FOR IMMEDIATE RELEASE:
Monday, June 18, 2001
CONTACT: Jim Jaffe, Michelle Bazie
(202) 408-1080

IN 2002, U.S. AID TO POORER NATIONS WOULD HIT POST-WWII LOWS
AS A SHARE OF THE ECONOMY AND THE BUDGET

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As a share of the U.S. economy  — and as a share of the federal budget  — development aid from the United States is on course to set a post-World War II low in 2002.

This is documented in a new report from the Center on Budget and Policy Priorities that tracks development aid spending patterns since the end of World War II. The further declines would occur, according to the report, even though the United States already devotes a much smaller share of its resources to such aid than any other comparable country.

The report examines the Bush Administration's budget, which in fiscal year 2002 would spend an amount on development, humanitarian, and economic aid essentially equal to the level in the Office of Management and Budget "baseline."

The report finds:

Discretionary Spending on Development and Humanitarian Aid

1980s Average

In 2002 under Administration’s Budget

Comment on 2002 Figures

Inflation-adjusted level
(in 2002 dollars)

$13.4 billion

$10.9 billion

Significantly below historic average

As a share of the economy

0.20%

0.10%

Post-World War II low

As a share of the budget

0.92%

0.56%

Post-World War II low

Source: Center on Budget and Policy Priorities analysis of data from the Office of Management and Budget and U.S. AID

The report also finds that the initial indications on Congressional action suggest that Congress will adopt funding levels generally similar to those the Bush Administration has proposed.

International Comparisons

The report also examines data from the Organization for Economic Co-operation and Development, the authoritative source for comparing various industrialized nations' levels of development assistance:

Finally, the report briefly compares resources and living standards in the United States to those of other nations. On average, each American has 75 times the average annual income of each person in the world's low-income countries. Some 1.2 billion people in developing or transitional countries  — four times the total U.S. population  — live on less than $1 a day.

Figure 1

These facts provide some context for coming Congressional deliberations concerning what funding level to provide for development, humanitarian, and economic aid in fiscal year 2002. "The United States would have to increase its foreign aid commitment substantially to reach the levels that other affluent nations provide or just to return to its own level of commitment in earlier decades," noted Isaac Shapiro, director of the Center's International Budget Project and author of the report. "Instead, the nation appears to be continuing the trend of long-term decline."

A full text of the analysis, As a Share of the Economy and the Budget, U.S. Development and Humanitarian Aid Would Drop to Post-WWII Lows in 2002, is available at the CBPP website, www.cbpp.org. The report will be released at a press briefing on June 18 at 11:00 a.m., at which Ambassador Princeton Lyman of the Aspen Institute (whose governmental appointments have included Assistant Secretary of State for International Organization Affairs and U.S. Ambassador to South Africa) and Michael Kremer of Harvard University and the Brookings Institution will speak.


The Center on Budget and Policy Priorities is a nonpartisan research organization and policy institute that conducts research and analysis on a range of government policies and programs. It is supported primarily by foundation grants.

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