“Foreign Aid” Is Neither. Another Government Dirty Little Secret
Originally posted on January 26, 2021
In an already massively corrupted federal program, Biden has sunk to an even lower depth of the cesspool. He has converted a once noble American effort to assist disadvantaged nations into a personal profiteering scam that endangers the security of the United States. Benedict Arnold is green with envy.
“As originally conceived, American economic aid to foreign countries in the postwar era was a means to rehabilitate nations devastated by war or to aid underdeveloped countries. But as the years passed, foreign aid became closely tied to Cold War politics the need to stop Communist aggression and revolutions in underdeveloped areas, as well as the determination to keep other nations neutral. Much foreign aid thus turned into military aid. Countries whose economies had only marginal health were pressed into buying enormous quantities of armaments from both the United States and the U.S.S.R. It was hardly a coincidence that 95 percent of the post-World War II conflicts were fought in the so-called “third world.” American aid to underdeveloped countries led on occasion to an American presence, such as the military advisors in Southeast Asia, and the American experience in that part of the world prompted many citizens to re-evaluate foreign aid policies and to urge, as Senator J. William Fulbright did in 1971, abandonment of the whole program.
On October 19, 1971, Idaho Senator Frank Church gave a speech in the Senate urging a complete revamping of the whole foreign aid concept:
“We stand in this year 1971 at the end of one decade of disillusion, with no good reason to believe that we are not now embarked upon another. Ten years ago, the leaders of the United States – and to a lesser degree the American people- were filled with zeal about their global goals. With supreme confidence both in our power and capacity to make wise and effective use of it, we proclaimed the dawning of a new era in which America would preserve world peace, stem communism and lead the impoverished masses of mankind through the magic point of “takeoff” into a “decade of development.” To bring these glories to pass – so we allowed ourselves to believe- we had only to recognize the simple, central fact which Professor Walt Rostrow assured us would bring victory in Vietnam and success in all our other foreign enterprises, “the simple fact that we are the greatest power in the world – if we behave like it.” – Annals of America, Vol. 19; p. 259
“Looking back on the sixties, no one can deny that we were indeed “the greatest power in the world” and that we surely did “behave like it” – if throwing our might and money around is the correct measure of “behaving like it.” Nonetheless, we not only failed to accomplish what we set out to accomplish ten years ago, we have been thrown for losses across the board in the name of preserving the peace, we have waged an endless war; in the guise of serving as sentinel for the “free world,” we have stood watch while free governments gave way to military dictatorship in country after country, from one end of our vast hegemony to the other. Today, confidence in American leadership abroad is as gravely shaken as is confidence in the American dollar. As for the “decade of development,” ten years of American foreign aid spread far and wide, not only has failed to narrow the gap between rich nations and poor; the gap between the small, wealthy elites and the impoverished masses in most underdeveloped lands has also widened.
Against this backdrop of general failure, the Senate is again being asked to authorize yet another year of foreign aid, as usual. For fiscal year 1972, President Nixon has asked for a foreign aid authorization of more than $3.5 billion [2020: $40 billion], as compared with $3.1 billion appropriated last year [2019: $39.3 billion] appropriated last year. Clearly the Administration seeks not just to sustain, but to increase, the level of spending.
The annual foreign aid authorization bill, however, is no more than the visible tip of the iceberg. It constitutes only about 2/5ths of a total foreign aid program of over $9 billion proposed for this fiscal year by the Executive Branch.
On the basis of our experience over the last decade in dealing with the third world – unquestionably the “disaster area of our foreign policy” – John Kenneth Galbraith suggests four lessons that we should have learned:
First, it now seems clear that the “Marshall Plan syndrome” – the belief that American capital, energy and know-how could not fail to work economic wonders in any country on whom these blessings might be conferred – has turned out to be largely irrelevant and unworkable in the poor countries which lack Europe’s pre-existing organizational, administrative and technical capacities.
Second, it is evident now, if it was not before, that in the poor rural societies of the third world the concepts of “communism” and “capitalism” are of little more than “terminological” significance. The fact that these countries are poor and rural has vastly greater meaning than the fact such little enterprise as they have may be “socialist” or “free.”
Third, in the course of discovering that the inner life and development of the third world lie beyond the reach of external control [listen up Bush, Jr.!], we have also discovered that the futile effort to shape another country’s development calls into being an enormous, intrusive civilian and military bureaucracy. Whereas colonial power was exercised directly, Professor Galbraith observes, through a simple line of of command, our campaign to win the hearts and minds of foreign populations requires “a much more massive table of organization.”
Fourth, Professor Galbraith notes, we have seen how an overseas bureaucracy acquires a life and purpose of its own, only tenuously controlled by the Executive in Washington and effectively beyond the reach of Congress and the American people. Like any bureaucracy the American aid and military establishments abroad are motivated by one simple unshakable ambition: to survive and perpetuate their species.
Finally, a fifth lesson , even with enormous power and the best of intentions, there are some things we cannot do, things which are beyond our moral and intellectual resources. It will profit us immeasurably to have learned that being richer and stronger than everybody else has not made us wiser.
Nevertheless, our Administration persists in the delusion that it can buy influence with aid. …..Experience has shown that our aid programs have little if any relevance either to the deterrence of communism or the encouragement of democracy.
Foreign assistance bills in the tens of billions of dollars routinely go to United Nations member states who habitually vote against American interests. For example, $2.4 billion to 55 member states that voted against our position or abstained on the question to admit the People’s Republic of China to the United Nations and expelled Nationalist China.
Our long-term loans, made in the name of nourishing development abroad, serve neither to deter communism nor strengthen democratic government, and if they do so little why do we persist in making them? To find the answer, one must begin the search here at home, in the land of the lender.*
Our foreign aid program is patently self-serving. Former AID Director William Gaud discloses that “ninety-three percent of “foreign” AID funds are spent directly in the United States.
The present program is designed primarily to serve the private business interests at the expense of the American people. The search for foreign investment opportunities by the largest American corporations is relentless and irrepressible, as the biggest profits are to found abroad, where the tax bite can frequently be reduced or averted. Moreover, the risk of loss due to political instability, Riot, revolution or expropriation, has been largely lifted from the investor and shifted to the U.S. Government.** OPIC, the Overseas Private Investment Corporation, backed by the Federal Government, readily insures American companies against risks abroad for which no comparable insurance is available at home. The multi-million dollar losses incurred by American companies, resulting from the nationalization of their holdings are borne– not by the companies that eagerly invested there – but by the American taxpayer. Our foreign aid program has become a spreading money tree under which the biggest American businesses find shelter when they invest abroad. …No longer will I endorse with my vote a foreign aid program which has been twisted into a parody and a farce.
The major preoccupation of the present foreign aid program is the massive disbursement of munitions which we either give away or make available at bargain basement prices. Instead of cutting back on the foreign aid package, Congress is about to enlarge on it. We are in the process of doing the same with the gigantic military budget, approving more money for the Pentagon this year than we spent at the height of our involvement in Vietnam [Afghanistan, Iraq, etc.]
The acquiescence of Congress to these money demands of the Administration make it clear that we have no disposition of changing our spending habits. The “new priorities” promised the American people won’t be realized, as long as we refuse to cut our foreign and military spending.” – Senator Frank Church (D), Congressional Record, 92 Congress, 1 Session, October 29, 1971
Note: In a corollary to “foreign aid”:
“We have decided that there is no such thing as “federal aid”. We Hoosiers were fooled for quite a spell with the magician’s trick that a dollar taxed out of our pockets and sent to Washington will be bigger when it comes back to us. We have taken a look at said dollar. We find it has lost weight in its journey to Washington and back. The political brokerage of the bureaucrats has been deducted. We know now there is no wealth to tax that is not already within the boundaries of the forty-eight states.” – Resolution of the Indiana State Legislature, November 1958
See:
War Is a Racket by Major General Smedley Butler, 1935
The Creature from Jekyll Island: A Second Look at the Federal Reserve by G. Edward Griffin
** Trading With the Enemy: An Expose’ of the Nazi-American Money Plot, 1933-1949 by Charles Higham, 1983
