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What We Got For What We Gave
The American Experience With Foreign Aid
April/May 1978 | Volume 29, Issue 3
Many countries, once recipients of grants for military equipment, have since the 1950’s become sufficiently prosperous to buy American weapons. In the decade of the 1950’s, the United States supplied $22.0 billion of weapons to other countries. Of this amount $17.4 billion was in grants and $4.6 billion in sales. By the 1960’s, sales exceeded grants, and today grants almost have disappeared while the volume of sales remains high. The American government has made great efforts to promote such sales. Critics argue that the practice stimulates local arms races (in Latin America, for example), uses resources more wisely devoted to human betterment, and gives some totalitarian governments the weaponry to suppress their own people. Proponents say that if the purchasers cannot buy from the United States, they will turn elsewhere; that the United States has more influence over countries using our arms than over those using arms from elsewhere; that arms sales sustain essential American defense industries; and that sales improve the balance-of-payments problem.
Disagreement and conflict between the President and Congress over the amount, recipients, conditions, and purposes of foreign aid have always existed. Sometimes Congress has pressed aid for a particular purpose or country on a reluctant President. Far more often, Congress has placed restrictions on how aid could be used. A recent example is the action of the House of Representatives in passing a foreign aid appropriation in June, 1977, with the proviso that none of the amount could be used directly or indirectly to grant or lend money to Vietnam, Laos, Cambodia, Uganda, Cuba, Angola, or Mozambique.
President Carter said these conditions would “severely restrict his ability to promote the interests of this country around the world.” He complained particularly about the prohibition on indirect aid, which conceivably could force the United States to withdraw all support from the World Bank, the United Nations Development Fund, and the African Development Bank should those institutions assist any of the proscribed countries. In specific terms the House action was an obstacle to improved relations between the United States and Vietnam and Cuba, a serious blow to twTo of the President’s foreign policy objectives. At the same session the House considered, but voted against, prohibitions on aid to Nicaragua and South Korea proposed because those countries violated the human rights of their citizens.
The foregoing sketch of the American experience with foreign aid has indicated only part of the complexity of the subject. Far more could he said of the increasing role of foreign aid extended by other countries: the Soviet Union, Communist and Nationalist China, Japan, Canada, the nations of Western Europe, even Israel. Until the early 1950’s more than 90 per cent of foreign aid worldwide came from the United States. In 1965 the figure was 60 per cent. In 1977 it was 25 per cent, and in most countries receiving American aid the contribution from the United States is now less than 15 per cent. Much could also be written about the importance of private agencies—large foundations like Rockefeller and Ford, special organizations like CARE, the Save the Children Federation, International Voluntary Services, Project Concern—more than two thousand agencies all told. These groups work primarily with their own endowments of philanthropic contributions, but they also cooperate with United States government projects and often receive government assistance, A complete discussion would also require attention to special emergency programs to assist countries afflicted by earthquake, floods, droughts, and other natural disasters.
The American government, beginning with the loans of World War I, has had sixty years’ experience with foreign aid. The experience reflects the shifting assumptions of foreign policy—from the denial in World War I that our loans should be considered a contribution to a common military effort; to the generosity of Lend-Lease and the Marshall Plan during and after World War II; to the subordination of all other considerations beneath the primary goal of military strength in the 1950’s, with a concomitant shift of emphasis from Europe toward Asia; to the optimistic hopes of the early 1960’s that the United States could eradicate hunger and lift the Third World to a condition of sustained economic growth; to the disillusionment of the Vietnam era, when many Americans seemed on the verge of abandoning the whole enterprise; to a quieter, more mature willingness in the late 1970’s to continue foreign aid, but on a relatively modest scale and without Utopian expectations.
Indeed, the lowering of expectations has been the most striking trend in the foreign aid experience. At the end of World War II, Americans had a near monopoly on usable world power, the result of special historical circumstances which could not last. But Americans unconsciously attributed that power to their own exceptional moral virtue. Foreign aid, as one instrument of that power, seemed capable of anything. By the time of the Vietnam War the myth of American omnipotence and exceptionalism was in ruins. The painful but necessary lesson that all things are not possible, even to Americans, had been learned.