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Development in High(er) Esteem August 4, 2009

Posted by Rebecca Williams in Analysis.
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Development seems to be getting more attention, if not more respect these days. The Senate and the House both intend to rewrite the Foreign Assistance Act (FAA) which has not been fully reauthorized since 1985. Secretary Clinton recently announced that the State Department will, for the first time in its history, carry out a Quadrennial Diplomacy and Development Review (QDDR) intended to provide a long-term strategic plan for US foreign assistance and diplomacy. The budget request for diplomatic and development operations is significantly higher than previous years, with $9.12 billion requested for State’s Diplomatic and Consular Programs and Capital Investment Fund accounts, and $1.65 billion in corresponding funding for USAID. Congressional appropriators seem to be listening as both the House and Senate Foreign Operations Appropriation bills have provided increased operational and program funds over previous years. For a semi-autonomous agency without an Administrator, the shift in political atmosphere is a positive sign for USAID.

There is also an emerging consensus in Washington that it is time to rewrite the basic foreign assistance/development legislation, the Foreign Assistance Act. The daunting reality is that while USAID is the development flagship, US foreign assistance is actually divided among multiple parts of the US government, including 12 departments, 25 agencies and nearly 60 government offices. This fragmented structure reduces effectiveness and causes duplication, two of the reasons Congress often cites when it cuts development funding. Equally challenging, foreign assistance and development programs are heavily earmarked and subject to directives, procedural rules and restrictions that add costs and slow the process. Both Congress and the executive branch have been responsible for these restrictions. The fact that the Congress is willing to tackle these tough issues is testament to the change in political environment.

The US does not have a current, well-articulated long-term strategic plan for international assistance. The challenge for the QDDR is to provide a coherent national view and rationale for US foreign assistance. Within the development community there are two distinct camps: those that see development assistance as a component of US foreign policy that should support US national interests and those that favor development-for-developments sake, which should be in the long-term US national interest. However, without an overarching framework policymakers have been deciding for themselves if and how international assistance relates to US foreign policy and humanitarian issues, causing certain programs within USAID to receive a disproportionate amount of funding to the exclusion and detriment of other programs. The QDDR process will need to resolve this difference of view.

The President’s budget request will be close to fully funded, including advance funding provided in the FY 2009 supplemental. The appropriations bill for State and Foreign Operations passed the House earlier this month and provided $8.389 billion for State’s Diplomatic and Consular Programs and Capital Investment Fund accounts and $1.602 billion in corresponding operations funding for USAID. The Senate Foreign Relations Committee provided nearly the same amount; the Senate bill is awaiting floor action. This marks a shift in previous personnel spending limits, which hovered around $6.7 billion for State and only $886 million for USAID.

FY 2010 State and Foreign Operations Appropriations Bills

($ in millions)

Capacity Building at State and USAID

Obama Request

Senate Bill Markup

House Bill

State, Diplomatic and Consular Programs

$8,960

$8,227

$8,229

State Capital Investment Fund

$160

$160

$160

USAID Operating Expenses

$1,439

$1,388

$1,389

USAID Capital Investment Fund

$213

$213

$213

Key program accounts also look to be fully funded in FY 2010, as the administration takes its first steps toward its commitment to double foreign assistance by FY 2015. While it is unknown which accounts will consist of this doubling, both the House and the Senate provided nearly all of the requested funding for some of the larger program accounts, as shown in the chart below.

FY 2010 State and Foreign Operations Appropriations Bills

($ in millions)

Programs

Obama Request

Senate Bill Markup

House Bill

Global Health and Child Survival

$7,595

$7,773

$7,784

Migration and Refugee Assistance

$1,480

$1,678

$1,480

Millennium Challenge Corporation

$1,425

$950

$1,400

Development Assistance

$2,734

$2,567

$2,465

The FAA rewrite, the QDDR and increased State and USAID operations funding are signs that development is being paid attention to in Washington. It remains to be seen, however, if the FAA rewrite will pass, if the QDDR will provide the overarching architecture that State and USAID need, or what funding level will be reached in conference .

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1. The Week That Was: August 3-7 « Budget Insight - August 8, 2009

[…] the upcoming QDR and possible program cuts it could bring. Diplomacy and development is receiving new attention with the upcoming Quadrennial Diplomacy and Development Review (QDDR), possible rewrite of the […]


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