Tag Archives: Foreign Aid

Washington Complains: China is Doing What We Always Do! by Doug Bandow

It’s hard to believe that a refreshingly honest guy like Doug Bandow was once in the goverment’s foreign policy blob. From Bandow at theamericanconservative.com:

Beijing is using threats and aid to pressure other governments to toe the line. Wherever did they get that from?

In a new official strategy of confrontation against the People’s Republic of China, the Trump administration has announced its intention “to compel Beijing to cease or reduce actions harmful to the United States’ vital, national interests and those of our allies and partners.”

Explains the strategy paper:

Given Beijing’s increasing use of economic leverage to extract political concessions from or exact retribution against other countries, the United States judges that Beijing will attempt to convert [One Belt One Road] projects into undue political influence and military access. Beijing uses a combination of threat and inducement to pressure governments, elites, corporations, think tanks, and others—often in an opaque manner—to toe the CCP line and censor free expression. Beijing has restricted trade and tourism with Australia, Canada, South Korea, Japan, Norway, the Philippines, and others, and has detained Canadian citizens, in an effort to interfere in these countries’ internal political and judicial processes.

All true. But which government pioneered the use of economic resources to reward and punish other nations? Hint: it was not China.

The U.S. has long used foreign aid as walking around money for the secretary of state. Countries with American bases have always gotten more cash, as have nations that have made peace with American allies, such as Egypt and Jordan.

In contrast, governments that have crossed Washington have lost money. In 1956, the Eisenhower administration punished Egypt’s Nasser government by revoking its offer to finance the Aswan High Dam. In 1990, Secretary of State James Baker told Yemen’s UN ambassador, “that was the most expensive no vote you ever cast,” after he voted against the UN Security Council resolution authorizing war against Iraq.

 

Foreign Aid and Sanctions, by Jacob G. Hornberger

Almost all foreign aid carries an implicit bribe. From Jacob G. Hornberger at fff.org:

Amidst all the political brouhaha regarding foreign aid, it is important that we keep in mind the nature and purposes of this particular federal program, as well as its related program, sanctions.

Foreign aid is money that the U.S. government sends to certain foreign regimes. The purpose of the money is to secure loyalty to the U.S. Empire. That loyalty comes in the form of votes in the United Nations or support for U.S. imperialist escapades abroad.

There is hardly ever a formal quid pro quo involved in foreign aid. That is, U.S. officials do not expressly say to a foreign leader, “If you will agree to become a loyal member of the U.S. Empire and support whatever the Empire does, we will send you hundreds of millions of U.S. dollars.”

Instead, foreign aid is based on an implied bribery agreement. Everyone understands what the core term of the agreement is: “We will give you this money and you, in return, will do as we dictate. If you fail to do so, your foreign aid will be terminated.”

Continue reading

Foreign Aid Makes Corrupt Countries More Corrupt, by James Bovard

Any time a government hands out money, not just foreign aid, it breeds corruption. From James Bovard at jimbovard.com:

And there are few better examples than Ukraine—just don’t tell the House impeachment hearings.

Barricade with the protesters at Hrushevskogo street on January 26, 2014 in Kiev, Ukraine.Sasha Maksymenko / cc

Counting on foreign aid to reduce corruption is like expecting whiskey to cure alcoholism. After closed House of Representatives impeachment hearings heard testimony on President Trump’s role in delaying U.S. aid to Ukraine, Senate Majority Leader Chuck Schumer declared: “Numbers don’t lie. It’s even more clear now that President Trump is not the anti-corruption crusader he claims to be.”

Most of the press coverage has tacitly assumed that American assistance is vital to fighting corruption in Ukraine. But that ignores foreign aid’s toxic record and Ukraine’s post-Soviet history.

A 2002 American Economic Review analysis concluded that “increases in [foreign] aid are associated with contemporaneous increases in corruption,” and that “corruption is positively correlated with aid received from the United States.”

Continue reading

The Marshall Plan Isn’t the Success Story You Think it Is, by Ryan McMaken

If one looks closely at the Marshall Plan and its effects, there is little confirmation that it did all the great things most history books say it did. From Ryan McMaken at mises.org:

To this day, the Marshall Plan, that enormous government program for foreign aid and wealth redistribution, is still held up as a model of good government planning, and of the benefits of forcibly redistributing the taxpayers’ money.

In American politics, this opinion has nearly risen to the level of gospel truth. For example, while domestic welfare programs are often met with derision from American conservatives, the Marshall Plan, which is founded on the same ideological foundation as the American welfare states, receives almost universal approval from Americans left and right.

Thus, it is not surprising that politicians and pundits continue to invoke the Marshall plan to push for more modern day programs based on the idea that if governments spread around the wealth, then prosperity will naturally result.

Tuesday in Europe, for example, European Parliament President Antonio Tajani invoked the Marshall plan to push for more EU spending programs in Africa designed to attract wealth there via sweetheart deals between European regimes and African contractors. Many of those firms, of course, are likely to be European-owned. And the scheme is reminiscent of the Marshall Plan. so it’s sure to be a success!

Not coincidentally, Tajani delivered his remarks on the 71st anniversary of Secretary of State George Marshall’s June 5, 1947 speech calling for what became the Marshall Plan. He outlined the plan to flood Europe with government welfare checks in order to help Europe overcome the fact that much of the continent’s capital had been destroyed in World War II.

The money spent totaled over 100 billion dollars in today’s dollars. And given that the American economy was but a small fraction of what it is today, this was an enormous sum.

The rhetoric behind the idea was nothing new. In 1947, it was routine to claim that government spending of the New Deal and World War II had ended the poverty of the Great Depression. That’s not the reality, of course. As economic historian Robert Higgs has shown, the New Deal made the Depression worse . Nor did World War II end the Depression . But at the time, this was a common misperception.

So, if redistributing the wealth worked so well to end poverty in the 1930s, why not do it all again in post-war Europe?

To continue reading: The Marshall Plan Isn’t the Success Story You Think it Is,