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The New Approach to U.S. Foreign Assistance

Randall L. Tobias, Director of U.S. Foreign Assistance & USAID Administrator
Remarks at Woodrow Wilson International Center for Scholars Gala
Washington, DC
November 17, 2006

Thank you, Lee (Hamilton) for that kind introduction and thank you all for the warm welcome. I want to begin by telling you how pleased I am to stand before you in this unique role as both our nation's first Director of United States Foreign Assistance, and as the 14th Administrator of the United States Agency for International Development. And I am pleased to have this unique opportunity to talk to you tonight about the major changes underway to reform U.S. foreign assistance

This is an exciting time for foreign assistance, which has never had a higher profile than it does right now. There was once a time when outside of the State Department, USAID, and a few people on the Hill, not many others in the government cared very much about foreign assistance. But now, foreign assistance is a mainstream commitment of the United States Government, not only for all of the traditional reasons which still apply, but because it has also been elevated to a national priority as a core part of our national security strategy. There is little doubt that helping developing nations become peaceful, stable and economically self-sufficient is in the best interest of this nation's security.

Commensurate with this priority, this Administration has made an enormous commitment, from the highest levels, to development and transformation. In fact, the total official development assistance (ODA) provided by the United States for 2005 came to $28.5 billion - a near tripling of ODA since President Bush took office. Our security assistance, as well, has seen significant increases over this time period.

But these vastly increased resources have also come with a new focus on the accompanying responsibilities: to focus on performance, results, accountability, and ultimately, to define success as the ability of a nation to graduate from traditional development assistance and become a full partner in international peace and prosperity.

In late 2005, not long after the President and the Secretary first talked with me about taking on this role, I asked to see the data that I thought would help me better understand the challenges we face in achieving more effective use of our foreign assistance resources.

I wanted to begin by understanding our existing foreign assistance strategy. And as a proponent of the theory that one's actions speak so loudly it never really matters what one is saying, I was more interested in understanding exactly where we were actually spending our foreign assistance dollars, rather than simply reading the speeches and policy papers that purported to describe our foreign assistance strategy. What I found was that the allocation of our resources was neither strategic nor consistent with what will be required to achieve this nation's transformational diplomacy priorities.

It turns out that most of our foreign assistance has been focused in five important though not transformative areas. They are:

  • Sustaining critical security partnerships in the Middle East
  • Supporting traditional Eastern European partnerships
  • Countering narcotics in the Andean region of Latin America
  • Fighting HIV/AIDS in a number of critical countries, mostly in sub-Saharan Africa; and
  • Responding to humanitarian crises as they occur.

Each of these goals, individually, is important. But they have not of themselves added up to a transformational diplomacy strategy. In fact, I don't believe they have added up to any comprehensive strategy at all.

While we may have been achieving great progress in some individual program areas - as clearly we have - our lack of a coordinated, comprehensive, internally integrated foreign assistance program means that we will not likely be able to sustain the gains of our various investments in the long term.

Many ideas for foreign assistance initiatives, presented individually, have seemed to look great on paper. But leadership, both in Washington and on the ground around the world, have had no effective way to assess the opportunity cost of doing one thing over another - no effective way to make informed choices to prioritize what is really going to make a sustainable difference over the long term. Even worse, our resources have too often been spread a mile wide and an inch deep, and therefore the potential impact of what we have been doing has been further diminished.

And even ahead of the determination of which initiatives to fund, we have lacked a set of shared goals to drive the allocation of our resources. The purposes for which foreign assistance funds have been allocated have differed from one U.S. Government agency to the next, from one office to the next, from one bureau to the next, from one overseas mission to the next. United States foreign assistance has had a thousand agendas, and therefore no coherent story to tell Congress, the American public, or the citizens and host governments of the countries we seek to assist about what it was the United States was seeking to achieve with its foreign assistance dollars.

Under Secretary Rice's leadership, the United States seeks now to reform its organization, planning and implementation of foreign assistance in order to address all of these challenges.

The principles of foreign assistance reform are targeted to four objectives:

  • First, establishing a common foreign assistance strategy, and focusing our resources on the attainment of the goal and objectives of that strategy.
  • Second, integrating our planning, budgeting, programming, and results reporting, at every level, so that we will always be able to make decisions on the basis of a full and coordinated picture of how our resources will work together.
  • Third, improving the transparency of all that we do in connection with our foreign assistance resources; and finally,
  • Strengthening accountability for the results that are - or are not - achieved with these resources.

All U.S. foreign assistance is now being applied to the achievement of a single overarching goal - the goal Secretary Rice has articulated as transformational diplomacy: "helping to build and sustain democratic, well-governed states that will respond to the needs of their people and conduct themselves responsibly in the international system." And therefore, a fundamental purpose of this reform is, in the end, to better ensure that we are providing both the necessary tools and the right incentives for host governments to secure the conditions necessary for their citizens to achieve their full human potential.

As this goal has become more widely communicated, some have raised concerns that the words "poverty alleviation" do not appear directly within the goal. Others have said that the goal itself sounds too focused directly on state governance, and therefore too political.

For some, the goal as stated feeds the fear that "development assistance" is now being overtaken by foreign policy concerns - and therefore short-term goals will overtake our long-term development objectives. I understand why people have these concerns. But I strongly disagree that these concerns are grounded in substance. In fact, in many ways, it is just the opposite. I would argue that our foreign policy is now recognizing what has been best practice in the development arena for at least a decade.

Among development professionals, best practice recognizes that empowering human potential and achieving sustainable transformational development requires more than short-term charity - or even the long-term open-ended provision of foreign aid services and funding. It requires a paradigm that is also focused on sustainability - and with that, a paradigm focused ultimately on local ownership.

While well-intended, some of what the international donor community has done historically, under the rubric of international development, has, too often, left few lasting traces beyond the immediate impact of short-term programs. The sad fact is that one cannot visit the developing world without seeing - often in a literal sense - the debris of past development assistance that did not also bring about lasting change - that did not put enough emphasis on the "development" part of development assistance.

To be sure, charity has its place, especially when it is charity in response to urgent emergencies. Yet it's important to distinguish between that kind of charitable humanitarian assistance, and support for a nation's development and transformation. Development must engender lasting economic, social, and political progress, through a transformation of institutions, economic structures, and human capacity, so that nations can sustain further economic and social progress on their own. And the primary responsibility for ultimately achieving this transformation rests with the leadership and citizens of the developing nations themselves.

I have a friend in Africa, Dr. Peter Mugyenyi. He is the leader of the Joint Clinical Research Center in his home country of Uganda. He's one of the most inspiring, creative and effective leaders in the fight against HIV/AIDS on the African continent. Some time ago during my time as the United States Global AIDS Coordinator, Dr. Mugyenyi made a comment that really struck me. To paraphrase, he said that it is neither practical nor moral for the people of Africa to expect that the rest of the world will take care of Africa's problems forever.

He explained that it is not practical because it means their own destiny will be at the mercy of changing political priorities in nations far beyond their control. And it is not moral, he said, because the people of his continent have many of the tools they need to meet their own needs, and those they do not have they can and must develop. And that is the model we must all embrace. As we refocus our management and deployment of foreign assistance, we must always remember that it's not about us; it's about them. It's about empowering them, supporting their ideas, and providing the right toolsand appropriate incentivesto support their leadership and responsibility to sustain further progress on their own. This, I believe, is what United States foreign assistance must be all about.

A crucial element for success, of course, is the role of the host governments in the developing nations themselves. It is no secret that many governments have demonstrated an inability - or worse, an unwillingness - to be accountable and respond to the needs of their citizens. The international system, including donors such as the United States, have thus stepped in to deliver those services, often by creating parallel systems of service delivery through international mechanisms, that go around locally owned systems. And too often, there seems to be no objective to bring that duplication to an end.

Now parallel systems are sometimes an understandable response, and for a famine or a major flood or a global pandemic, it may be is essential. But the dominance and the permanence of donor-led responses has had the effect of creating too much dependency, of shifting the focus of responsibility from host governments to donor nations.

We've too often created parallel systems of service delivery that have allowed reluctant governments to shirk their responsibility - and shifted citizens' expectations from their own governments to the international donors. But outsiders cannot, with sustainability, secure citizens' health and safety, educate a critical mass, or create the conditions needed for economic growth - all of which are necessary for development, and all of which are the responsibilities of a nation's own government.

Citizens in the countries we seek to assist must understand that their own governments are responsible. And much as occurred in this country following Hurricane Katrina, they must make demands of their governments, and reject excuses for failure. This understanding of citizen empowerment and responsibility is indeed a prerequisite for true democracy, and for transformation. And the foreign assistance policies and programs of the United States can and must play a vital and catalytic role in the establishment of a clear understanding about appropriate roles and responsibilities.

That's why our new Strategic Framework for Foreign Assistance focuses on achieving a well-functioning and accountable state that responds to the needs of its people. That's also why the framework explicitly identifies end goals for U.S foreign assistance, goals that focus on graduating countries from receiving traditional development assistance. There may always be a need, for some countries, in some times, to receive targeted assistance to help maintain partnerships, progress, and peace. But our development assistance must be focused on transformation.

The framework also seeks to bring to U.S. foreign assistance, focus on those objectives that are critical to achieving the transformational diplomacy goal. The framework explicitly identifies a comprehensive and long-term approach. It recognizes that nations cannot progress without peace, security, and stability. They cannot progress without just and democratic governance. They cannot progress without investments in the human capacity of their citizens. And they cannot progress without economic growth.

When we then add humanitarian assistance, these five areas are now the objectives of U.S. foreign assistance.

Along with this new strategic approach, we have implemented a leadership and management model that will help us achieve what this strategy intends. Because we all know that these are words on paper if we cannot mobilize our bureaucracies, in Washington and in the field, to implement effectively.

Through the creation of the role of Director of Foreign Assistance with the rank of Deputy Secretary of State, and then coupling that role with that of Administrator of USAID, we've created a new leadership approach that strengthens the role of the Secretary of State and the other senior leadership at both State and USAID in driving a strategic, budget, and program planning process rather than reacting to the process that existed before.

With input from the field, Washington will now set the strategic direction for foreign assistance, with integrated, coherent operational goals and priorities across agencies, determine budget allocations among countries, regions and Washington-based activities, and define indicators to measure performance toward these goals.

Over the last couple of months, my staff and I have met with key players in the delivery of foreign assistance within the United States government, and with many leaders in the development community and on the Hill. In meetings all around the world, I have met personally to discuss our foreign assistance reform initiative with 89 United States Ambassadors and with 64 USAID Mission Directors. In addition, we have presented the framework and reform elements to multiple consortia of NGO groups, including InterAction, the Global Health Council, the Global Leadership Campaign, environmental NGOs, education NGOs, labor NGOs, and gender equity NGOs. All told, we have conducted over 40 briefings with NGO groups, and over 40 briefings on the Hill.

We have solicited input from these groups on the framework itself, on the indicators that we will use to measure our progress, as well as on our process for ensuring that our foreign assistance resources are integrated, coordinated, and comprehensively targeted to the achievement of the transformational diplomacy goal. Throughout this process, I've been struck by the fact that, notwithstanding an incredibly fast moving process which has in many cases limited our ability to communicate even more thoroughly with all interested parties, the principles of this reform seem to have very widespread support.

So much is changing, but while we're implementing all of this change, let's not let anyone be misled into somehow thinking that all that came before this reform was ineffective. I know, and the world needs to know, that United States foreign assistance has indeed had a tremendous impact. Worldwide, let's consider the following:

  • In 1950, 55% of the world population was living on $1 a day or less. Only 20% are so impoverished today. United States foreign assistance has played a major role.
  • Life expectancy is longer, mostly because the United States Government has contributed greatly to innovative strategies that have helped to lower infant deaths from diarrheal disease.
  • Whole diseases have been eradicated in countries and worldwidepolio and smallpox are among the diseases that have now been largely eradicated. Again, United States foreign assistance has played a major role.
  • People are eating more and better. In spite of the desperate hunger and malnutrition we see in places such as Darfur or North Korea, the share of people below nutritional adequacy has fallen from 57 to 7% since 1961. And the U.S. is the largest single donor to the World Food Program.
  • More boys and girls are in school. In 1950, there were about 100 million. Today, there are about 1 billion. This means that literacy and numeracy are no longer reserved for the elite.
  • Democracies have flourished. In 1950, there were approximately 20 democracies out of the world's 80 sovereign states. In 1974, about 40 of the world's 150 countries could be called democratic. And today, according to Freedom House, the total number of democracies has tripled to about 120 democracies, or two thirds of the world's 193 states.
  • Most important of all, in the 1960s there were around 90 countries where development efforts were focused. Now, about 25 of those have graduated. And another 15 or so countries that are at or near middle-income-country level are close to graduation.

And United States foreign assistance has played a major role in all of these accomplishments. So despite the enormous challenges faced today by so many in the developing world, we should not forget that much has already been accomplished, thanks in large part to the dedicated work of the men and women of the United States Government.

As we move forward, I seek your partnership, and that of all American people, in securing the successes of the future. The time when only a handful of people recognized the value of development has passed. From world leaders to rock stars to elementary school children, people are aware as never before of the challenges facing the developing world - and the way those challenges affect not just those suffering, but the entire global economy and the security and prosperity we seek.

As we celebrate the 150th birthday of President Wilsona man who in 1917 proclaimed American entrance into World War I a crusade to make the world "safe for democracy"it is fitting that we should take the time to examine, and address, whether our foreign assistance is supporting the conditions necessary for democracy.

I hope we can count on your support as we seek to reform America's foreign assistance. After all, like President Wilson, all of us gathered here tonight share the belief that peace, prosperity, health, education, and the freedom to provide for themselves and their families are the legitimate aspiration of human beings everywhere.

Thank you very much.


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