A Bevy of Good Ideas on Foreign Aid Reform….If Anyone’s Listening

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by Diana Ohlbaum

There are lots of difficult problems with no good solutions. Foreign aid isn’t one of them.

For starters, the system works, even if it’s not particularly efficient, or popular with the public. It can be enhanced with small tweaks if a wholesale make-over proves unrealizable.

Beyond that, those who watch aid closely tend to have similar ideas about how to improve it. Maintain a strong and independent role for development, alongside other aid objectives. Reduce fragmentation and inconsistency. Expand the use of data for decision-making. Revise outdated rules, complicated procedures, and unnecessary requirements. Provide adequate resources.

Recent reports by the co-chairs of the Modernizing Foreign Assistance Network (MFAN) and a task force of the Center for Strategic and International Studies (CSIS) take the long view by proposing far-reaching structural reforms. Although the current administration is unlikely to embrace their recommendations, they offer a compelling vision and set a constructive tone for debate.

A new paper by Jeremy Konyndyk and Cindy Huang of the Center for Global Development (CGD) opts for a different approach, adding to the mix a list of 14 smart, “immediately actionable reforms.” Although it also lays out options for major reorganization, most of the emphasis is on what could be done now to pave the way for future progress.

Half the proposed reforms involve changes that the administration could make without legislative approval. To the uninitiated they may sound abstruse, but they can be grouped under three general headings:

1) Make better use of existing authorities to act quickly and nimbly (“Expand the use of USAID competition waivers,” “Build a USAID recovery/transition surge capacity,” “Rationalize USAID hiring mechanisms”)

2) Improve interagency coordination and clarify the division of labor (“Increase complementarity between USAID and MCC,” “Better align PEPFAR funding streams with agency core capacities,” “Harmonize country-level development engagement strategies”)

3) Streamline management to improve accountability and oversight (“Consolidate and elevate USAID’s humanitarian offices”)

Now that Mark Green is in place as USAID administrator, he could pursue several of these ideas—especially those in the first and third categories—with minimal risk of backlash from the State Department or White House.

The other seven proposed modifications are directed more appropriately at Congress, which is proving a far better partner for sensible aid reform than the administration. Nevertheless, the steps could be politically thorny. They also fall into three categories:

1) Establish independent review boards or panels (“Conduct a multilateral assistance review,” “Review the rationale for the African Development Foundation and the Inter-American Foundation”)

2) Minor adjustments in appropriations language (“Permit earmark relief in post-disaster and transitional settings,” “Embrace subsequent compacts in MCC countries”)

3) Major reform legislation (“Expand OPIC into a full-fledged development finance institution,” “Get food aid reform over the goal line”)

The first category is fraught with danger because the outcome depends entirely on the composition and scope of the review boards or panels. How can Congress ensure that reviewers will bring relevant expertise but not ideological agendas?

The second category is simpler, but only if the administration can convince appropriators that it will use its new flexibility wisely and be responsive to their concerns. The trust deficit between the executive and legislative branches has only widened in recent months, and Congress sees little incentive to reach across the chasm.

There is already considerable bipartisan support for the objectives in the third category, but reforms of this magnitude are never easy—especially when they involve clashing committee jurisdictions, competing domestic interests, and outright opposition from the administration.

The remaining proposal—“Streamline reporting requirements and create a standardized rating system for program effectiveness”—is a rather strange hybrid that probably could be rephrased as “Shift to outcome-based reporting.” Both the administration and Congress are already well aware that there are too many time-intensive, overlapping, unnecessary, little-used, and less-than-useful reports being produced. Every administration sends Congress lists of legislatively imposed reports that it wishes to see repealed, and Congress has adopted an informal rule requiring at least one existing report to be rescinded for each new one mandated.

However, creating standardized, evidence-based methods for analyzing and comparing aid programs is a different matter entirely. Monitoring, evaluation and learning techniques, and information-sharing platforms are still in their infancy at USAID (and embryonic at the State and Defense Departments), and will require sustained financial support and senior-level political leadership. Fortunately, this is a subject on which Congress has already taken a stand, enacting landmark legislation last year after overcoming behind-the-scenes opposition from the administration.

Regardless of the likelihood that any of these individual reforms will be implemented, it is helpful to have a list of concrete steps that could be pursued in short order and would have high impact even in isolation. In today’s chaotic and polarized political environment, continuous improvement of our foreign aid programs may be a more viable and less perilous path than comprehensive redesign.

Photo: Mark Green (by Gage Skidmore)

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Diana Ohlbaum

Diana Ohlbaum is the owner of DLO Global LLC ( https://www.dloglobal.com/), an independent consulting firm providing legislative and political strategy for sustainable human security, and a board member of the Center for International Policy. In addition to conducting oversight of U.S. foreign assistance on Capitol Hill for nearly 20 years as a senior professional staff member of the House Foreign Affairs Committee and the Senate Foreign Relations Committee, she has managed post-conflict programs at USAID and directed policy and advocacy at InterAction. Dr. Ohlbaum holds a Ph.D. in political science from Johns Hopkins University and a B.A. in Russian studies from Amherst College. Follow her on Twitter: @dohlbaum