Editor's Note: Alastair Smith is a professor of politics at NYU, and is co-author of The Dictator's Handbook: Why Bad Behavior is Almost Always Good Politics. The views expressed in this article are solely those of Alastair Smith.
By Alastair Smith – Special to CNN
Rick Perry claims that if elected president he would scrap foreign aid. While I believe such a plan might be good for poor people around the world because it could reduce dependence on the U.S. and promote third-world growth and democratization, I also think ending foreign aid is against the interests of U.S. voters.
Aid is only nominally about helping the poor. The simple fact is, aid does not flow to the most needy. Based on 2009 figures from USAID, only 29% of the U.S.’s $34 billion in economic assistance went to low-income countries and over $3 billion of that went to a single recipient, Afghanistan. While aid might have benevolent side effects, the reality is that U.S. foreign aid is used to buy compliance with policies favorable to America.
In the process, aid also props up those leaders who are willing to enact such policies. They tend to be mostly autocrats because their support can be more cheaply bought. The graph below illustrates the point by plotting U.S. aid to Egypt in millions of dollars. Either Americans suddenly became concerned about the plight of Egyptians in the late 1970’s or the U.S. paid out so that Egypt would recognize the State of Israel.
Rather than being grateful, surveys such as the Pew Global Attitudes Project, find that Egyptians have a very low opinion of the U.S. But since U.S. largesse buys policies that Egyptians (or other aid recipient citizens) dislike and sustains repressive regimes to boot, such reactions should come as no surprise.
Cutting aid is like a Republican workfare program designed to break dependency. As with limits on benefits in social programs, ending aid forces recipients to change their ways.
To survive in office, leaders need funds to pay their cronies. If foreign aid were withheld, then leaders would be compelled to enact policies that promote economic growth in order to swell their tax revenues. Generally, autocrats fear such policies because once they let people interact economically, it is hard to stop them from also organizing politically. Foreign aid provides a crutch that allows wily autocrats to postpone reform and democratization. But it also allows aid donors to extract more cooperative policies from aid recipients.
Foreign aid lets the U.S. buy policies such as anti-communism, anti-drugs, access to cheap oil and inexpensive market penetration by U.S. firms. Over the post-war period, the U.S. has spent $1.3 trillion on foreign aid; but it will clearly pay much more to achieve its policy goals. The current wars in Iraq and Afghanistan, for instance, cost far more. For the small price of about 0.2% of Gross National Income, foreign aid offers a far cheaper way to buy favorable policies than military force.
A Perry-style plan to cut aid would promote democracy and economic growth worldwide, I believe, but it is simply not credible. The temptation to buy policy concessions ensures the survival of the aid-for-policy favors system. However, Perry’s pledge that “every country is going to start at zero dollars” might be a good way to negotiate more favorable policies for fewer dollars going forward.
The views expressed in this article are solely those of Alastair Smith.