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Foreign Aid Spending Likely to Go Down

© Bryan Johnson

Congress' annual rush to pass next fiscal year's appropriations bills is in full swing this week. For two consecutive fiscal years (1996 and 1997), foreign aid spending decreased. This occurred during Congress' attempts to reach a balanced budget. However, In fiscal year 1998, spending increased. Now, Congress seems to be signaling that spending may again be on the downward trend and the Clinton Administration already is showing sign of concern.

The Agency for International Development (AID), the agency responsible for administering the bulk of the U.S. foreign aid program, is set to take the brunt of the proposed reductions, as much as $2 billion. The so-called 150 Account (the account that funds foreign aid, U.S. diplomatic initiatives, embassies, international financial institutions, etc.) was $18.2 billion in 1997.That was increased for this fiscal year to $19.1 billion and the Clinton Administration called for $20.15 billion in his fiscal year 1999 budget.

Yet, Congressional sources indicate that the spending likely will be closer to $18 billion, leading AID Administration J. Brian Atwood to state, "A $2 billion cut is larger than our entire development assistance request for $1999. These cuts would require shutting down programs which address poverty and hunger."

Senator Patrick Leahy (D-VT), who sits on the Senate Appropriations committee said, "Last month we received our 1999 budget allocation and in the best of circumstances, it amounts to a $200 million cut below the current level. Not only will you not get any of the increases the president requested, but many foreign operations programs except, or perhaps because of the Middle East, will be cut sharply."

Indeed, the Middle East money that Leahy is referring to is the so-called "Camp David" money. This amounts to over $5 billion, with $3 billion going to Israel and about $2 billion to Egypt. Lawmakers generally are unwilling to touch the Camp David funding due to the immense domestic constituency and support for the program. Thus, almost one-third of the foreign affairs budget cannot be touched. As such, that makes any cuts to the foreign affairs budget all the bigger because it must come out of other programs: usually foreign aid.

The final foreign operations spending levels will not be decided until both houses of Congress pass their respective appropriations bills and settle any differences in a conference committee. This is unlikely to occur before early fall. With 13 major spending bills that Congress considers each year, the foreign operations bill is one of only four where little or no action has been achieved. Right now, the bills have yet to be marked up by their respective sub-committees. When they are, a clearer picture on the direction of foreign aid spending will arise.