What might Obama do on US Aid Policy?

December 27, 2008

     By Duncan Green     

By the time I got to the US (a week after the election), euphoria seemed to have given way to the strange interregnum between presidents. I found a vast gossip machine on who gets what job in the new administration (7000 jobs are up for grabs), and a lingering underswell of pride and anticipation, laced with concern at inflated expectations (not confined to the US – have a look at this front page from Uganda).

Aid is clearly not going to be Obama’s top priority, but he has already said some sensible things about his plans, and there are some real opportunities, many of them created by some well targeted research and advocacy work involving networks of foundations, thinktanks and NGOs, with Oxfam America’s excellent aid effectiveness team playing a central role.

Most of the running has been made by the Modernizing Foreign Assistance Network. Several key players from the Network, including co-chair Gayle Smith, long-term congressional insider Larry Nowels, and the Center for Global Development’s Sheila Herrling have already found their way into Obama’s transition team, raising the chances of success. Smith has been tipped by the Economist  to be Obama’s senior diplomat in charge of African affairs.

Oxfam America sees real opportunities to reform the quality and structure of US aid, under the following headings:

1. Purpose: ensuring development and poverty reduction trump short-sighted security and political concerns as the guiding purpose for aid;
2. Modernization: agreeing a global development strategy, an efficient structure (perhaps with a separate cabinet post for development, a la DFID), a new Foreign Assistance Act (the last one was passed in 1961) and more resources.
3. Developing Country Ownership: redesigning aid in order to strengthen Active Citizens and Effective States (they’ve drawn on From Poverty to Power for this), under the general headings of transferring better information, capacity and control to aid recipients.

OA thinks most debate has so far been on the second of these (Washington loves discussing ‘org charts’), and is keen to push the other two.

Besides the election, there are other grounds for optimism:  there were 13 hearings on aid issues in 2008; Howard Berman, the new chair of House Foreign Affairs Committee; has committed to rewriting the Foreign Assistance Act 1961; Senator Russ Feingold, tipped  to lead the Senate Foreign Relations Committee is also progressive on development issues. Nancy Birdsall at CGD reckons the appointments of Timothy Geithner as treasury secretary and Lawrence Summers as director of the National Economic Council also bode well on development policy.

Reform won’t be easy – Congress and the US aid system are both fragmented, with many centres of power, each reluctant to cede turf, but the chances look better now than for an awfully long time. Fingers crossed.

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December 27, 2008
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Duncan Green
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