The Daily Demarche
Thursday, February 10, 2005
If the shoe fits...
I was all set to continue the piece on Public Diplomacy when I found this article from the L.A. Times in my daily sweep of the news: Mubarak, $2 Billion and Change. Here are the opening paragraphs:

Strong words alone will not dislodge an entrenched dictator like Hosni Mubarak. Obviously we're not going to send the 3rd Infantry Division to achieve regime change in Cairo. How, then, is Bush going to back up his demand for democracy? Here's a modest proposal: Reduce or eliminate altogether the $2-billion annual U.S. subsidy to Egypt unless there's real economic and political progress.

Since 1975, Washington has provided Cairo more than $50 billion in military and economic aid. Initially this largesse had two justifications: first, to keep Egypt out of Soviet clutches; second, to reward it for concluding a peace treaty with Israel. The first rationale no longer applies. And the second? Egypt has lived in peace with Israel, but so for the most part has Syria — and it hasn't gotten a cent from U.S. taxpayers. Arab states coexist with Israel because they have failed to destroy it, not because they've been bribed.

Now we have blogged repeatedly about foreign aid here at the Daily Demarche (here, here, here, and most recently here) about what we give, who we give it to and what we get out of it. This is the first piece I have seen in a major MSM source in some time calling for a reasoned re-examination of our foreign aid policy. I sincerely hope this is the start of a new trend in examining how we make use of our aid dollars and hold recipients responsible for their behavior. I do not oppose aid as a tool of diplomacy, but I do think we can reasonably expect some return on our dollars other than state sponsored anti-Americanism. Of course the venerable Cato Institute recently pointed out that empirical evidence indicates such an expectation may be unfounded:

Nor is aid generally effective at promoting reforms in recipient nations. Post-soviet Russia and dozens of countries around the world -- including heavily indebted ones -- are evidence that countries promise necessary reforms but ignore aid conditions once the money is received. By the end of the 1990s, the World Bank acknowledged what has also become a consensus among development experts: there "is no systematic effect of aid on policy."

One of the reasons for aid's disappointing performance is that "rich countries don't hold the managers of aid institutions accountable for their long record of failure," according William Easterly, a leading development economist formerly at the World Bank. Indeed, aid agencies rarely cut off recipients who misuse those funds, something of which all recipients are well aware. Largely because the lack of accountability hasn't changed, Easterly opposes increases in foreign aid.

I know that a segment of the international community and anti-American left will accuse the U.S. of "buying" friendly governments if we hold recipients to some standard in order to receive aid. That is a sophomoric argument. Any government anywhere in the world is free to reject aid from us if they do not like the strings that are attached. What other country lends or gives money to another that is openly hostile to it? From the L.A. Times again:

The Egyptian media also love more-modern conspiracy theories. They accuse the U.S. of dropping poisoned food packets in Afghanistan and spreading AIDS in Africa. Almost every terrorist outrage, including 9/11, is blamed on Americans or Israelis. Ibrahim Nafi, editor of the government newspaper Al-Ahram, wrote last year: "The West, and specifically those that are at the helm of their empire of evil, are the real terrorists…. The West is currently engaged in a war of annihilation against Muslims…."

As far as I can tell the Egyptian government is doing nothing to refute claims such as these- and neither are we. This ties in nicely with our failure to succeed in public diplomacy. As one reader pointed out, we should be on site for every dedication of every project funded by U.S. tax dollars, showing the flag and getting the word to the man on the street that Uncle Sam picked up the tab for the newest waste-water treatment facility.

The President's budget proposal calls for increases in foreign aid- and the world is watching- and eagerly scouring the budget to see how much they get. Now is the time for the President to redefine what it means to receive aid from America. This is the opportunity to tie aid to the growth of democracy and the long term development of recipient nations. For far too long we have been simply giving money away without demanding something to show for it. The days of counter balancing the Soviet Union are over- our aid must continue, but it must be used as a tool for diplomacy to promote the vision of the world the President offered in his inaugural address. Egypt is not the only country that needs to answer for it's aid, but it may be the most egregious offender.

Former Secretary of State Powell had this to say about foreign aid in January of this year:

...If a country needs aid year after year, decade after decade, it will develop a dependency on outside assistance.

Indeed, foreign aid to undemocratic regimes can be counterproductive in that it increases the longevity of the ruling autocracy by making it easier for despots to keep their small clique of supporters happy. Foreign aid will not make a real difference if markets are manipulated by autocrats who control access to credit, licenses, and jobs. Foreign aid will not generate growth if sound banking institutions cannot arise, because transparency exposes nepotism and other forms of corruption. Foreign aid does not work if the heavy hand of authoritarianism crushes individual initiative.

I repeat: Egypt has received over $50 billion in foreign aid in from America since 1975. I don't know if Powell had Egypt in mind, but if the shoe fits...


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dé·marche 1) A course of action; a maneuver. 2) A diplomatic representation or protest 3) A statement or protest addressed by citizens to public authorities.

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