Is Giving Better than Receiving? Congress Debates Foreign Aid

How many U.S. taxpayer dollars should go to foreign nations in need? As the richest country in the world, are we responsible for nations that are struggling? How does our own debt figure in the equation?

House cuts foreign aid

On June 9th, 2006, the House passed the fiscal 2007 foreign aid bill, giving 10 percent less than President Bush would have liked, but 3 percent more than in fiscal 2006.

The $21 billion spending measure provides $2 billion to the Millennium Challenge Account, a White House priority that rewards developing nations for economic and political progress. However, the Bush administration wanted at least $3 billion to go to the program.

President Bush was also disappointed with the House’s funding of Iraq reconstruction; he asked for $522 million, but the House allotted $227 million. Similarly, the House passed $962 million for aid to Afghanistan instead of the $1.1 billion requested.

The administration responded with concern to the House bill, which was passed overwhelmingly 373-34.

Twenty-five representatives did not vote, and seven Democrats and twenty-seven Republicans voted against the measure. Those voting against represented the ends of the political spectrum, with Democrats like Dennis Kucinich (Ohio) voting against the priorities and Republicans concerned about the deficit voting against the high expenditure.

What stayed in

The House bill does fully fund several Bush administration priorities, including $3.4 billion for international HIV/AIDS relief, $2.5 billion in aid to Israel, $1.8 billion to Egypt, and $450 million for Sudan.

In addition, the House added a few amendments, including a ban on aid to Saudi Arabia, drafted by Anthony Weiner, (D-N.Y.) Congressman Weiner explained that Saudi textbooks contain anti-Semitic and anti-American ideas and that the Saudi government continues to financially support terrorist organizations. His fellow House members agreed.

Other amendments prevent the State Department from waiving foreign-aid bans for countries that refuse to extradite people charged with crimes punishable by life imprisonment or those who allegedly killed a law enforcement officer in the United States.

The Debate over foreign aid

Some Americans don’t want taxpayer dollars to go overseas when we ourselves have mounting debt. Others believe it is our duty to help poor countries in need.

The debate becomes more complicated when one considers the efficacy of aid. A new book by William Easterly, a former World Bank official who teaches economics at New York University, says aid does more harm than good. In The White Man’s Burden, Easterly asserts that aid can negatively affect a country’s economy and competitiveness by dampening its manufacturing and innovation and increasing its local exchange rate.

Easterly further argues that food aid can dissuade local farmers from planting for the next season because food prices can plummet when free imported food arrives on the scene.

Easterly’s critics retort that aid dollars can be used to buy local food and spur local farming instead. And other economists contend that aid stimulates growth for countries with competent governments. Further, pro-aid economists argue that foreign-funded health projects save lives. Fighting infectious diseases costs comparatively little money and improves lives dramatically, they say.

Where do you stand on the foreign aid question? What comes first for you - helping or paying off the debt? How does your personal philosophy of giving relate to the bigger world picture?

Your input matters

Your representatives DO care what you think. Especially now -- 2006 is an election year and many representatives will be looking to reconnect with their constituents. Let your congressmen and women know what you think! Give your senators a piece of your mind! To find your reps, click here.

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Article Posted on: 6/23/2006