A Half Penny on the Federal Dollar: The Future of Development Aid.

• Author: Chollet, Derek
• Position: Review

A Half Penny on the Federal Dollar: The Future of Development Aid

Michael O'Hanlon and Carol Graham (Washington, DC: Brookings Institute Press, 1997) 102 pp.

The amount of money the United States spends to support economic development abroad--often lumped under the rubric of "foreign aid"--has been buffeted by two events. The first was the end of the Cold War, which for many eliminated the strategic imperative for spending money in the developing world to combat creeping Soviet expansionism. With the Soviet empire in history's dustbin, many Americans awaited the great "peace dividend" in which money once spent abroad could be turned to problems at home. The second event, not unrelated to the first, was the 1994 Congressional elections, in which a new generation of political leaders came to power--a Republican generation that aspired to reduce the size of the federal government. This new congressional class was also decisively, if not proudly uninternationalist; nearly half of them did not even have passports, and almost all of them avoided the once-prestigious positions on Congress' foreign affairs committees. They came to Washington so hostile toward the federal government, the Clinton Administration and world affairs that one Republican committee chairman, Sonny Callahan of Florida, once told Secretary of State Warren Christopher that he felt obligated to reduce the amount of money spent on foreign affairs by $1 billion a year, regardless of the Clinton Administration's arguments. In these budget-cutting times, foreign aid is among the easiest of targets.

These developments provide the context for the work of Michael O'Hanlon and Carol Graham, two Brookings Institution specialists on American foreign policy. O'Hanlon and Graham's book, A Half Penny on the Federal Dollar, will prove invaluable to anyone who wants to understand the past, present and future of U.S. foreign aid. In less than one-hundred pages, their book meets several needs. First, it covers all of the essential bases--defining what foreign aid is, what it is designed to do, and how much we actually spend on it. This last item is no small contribution, as gross misperceptions about how much the U.S. government allocates to foreign aid plague a debate that has been demagogued even by Washington's standards. In fact, even at its peak, the total money spent on foreign aid was minuscule. As the title of O'Hanlon and Graham's important new book suggests, the total comes to less...