Foreign Aid's Wry Success

The rinderpest is done for in Nigeria; U.S.-supplied vaccine, shot into 10 million cows, saw to that. In Peru, courtesy of U.S. taxpayers, 500,000 school kids get a glass of milk each morning. Fishermen in Kenya are content: the U.S. gave them new boats so they could catch fish twice as fast, and now they only work half as long. But oops! That $2.6 billion sent to Yugoslavia seems to have sunk without a trace. In Jordan a dike that cost the U.S. close to $1,000,000 meanders across the flinty desert for dozens of miles, waiting to trap rain that never falls. And in Indonesia, as one cynic puts it, the net effect of much teaching aid is to assure that "the anti-American signs in Djakarta are written in good English."

So that such things can continue, Congress last week once again passed a foreign aid bill. The measure provides $3.36 billion for fiscal 1966, $100 million less than Lyndon Johnson's "preshrunk" request, but $13 million more than Congress gave last year. Few cries of "giveaway" or "rathole" were heard in the Capitol; instead the bill passed in an atmosphere of doubt, hope, disillusionment and dutiful expectation. Foreign aid still seems a stranger in the house.

Where $110 Billion Went

The history of U.S. foreign aid is one of changing goals, phased in and then phased out as they succeeded gloriously or were abandoned in panic. Back in 1942, when Congress voted funds for the Institute of Inter-American Affairs, a technical-assistance operation for Latin America, it was only trying to combat pro-Nazi sentiment in Central and South America. Next, the U.S. chipped in to establish UNRRA, a desperate charity aimed at stopping hunger in a war-destroyed world. It filled a lot of bellies and the pockets of countless profiteers. In 1947, President Truman, still answering fire alarms, rushed arms and aid to Greece and Turkey. A year later, not thinking primarily in terms of economic programs for development but only of strategies to build strong European allies against Communism, he set in motion the Marshall Plan, which eventually cost $13 billion and is everywhere accounted a triumph. Out of all this experience flowed Point Four's technical-assistance goals, and suddenly the U.S. was in the foreign aid business for sure, without ever asking itself whether it should be, or to what extent, or for how long.

Using foreign aid to defend the free world against Communism attained the status of a philosophy in 1951, when the Mutual Security Act was passed by Congress and an attempt was made to gather all the proliferating economic and military assistance plans into one coordinated program. So many administrators came and went that nothing really got coordinated; 2,000 steel plows lay rusting in Ethiopia, dams were built in a remote corner of Afghanistan, Asian potentates had fleets of cars bought with aid funds. This phase began to end in 1957 when President Eisenhower shifted the major emphasis of foreign aid from outright grants to development loans and investments. President Kennedy in 1961 created the Agency for International Development (AID) as a kind of holding company for all foreign operations, and later put his budget director, David E. Bell, in charge. Now Bell has served longer than any earlier aid boss and won a reputation for taut and canny administration.

The whole venture has cost $110 billion in aid to 100 countries. Right now, 72 countries are slated for U.S. aid, but 95% of it will go to only 31 of them and 74% of all development loans will go to only seven--Brazil, Chile, Nigeria, Tunisia, India, Pakistan and Turkey. Yet even after two decades as a developer, teacher, influence buyer and underwriter, the U.S. still gets surprised in the way aid programs work out. Some triumphs and failures from the ledger:

> INDONESIA. The marvel is that any progress at all could have been so skillfully avoided. The $831 million in economic aid and $77.8 million in military assistance that were poured into this naturally rich country collided with the simple fact that Sukarno has no interest in economic development; he seeks empire. The U.S. program crashed when he shouted, "To hell with your aid." One salvageable irony is that the U.S. effort inspired the U.S.S.R. to give Indonesia more than $1 billion, and now Sukarno is bitter against Russians too.

> TUNISIA. With one of the highest per capita aid rates ($15 a year, roughly equal to the average share of U.S. citizens in the aid tab), this dry and dusty country is rapidly being turned into a gigantic orchard. President Bourguiba has pushed the plan to sink most of $397 million in economic aid since 1958 into fruit and vegetable production.

> PERU. Some $468.9 million in economic aid and $113.1 million in military assistance have bought technical and professional educations, better roads, better public administration, improved tax systems. Few Peruvians are grateful--the conditions on the loans, it seems, are irksome. President BelaUnde's thought for today is: "Suppose that more or less the same demands had been made by the Spanish crown when Columbus applied for aid; we might have remained undiscovered until now."

> INDIA. One of the largest recipients of U.S. help ($5.2 billion in economic funds, plus a secret amount in military aid), India is so big that U.S. aid is none too obvious. But the community farm projects, new schools, roads and modern agricultural methods all owe some small debt to the U.S.

New Giver-Getter Pattern

Nearly 20 years of aid have powerfully molded the U.S. program of today. Assistance has been cut back for various reasons: heartening success, as in Formosa, or depressing failure, as in Haiti. The fact that nations do get cut off suggests that AID may not go on forever. That debilitating form of aid, direct injections into national budgets, has been mostly dropped, except for South Viet Nam, Korea, Laos, Jordan and the Congo. Military aid, once the source of sour jokes about dictators who "imported 5,000 Communists" to scare the U.S. into supplying arms, now goes mostly to eleven nations ringing the Russian-Chinese land mass. No aid at all goes to Communist nations any more.

The new, honed-down kind of aid also 1) stresses hard loans repayable in dollars, 2) gets by with fewer (15,642) employees by relying more on contracting assignments to universities, and 3) welcomes help from other nations drawn into aid by the U.S. example. But the deepest significance of the new style is that despite the lowered cost of aid (it has dropped from 2% of G.N.P. at the height of the Marshall Plan to one-half of 1% now), the funds going out for economic and social ends are running at the highest rate ever.

Simple Uncle Sap-ism? No; other new attitudes, drawn from two decades of experience, have clarified the giver-getter relationship. Only the naive among the givers expect lavish thanks; only the naive among the getters darkly suspect concealed U.S. motives. The U.S. now knows that arm twisting by withdrawing aid rarely works--and it usually knows better than to let foreign governments attempt aid-or-else blackmail. Moreover, the U.S. has backed away from any grandiose dreams of remaking the world; receiving nations nonetheless candidly want a large helping of U.S. machines, techniques and comforts.

-"It's not immoral to be moral," says one U.S. official in wry and epigrammatic justification of aid, and Congress, after the arguments are over, always seems to agree. This year's votes, which in both houses ran two-thirds in favor of aid, say in effect that Americans think the world a little healthier with U.S. help, and think the U.S. a little healthier too.

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