More about Foreign Aid

April 9, 1956

Last week I cited here the proposed Aswan High Dam in Egypt as an embodiment of the most dubious principles involved in our foreign-aid program. A foretaste of the probable consequences of financing this program by American fiscal agencies is supplied by what has already happened to the Helmand Valley Irrigation Project in Afghanistan. The consequences of this were described by Peggy and Pierre Streit in The New York Times Sunday Magazine of March 18. This is the largest American-financed and constructed development in Asia. Conceived as a boon to the people of Afghanistan, it “has today placed a dangerous strain both on the Afghan economy and on the nation’s morale.”

The project was envisioned as providing a firm water supply, hydroelectric power, flood control, and land development. The U.S. Export-Import Bank dropped loans of $40 million into it. But we have found no Afghans trained to operate it. The Afghan Government has found its share of the cost “a bitter burden that seriously threatens the Afghan economy.” And there are many who think that the project “may have unwittingly and indirectly contributed to driving Afghanistan into Russian arms.”

The previous history of our foreign-aid programs all over the world, in fact, raises the most serious questions about President Eisenhower’s message asking for a total of $4.9 billion new foreign-aid appropriations for the new fiscal year:

1—“We cannot now falter in our quest for peace.” We cannot. But this begs the real question at issue, which is whether our foreign-aid programs actually contribute to security and peace. We should not confuse obvious goals with dubious means. The most dangerous aspect of the foreign-aid program is that it creates the illusion we are “doing something,” and diverts attention from the real measures that need to be taken. Do we solve every problem by giving away more of the American taxpayers’ money?

2—“We must continue to stimulate expansion of trade and investment of the free world.” Is a foreign give-away program the sound way to do it?

3—“We have . . . no purpose to change their [other people’s] chosen political, economic, or cultural patterns.” Yet unless most of the governments to which we are giving handouts change from socialistic to free-enterprise policies, our help is worse than useless in bringing permanent improvements in living standards.

4—Asiatic and other nations “are striving to create the standards of living under which their economies can develop.” A worthy goal. Any American who wishes to make a voluntary contribution to it is free to do so. But what is the ethical basis for the notion that our government bureaucrats must force our taxpayers to turn over their hard-earned money to relieve foreign taxpayers and to raise foreign living standards? Why must we have a guilty conscience because we produce more than foreign nations?

5—“Military grant assistance is still necessary in most countries to assist them in maintaining equipment and replacing materiel lost by attrition. . . . Military assistance in Latin America should be continued where needed in order to provide standardized equipment,” etc. Some nations are no doubt unable to manufacture their own arms. But why must U.S. taxpayers pay for the armament of other countries? Some areas, such as Korea and Formosa, undoubtedly need our help. But most countries honestly determined to resist Communist aggression can afford to pay for their own armament. If they can’t make it themselves, they can buy it from our government, at cost.

6—The President’s message mentioned that in the last two fiscal years there has been a “reduction in unexpended balances” for foreign aid of $2.5 to $3 billion. Yet as of Jan. 1 last there was still an unexpended foreign aid balance of $9 billion. Why didn’t the President’s message mention this amount also?

7—Is it either wise, or in accordance with the spirit of our Constitution, to ask one Congress to commit its successors to any long-term foreign aid program?