Friday, October 21, 2005
Bloomberg News: War on Global Poverty Should Be Fixed, Not Ended
By Gene Sperling
Oct. 20 (Bloomberg) -- Amid the turmoil swirling around the administration of President George W. Bush, there is one positive Bush legacy Democrats ought to recognize: the increase in bipartisan support for U.S. aid to fight AIDS and global poverty.
For most of the 1990s, the Republican leadership was either cool to foreign assistance or bent on cutting it. After seizing control of Congress in 1994, the Republican majority won a 10 percent reduction in foreign aid. During this period, Foreign Relations Committee Chairman Jesse Helms referred to aid as ``money down a rat hole,'' while as late as 2000, former House Majority leader Tom DeLay accused Democrats who voted for aid of ``putting Ghana over Grandma?''
The year 2000 was a turning point. The Reverend Pat Robertson and Republican members of Congress such as Spencer Bachus and John Kasich -- buoyed by the multi-denominational ``Jubilee 2000'' grassroots movement dedicated to canceling the debt of developing nations -- joined with President Bill Clinton and key Democrats to secure congressional support for a G8 plan to provide tens of billions of dollars of debt relief to the world's poorest nations.
Although this was an important victory, the fact that it took a full-court press to overcome intense congressional resistance was discouraging, particularly given how much more the U.S. still needs to contribute to the global war on poverty.
Nixon to China
That is why President Bush's call for a multibillion dollar emergency plan for AIDS relief as well as the so-called Millennium Challenge Account (MCA) to provide assistance to countries deemed to perform well on measures of governance, investing in people and promoting economic freedom, was a Nixon- going-to-China moment in development assistance.
Certainly the administration's record is not beyond criticism. The U.S. is still following too slowly an emerging consensus among richer nations on increased global development assistance.
The Bush administration was seen to have lagged behind the U.K. and European nations in pledging to do its share on global poverty at the recent G8 Summit in Gleneagles, Scotland. And there are serious concerns about whether ideology has restrained the effectiveness of how the AIDS money has been spent.
Even with these caveats, President Bush deserves significant credit for winning aid increases that could have never passed a Republican Congress in the 1990s.
Proposing Cuts
Will this bipartisan support hold? In a disturbing sign, the Congressional Republican Study Committee recently released a plan by Representative Mike Pence of Indiana and Jeb Hensarling of Texas proposing dramatic cuts to development assistance, including the complete elimination of the MCA, which is up for reauthorization this year.
Critics on both the left and right -- and even within the administration -- point to the fact that it took three years after President Bush's original announcement and more than 14 months after congressional authorization to agree on the first MCA compact, finalized with Madagascar in April 2005.
Even after signing agreements in recent months with four more nations -- Cape Verde, Georgia, Honduras, and Nicaragua -- the MCA has committed just about $200 million a year through 2010, less than a tenth of the funding originally announced.
These criticisms don't justify eliminating the funds dedicated to the MCA. A better plan would be to broaden the MCA while still keeping its focus on strong country plans, performance and accountability.
Second Tier
One reform proposal would be to create what Tom Hart, a top official at DATA (Debt AIDS Trade for Africa, founded by U2 frontman Bono), and I have called a ``second tier'' for the MCA.
Currently, 90 percent of MCA funds go to the few first-tier nations that score well on a range of positive indicators. Allowing assistance only for this handful of high performers not only has prevented dollars from getting out the door, but also provides little incentive for reform for those nations that are still far from such a record.
A second tier would say to countries: even if you have not shown progress in every area, we will support you if you have an initiative to give children a free, quality education; basic health services; or clean water, and if you can show you are meeting rigorous standards of accountability and transparency.
Focus on Performance
This reform would maintain the MCA's focus on performance and on ensuring that recipient nations feel ownership of their assistance strategies. What would be different is that it would give a nation like Ethiopia or Rwanda an incentive to undertake dramatic reforms in health and education, even if it is years away from reaching first-tier status.
So far, the MCA has done very little in the areas of education and health, in part because it is seen as discouraging such investments in favor of infrastructure and the private sector.
While there is currently in place a scaled-down version of this idea, a strong second tier would enable up to 50 percent of MCA funds to support such significant reforms.
Because such a second tier would help fund other congressional proposals for clean water and education for girls in poor nations, it could also help provide the MCA with sorely needed bipartisan support.
This type of reform makes far more sense than simply rushing to the misguided conclusion that we have no other way to reduce our budget deficit and curtail spending than by cutting assistance for the poorest children, whether here in the U.S. or around the world.
To contact the writer of this column:Gene Sperling in Washington at gsperling@cfr.org.
Oct. 20 (Bloomberg) -- Amid the turmoil swirling around the administration of President George W. Bush, there is one positive Bush legacy Democrats ought to recognize: the increase in bipartisan support for U.S. aid to fight AIDS and global poverty.
For most of the 1990s, the Republican leadership was either cool to foreign assistance or bent on cutting it. After seizing control of Congress in 1994, the Republican majority won a 10 percent reduction in foreign aid. During this period, Foreign Relations Committee Chairman Jesse Helms referred to aid as ``money down a rat hole,'' while as late as 2000, former House Majority leader Tom DeLay accused Democrats who voted for aid of ``putting Ghana over Grandma?''
The year 2000 was a turning point. The Reverend Pat Robertson and Republican members of Congress such as Spencer Bachus and John Kasich -- buoyed by the multi-denominational ``Jubilee 2000'' grassroots movement dedicated to canceling the debt of developing nations -- joined with President Bill Clinton and key Democrats to secure congressional support for a G8 plan to provide tens of billions of dollars of debt relief to the world's poorest nations.
Although this was an important victory, the fact that it took a full-court press to overcome intense congressional resistance was discouraging, particularly given how much more the U.S. still needs to contribute to the global war on poverty.
Nixon to China
That is why President Bush's call for a multibillion dollar emergency plan for AIDS relief as well as the so-called Millennium Challenge Account (MCA) to provide assistance to countries deemed to perform well on measures of governance, investing in people and promoting economic freedom, was a Nixon- going-to-China moment in development assistance.
Certainly the administration's record is not beyond criticism. The U.S. is still following too slowly an emerging consensus among richer nations on increased global development assistance.
The Bush administration was seen to have lagged behind the U.K. and European nations in pledging to do its share on global poverty at the recent G8 Summit in Gleneagles, Scotland. And there are serious concerns about whether ideology has restrained the effectiveness of how the AIDS money has been spent.
Even with these caveats, President Bush deserves significant credit for winning aid increases that could have never passed a Republican Congress in the 1990s.
Proposing Cuts
Will this bipartisan support hold? In a disturbing sign, the Congressional Republican Study Committee recently released a plan by Representative Mike Pence of Indiana and Jeb Hensarling of Texas proposing dramatic cuts to development assistance, including the complete elimination of the MCA, which is up for reauthorization this year.
Critics on both the left and right -- and even within the administration -- point to the fact that it took three years after President Bush's original announcement and more than 14 months after congressional authorization to agree on the first MCA compact, finalized with Madagascar in April 2005.
Even after signing agreements in recent months with four more nations -- Cape Verde, Georgia, Honduras, and Nicaragua -- the MCA has committed just about $200 million a year through 2010, less than a tenth of the funding originally announced.
These criticisms don't justify eliminating the funds dedicated to the MCA. A better plan would be to broaden the MCA while still keeping its focus on strong country plans, performance and accountability.
Second Tier
One reform proposal would be to create what Tom Hart, a top official at DATA (Debt AIDS Trade for Africa, founded by U2 frontman Bono), and I have called a ``second tier'' for the MCA.
Currently, 90 percent of MCA funds go to the few first-tier nations that score well on a range of positive indicators. Allowing assistance only for this handful of high performers not only has prevented dollars from getting out the door, but also provides little incentive for reform for those nations that are still far from such a record.
A second tier would say to countries: even if you have not shown progress in every area, we will support you if you have an initiative to give children a free, quality education; basic health services; or clean water, and if you can show you are meeting rigorous standards of accountability and transparency.
Focus on Performance
This reform would maintain the MCA's focus on performance and on ensuring that recipient nations feel ownership of their assistance strategies. What would be different is that it would give a nation like Ethiopia or Rwanda an incentive to undertake dramatic reforms in health and education, even if it is years away from reaching first-tier status.
So far, the MCA has done very little in the areas of education and health, in part because it is seen as discouraging such investments in favor of infrastructure and the private sector.
While there is currently in place a scaled-down version of this idea, a strong second tier would enable up to 50 percent of MCA funds to support such significant reforms.
Because such a second tier would help fund other congressional proposals for clean water and education for girls in poor nations, it could also help provide the MCA with sorely needed bipartisan support.
This type of reform makes far more sense than simply rushing to the misguided conclusion that we have no other way to reduce our budget deficit and curtail spending than by cutting assistance for the poorest children, whether here in the U.S. or around the world.
To contact the writer of this column:Gene Sperling in Washington at gsperling@cfr.org.
