Aid looks good after it's gone

When Joni Mitchell sang that line in 1970, she was lamenting the destruction of the environment, but the sentiment applies to many issues. Today, we can add official development assistance (ODA) to the list.

- JEFFREY FRANKEL

For some 80 years, the United States spent more on humanitarian assistance, economic development programs, and other types of foreign aid than any other government. In the 2023 fiscal year, the US government disbursed $72 billion, with much more coming from private NGOs and individual citizens.

But the US does not spend the most as a share of its income; by that measure, the US contributes just 0.24%—a quarter of what northern European countries give—putting it in 24th place globally. Moreover, foreign aid accounts for just 1% of total US government spending—a far cry from the 25% many Americans believe the US allocates.

Many Americans, including some prominent scholars, believe that foreign aid has a negligible impact, with some, such as Dambisa Moyo and William Easterly, arguing that it does more harm than good. Critics highlight examples of misguided aid programs falling prey to mismanagement, government overreach, or corruption, including Vietnam in the 1960s, Zaire in the 1980s, and Afghanistan in the 2000s. While some economists, such as Paul Collier, insist that foreign aid is useful—especially when certain conditions are met—the dominant message seems to be that foreign aid is suspect.

But now foreign aid is gone, or at least going fast. Soon after Donald Trump returned to the White House, his administration—and, in particular, his unelected billionaire crony Elon Musk—began frantically dismantling the US Agency for International Development (USAID).

Almost immediately, reports began flooding in: what was being defunded were often life-saving, high-return projects.