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Why does everyone hate USAID? August 16, 2010

Posted by Elizabeth Cutler in Analysis.
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It “loses hearts and minds”, it should “pack up its bags and head home”, it’s “crushingly bureaucratic”, and it’s a “ship without a full crew”. Okay, so maybe not everyone hates USAID, but the agency certainly receives a considerable amount of criticism. Waning public support for the war in Afghanistan coupled with recent reports of waste, fraud, and abuse has increased the murmur of complaints to a more feverish pitch, highlighting the persistent tension and ambiguities that continue to characterize U.S. foreign assistance and, as a result, its primary agent: USAID.

Policymakers have conflicting views about U.S. foreign assistance.  Questions persist, including:  How much does foreign assistance actually accomplish? Should foreign aid goals always align with U.S. national security priorities? Should the U.S. military be involved in foreign assistance programs?  If so, how much?  What is the actual meaning of “democracy assistance” in the 21st century?

Disagreements have led to workarounds like the Millennium Challenge Corporation (MCC) that intensify the diaspora of foreign assistance rather than solve the essential problems plaguing USAID. Rather than strengthening USAID to work more effectively and efficiently, we have instead dispersed foreign assistance programs across 12 departments, 25 agencies and nearly 60 government offices. This fragmented structure reduces effectiveness and causes duplication, both of which are often cited by Congress when it slashes funding for development.

These broader tensions and ambiguities are compounded by USAID’s own problems.  USAID notoriously suffers from serious internal bureaucracy that slows its processes—in the U.S. and internationally—considerably. As Thomas Carothers discussed in his 2009 Carnegie report, USAID also has awkward (read: contrary to productivity) relationships with Congress and the State Department and a void where a modern legislative underpinning for foreign assistance ought to be.

There is a lack of political consensus on why the US gives foreign aid.  For the first few decades of USAID’s existence, the reason for supplying foreign assistance was politically clear: preventing the spread of communism. This was an oversimplification and since the end of the Cold War, the reasons for investing in international development have become less clear and more numerous, opening the door for any and every reason to provide assistance.  Without consensus, priorities are not set. Every reason means no reason, which is why many advocate for the drafting of a modern foreign assistance act in order to fill this void.

Although agency administrator Dr. Rajiv Shah seems to enjoy a positive working relationship with the Obama administration, overall attention paid to USAID (or lack thereof) points to an overall de-prioritizing of the agency’s improvement by the executive branch as well as Congress. Many of the agency’s top positions still lack Presidential nominees, some of those with nominees still wait to be confirmed. Personnel management may not be the flashiest area of focus, but it’s clearly a necessary one if we want to see larger improvements in the agency’s management and operations.

USAID does not have the staff to implement its own programs and contracts most of its development projects out to private companies.  A recent article in The Christian Science Monitor offers a scathing depiction of waste in the Badakshan province of Afghanistan. Staff writer Ben Arnoldy reported that a USAID project to build a canal intended to expand access to electricity instead resulted in an unfinished trench—to the tune of $1 million American dollars paid to the contractor hired by USAID. Though it is difficult to identify the exact cause of this project’s failure, suffice to say that it demonstrates that management and personnel problems and ineffective internal bureaucracies do have a tangible, on-the-ground impact.

Confusion over USAID’s role vis-à-vis the State Department and DoD also continues, further exacerbating the ambiguity that has come to characterize USAID’s very identity. USAID is a semi-autonomous organization that continues to war with the State Department over appropriate roles and missions. Moreover, over the last 10 years, DoD’s role in foreign and security assistance has increased primarily due to the wars in Iraq and Afghanistan.  This has led to more military involvement in traditional development projects overseas, further blurring the lines that previously delineated the three organizations.

In the midst of USAID’s own challenges, its leadership as well as the Executive branch must grapple with what its role ought to be with regard to DoD as well as the State Department. Unfortunately, the interim Presidential Study Directive on Global Development (PSD-7) did not tackle these issues, and it is unclear how much the Quadrennial Diplomacy and Development Review (QDDR) will address the State/USAID relationship.  It also remains to be seen how President Obama, Secretary of State Clinton, and Dr. Shah will work—if at all—to address the issues articulated by Carothers as well as others. Change seems to be moving slowly if at all, an issue Budget Insight will continue to examine.



1. Barak - August 16, 2010

I agree with much of what you wrote, but I think you left out an important part of the problem: you blame everyone in the USG except USAID. Part of the agency’s problem is that it does a terrible job of justifying its own existence. USAID does not operate as a single agency, but is more like an umbrella organization for lots of different development projects (health, education, environment, democracy/governance, etc.). USAID has been unable to frame why it exists, so others have chosen to do so – to the detriment of USAID.

2. Today’s News « Budget Insight - August 17, 2010

[…] Defense chief to step down in 2011 Defense Secretary Robert Gates plans to step down sometime next year, leaving to his successor a long list of to-dos ranging from operations in Iraq and Afghanistan to efforts to get the Pentagon’s sprawling budget under control. […]

3. Elizabeth Cutler - August 18, 2010

Thanks for the feedback, Barak. I approached this piece with the goal of unpacking the background of why USAID is so often the talk of the (wonky development policy) town. In doing so I wasn’t really looking internally, but you are totally right that therein lie a plethora of factors that are worth exploring. That said, I do believe that much of USAID’s own issues would be easier for them to work on (such as epic quantities of red tape, reporting processes, etc) if they had a “full crew” as the CGD has pointed out. And that depends on the President nominating the appropriate people and Congress confirming them in a timely manner.

I also think an angle of this issue that needs to be explored further is that of modernizing/rewriting the FAA. And perhaps if that were to actually happen, USAID would be held accountable for defining itself in contemporary terms and goals.

4. Barak - August 19, 2010

This is undoubtedly true and I hope the new policy office at USAID will also help. USAID’s shortage of personnel is appalling and substantially undermines the quality of their work.

5. Continuity in Development Policy, but Implementation is Key « Budget Insight - September 23, 2010

[…] The PSD and QDDR leaderships were reportedly at loggerheads for months.  USAID and State remain suspicious of one another and Congress lacks confidence in both.  It’s no longer news that grand plans for […]

6. Continuity in Development Policy, but Implementation is Key « The Will and the Wallet - September 23, 2010

[…] The PSD and QDDR leaderships were reportedly at loggerheads for months.  USAID and State remain suspicious of one another and Congress lacks confidence in both.  It’s no longer news that grand plans for […]

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