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US Development Policy


Partisan jabs (even a few in Latin) dominated the House Foreign Affairs Committee hearing with the heads of USAID and MCC yesterday. For the first time ever, USAID Administrator Rajiv Shah and MCC CEO Daniel Yohannes appeared together before the full House authorizing committee. It was an opportunity for substantive engagement on the administration's new global development policy and the activities of two major U.S. development agencies. It was an opportunity missed.

In stark contrast to the House appropriations subcommittee hearing with Yohannes on Tuesday, the authorizing committee members could hardly stop bickering amongst themselves for the witnesses to get a word in edgewise. For the most part, Republicans members argued America is "broke" while Democrats said foreign affairs spending is too small to affect the deficit and cuts now would cost more later. (Rep. Mike Kelly (R-PA)  derided the "mea culpa" attitude of his dear friends on the other side of the aisle; Rep. Gerald Connolley (D-VA) said the U.S. would be saying "requiescat in pace" if the U.S. slashed the budget irresponsibly.)

There were a few glimmers of substance. Chairwoman Ileana Ros-Lehtinen (R-FL) touched on the need for MCC and USAID to remain distinct in her opening statement (hinting at the USAID versus MCC debate) and ranking member Howard Berman (D-CA) called for MCC and USAID to show meaningful returns for taxpayer dollars, but neither pressed these topics in questions.

Other bright spots in the hearing came from Reps. Jeff Fortenberry (R-NE) and Ann Marie Buerkle (R-NY). Rep. Fortenberry asked "what works?" and "what doesn't?" Rep. Buerkle asked how she could go to the American people to justify spending money elsewhere when money is tight at home. Both are reasonable questions, were respectfully submitted and gave Shah and Yohannes time to answer.  Shah and Yohannes said development investments benefit U.S. national security, prosperity and help create American jobs. Shah mentioned vaccines as an example of what works, and said programs like teacher training without outcome measures or health interventions that focus only on hospitals are less effective. In the ten seconds Yohannes had to answer the question, he said MCC’s business approach is part of what works.

Reps. Ros-Lehtinen and Connie Mack (R-FL) both pushed the MCC on why Honduras no longer receives MCC funds. Yohannes explained that Honduras successfully completed its first compact in 2010 but fails the corruption indicator so was not selected as eligible for a second compact in the FY2011 process. Rep. Ros-Lehtinen commended the MCC for taking a “principled approach” to the matter but hoped Honduras, and the new government, would again become MCC partners. Rep. Mack argued the MCC corruption indicator measures circumstances from the previous administration in Honduras. (I would say this is a call for the research community to keep working to develop better, more timely data, rather than a failure on the part of the MCC.)

Rep. Ed Royce (R-CA) also raised questions about the MCC’s compact in Senegal, where the country continues to pass the control of corruption indicator, but there are widespread concerns about President Wade’s $27 million statue and his son’s appointment as uber-minister of international cooperation, urban and regional planning, air transport and infrastructure (recall that the MCC compact focuses on roads, irrigation and water management). Yohannes said the issues in Senegal are still better than in many other developing countries and that the MCC is responding to concerns and recently helped ensure Senegal maintains open procurement processes. The challenge for MCC remains twofold: 1) making sure (and communicating) that there are adequate accountability measure in place to show no MCC funds are used improperly, and 2) overcoming the negative perception that the MCC is operating in a country where there are high-level, visible concerns about corruption. The MCC has invested heavily in the first part; the second part is more difficult.

Aside from these few questions, the witnesses were largely spectators to congressional grandstanding. It’s hard to argue anyone’s time was well-spent (I’m tempted to do a back-of-the-envelope calculation of how many taxpayer dollars paid for the hearing preparation and actual event). It was neither a constructive debate on the purpose of aid nor a way forward on budget cuts. Worse, it erodes respect and trust between the executive and legislative branches that is in much need of repair in order to reform U.S. foreign assistance and make sure Americans get the biggest bang for their development bucks.


CGD blog posts reflect the views of the authors drawing on prior research and experience in their areas of expertise. CGD does not take institutional positions.