Opinion: Rethinking USAID selection criteria

Devex
By Michael Miklaucic

Kit sets and emergency supplies at a warehouse in Port-au-Prince, Haiti. Photo by: Ellie Van Houtte / USAID / CC BY-NC

The Trump administration budget proposal envisions dramatic cuts to the foreign assistance program as the White House cannibalizes civilian budgets to pay for major military increases. Although those cuts may not, in the end, amount to the 30 percent proposed, it is certain that the U.S. Agency for International Development and its development programs will be hit pretty hard. The kinds of soft power that economic and social development represent do not resonate loudly with the president or his closest advisers. USAID and its supporters will of course resist, and argue fiercely that foreign assistance makes a substantial contribution to national security, and in the end saves money.

In theory, this may be correct, but the reality is less clear. A better response would be for USAID to take a step back and repurpose itself to accept a narrower, but more focused role, drastically reduce the scope of its work and its global footprint, and more explicitly support national security objectives.

Currently managing projects in over 100 countries addressing no fewer than 13 strategic objectives, USAID could reduce its exposure significantly. What is the strategic logic of programs in Madagascar? East Timor? Moldova? Why are U.S. taxpayer dollars being spent by USAID to promote development in India, one of the world's largest and most dynamic economies, or underwriting a $15 million USAID program in the People’s Republic of China?

The selection of countries for USAID programs should be based on the following four criteria.

1. Strategic interest.

Does the U.S. have a significant strategic interest in the country? By this criterion countries such as Madagascar, East Timor, Moldova, Paraguay, or Mozambique would be out. I see no serious argument that these countries are of strategic importance to the United States.

2. Comparative advantage.

Does the U.S. have a comparative advantage in the forms of assistance needed in a particular country? This criterion demands that any assistance program be one that cannot be done as well or better by some other development organization, such as the World Bank or the U.N. Development Program.

3. Program impact.

Can a U.S. assistance program make a significant difference in terms of meeting our national strategic objectives? This would require that we ask about the effectiveness of programs. For example, there is no question that the U.S. has a profound strategic interest in India; however, India is among the world’s largest and fastest growing economies, and has made dramatic development innovations in recent decades on its own. Indeed one of the most dramatic development advancements in recent years was India’s introduction of a nationwide biometric ID program, Aadhaar, developed with no contribution from USAID. The $105 million USAID program in India is inconsequential, though not inexpensive.

4. Governance and security.

Does a proposed country aid program reinforce the rule-based system of progressive states in which the U.S. has flourished? The U.S. and its allies have prospered dramatically within the rule-based system of states that has prevailed during the last 70 years. Today that system is in peril, as entropic forces change the global threat environment in ways that are eroding it. Among those are the growth and power of illicit global networks including transnational criminal organizations, global terror organizations, and networked insurgencies. Their damaging behavior is compounded by corrupt, criminal or failed states. When foreign assistance can effectively improve governance in strategically important, but fragile, failing, or failed states, this can fortify the system while advancing U.S. national security.

USAID must narrow its focus, consolidate its shrinking workforce, and reduce its overseas footprint.

USAID must reflect carefully, and develop a strategy over the next four years for regaining relevance. By narrowing its presence and consolidating its financial and human resources in 25, or even as many as 40 developing countries of strategic interest, USAID might actually be able to dramatically increase the impact of its programs and contribute more effectively to national and international security.

Its limited human resources, stretched thin throughout the world, could be productively consolidated with a much-reduced overseas footprint. Instead of having tiny staffs trusting project implementation to contractors, USAID missions would once again have critical mass to perform inherently developmental activities themselves rather than relying on outsourcing to contractors and NGOs.

If USAID wants a future of more relevance, it must not be hostage to its past. USAID must consider how it might best contribute to the security and prosperity of the United States, and carve out a niche accordingly. A role model for USAID could be the U.S. Treasury, which in the early post-9/11 years was shorn of most of its law enforcement functions, and reinvented itself as a national security agency leading the fight against terrorist financing. There is no guarantee that USAID can similarly reinvent itself, but if USAID is capable of pulling off such a transformation, it may yet have a dynamic future. Otherwise USAID risks continuing to fade into strategic irrelevance.