BLOG POST

Unilateral Disarmament Is Not in Our Interest

In 1948, Congress overwhelmingly passed what would become known as the Marshall Plan. That act appropriated $13.3 billion over 1948-51 for Europe’s recovery, equivalent to about $150 billion today.

It was proposed by a former general, not an economist or a politician, a man who understood well what America had already sacrificed in WWII. The country had just lost more than 400,000 men and spent $296 billion (more than $5 trillion when adjusted for inflation) in the war. Public debt stood at 123 percent of GDP. Congress might well have refused to bear any additional burden in Europe.

Instead, the plan garnered bipartisan support (passed by a Republican Congress and signed by President Truman) and was regarded as an investment in American security and prosperity. It made America (to use Secretary Rubio’s words) “stronger, safer, and more prosperous” by building markets and democracy in Europe. It “put America first,” not just at home but in the world.

No one today would dispute the enormous political, security, and economic returns on that investment. Whatever the strains, disappointments, and tensions in the relationship, our alliances and markets in Europe are among our biggest, strongest, and most enduring.

Today, once again we are confronted with not one, but two expansionist, autocratic powers, seeking to advance alien ideologies and intent on threatening America’s economic, political, and military role in the world. Once again, we have a strategic choice on how we mix defense and offense in our international economic and diplomatic policy—do we rely only on hunkering down behind high border walls and high tariffs or do we also mobilize other countries as reinforcements and build forward positions around the world?

Indeed, one could even make the argument that the case for aid is stronger today than it was in 1948. We’ve just seen the devastating consequences of a global pandemic and the clear self-interest in reducing other countries’ vulnerability and resilience to diseases that spread quickly across borders.

We know that poorer countries are particularly vulnerable to catastrophic droughts and floods, violent storms, and sea-level rise. And these shocks are often drivers of conflict and migration. Providing them with the finance, technology, and technical assistance to make them more resilient supports their long-term growth, stability, and ultimately their value as US markets and allies.

And developing economies are key sources of some of the critical minerals that the US needs to lead in global supply chains. Aid to secure access to those minerals is not altruism. It’s self-interest.

Moreover, the cost of aid now is dramatically lower than in 1948, and certainly not a significant contributor to our budget deficit. Aid’s share of the federal budget is 1 percent, one-sixth of its share in 1948.

We also now have the benefit of multilateral institutions, the Bretton Woods banks, that share much of the burden with other countries and leverage US capital contributions into much larger lending flows. Only $3.7 billion in cumulative US capital in the International Bank for Reconstruction and Development (the World Bank) , for example, has, with help from other shareholders, driven more than $800 billion in cumulative lending. For the poorest countries of the world, $60 billion in US contributions to IDA, the low-income lending arm of the World Bank since 1960 has been multiplied into $558 billion in cumulative grants and lending.

We also now have a multilateral infrastructure that brings in support from dozens of countries, along with private donors, to help ensure the world’s poorest people have access to basic lifesaving health services—including Gavi, the Vaccine Alliance, and the Global Fund to Fight AIDs, Tuberculosis, and Malaria. Other multilateral institutions like the Pandemic Fund invest in making the US and the world safer through pandemic prevention, preparedness, and response.

And we have a full suite of US bilateral institutions—the US Agency for International Development, the Development Finance Corporation, and the Millennium Challenge Corporation—that can engage both governments and the private sector, bring together a full arsenal of financial and non-financial tools, and use their on-the-ground presence to build powerful partnerships.

That does not mean that all aid programs have equal merit, or that they are all cost-efficient, or that there is sufficient emphasis on ensuring aid effectiveness. An aid review that focused on ensuring that US dollars are spent on the most effective programs could yield the greatest gains.

So why would we unilaterally disarm? Our pulling back just creates opportunities for our adversaries. China and Russia are stepping up, not stepping back.

Ronald Reagan, characteristically, said it succinctly and effectively: “You know the excuses: We can’t afford foreign aid anymore, or we’re wasting money pouring it into these poor countries, or we can’t buy friends . . . Well, all these excuses are just that, excuses—and they’re dead wrong.”

Disclaimer

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


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