US Foreign Aid: Then and Now

Matt Chatham | Contributing Writer

Historically, since WWII, the U.S. has provided substantial aid to foreign governments. In 1947, the British government informed the State Department that they would be withdrawing support from Greece and Turkey, both subject to communist pressure. The U.S. then took it upon itself to support these nations, and the Truman Doctrine was born:  “It must be the policy of the United States to support free peoples, who are resisting attempted subjugation by armed minorities or by outside pressures.” The reasoning behind this was that communist forces, were they to gain power, would cause nearby governments to fall. $400 million were appropriated for these two nations, followed by the massive Economic Cooperation Act of 1948, known as the Marshall Plan, which ultimately delivered almost $13 billion to Europe.

Throughout the Cold War, the U.S. engaged in significant military spending and the use of foreign assistance as political leverage, both of which culminated in the Vietnam conflict, which began long before the Gulf of Tonkin incident. In 1961, President Kennedy created the U.S. Agency for International Development, which is the vehicle for significant amounts of funds today. After the attacks of September 11, 2001, foreign aid increased significantly, from $17 billion in 2001 to $45 billion in 2009. Afghanistan took the largest chunk of aid that year, with almost $9 billion, 65% of which was devoted to military-related aid. (Interestingly, according to the government’s website,, only about $3 billion was spent in Afghanistan in 2009, yet the Census’ statistics give the above numbers.) Of the next six countries receiving the most aid, Afghanistan, Egypt (sorry Arab Spring), and Israel had the highest military-to-economic aid ratio, with Israel receiving almost no economic aid whatsoever. Iraq and the West Bank/Gaza had almost zero military spending (military occupation doesn’t count, apparently), though that is set to change with at least two billion dollars budgeted for Iraq’s “Peace and Security” in 2012.

In 1970, UN Resolution 2626 was adopted by the General Assembly to declare the Second UN Development Decade. To help developing nations progress, it was recommended that each “economically advanced” nation increase foreign aid to .7% of GNP by 1975. This never happened, and although there have been several reifications of the goal, it is not being met, at least not by the U.S. According to the United Nations Millennium Project, which is devoted to ending a host of global problems, this percentage is “utterly affordable” and would easily help achieve the Millennium Development Goals. In 2009, $45 billion dollars was about a third of one percent of the GNP. From 2009 to 2012, little change in the total aid budget has occurred.

The question now is: what kind of power does the US want to be; what message does the U.S. want to send? True, our government currently provides the largest nominal dollar amount of aid in the world. Yet it seems that we, as a people commonly cited as the richest and most powerful on the face of the earth, would have more than a dime to spare for those less fortunate than ourselves.

2 Responses

  1. Jeanne says:

    Matt, I just wanted to clarify your reference to the ForeignAssistance website cited in your article. The website currently only displays request and appropriation data for the Department of State and USAID at the country level and MCC obligation and disbursement data. While the site does show $3B for Afghanistan in ’09, that’s only the appropriation number and not what was actually disbursed, so your comparison to the Census’ information is inaccurate. For more information on the data that is displayed on the site, please read the Top 10 page,, specifically items 3 and 7.

  2. Matt says:

    Thanks for the clarification. I probably should not have included the point without further researching the cause of the discrepancy, and it was included merely as a curiosity. I appreciate your feedback.

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