Uganda. It didn't take me long to pick up on the truism that our approach to foreign aid is broken.

Fixing this process is really important. Last week in Berlin, when Barack Obama said “The poverty and violence in Somalia breeds the terror of tomorrow,” he was drawing on the now widely accepted notion that to strengthen our national security, we need to do a better job promoting development around the world.

Today, there are 50 agencies involved in the foreign assistance process [check out this mind-numbing chart], the earmark process is dreadful and there is no single strategy that guides the aid process.

What is to be done? This is a big question, and this blog post is an effort to identify who is thinking about fixing America's approach to foreign aid, and what their best ideas are. To me, this question seems critical to the next Administration, who will have an opportunity to drastically change America’s interactions with the developing world for the first time since the 1960’s.

Nota bene: It is important to make a distinction between development economists, who use econometric analysis to make important generalizations about growth, and policy folks, who think about managing the US institutional approach to aid.

The Brookings-CSIS Task Force for Transforming Foreign Assistance for the 21st Century
Lael Bainard of Brookings, in recent testimony in front of the House Subcommittee on State, Foreign Operations, and Related Programs, summarized the findings of all 3 of the recent high profile committees on re-shaping foreign aid [HELP Commission, 2006 Task Force on Transforming Foreign Assistance for the 21st Century, and the Smart Power Commission].

All of these efforts call for greater U.S. engagement on development—not less. All call for elevating development on a par with diplomacy and defense-not subordinating it. All emphasize the need for stronger civilian operational capabilities for development, humanitarian, and post conflict missions. All call for coordination of aid with other soft power tools such as trade and debt relief. And all emphasize the urgent need to modernize an aid infrastructure designed for the challenges of a different century—not tweak the status quo.

The Modernizing Foreign Assistance Network
A group of high-profile policy thinkers, most based out of center-left Dupont Circle think tanks such as Brookings Institution, Center for Global Development and Academy for Educational Development. Interestingly, the group also contains leading democracy academics, including Michael McFaul, Frank Fukuyama and Larry Diamond. On June 1st, 2008, the group published a short general proposal calling for the ideas in the quotation above.

The HELP Commission
The HELP Commission, the most recent high profile commission on re-vamping aid, published its report in December 2007. The Commission, in addition to hitting the points above, has a strong emphasis on the private sector. The report calls for more assistance to help build private sectors around the world, and the creation of a new business model to engage NGO's.

The Center for Global Development's Modernizing U.S. Foreign Assistance Initiative
A great initiative that attempts to capture the best in analysis and advocacy on U.S. foreign
assistance reform. The most important paper is Steve Radelet's Modernizing Foreign Assistance for the 21st Century: An Agenda for the Next U.S. President, which has one of the strongest presentation of the above points.

The Spence Commission Report
This isn't about the management of foreign assistance, but I couldn't help myself. Published in June 2008, the The Spence Report represents a new Washington Consensus, the best new thinking about growth. Economist Dani Rodrik sums it up best:

It is to Spence's credit that the report manages to avoid both market fundamentalism and institutional fundamentalism. Rather than offering facile answers such as "just let markets work" or "just get governance right," it rightly emphasises that each country must devise its own mix of remedies. Foreign economists and aid agencies can supply some of the ingredients, but only the country itself can provide the recipe.

I would love to find out if I'm missing anything that is out there.