Thursday, February 05, 2015

Worth viewing this about foreign aid if you are not expert already in some of the inadvertent consequences.

As I understand its history, U.S. aid was created in part to allow allied countries that needed U.S. goods and services to obtain them even though they did not have the dollars to buy them. Thus it made sense to use the U.S. aid dollars to buy the goods and services here and send them to the countries in need.

Of course, the funding for USAID is appropriated by the Congress through a political process. Rice growers, beltway bandits and others who found selling goods and services to the foreign aid program lobbied for funding to be earmarked for their goods and services. Shipping on "American bottoms" seems a case in point -- food aid from the USA shipped under foreign aid has to be shipped on U.S. owned cargo ships, even when it might be better to use other carriers.

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