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American Non-Security Foreign Aid: The Swamp of Misguided Good Intentions

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The United States spends approximately 42.4 billion USD per year in foreign assistance. While it is easy to point out that 42.4 billion is actually barely 1% of the overall US budget (4.15 TRILLION USD) and use that figure to try to fight conventional wisdom worry that America spends too much helping other people in other lands solve their problems while not trying to solve its own problems, the real-term reality is that 42.4 billion is A LOT of money. Anywhere. To anyone.

It might even be surprising to people to learn that of that 42.4 billion, significantly less than half (16.8 billion USD) is allotted to ‘security.’ Fully 60% of the American foreign assistance budget goes to ‘economic and development’ initiatives all over the world. These initiatives run the gamut of well-intentioned policies, from migration and refugee assistance (2.8 b) to development assistance (3 b) to economic support funds (6.1 b) to global health programs (8.6 b). At face value it is difficult to argue with the theory and philosophy of humanitarian outreach underpinning these financial allotments. But if one begins to scratch below the surface of this humanitarian outreach, layers upon layers of illogic and negligence is revealed. At the very least, the methodology for determining recipients and structures in place for financial oversight seem to be deeply troubled.

This article completely avoids analysis of American foreign aid that is security-based, largely for two reasons. First, as cited above, security-based foreign aid, while getting the wolf’s share of media attention and criticism, is actually far less compared to the more universally praised and justified economic and development funds. Second, while some might find this cynical, there is often a common ‘legal kickback’ mechanism in place with American security-based foreign aid that directly supports the American defense industry. For example, under the current agreement between the United States and Israel, the latter can choose to spend as much as 26% of its security aid on weapons and systems produced within Israel. In essence, a quarter of American aid could be utilized as a direct subsidy to build up native Israeli defense industries. A new agreement, however, comes into effect in 2019 where even that small percentage is eliminated and all American security funds have to be spent by Israel on American defense contractors. This means America has begun to shift this aid-as-defense-industry-subsidy for other countries to its own military-industrial complex. It is, ultimately, destined to be a US governmental welfare program for American defense industries. This is not highlighted so much as a criticism (although it is clear many have issues with this practice), as an acknowledgement that even when American security-based foreign aid is mishandled or used in a way that works against American objectives, it is still ultimately connected to a positive economic purpose back to the United States. The benefit might not be as large or as long-term as the aid is meant to engender, but a benefit nonetheless exists for America no matter what emerges politically and militarily on the ground in these other countries.

There is no obvious direct ‘legal kickback’ explicitly benefiting the United States when it comes to its distribution of economic development-based foreign aid. This means it is arguably more important to watch not only how much money is spent but also to whom does the money go? It is in answering this question that some serious questions and misgivings emerge. Below, the top recipients of American ‘economic and development’ foreign assistance aid were juxtaposed against the respective 2015 Transparency International Corruption Perception Index. The TI Corruption Perception Index ranks 168 countries around the world, measuring the perceived levels of public sector corruption. As TI itself says, ‘public sector corruption isn’t simply about taxpayer money going missing. Broken institutions and corrupt officials fuel inequality and exploitation – keeping wealth in the hands of the elite few and trapping many more in poverty.’ The TI index has up to now been used for evaluating internal processes within given countries, in terms of how domestic institutions and state governance properly (or improperly) represent and protect its people. What this analysis does is tie the CPI directly into the distribution of American economic development-based foreign aid. The reason for this is simple: if a country scores low in terms of public sector corruption, then it is signaling globally that its domestic institutions are structurally engineered to manipulate received foreign aid, especially if it is geared to internal economic development. Arguably, the distribution of such foreign aid should avoid countries scoring low on Transparency International’s CPI. Unfortunately, when it comes to America, the dominant force in distributing foreign aid, this common sense idea is not in play:

TOP RECIPIENTS OF AMERICAN FOREIGN AID DESIGNATED FOR ECONOMIC DEVELOPMENT and CPI rank:

  • Afghanistan – 166
  • Pakistan – 117
  • Ethiopia – 103
  • Nigeria – 136
  • Sudan – 165
  • Kenya – 139 (tied)
  • Uganda – 139 (tied)
  • Tanzania – 117 (tied)
  • Zambia – 76
  • Mozambique – 112
  • Ukraine – 130
  • Democratic Republic of Congo – 147
  • Malawi – 112
  • South Sudan – 163
  • Iraq – 161

It is beyond the scope of this brief analysis to dive into each of the 15 individual cases above. What matters is to note that the AVERAGE Corruption Perception Index ranking of the top American economic development aid recipients is 132 (out of 168). This is horrifyingly low. For those who might be tempted to argue that this makes sense because it is obviously these countries that are in the most need of foreign assistance and guidance, that argument is fatally flawed: when a reminder is given about just what the CPI truly means – structural and institutional prevalence to manipulate, misuse, and exploit opportunities for elite gain – then it is obvious that in these countries all foreign aid inevitably flows through corrupt institutions before having any opportunity to be distributed to the communities most in need. Without strict and relatively oppressive external oversight mechanisms, these monies are de facto destined to be misappropriated or simply brazenly stolen. And studies have long shown the oversight mechanisms in place for the management of American foreign aid is lacking, to be kind.

The unfortunate but unavoidable conclusion is that the majority of American foreign aid, the bulk of which is rarely questioned compared to the more controversial security-based assistance, is currently going to countries structurally engineered at the moment to simply steal it. Perhaps most troubling of all, the current global political environment is focused more prominently on military/security-oriented initiatives and operations. This means it is unlikely any near-term future will witness even an inquiry into constructing a new system for foreign assistance. But a new system is what is desperately needed if the swamp of misguided good intentions is ever going to be drained.

Dr. Matthew Crosston is Executive Vice Chairman of ModernDiplomacy.eu and chief analytical strategist of I3, a strategic intelligence consulting company. All inquiries regarding speaking engagements and consulting needs can be referred to his website: https://profmatthewcrosston.academia.edu/

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Weakness or calculation? How the pandemic undermined the US world leadership

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Anyone watching the numerous doomsday movies, happily churned out by Hollywood, will see American doctors saving the planet from space-borne viruses and the plague epidemic that turn people into zombies. However, the very first serious test in a decade has shown that the US healthcare system is actually inferior even to the Russian one, created during the Cold War years. And this despite the fact, that for the past 30 years, the Russian medical system has been suffering from “optimizations,” cuts and underfunding. Moreover, while the Kremlin, even for propaganda reasons, has managed to provide real assistance to a number of European countries, and has been the first to launch a vaccine on the market, Washington’s actions can be regarded as a sign of weakness, and a very dangerous one to its allies at that.

More than a year after the start of the global lockdown, we can already sum up the initial results, which look disappointing to Washington. The US healthcare system has collapsed under the pressure, thus laying bare the country’s inability to bring the outbreak of a less-than-deadly disease under control. As for Russia, despite its lack of America’s vast resources, it still managed to win the vaccine race and become the first to come up with a viable antidote.

More importantly, Moscow has also come out on top in the information “war” with the West, with its Sputnik V vaccine proving to have far fewer side effects than its Pfizer and Moderna counterparts. Therefore, the US and British lobbying of their own vaccines, and their attempts to close the European market for the Russian vaccine look unethical, to say the least, all the more so amid numerous European media reports about people having  died from side effects after being inoculated with Western vaccines. At the same time, there are simply no reports about similar complications caused by the Russian vaccine, even though the European Commission and Brussels have been keeping a close eye on the effects of its use in European countries, including Serbia and Hungary, which have already taken the first deliveries of the Sputnik V vaccine.

What is the reason for the US demonstrating its weakness? How come that in the midst of the epidemic Washington was unable to find the resources to demonstrate its readiness to lend a helping hand to its European allies? Unfortunately, one of the reasons was that the Americans simply freaked out. The truth is, the US healthcare system is rather decentralized and unorganized. People with good health insurance have little to worry about. However, in a situation of a pandemic, the US medical facilities are pretty hard to manage, so one has to do it manually. Compounded by the general atmosphere of panic and the fact that the poorest strata of society, who have no health insurance and constitute the main risk zone (obesity due to malnutrition, advanced chronic diseases and other COVID-inducing conditions), the system simply collapsed. Therefore, it is not surprising that the Trump administration tried to keep maximum resources at home. Moreover, the businessman-turned-president, who had openly spoken about “exporting security,” never missed a chance to make it clear to his allies that US assistance is never free. As a result, he was replaced by Biden, a Democrat who advocates maximum support for all democratic forces. However, Democrats usually provide moral or military support, but they have proved equally unprepared to line up any serious assistance to the countries hit the hardest by the pandemic.

Moreover, it was actually at the suggestion of the United States and the UK that the COVAX system, a global initiative aimed at providing equitable (but not free) access to COVID-19 vaccines for countries in need, stalled. It turned out (who might have guessed?) that both the US-developed Moderna and the British AstraZeneca vaccines are primarily needed by their own electorates, and only then by countries that need them, but are unable to produce their own vaccine. Meanwhile, India with a population of over 1 billion, managed to fulfill its obligations, and Russia is ready to launch the production of vaccines in Europe. However, bending under Washington’s pressure, the European Union has banned the import of Russian, Indian and Chinese vaccines, without bothering to explain the reasons for this ban.

A country, claiming world domination cannot lead in everything, of course.  Therefore, it is not surprising that the healthcare systems of many European countries, like Sweden and Switzerland, are way better that what they now have in the United States. That being said, the world leader still bears full responsibility for its allies and cannot leave them to their own devices, not only in the event of a military conflict, but also in the midst of a pandemic. However, this is exactly what it did…

From our partner International Affairs

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The legacy of 2020, and 2021 in the prospects of the United States and China

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image source: cnn.com

2020 was a crucial year because of Covid-19, which disrupted the evolution of the world order in the direction of differentiation and transformation. This is the most severe crisis the human world has faced since the Second World War.

As of 10 May 2021, According to the Hopkins University Global New Crown Epidemic Statistics Report, as of May 10, 2021 there have been 158,993,826 confirmed cases worldwide and 3,305,018 deaths.

The pandemic is like a fatal global social test. On the basis of a world order that has already undergoing a crisis, it has not only caused a pause and thus a deceleration of economic development, but it has also stepped up social division and the transfer of power from the political to the technical sphere.

Although the most experienced analysts and leading research institutions have published various reports, currently none of them can accurately predict in detail the huge impact of the pandemic on the history of the 21st century.

The pandemic, however, will bring about major changes in four areas.

Firstly, it will accelerate the general trend of global economic recession and differentiation. This is due to the currency over-issue policies adopted by several countries and to intensified domestic social polarisation. Since 2018 the global economic and financial crisis has not yet been solved. On the contrary, the crisis has only been concealed by the short-term response of monetary policy.

Secondly, the pandemic will speed up internal changes and the reorganisation of the international political and economic order precisely due to internal social differentiation. Owing to the turbulent influence of domestic and international policies, economic and political risks in fragile regions of the world will intensify or have knock-on effects.

Thirdly, the pandemic will strengthen the digital society and competition between countries in building new technologies will become more intense. The most significant impact of digital society is the silent arrival of a transparent society that exists but has no human contacts.

Fourthly, the pandemic promotes the rise of vaccine nationalism and accelerates the revival of the community value of East Asian countries, which has epochal significance from the perspective of the history of world civilisation.

The most influential political and economic event in 2020 was the US elections and the related change of Administration. The US elections represented the sharpest but also the most frustrating change in US history. Although Donald Trump lost the election, 74,216,154 citizens voted for the outgoing President.

For the United States, the change in direction cannot be seen as the advent of a resolute and determined policy along one single line, as the basic reality of the highly divided American society was not changed, but indeed strengthened due to the general election. The huge impact promoted the spread of political violence and protests in the United States.

Source: The US Crisis Monitor, Bridging Divides Initiative, Princeton School of Public and International Affairs’, Liechtenstein Institute on Self-Determination.

First of all, Donald Trump lost the election, but the spectre of Trumpism has remained in the United States and even in Europe, which is generally not conducive to advancing the strategy of developing relations with China.

Secondly, the “antagonism” of the US strategy towards China has not changed radically. Trump hadopened a political-economic dispute with China. Itisparticularlynoteworthythat the younger generation of the Republican leadership isgraduallybecominghostile and negative towards China, and exertsgreatinfluence in Congress.Thisdoesnotfavours world peace.

Thirdly, if this attitude is not contained, it will lead to negative long-term impacts between high-tech decoupling and ideological competition. Finally, China’s policy towards the United States has been perfected and refined: although the government is still adopting a wait-and-see attitude, the voice of seeking cooperation and being rational and pragmatic is still the mainstream in China.

Besides the issue that China will reduce its dependence on the world and increase world’s dependence on China itself, China will reduce its dependence on traditional growth models and increase its care for social, green and environmental sustainability.

The year 2021 is proving that the focus of the analysis of global political and economic trends will still be competition between China and the United States. President Biden’s Administration still regards China as its main strategic competitor, but the methods of addressing the issue are quite different from those of Trump’s Administration. The main difference lies in the fact that President Biden focuses on solving domestic problems and does not exclude the most important issues with China.

President Biden’s Administration has adapted its strategy for China as the influence of major lobbies and interest groups – such as the US finance and military industry – on policy is constant compared to the previous Administration. Nevertheless, the Chinese factor in the chain of global interests keeps higher levels.

Indeed, voices from both parties in the US Congress calling for curbing China’s rise are also increasing.

In short, in terms of China’s policy direction, President Biden’s Administration is expected to oppose a trade war because it harms the core interests of the US business community. However, there are likely to be problems for Taiwan, Xianggang (Hong Kong), Xinjiang Weiwu’er (Uyghur), South China Sea, Xizang (Tibet), as well as other issues.

The possibility of renewed trade negotiations between China and the United States is expected to increase significantly in the future and the US strategy of constructive competition will be reformed.

Regardless of changes in Sino-US relations, China will certainly promote greater bilateral and multilateral investment cooperation, while seeking new development and shaping new models of cooperation.

The key areas which are currently the most important and noteworthy are, firstly, China’s joining the Regional Comprehensive Economic Partnership (RCEP) and seeking to adhere to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which shows that China’s top leadership has decided to continue the reform strategy of internal and external promotion.

The RCEP is a free trade agreement in the Asia-Pacific region between the ten States of the Association of South-East Asian Nations (Brunei, Cambodia, Philippines, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand and Vietnam) and five of their free trade partners: Australia, China, the Republic of Korea (South Korea), Japan and New Zealand. These Member States account for approximately 30% of world’s population and GDP, thus making it the largest trading bloc.

The CPTPP, instead, is a draft regional investment and regulatory treaty in which negotiations, until 2014, twelve Pacific and Asian countries participated: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the USA and Vietnam.

Indeed, between the RCEP and the CPTPP, there is not only the interconnection of the industrial chain and commonality -and more reasons for unity than differences – but also the influence of great powers’ strategic factors.

The main difference between the two is that the CPTPP has higher economic quality requirements, while the RECP is more inclusive. Secondly, the China-EU trade and investment agreement is likely to be signed, which has clear short-term interests for Europe and long-term strategic interests for China. China, however, still needs to take a cautious attitude towards European policy and its legal systems based on double standards. Thirdly, China and Russia are strengthening comprehensive strategic cooperation and there will be new opportunities for their cooperation in the energy and military sectors.

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Why Congress should be rough on Chris Miller at his testimony on Wednesday

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FBI director Chris Wray’s weak congressional testimony in March left most of the Capitol attack questions unanswered and most of us scratching our heads: if the chiefs of the intelligence agencies don’t know, then who does?

As I argued back in March, before Senate Wray picked the low hanging fruit questions — such as confirming that the Trump mob that stormed the Capitol was indeed Trump’s mob and not some other people — while conviniently glazing over the real questions.

This is why the congressional testimony by former acting Secretary of Defense, Chris Miller, this Wednesday matters. The national guard mystery is still the elephant in the room that’s still sitting in the corner in loud, deafening silence.

The House Oversight and Reform Committee has been looking for answers from federal intelligence agencies on Trump’s role in the Capitol insurrection since day one. They have knocked on pretty much any door they could think of, requesting information from sixteen offices in total. That brings us to Wednesday when the Committee will hear from Chris Miller, as well as Jeff Rosen, former acting Attorney General, and Robert Contee III, District of Columbia Police Chief, in a hearing titled “The Capitol Insurrection: Unexplained Delays and Unanswered Questions.”

Back in March, when Senate grilled Wray, the FBI director could not answer why the national guard was not sent in to quell the attack. Wray vaguely put the decision on local policy makers, conveniently circumventing federal responsibility.

Then months later, defense officials actually stated that the national guard was delayed for reasons of “optics” and worries over how it would look if Trump’s mob was pushed out forcefully, as they should’ve been. Miller dragged his feet for hours before giving the green light, as he wanted to imagine what exactly the national guard’s intervention will look like. The actual deployment took only 20 minutes, logistically speaking.

Miller has already spoken about Trump’s “cause and effect” words responsible for inciting the Capitol attacks. And some commentators like Sarah Burris at Raw Story already predict that Miller is about to throw Trump under the bus on Wednesday.

But that’s not enough. Where was Miller back then? The delay was his decision and no one else’s. The Congressmen and Congresswomen of the House Oversight and Reform Committee chaired by Congresswoman Carolyn Maloney, should not go easy on Miller only because now, after the fact, he is willing to speak up against Trump. Now it’s easy. Now it doesn’t count.

Trump removed Secretary of Defense Esper over his objection to sending the national guard on the Black Lives Matter movement that sparked up exactly one year ago. That’s why Trump replaced Esper with Miller. Miller could have also said no to Trump but he played along. That’s why Miller doesn’t get to play hero now. There are no heroes in the Trump Administration’s aftermath. Some “cause and effect” talk and hypocritical outrage after the fact don’t count. Now doesn’t count. The House Oversight and Reform Committee shouldn’t buy this. The time for cheap spins and late awakened conscience is up. Now is the time for real answers. Miller and Rosen should get a rough ride on Wednesday. Anything else would not be acceptable.

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