Bush's surprising liberal legacy

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United States foreign aid this year should jump to $23 billion from $13 billion in fiscal 2003.

"What? What?" you ask.

One of the great surprises of the Bush presidency has been the push for more aid. After all, many conservative Republicans call it a waste - pouring money down the drain.

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But the new fear of terror and the spread of AIDS has changed all that. The administration now calculates that by making the foreign-aid system more effective, it can reduce world poverty and thereby boost US security. The effort breathes new life into a program that's lost credibility - and has become Bush's boldest foray into liberal territory.

"Foreign assistance has assumed an importance within US national security that it has not enjoyed since the Marshall Plan more than half a century ago," says Patrick Cronin, an expert on aid at the Center for Strategic and International Studies in Washington.

In one sense, that $23 billion in the latest Bush budget exaggerates the aid increase. That's because it includes $7 billion for Iraq's reconstruction. Even ignoring Iraq, however, aid has risen under Bush, after declining since the 1980s.

"Foreign assistance funding has gone through the roof under this president," says a Republican congressional staffer.

US official development assistance amounted to $11.4 billion in 2001 and $13.2 billion in 2002, as measured by the Organization of Economic Cooperation and Development, a Paris-based club of mostly rich nations. And if Congress provides all the money sought by Bush for his Millennium Challenge Accounts (MCA), his HIV/AIDs initiative, and other smaller programs, the total could about double by 2008.

Washington experts doubt that the legislators, facing huge budget deficits this decade, will be quite that generous.

"If you put foreign aid in competition with domestic social compacts, you are going to lose," says John Sewell, a senior scholar at the Woodrow Wilson International Center, a Washington, D.C., think tank.

But foreign aid has important support from Rep. Henry Hyde (R) of Illinois, better known for leading the impeachment of President Clinton. As chairman of the House Committee on International Relations, he's managed to swing through Congress money to launch the various Bush aid initiatives.

Consider the MCA. The aim of this new program is to reward those low- income countries that rule justly, invest in the education and health of their people, and provide considerable economic freedom with extra aid for programs that they select as priorities.

Thanks to Representative Hyde's support, the Millennium Challenge Corp., which will administer the aid, got $600 million in fiscal 2004. It opened an office last month, has been hiring staff, and set up a website, www.mca.gov. Fifteen nations are to be named as recipients this spring. Bush has asked that MCA funding be increased to $5 billion a year by fiscal year 2006. Success in reaching goals will be tracked.

Or look at AIDS. Projections point to 40 million AIDS orphans in sub-Saharan Africa in the years ahead. The administration figures that by reducing the ravages of the epidemic it can reduce poverty and promote free markets in that section of the world. Bush has called for $15 billion over five years for AIDS prevention programs. Bush's budget calls for authorizations to reach $2.6 billion by 2008. "We are on track," says the staffer.

The importance of foreign aid to development can be exaggerated. The approximately $56 billion per year provided by all donor nations amounts to about $10 per person a year for people in developing countries.

Private money flows to poor nations are much bigger. One major element: Remittances home by immigrants in rich countries are about $100 billion a year. And nongovernmental groups and charities spend billions in poor countries.

Then there's foreign investment.

A net $187 billion of private investment money flowed into "emerging markets" last year and about $196 billion will this year, according to the Institute of International Finance.

But that money went to only 29 nations seen by investors as offering good prospects. Foreign aid goes primarily to the poorest nations of Africa, Asia, and Latin America, where investors often fear to tread. Aid is often seen as a catalyst, helping to provide the education, health programs, and infrastructure that can lead to sustainable growth.

Critics of foreign aid hold that the $500 billion given to less-developed countries by the US over the past 50 years has not had a lasting impact. But proponents note that much of the aid money given during the cold war - say, to Somalia, Sudan, or Zaire - was aimed at supporting anticommunist regimes rather than economic development.

Mr. Sewell points to aid successes - the Green Revolution that has averted widespread famine, great improvements in child survival, and a major contribution to the spread of family planning. The United Nations now predicts stabilization of the world population at 9 billion in 2050, up from 6.2 billion now.

Aid experts, like Steven Radelet of the Center for Global Development, would like to see US foreign assistance programs, involving at least 16 Washington agencies, better coordinated and given clearer objectives.

But Mr. Hyde doubts a major revamping of US aid would get through Congress. So his goal is to use "rifle shots" - MCA, HIV/AIDs, etc. - to make aid programs more "accountable." That idea has wide support in Congress.

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