Ideas to Action:

Independent research for global prosperity

United States

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2006 Results

Aid

What it measures

Aid quality is just as important as aid quantity, so the CDI measures gross aid as a share of GNI adjusted for various quality factors: it subtracts debt service, penalizes “tied” aid that makes recipients spend aid only on donor goods and services, rewards aid to poor but relatively uncorrupt recipients, and penalizes overloading poor governments with many small projects.

United States Overall
  • Score: 2.2
  • Rank: 19
United States Strengths
  • Large amount of private charitable giving attributable to tax policy (rank as a share of GNI: 3)
United States Weaknesses
  • Low net aid volume as a share of the economy (0.18%; rank: 20)
  • Large share of tied or partially tied aid (72%; rank: 19)
  • Selectivity: large share of aid to less poor and relatively undemocratic governments (rank: 17)



Trade

What it measures

International trade has been a force for economic development for centuries. The CDI measures trade barriers in rich countries against exports from developing countries.

United States Overall
  • Score: 7.4
  • Rank: 2
United States Strengths
  • Low protection of agricultural commodities (rank: 3)
  • Low tariffs on agricultural products (rank: 3)
United States Weaknesses
  • High barriers against textiles (rank: 19)
  • High barriers against apparel (rank: 18)



Investment

What it measures

Rich-country investment in poorer countries can transfer technologies, upgrade management and create jobs. The CDI includes a checklist of policies that support healthy investment in developing countries.

United States Overall

  • Score: 6.9
  • Rank: 6
United States Strengths
  • Employs foreign tax credits to prevent double taxation of corporate profits earned abroad
  • Particularly active in the Extractive Industries Transparency Initiative (EITI) and in the G-8 Anti-Corruption and Transparency Action Plan
  • Provides official support for design of securities regulations and institutions in developing countries
  • Provides official support for outflows of portfolio investment
United States Weaknesses
  • Limits official insurance against political risk to domestically owned firms
  • Employs inappropriate home country national economic tests for eligibility of projects
  • Negligent in identifying bribery and corrupt practices on the part of home country firms abroad
  • Does not provide official assistance in identifying direct investment opportunities
  • Imposes restrictions on pension fund investments in emerging markets



Migration

What it measures

The movement of people from poor to rich countries provides unskilled immigrants with jobs, income and knowledge. This increases the flow of money sent home by migrants abroad and the transfer of skills when the migrants return.

United States Overall
  • Score: 4.6
  • Rank: 11
United States Strengths
  • Large increase during the 1990s in the number of unskilled immigrants from developing countries living in the United States (rank by share of population: 5)
  • Large share of foreign students from developing countries (79%; rank: 6)
United States Weaknesses
  • Small number of immigrants from developing countries entering the United States in 2004 (rank by share of population: 14)
  • Bears small share of the burden of refugees during humanitarian crises (rank: 17)



Environment

What it measures

Rich countries use a disproportionate amount of scarce resources and poor countries are most vulnerable to global warming and ecological deterioration, so the CDI measures the impact of policies on the global climate, fisheries and biodiversity.

United States Overall
  • Score: 3.2
  • Rank: 21
United States Strengths
  • Large decline in greenhouse gas emissions rate in 1994–2004 (average annual growth rate/PPP GDP, –2.2%; rank: 10)
United States Weaknesses
  • High greenhouse gas emissions rate per capita (25 tons of carbon dioxide equivalent; rank: 20)
  • Low gas taxes (rank: 21)
  • No ratification of Kyoto Protocol on climate change
  • Large number of endangered species imports (rank: 16)
  • No ratification of UN Convention on Biodiversity
  • No policy to regulate imports of illegally cut timber



Security

What it measures

Since security is a prerequisite for development, the CDI rewards contributions to internationally sanctioned peacekeeping operations and forcible humanitarian interventions, rewards military protection of global sea lanes, and penalizes arms exports to poor and undemocratic governments.

United States Overall
  • Score: 5.9
  • Rank: 8
United States Strengths
  • Has the most military ships in the world stationed in sea lanes important to international trade (rank by share of GDP: 1)
  • Significant financial and personnel contributions to non-UN internationally sanctioned peacekeeping and humanitarian interventions (overall contribution rank over last 10 years by share of GDP: 6)
United States Weaknesses
  • Arms exports to poor and undemocratic governments (rank by share of GDP: 19)
  • Small financial and personnel contributions to UN peacekeeping and humanitarian interventions (overall contribution rank over last 10 years by share of GDP: 18)



Technology

What it measures

Rich countries contribute to development through the creation and dissemination of new technologies. The CDI captures this by measuring government support for R&D and penalizing strong intellectual property rights regimes that limit the dissemination of new technologies to poor countries.

United States Overall
  • Score: 5.0
  • Rank: 13
United States Strengths
  • High government expenditure on R&D (rank by share of GDP: 1)
  • Does not offer patent-like proprietary rights to developers of data compilations, including those assembled from data in the public domain
United States Weaknesses
  • Large share of government R&D expenditure on defense (56%; rank: 21)
  • Low tax subsidy rate for business R&D (rank: 13)
  • Allows patents on plant and animal varieties
  • Allows patents on software programs
  • Pushes to incorporate “TRIPS-Plus” policies in bilateral free trade agreements with developing countries
  • Imposes strict limitations on anti-circumvention technologies that can defeat encryption of copyrighted digital materials