What’s the point of aid?

What is the purpose of aid?

That is a question that many within the development world are having to answer as governments increasingly look to cut budgets and tighten their belts. 

For many years, the consensus was that aid was both a tool of economic statecraft meant to ensure that the recipient could grow and become a contributing member of global society, this was particularly true during the Cold War, where aid was a tool of foreign policy. The reasoning being that a country receiving aid from the capitalist west would have no reason to turn communist if they had the tools to embrace capitalist benefits. This often meant that aid donors looked the other way if recipients spent the aid in ways that didn’t exactly meet the standards the donors wanted.

This changed in the 1980s with the advent of the neo-liberal era, where terms and conditions were imposed on aid, with recipients risking losing their aid if they didn’t meet a strict checklist of requirements. The 2000s saw a merging of the neo-liberal and cold war ethos, as public-private partnerships came to dominate the aid world.

Now, however, aid is directly in the firing line, most particularly in the United States, where Secretary of State Marco Rubio has clearly stated that aid funding will be subjected to three questions: “Does it make America safer? Does it make America stronger? Does it make America more prosperous?” Given the America First approach of the US government, these questions make sense.

However, the cuts to USAID that the administration have implemented would seem to undermine the purpose of Rubio’s more forensic approach, here’s why:

Aid has traditionally been used to provide transnational public goods to developing countries, this has often involved providing vaccines and medicines, which played a significant role in reducing serious illness such as polio, which thanks to aid decreased by 99%. Furthermore, PEPFAR has been instrumental in decreasing the spread of HIV/AIDS. What’s more, before the cuts to USAID, aid was being used to secure global food networks, alongside helping to finance more sustainable agricultural practices to attempt to mitigate climate change.

And if one wants to pursue a more hard-headed approach to aid, the cutting of aid necessitates the potential decrease in domestic security. Research by David Leblang has shown that aid sent to migrant-sending states can disproportionately help the donor state, hence why the US up until the current administration sent a lot of aid to the Caribbean Basin Security Initiative. The aid sent to this initiative helped improve regional security close to the US through the use of aid financed projects that initiated justice sector reforms and programmes for youth at risk of recruitment to criminal organisations.

These are just two of the ways that aid can provide a real net benefit and how the cuts in funding to USAID are undermining the questions that Secretary Rubio claims to want answered.