President Obama and Secretary Clinton have been quite vocal in pledging to rebuild USAID into “the world’s premier development agency.”  The newly issued development policy does not make it clear just how that will happen, or if it will happen at all.

In general terms, any government agency is strong only to the extent that it has at least these three conditions:

  • the human resources to get the job done;
  • the authority to form its own budget and then fight for it through the labyrinthine budget process; and,
  • policy influence and operational control over the programs that form the core of its mission.

These issues have been points of contention between State and USAID through both the PSD and QDDR processes.  The newly released global development policy represents an attempt by the White House to adjudicate between calls from the development community (and some voices within the administration) for a strong and independent aid agency and arguments from the State Department on the need to more fully integrate diplomacy and development.  I fear that reality will not match the rhetoric in this case, and political dynamics will continue to work against USAID.

Implementation is where the rubber hits the road.  If the past is any indication, the road ahead will be difficult.

Pothole No. 1:  Human resources.  The administration has an abysmally slow record in filling top USAID positions, as our USAID Staffer Tracker points out.  It took nearly a year to fill the Administrator’s job, and only two Senate-confirmed positions are currently filled, leaving nine still open some 20 months into the administration.  It is possible that two more could be confirmed by week’s end.  Second, the agency is hampered by restrictions on the use of program versus operating expenses that force it to turn to contracting with other US government agencies for personnel, often at a very high premium.  The PPD does not speak to this issue, which would require a legislative fix.  And finally, calls by some quarters of the political spectrum for a federal government hiring freeze imperil progress that has been made over the last year to restore USAID’s ranks – unless the President can successfully make a national security argument.

Pothole No. 2:  Budget authority. The new development policy asserts that rebuilding USAID will involve “the development of robust policy, budget, planning, and evaluation capabilities.”  The agency has stood up its new Policy, Planning, and Learning shop.  It has also created a budget office, but State officials have made clear that all budgeting matters will still be under the control of State’s F Bureau.  And, the Administrator still lacks authority to directly argue his case to OMB.  Even under the much maligned F process, the Administrator, because he was dual-hatted as the Director of Foreign Assistance, had more control over USAID’s budget.

Pothole No. 3 (also known as the Mother of All Potholes):  Policy influence and operational control.  Well, let’s see.  The Bush administration’s signature development program that rewards countries for good performance was put in the specially created Millennium Challenge Corporation.  Another Bush administration program – PEPFAR – was put in the State Department under the direction of a coordinator.  In the Obama administration, aid to Afghanistan and Pakistan is largely directed out of the Holbrooke shop at State, and in the field, USAID mission directors report to State Department foreign assistance coordinators.  In Afghanistan, Pakistan, and several African countries, the U.S. Department of Agriculture is running agriculture programs.  The Feed the Future initiative was developed at the State Department, and it is expected that a global food security coordinator will sit at State.  (While no announcement has been made on whether the State coordinator will have operational control of FTF, isn’t it a tad troubling that anyone would question putting USAID in control of what is fundamentally a development program?)  As for the Global Health Initiative, we still don’t know who is in charge.  USAID will provide “leadership in the formulation of country and sector development strategies, as appropriate.”  (When would it not be appropriate?)  It appears that the scope of USAID’s mission has been, and continues to be, diminishing.

The new policy does not advance the Administrator’s role but maintains the status quo for the most part.  He will be invited to NSC meetings “as appropriate.”  He will continue to “report to the Secretary of State.”

So where does that leave us in determining the future of USAID?  Waiting for the QDDR.  And who’s in charge of the QDDR?