The Foreign-Aid Fiasco

May 26, 1958

The treatment of the Nixon party in South America—the face-spitting, the rock-hurling, the desecration of the American flag—is an end result of our policy of total foreign entanglement in the last dozen years, and in particular of the foreign-aid program.

It may not be possible to determine the exact extent to which the South American riots were inspired by organized Communist plots directed locally or from Moscow, and to what extent they reflected genuine national feeling. In any case, the Communists won another major propaganda victory, and our own world prestige suffered another major blow. The Nixon tour was primarily an effort to woo South American good will and to secure a demonstration of it. Instead, our Vice President and his wife were insulted, physically attacked, and shamefully humiliated. The rioters successfully showed that they hate us and do not fear us. From this standpoint it is hard to deny the Moscow radio’s triumphant claim that the Nixon tour was a “fiasco.”

WE CAN’T BUY ALLIES

A few months ago (Jan. 13) I quoted here a passage from Machiavelli in which he pointed out that, in international affairs, “it is much safer to be feared than loved, if one of the two has to be wanting” and that “the friendship that is gained by purchase is bought but not secured.” James Burnham, in National Review (May 17), has taken an even more appropriate quotation from the same source: “When things are so managed in a government, that the neighbors purchase its comity, and make themselves its pensioners, ‘tis a certain sign of the potency of that government; but when the neighbors on the contrary receive money from it, ‘tis as infallible a sign of its weakness.”

From the very beginning, one of the main purposes of our foreign-aid program, in whatever euphemistic forms it may have been expressed, has been to buy the friendship and good will of other nations—to buy allies. It has not only failed to do so; it has done the opposite. We overlooked the elementary fact that the recipient of alms feels humiliated in accepting them. They wound its national pride; they advertise its dependence on the giver. The recipient resents any quid pro quo or any conditions, even when these are in its own interest. One of the signs carried by the mob that attacked Nixon in Lima was PERU IS NOT FOR SALE. Even if this was composed by Communists, they could count on it to inflame anti-American feeling.

GET RICH BY GIVEAWAY?

For many other reasons our foreign-aid policy has produced exactly the opposite results from those its supporters expected. To woo a country with bribes or their equivalent is to make that country feel that any alliance is primarily for our benefit rather than for its own. It regards such offerings as a sign of weakness. We lose respect by them. We have extended foreign aid to some 80 countries. The crowning irony is that nations that should have got not a cent from us are resentful and embittered because they get less than other nations.

The “economic” case for foreign aid is even worse. If there had been no economic foreign-aid program, countries wishing private American capital for development would have had to adopt sound political and economic policies to attract it. Government-to-government foreign aid has made this unnecessary. It has supported and prolonged foreign-exchange control, inflation, confiscatory taxes, and Socialism. And so it has on net balance retarded, not advanced, world production and economic recovery.

The reductio ad absurdum of all the economic arguments for foreign aid has been solemnly put forward by the Secretary of State. “The great bulk of our Mutual Security funds—over three-fourths,” he said on March 24—“are spent in the United States. . . . To cut these funds would be to cut employment here at home.” This is the argument that we get rich by giving our goods away. We could, of course, “create” the same employment by making the same goods to dump into the sea. If we want to subsidize our exporters, there are cheaper ways of doing it than giving away $100 for every $5 or $10 of net profit that exporters might get from added foreign sales.