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Friday, February 7, 2025

USAID Myths

Many posts have discussed myths and misinformation.

 Rachel Bonnifield and Justin Sandefur at the Center for Global Development:

A viral claim, spread and amplified by Elon Musk, suggests that only 10 percent of USAID money reaches its intended beneficiaries. This is a wildly incorrect and misleading interpretation of a different statistic—that 10 percent of USAID payments are made directly to organizations in the developing world. The remaining 90 percent includes all the goods and services that USAID, American companies, and faith-based organizations deliver in kind, from HIV drugs to emergency food aid, malaria bed nets, and treatment for acute malnutrition. And it is absolutely crucial to debunk this false claim because it is being used as part of the pretext to dissolve USAID in its entirety.

Joannie Tremblay-Boire at The Conversation:

You may think that foreign aid consists of government-to-government transfers of money. But governments channel most aid through nonprofits such as Catholic Relief Services, public-private partnerships, private companies such as Chemonics International and Deloitte, and multilateral organizations such as the United Nations and the World Bank.

In fact, according to the Congressional Research Service, between 2013 and 2022, most U.S. foreign assistance bypassed governments altogether: NGOs received 24% of the money, for-profit companies 21%, multilateral organizations 34%, and other organizations, such as universities, research institutes and faith-based organizations, 7%.

When the political scientist Simone Dietrich researched this question, she found that the United States outsources a lot of its foreign aid to NGOs. This is especially the case with the support it provides countries with bad governance and rampant corruption such as Sudan and Sri Lanka, which could be likely to squander or swipe those funds.

To be sure, corrupt governments sometimes do squander U.S. foreign aid. But it is important to understand that most aid never enters the coffers of those corrupt governments in the first place.