By Minaz Kerawala, Communications and Public Relations Advisor
Upon assuming office last month, President Donald Trump announced the intention to cut United States Agency for International Development (USAID) funding. Snowballing in scope at the behest of billionaire Elon Musk, that intent materialized last Sunday in the summary firing of 2,000 USAID staff and the furloughing of nearly all others.
While it is up to the citizens of the world’s oldest democracy to determine whether they find it acceptable for their president and an unelected oligarch to so rule by fiat, the ruling has global implications. As a global actor, Development and Peace ― Caritas Canada therefore joins Caritas Internationalis in strongly condemning this “reckless decision.” We share the concern that “the ruthless and chaotic way this callous decision is being implemented threatens the lives and dignity of millions” and that it will “undermine decades of progress.”
USAID cuts widely denounced
The attack on USAID has been criticized in many quarters. Cooperation Canada, a national coalition of NGOs, noted that it “is already having catastrophic consequences on communities around the world.” Likewise, Doctors Without Borders warned that “freezing US foreign aid will result in humanitarian disaster.”
UN Secretary-General António Guterres expressed concern about the freeze and called for humanitarian exceptions to it. World Health Organization chief Tedros Adhanom Ghebreyesus said the cuts threatened the global health response. His view is shared by Prof. Richard Horton, who wrote in his recent editorial in the leading medical journal The Lancet, “Trump’s assault against WHO, USAID, and medical research threatens to bring the entire global health architecture crashing down.”
Closer to home, a spokesperson for Canada’s minister of international development wrote that Ottawa is “deeply concerned” and lamented that “the loss of USAID’s leadership and resources represents a dangerous retreat.”
These apprehensions are not hypothetical. Already, our American sister organization and fellow Caritas agency Catholic Relief Services has had to cut programs and lay off staff. Our longtime partner Jesuit Refugee Service has reported that projects serving 100,000 refugees in nine countries have been immediately affected.
American foreign aid matters
U.S. foreign aid has been the target of a long, corrosive campaign of misinformation. Nobel laureate economist Paul Krugman debunked charges of profligacy, noting that USAID’s $40-billion budget accounted for only 0.66 per cent of 2023’s total federal outlays. For comparison, the U.S. spent an estimated $17.9 billion on military aid to Israel just in the year following October 7, 2023, and an eyewatering $8 trillion on war since 9/11.
However, the U.S. is also the world’s largest donor, having provided 47 per cent of all humanitarian aid last year. The Pew Research Center reported that USAID disbursed 60 per cent of U.S. foreign aid, supporting programs run by thousands of foreign government agencies, nonprofit groups, international organizations and universities in 177 countries.
The Brookings Institution has noted that U.S. foreign aid, which enjoys broad public support, reduces poverty, maternal mortality and disease; increases life expectancy; contributes to U.S. national security; advances America’s and recipient countries’ economic interests; promotes core American values; and helps stem forced migration.
Little wonder then that the USAID shutdown is viewed as a threat to American interests.
The case for international aid
The cold contention that no country deserves any aid because all countries have productive citizens is undermined by the fact that expatriates from poorer countries send more money home than all official development assistance and foreign direct investment combined.
Encouragingly, many national funding agencies still believe in international aid. For instance, the French Development Agency states that official development assistance (ODA) “initiates processes of ‘virtuous development’ and creates… a leverage effect that multiplies impacts,” and can contribute up to an extra percentage of annual economic growth in recipient countries over the long term.
Evidence backs up the optimism. An analysis of 36 years of data from 140 countries found that with every 1 per cent increase in health aid, life expectancy rose by 0.24 months faster and child mortality declined by 0.14 per 1,000 live births faster. Research also conclusively shows that giving foreign aid enhances donor countries’ standing abroad, especially with health aid, and even among non-recipient countries.
Canada has a role to play
Canada has a rich history as an effective donor. Cooperation Canada has noted that in a 30-year period over which it received $1.5 billion in aid from Canada, Vietnam underwent so much economic development that Canada now earns more from trade with the country every two years than it gave to it over the previous 25 years.
In 2023, Canada’s ODA outlay of $7.97 billion accounted for 0.38 per cent of its gross national income. This was barely above the average spent by members of the Development Assistance Committee of the Organisation for Economic Co-operation and Development and well below the target of 0.7 per cent set by a UN General Assembly resolution in 1970.
Fortunately, in the 2024 budget, the Government of Canada undertook “to increase international assistance every year out to 2030” to the end of “upholding Canadian values around the world.” To its credit, the government also understood the importance of “helping lift up the most vulnerable, preventing overlapping crises from worsening, and promoting a more inclusive future for everyone” and that the “stability of Canada’s democracy, and democracy around the world, depends upon it.”
Last April, we had joined Canadian civil society groups in welcoming this commitment and encouraged the government to use its upcoming G7 presidency to lead other nations “towards reversing the global decline in official development assistance.”
It is now even more urgent for Canada to increase ODA funding and convince its peers to do the same; engage in diplomacy to urge the United States to reverse its foreign aid cuts; and honour its undertakings regardless of any change in government.
Research shows that in so doing, “Canada can safeguard its economic interests while reinforcing its commitment to global equity and stability.”
Most important, however, is the moral imperative that Pope Francis laid out: “Let us not forget that having wealth includes responsibility. Thus, I ask for constant vigilance so that the most disadvantaged nations will not be neglected, and that they be helped to rise from their impoverished conditions.”