How to reform a "rathole" on $10 billion

Global humanitarianism is the domain of liberals no more. Earlier this month President George W. Bush announced an ambitious plan for overseas development. By 2006, if the president gets his way, U.S. taxpayers will spend $10 billion helping poor people around the world. That figure is twice the amount the United States currently spends each year on food and humanitarian aid.

Mr. Bush calls the boost in aid "a new compact for global development." He said it will be defined by "new accountability for both rich and poor nations alike. Greater contributions from developed nations must be linked to greater responsibility from developing nations."

The president said a global war on poverty is in line with the war on terrorism. "Even as we fight to defeat terror, we must also fight for the values that make life worth living," he said. "This is both the history of our country and it is the calling of our times."

Mr. Bush also announced this month an expansion of the Peace Corps. He will double the number of Peace Corps volunteers worldwide and reopen what has in many countries become a moribund program-one long slated for extinction by conservatives in Congress.

If Mr. Bush has been steering the military campaign since Sept. 11 with plainspoken Reaganism, he is charting the war's nonlethal offensive with Kennedy-like largesse. President John F. Kennedy launched the Peace Corps in 1961. At the same time he revamped and expanded foreign aid emerging from the post-war Marshall Plan era.

In the old millennium, venturing new billions on overseas public works like water wells, food giveaways, schools, and textbooks would have been anathema for a conservative president pledged to cut domestic welfare. In the mid-1990s Republican lawmakers attempted to slash foreign aid and eliminate the U.S. Agency for International Development. Jesse Helms, Republican Senator from North Carolina and then-chairman of the Senate Foreign Relations Committee, earned jeers from the human-rights establishment by declaring that spending on foreign aid was sending taxpayers' money "down a rathole."

At the same time, important community development in poor countries has been carried out more and more by private relief groups, both Christian and secular, American and European. On Capitol Hill, Republican lawmakers admit they would never have let Bill Clinton get away with an enormous expansion of governmental foreign aid. Those who favor increasing aid have long suggested that private organizations are more effective than governmental ones.

But Bill Clinton wasn't fighting this war. Republicans have exchanged ratholes for foxholes. "The war on terrorism has radically changed a lot of budget items in this government," said Lester Munson, Republican spokesman for the Senate Foreign Relations Committee and an aide to Sen. Helms. "This aid package should be looked at in the context of increased aid for law enforcement and immigration programs. Like other aspects of this war, you have to be the world leader on this issue."

Another reason conservatives are circumspect about big spending is Andrew Natsios. As head of the U.S. Agency for International Development, he will be the president's point man for the new aid. Mr. Natsios, a longtime public servant in Massachusetts, knows a thing or two about ratholes. In 2000 he took over managing the Massachusetts Turnpike Authority and its notorious boondoggle, the Big Dig. Then-governor Paul Cellucci hired Mr. Natsios to rein in the mammoth tunnel-digging project under Boston Harbor-the largest highway construction project in U.S. history-after his predecessor ran up billions in cost overruns, litigation, and delays.

Mr. Natsios first earned a reputation as a fiscal conservative while a Republican legislator in the Massachusetts House. He supported a referendum limiting property taxes and rollbacks on income tax. Later he served at USAID under Mr. Bush's father and then became a vice president for World Vision. When he took over the Big Dig, former legislative colleague Barbara Anderson observed, "Andrew Natsios is the kind of man who learns from history and is therefore not doomed to repeat it." She predicted, "If he can get control of the Big Dig, we might in the future define 'good government' as him."

Eight months later Mr. Natsios left the project to accept the president's nomination to head USAID. Mr. Bush stocked the aid agency with other outside experts, in contrast to the Clinton era, when State Department careerists dominated the development agency's top tier. Working under Mr. Natsios is Roger Winter, former director of the U.S. Committee for Refugees. Mr. Winter closely allied himself with members of a Christian coalition, along with members of the Congressional Black Caucus, working to end the war in Sudan. In many ways "new aid" grows out of a maturing alliance between humanistic human-rights activists, conservatives, and activists who earned political stripes lobbying against Christian persecution.

Mr. Natsios, who complained one year ago that politics in his home state is "a blood sport," told reporters he was glad to leave Boston for tamer battles in Washington. That was before Sept. 11. Mr. Natsios has made two trips to Afghanistan since the terrorist attacks. One came in November before the Taliban collapsed, when he was the highest-level U.S. official to visit the country in two decades. He told WORLD, "In very few places in the world have I seen this level of destruction. Taliban fighting destroyed 50 percent of the irrigation system, and this is an arid country."

Mr. Natsios is credited with putting a food plan in place that helped Afghans to avoid a much-expected famine after U.S. bombing began in October. When Afghan schools reopened March 23, the agency was ready with 4 million textbooks. But that kind of response costs money. In the year before 9/11 the U.S. government spent $183 million in Taliban-ruled Afghanistan. Since Oct. 1, 2001, U.S. humanitarian assistance has already topped $240 million.

Mr. Natsios, encouraged by the level of cooperation with the interim government led by Hamid Karzai, is already looking forward to better days for the war-plagued country. "I worked in complex humanitarian emergencies for a decade. Many countries that have been through this before, when they are helped, can see real improvement," he told WORLD.

He cites as an example Mozambique, which endured one of the worst civil wars in African history until 1994, when it ranked as one of the poorest countries in the world. Last year it had 14 percent economic growth.

"What's hard for Americans to understand is that all of it cannot automatically happen once you have peace," he said. "Free markets will not bring prosperity unless people have been educated from primary levels, unless they have good health clinics, and rural road systems. This needs some investment. It is not aid or trade. It is aid and trade."

In staking new budgetary territory, both the president and Mr. Natsios acknowledge that past mistakes in foreign-aid management need to be corrected and new incentives attached to countries receiving it. Mr. Bush promised to tie recipients to "clear, concrete, and objective" criteria to measure economic and political reform before they can receive new aid.

"If you don't have your macroeconomic policies correct," Mr. Natsios told lawmakers earlier this month, "no amount of foreign assistance is going to make a country that's poor become prosperous. Policy reform has been shown over and over again to be an absolute prerequisite for long-term sustainable development."

By linking new aid to good governance, the Bush administration claims it will also lure private investment to recipient countries, two dollars of private capital for every dollar of aid.

Mr. Natsios admits he was looking for "a substantial increase" in foreign aid when he came into office. Like others in the foreign-policy establishment, he was disturbed that the United States was falling behind its allies in aid as a percentage of GDP. Nine developed countries supply a higher percentage (the United States, nonetheless, provides more in actual dollars than any other nation).

After terrorist attacks on the United States, those numbers mattered more-even for aid critics. Mr. Natsios said the administration developed a plan to take advantage of the mood among lawmakers: "It became quite apparent that conservatives and liberals in Congress after Sept. 11 were arguing for upping foreign aid."

"Now it is clear what the threats are to the security of the United States. Poverty does not cause terrorism, but failed states are places where it is much easier to engage in the activities that support terrorism: opium production, drug smuggling, arms proliferation. With civil war, as Afghanistan eventually became a failed state, al-Qaeda found a base of support," said Mr. Natsios.

To underscore a new way of thinking, the president surrounded himself with a new cast of supporters when he first announced the plan at an Inter Development Bank speech in Washington March 14. Appearing center stage with Mr. Bush were U2 lead singer Bono, Roman Catholic Cardinal Theodore McCarrick, and World Bank President Jim Wolfensohn. All have been critics of past Republican administrations but are finding common ground with this president. Ironically, Sen. Helms was the one who pushed Bono on the president. The senator has developed a friendship with the winner this year of four Grammys and considers him a cultural liaison-a Christian with an MTV audience who speaks out against poverty and AIDS overseas.

Mr. Bush then carried his message to Monterrey, Mexico, where heads of state and aid bureaucrats gathered March 22 for a summit on development. "For decades," he told the delegates, "the success of development aid was measured only in the resources spent, not the results achieved. Yet, pouring money into a failed status quo does little to help the poor, and can actually delay the progress of reform. We must accept a higher, more difficult, more promising call."

Jesse Helms, the most surprising supporter of new aid, is asking the Senate to approve $500 million in additional spending for programs to fight AIDS overseas. "I know that, like the Samaritan traveling from Jerusalem to Jericho, we cannot turn away when we see our fellow man in need," Mr. Helms wrote in The Washington Post after the president's speech in Monterrey.

But the Bush administration may have trouble moving the overall aid plan through Congress. "When Congress considers the plan, it will raise basic questions about how to administer the program," said Mr. Munson. "Will a new agency be needed to handle it separately from existing foreign-aid programs? Congress will look at those issues very carefully, and you will have to look at restructuring the way we do foreign aid."

For now congressional critics are laying low, leaving vocal opposition to columnists and think tanks. Writing for the Heritage Foundation, policy analysts Brett Schaefer and Aaron Schavey point out that the United States has given more than $500 billion to less-developed nations since 1945. "Yet the people in many of these countries are no richer today-and in many cases actually are worse off-than they were decades ago," they write. The "chorus for ever-higher amounts of aid obscures" that record.

Here are some questions that legislators should ask: How much U.S. government aid will go to foreign government bureaucracies and how much to private, nonprofit, even faith-based organizations? How much will go directly to areas of need, and how much will be routed through United Nations agencies? How will progress on political reform and adherence to the rule of law in recipient countries be monitored?