Latest FY08 Omnibus Spending Bill Gives MCA $1.54 Billion

December 17, 2007

Today we got our first look at the results of Senate and House Appropriators' weekend wrestling with the FY08 Omnibus Appropriations bill, comprising the remaining 11 appropriations bills, including State-Foreign Operations. In an effort to meet the president’s demand that aggregate discretionary spending be held to his request of $933 billion, the current Omnibus slashed an additional 4% from the Foreign Operations discretionary spending level earlier passed by both chambers to arrive at $32.8 billion. The Millennium Challenge Account ended up at $1.54 billion, though like several accounts, it may be vulnerable to further cuts as the Bill moves forward.It is with some amusement that I read the Congressional Quarterly headline (subscription required) on the Bill, "Bush's Signature Foreign Aid Program Takes a Hit." The fact that it halves the President's original request is old news. The fact that it is middle ground between the billion figure and the House's $1.8 is new and good news. And the fact that the Lugar Amendment that would have changed the requirement to obligate full compact funding upfront was dropped is a terrific outcome in terms of maintaining the program's innovative partnership construct.Perhaps most important about the $1.54 billion MCA spending figure -- and compelling reason to withstand any attempts to reduce it as the Bill moves forward -- is that it allows the U.S. to save face with its developing country partners that have worked hard to design compacts and might have been turned away at the finish line if the figure was any less. From what I can piece together, a $1.54 billion FY08 appropriation would allow the MCC to sign the pending $700 million compact with Tanzania as well as the compacts with Namibia and Burkina Faso that are in the very final stages of negotiation. It would, however, leave little room for new Threshold Programs.So, considering what might have happened to the MCA, its current standing is not bad...all things considered. Hopefully, the MCC and its partner countries will demonstrate progress on program milestones -- beyond disbursements which, unfortunately, have dominated the discussion thus far -- and enter the FY09 budget round with positive momentum.


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