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ince 2004, U.S. foreign aid has been split into two
camps. Tat is when President George W. Bush cre-
ated a new aid agency separate from the U.S. Agency
for International Development: the MillenniumChal-
lenge Corporation.
Since 1961, USAID had been the centerpiece of U.S. aid
programs that, in principle, are focused on getting help to those
who need it most—the poor, the ill, the illiterate and those hurt by
storms and earthquakes and famine. But its staf had shrunk from
perhaps 15,000 during the VietnamWar to about 1,000 Foreign
Service ofcers and 1,000 Civil Service staf as of 2002. (USAID is
now in the process of doubling its FS staf.)
Sometimes the State Department has intervened on political
grounds to cut aid to governments seen as hostile to U.S. interests.
In contrast, the MillenniumChallenge Corporation is tasked with
applying a neutral yardstick, using business acumen to improve
the economies of developing countries.
Like a global banker, the MCC grades developing countries
on whether they invest in health and education, move toward
democracy and allow free press andmarkets. Countries with better
Eight years after the MCC’s creation, the verdict on its eforts to jump-start the
process of development is not yet in. But there are reasons for optimism.
performance are eligible for potentially game-changing develop-
ment grants of $500 million andmore, payable over fve years. In
addition, some poorly-performing countries can obtain “thresh-
old” grants to bring themup to eligibility.
Te new agency was intended to stop wasting foreign aid by
grading all recipient countries on howwell they govern their citi-
zens. Tere would be nomore funding for corrupt dictators who let
their own people starve.
Te fip side of the coin was the idea that USAIDwould spend
the remainder of the foreign assistance budget on what some
call the basket cases—e.g., Haiti and the Democratic Republic of
the Congo. Its focus would be on humanitarian relief, education,
medicine and food.
A Too-Ambitious Goal?
Some aid experts in Congress and at think-tanks say Pres. Bush
was working from a Republican agenda dating back to the late
Senator Jesse Helms, R-N.C., who tried to abolish USAID—which
he famously claimed poured U.S. aid “down a rathole.”
“Te MCC evolved out of frustration at USAIDwithin the Bush
administration,” says a senior congressional stafmember, speak-
ing on condition of anonymity. “It was a diferent approach to
foreign aid—not dealing with the basket cases but with countries
capable of reaching the next level of development.
“Te MCC had a lot to recommend it—a lot which could apply
to USAID,” the stafer adds. But the Bush administration “never
wanted the MCC to be a separate agency fromUSAID.”
Pres. Bush set an ambitious goal of $5 billion a year in funding,
Ben Barber writes about the developing world for McClatchy Newspa-
pers, and has also contributed to
, the
London Observer
, the
Christian Science Monitor
Foreign Afairs
, the
Washington Times
USA Today
and From 2003 to 2010, he was a senior writer
at the U.S. Agency for International Development. His photojournal-
ism book,
Ground Truth: Work, Play and Confict inTe Tird World
will be published later this year by