Foreign Aid?!?

[Boomer.....]

I read yesterday that the US will resume giving $1.6 billion to Pakistan, this just after having to raise the debt ceiling yet again. Last year we spent $21 billion on foreign aid and this year will be around the same. I'm not very political, so please tell me why we continue to do this when our country is sinking in debt.

[SoonerProphet]

Poverty prevention, democracy spreading, and stability promotion. Not saying I agree but those are the big three.

http://www.forbes.com/sites/brianwingfield/2011/01/29/making-sense-of-u-s-foreign-aid-to-egypt-and-elsewhere/

[Soonerjeepman]

we feel like we must have the world depend on us...

[Boomer.....]

So we are giving aid to China despite them being the largest holder of our debt bonds? That's like our mortgage bank asking us for free money.

[8timechamps]

Foreign Aid is not a black and white/clear cut process. It's not as simple as saying "we need X amount of money, and since we give (insert country) X amount, we'll just stop giving them money and we'll be fine". In other words, it doesn't work like "normal" economics.

One thing I will add is that I continue to think we give too much, to too many other countries. However, I don't think the answer is to stop altogether. That's really not possible/probable.

[KantoSooner]

Foreign Aid has to be defined very carefully to have any hope of a rational conversation. Examples:

Sometimes we give military aid to a country...and get basing privileges out of the deal. Worth it? May very well be, depends on what we get. (and, having our arms in a certain country means spare parts and training contracts down the road and a certain leverage in the future. Iran bought F-14's just before the revolution. Pity they find it so hard to buy spare parts. Wonder how that happened?)

Sometimes we give aid in kind in the form of food. We get the video of starving kids off the teevee for a while and the farm lobby gets to sell more grain. Worth it? May be. It's humanitarian, it supports grain prices and we might get a bit of good will out of the deal (although the Soviets for years rebagged US AID wheat in Africa in 'From Your Friends in the USSR' bags. No one from our Ag group caught on until American Ex-pats living there raised a stink.

Sometimes we give cash to support a government we like, to prevent a worse one from coming to power, to prevent a regional banking crisis. So forth and so on. It's a case-by-case call.

Sometimes it's a one-time or one project (a dam, a highway, whathaveyou) deal, sometimes it's an evergreen commitment.

It almost never produces an effect that can be photographed or pointed to. But that's not say there is not a 'worthwhile' effect. Since we probably are losing more in terms of increased interest caused by a bump to our credit rating caused by our politicians being morons over the last six weeks or so than we give out in foreign aid each year, I'm not going to waste much time worrying about it. It's insignificant compared to the other egregious crap we spend money on and we do get something for it.

[8timechamps]

Foreign Aid has to be defined very carefully to have any hope of a rational conversation. Examples:

Sometimes we give military aid to a country...and get basing privileges out of the deal. Worth it? May very well be, depends on what we get. (and, having our arms in a certain country means spare parts and training contracts down the road and a certain leverage in the future. Iran bought F-14's just before the revolution. Pity they find it so hard to buy spare parts. Wonder how that happened?)

Sometimes we give aid in kind in the form of food. We get the video of starving kids off the teevee for a while and the farm lobby gets to sell more grain. Worth it? May be. It's humanitarian, it supports grain prices and we might get a bit of good will out of the deal (although the Soviets for years rebagged US AID wheat in Africa in 'From Your Friends in the USSR' bags. No one from our Ag group caught on until American Ex-pats living there raised a stink.

Sometimes we give cash to support a government we like, to prevent a worse one from coming to power, to prevent a regional banking crisis. So forth and so on. It's a case-by-case call.

Sometimes it's a one-time or one project (a dam, a highway, whathaveyou) deal, sometimes it's an evergreen commitment.

It almost never produces an effect that can be photographed or pointed to. But that's not say there is not a 'worthwhile' effect. Since we probably are losing more in terms of increased interest caused by a bump to our credit rating caused by our politicians being morons over the last six weeks or so than we give out in foreign aid each year, I'm not going to waste much time worrying about it. It's insignificant compared to the other egregious crap we spend money on and we do get something for it.

Well put Kanto. I don't think I have the ability to summarize the topic in this way. There's no easy answers either. Each case has to stand independent of the others, so there really is no black/white on the issue.