What's the Point of Foreign Assistance?
Why should we even care about funding cuts to USAID?
Ok, sorry for the clickbait title! Now that I have your attention, we’re going to talk about US foreign aid, particularly the United States Agency for International Development, or USAID. If you have been following the news even a little bit over the past week, you know that the agency has been in the crosshairs of Elon Musk and many others in the new administration. Musk in particular has repeatedly maligned USAID on Twitter:
The new Secretary of State Marco Rubio put it slightly more gently to foreign dignitaries at the US Embassy in Guatemala:
“I want to tell you that this is not about politics,” Mr. Rubio said. “But foreign aid is the least popular thing government spends money on. And I spent a lot of time in my career defending it and explaining it. But it’s harder and harder to do across the board. It really is.”
This is a fast moving situation. Just yesterday, news broke that the new administration was slashing the USAID workforce from 10,000 to under 300, and cancelling virtually all existing contracts and programs. When you go to https://www.usaid.gov/, this is now the only thing that shows up on the page:
I am not going to go into the specific politics of this situation, or the disturbing methods Musk et al used to dismantle USAID1. Rather, I want to take a step back and explain what USAID is (was?), what kind of work it does, and why it matters for global public health, and ultimately, US diplomacy and geopolitical interests.
The History of USAID
The United States has a long history of foreign aid going back further than you might think. One of the first instances was in 1812 when we sent $50,000 (over $1 million adjusted for inflation) to Venezuela to help recovery from an earthquake that destroyed Caracas. More people might remember the Marshall Plan to rebuild Europe after WWII, which cost over $13 billion at the time.
The Foreign Assistance Act was passed into law by Congress in 1961 and reorganized the multiple different development organizations in this country, separated military from non-military aid, and established that no aid should go to Communist countries or those that:
“…engage(s) in a consistent pattern of gross violations of internationally recognized human rights, including torture or cruel, inhuman, or degrading treatment or punishment, prolonged detention without charges, causing the disappearance of persons by the abduction and clandestine detention of those persons, or other flagrant denial of the right to life, liberty, and the security of person, unless such assistance will directly benefit the needy people in such country.”
Later that year, President John F. Kennedy signed the executive order establishing the United States Agency for International Development to implement much of the goals of the Foreign Assistance Act. The objectives of the FAA and USAID at the time were closely aligned with the US geopolitical strategy of using soft power to win the Cold War. Since then, it has grown into a diplomatic tool to improve global public health, lift nations out of poverty, and assist with disaster relief and mitigating climate change. Withholding foreign aid has been one lever our government uses to push repressive countries into improving conditions for their people.
How Much Do We Spend and On What?
Surveys consistently find Americans vastly overestimate how much we spend on foreign aid. When you ask people what percentage of the budget it takes up, the average answer is 25%. People say the “right amount” would be about 10%.
The actual number?
Less than ONE percent !
Indeed, the average annual budget for USAID over the past few years was between $30-40 billion. While that sounds like a lot, it’s a tiny drop in the bucket compared to the overall $6 trillion budget. It looks even less impressive when you scale the amount of aid relative to our wealth and economic output, where the US actually lags the vast majority of peer countries:
Some critics counter that this aid money is misspent and doesn’t go to those truly in need. Elon Musk recently claimed that upwards of 90% of the USAID budget was fraudulent—even criminal—based on a gross misunderstanding of how the agency works. The respected surgeon and public health expert Dr. Atul Gawande ran the global health arm of USAID during the Biden Administration, and he countered this falsehood with actual data:
A more detailed breakdown from the Congressional Research Service shows which countries and programs in Africa get how much:
What are some tangible initiatives USAID has funded? Here are just a small handful:
Works with the State Department, HHS, and other agencies to coordinate and administer PEPFAR to fight HIV/AIDS, which has saved over 25 million lives
During the COVID-19 pandemic, USAID donated thousands of ventilators and invested in disease surveillance labs around the world
Numerous programs to fight human trafficking and promote democracy around the world
USAID also funds many veterinary initiatives in the US and globally! It partnered with NC State and UNC on a New Castle Disease vaccination program to reduce poultry losses and fight malnutrition in Ethiopia. It trains food animal veterinarians and epidemiologists in Cameroon to monitor zoonotic diseases that can threaten humans. It supported veterinary diagnostic labs in Guinea (again to monitor for human health threats).
But I Heard a Lot of Crazy Stuff Got Funded By USAID!
Elon Musk and many influencers online have been flooding the zone with outrageous attacks to discredit USAID, such as the claim that 98% of staffers donated to Kamala Harris (Totally made up). Funding celebrity visits to Ukraine (False). Tens of millions of dollars to Politico (Total amount off by a factor of 1,000, and grossly misleading). The list of targets is huge and ever expanding:
“Bill isn’t alone in receiving these weird smears and creepy attacks. The New York Times, Politico, the BBC, the Associated Press, Ben Stiller, Orlando Bloom, Jean-Claude Van Damme—all have also been accused of receiving USAID money for various normal things they did that Elon and/or his online fanboys do not like.
I can’t possibly say this in simpler terms: They’re just making it all up.”
Musk even claimed that USAID created COVID-19 !
To dig into that salacious allegation a little more, what actually happened goes like this: USAID provided funding to virology labs all over the world from 2009-2022 for something called the PREDICT program to monitor viruses that could potentially cause future pandemics. EcoHealth is a US-based NGO that researched Ebola, SARS, MERS, Nipah virus, Rift Valley virus, and a variety of other viruses, and they were involved with PREDICT. Infamously, they provided some research funding to the Wuhan Institute of Virology (WIV). Even though there has been no evidence beyond conjecture that WIV worked on SARS-CoV-2, let alone that it escaped from there, based on hypothetical concerns about possible gain-of-function research, EcoHealth was defunded and debarred by the NIH during the Biden administration (this was more due to political pressure than any facts showing wrongdoing).
Suffice to say, these claims range from kernels of truth that are grossly distorted or exaggerated to complete fabrications. Critics are generally arguing in bad faith with reckless disregard for even basic fact checking.
Am I saying that foreign aid dollars are never misspent? Of course not! Waste, fraud, and abuse plague every large organization, including charities and NGOs. However, USAID already imposes onerous reporting and verification processes, and has regular audits by an independent Inspector General (you can read their most recent report here). Speaking of which, this new administration recently fired at least 17 inspectors general, including the one that oversees USAID, which would not seem consistent with trying to reduce waste… 🤔
Why Does Foreign Aid Matter for Americans?
Some people may read all this and respond, “Sure, I hear what you’re saying about the amount of money being small overall, and the benefits some projects have, but I just think we should be spending money on Americans, rather than other countries.” Even if I disagree, I understand that perspective. That’s why it is important to see the bigger picture: While humanitarian concerns drive USAID's mission, the agency's work also generates significant economic and diplomatic benefits for the United States.
Fostering economic stability and supporting democratic institutions abroad buys us good will, influence, and reduces conflicts that could threaten us. helps create more prosperous and politically stable international environments. USAID focuses on building local capacity, supporting local innovation, and creating sustainable pathways for economic development. This strategy not only improves living conditions but also opens new markets for us and opportunities for international collaboration.
As the COVID-19 pandemic showed, infectious disease threats do not respect national boundaries and impact all of us. Disrupting HIV medications through PEPFAR risks viral mutations that create resistant strains which will eventually threaten our own citizens. Malaria and other tropical diseases are spreading to the southern US as the planet warms. Food and water shortages in the developing world drive sudden large migrations to developed countries (like the US and European nations) that can result in civil unrest, even wars.
I would argue that USAID, while not perfect, does far more good in the world than bad. It’s costs are minuscule compared to most of our other spending priorities, and fully zeroing out the agency would make almost no difference to the budget deficit. Furthermore, even if you don’t care about helping people abroad (and I really think you should), in my opinion the direct and indirect benefits to Americans are worth it.
In the near term, USAID appears to have been gutted. However, we should continue to advocate for the value of global public health and foreign aid. Hopefully we will return to our senses some day.
—Eric
Interested readers are directed to the following articles:
“Behind the Chaotic Attempt to Freeze Federal Assistance” — Atul Gawande, The New Yorker
“Elon Musk is reportedly taking control of the inner workings of US government agencies” — Sean O’Kane, TechCrunch
“Elon Musk’s Team Now Has Access to Treasury’s Payments System” — The New York Times
And oh, by the way, Musk himself was being investigated by USAID, which is probably not a coincidence!
“Alleged USAID Probe Into Starlink Raises Elon Musk Conflict Concerns” — Theo Burman, Newsweek