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Despite a self-image as generous, America gives less foreign aid per capita than most wealthy countries
GENEVA — America has always thought of itself as a generous country, and it is.
Some Americans are even convinced that the U.S. has been overly generous in carrying the lion’s share of the burden in provding development aid to poorer countries, and many wonder whether it can afford to continue to give so much amid the global economic downturn.
But when aid dollars are considered on a per capita basis, the truth is America ranks at the bottom of the list of the wealthiest countries in the world. And in recent years an international campaign has been mounting for the wealthiest countries, particularly America, to dedicate a higher percentage of their gross national income to aid for the develping world.
So one of the deceptively difficult foreign policy issues that Barack Obama will face as president is what to do about all this. If the Obama administration seeks to live up to the international call for a higher percentage of wealth to be dedicated to aid for development, it will need to begin by helping Americans develop a more realistic image of themselves in the world.
And it will have to encourage them to give more development aid at a time when the country is hurting in a way it has not since the Great Depression.
Some advisers close to the Obama administration are going so far as to recommend that a cabinet level post— a secretary for international development — be created to focus purely on development issues.
So how do we understand the ranking system that so contravenes America's perception of itself?
First of all, the U.S. does provide a huge amount of aid. It provides just over $22 billion dollars in official development aid—just under a fourth of the total amount of world development aid. And it gives more in total dollar terms than any other country in the world.
As Robert Glasser, Secretary General of CARE International, put it, “that is because it has the largest economy.”
But the Center for Global Development’s (CGD) latest index on actual commitment to development, ranked the U.S. 17 out of 22 countries — just behind France, and barely ahead of Switzerland. The CGD, a non-profit think tank dedicated to monitoring aid for developing countries, bases the ranking on how much the wealthy countries help poorer countries build prosperity, good government and security.
A major criticism of U.S. foreign aid is that Washington ties its help to sales of U.S. goods and services. There is also cynicism that it bases its decisions on whether to provide the aid on geopolitical interests, dumping billions on countries like Iraq and Afghanistan that are simply too politically unstable for long range development to have much of a chance.
Another complaint is that American aid donations are all too often tied to earmarks connected to domestic politics.
Michael Keating, Executive Director of the Africa Progress Panel, a new initiative chaired by former UN Secretary General Kofi Annan, points out that financial aid is only one part of a basket of initiatives needed for genuine development. America is frequently criticized for giving with one hand, and taking back with another.
“If you are giving millions of dollars in aid, but cut a country off economically by creating prohibitive tariffs or blocking immigration and remittances,” Keating says, “You are defeating your purpose.”
At the Millenium Summit in September, 2000, the U.S. and other wealthy countries promised to increase their aid contributions to 0.7% of their gross national incomes. Virtually the only countries that have matched that kind of commitment are Norway, Sweden, Denmark, Holland and Luxembourg. The U.S. is currently commiting a minimal 0.16% of its gross national income to development. The Bush administration actually doubled development aid during its eight years in office, and made important contributions to fighting HIV/AIDS, but a sizeable chunk of the development funding has gone to Iraq and Afghanistan.
The financial crisis has also had a perverse impact. The crisis has sent the dollar soaring in relation