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DEVELOPMENT: Clinton Lays Out U.S. Strategy

Jim Lobe*

WASHINGTON, Jan 6 2010 (IPS) - Secretary of State Hillary Clinton Wednesday pledged to make development, along with defence and diplomacy, “a central pillar” of U.S. foreign policy and results, rather than ideology, a guiding principle in devising development policy.

In what was billed as a major address to the Peterson Institute for International Economics here, Clinton listed six key features of the Barack Obama administration’s approach to development.

They include greater coordination with recipients, with other donors, and among the many U.S. agencies, including the Pentagon, that deliver foreign aid; and a more-targeted focus on key sectors in poor countries; namely, health, agriculture, security, education, energy, and local governance.

Washington also intends to increase its investment in new technologies that will allow “billions of people to leapfrog into the 21st century after missing out on 20th-century breakthroughs” and in projects designed to advance the status and power of women, an issue, Clinton said, that is “of personal importance to me, and one I have worked on for almost four decades”.

She also stressed her determination to rebuild the long-neglected U.S. Agency for International Development (USAID) into “the world’s premier development agency” and rely less on private contractors who became major beneficiaries of U.S. foreign aid, especially under President George W. Bush.

“For too long, we’ve relied on contractors for core contributions and diminished out own professional and institutional capacities,” she said.

“This must be fixed. Contractors are there to support us, not supplant us. USAID and the State Department must have the staff, the expertise, and the resources to design, implement, and evaluate our programmes.”

Clinton spoke amid continuing uncertainty about the future of development policy and the precise role that USAID, whose youthful new administrator, Rajiv Shah, was confirmed by the Senate last week and will be sworn in Thursday, will play in it.

Shah, a 36-year-old medical doctor who served briefly as Undersecretary for Research and Chief Scientist at the Department of Agriculture, before his nomination in November, previously held senior posts in the Bill and Melinda Gates Foundation in Seattle.

The administration is currently undertaking two major reviews of development policy; the first, by the White House’s National Security Council entitled the “Presidential Study Directive on Global Development”, and the second, the State Department’s own “Quadrennial Diplomacy and Development Review,” or QDDR. Both are expected to have a major impact on development policy and how it will be administered.

While USAID during the Cold War served as Washington’s most important foreign aid agency by far, its influence, budget, and staff have steadily diminished over the past two decades, and particularly during the Bush administration.

With the onset after the 9/11 attacks of the “global war on terror”, for example, the Pentagon was given responsibility and hundreds of millions of dollars for “nation-building” and other development-related work that traditionally had been performed by USAID.

In addition, the Bush administration, ideologically sceptical of government efficiency, often gave preference to private contractors for whom the past eight years have yielded a bonanza.

In addition, USAID lost what little institutional autonomy it enjoyed when it was formally incorporated into the State Department in 2006 in order to ensure better coordination between U.S. diplomatic policy and development work.

Finally, the Bush administration’s creation in 2004 of a separate Millennium Challenge Corporation (MCC) effectively reduced USAID’s clientele to poor-performing or conflict-ridden nations, such as Afghanistan and Yemen, and humanitarian disasters.

The MCC was designed to assure higher levels of bilateral aid for developing countries committed to far-reaching political reform and economic liberalisation. Nineteen countries currently receive funding from the MCC under bilateral agreements.

The administration’s ongoing reviews are intended to address these and other issues, but Clinton, who spoke favourably of the MCC’s work, has also indicated that she opposes restoring USAID’s independence, let alone elevating its administrator to a Cabinet-level position as has been recommended by a number of aid experts.

While Shah made a strongly favourable impression during his Senate confirmation hearings, some USAID advocates have expressed concern that his relative youth and inexperience in Washington will make it more difficult for him to assert the agency’s interests in long-term development for its own sake against the shorter-term political and security calculations of more-powerful players, including the Pentagon, the Treasury, and the State Department.

Because the two reviews have not yet concluded, Clinton shed little light on how she proposed to “rebuild USAID into the world’s premier development agency” or other bureaucratic innovations, and she asserted that Washington’s interest in achieving long-term development in poor countries need not conflict with shorter-term considerations.

“We are working to integrate development more closely with defence and diplomacy in the field,” she said, elaborating on the concept of what the administration has called the interrelationship of the “Three Ds”.

“I know that the word ‘integration’ sets off alarm bells. There is a concern that integrating development means diluting it or politicising it – giving up our long-term development goals to achieve short-term objectives or handing over more of the work of development to our diplomats or defence experts,” she went on.

“That is not what we will do. What we will do is leverage the expertise of our diplomats and military on behalf of development, and vice versa. The three Ds must be mutually reinforcing.”

She also said she wanted to adopt a model of development based “on partnership, not patronage”, and “built on consultation rather than decree”.

In addition to working more collaboratively with aid recipients, she said Washington will work more closely with other bilateral donor countries – including emerging powers China, Brazil and India which she called “important contributors to global development” – multilateral organisations like the World Bank, and charities, such as the Gates Foundation, CARE, Oxfam, and the Clinton Foundation.

On sectors on which Washington hopes to focus its aid efforts, she announced plans to invest 3.5 billion dollars over the next three years in countries where agriculture represents more than 30 percent of gross domestic product and more than 60 percent of jobs and where up to 70 percent of a family’s disposable income is spent on food.

She also repeated previous administration pledges to provide 63 billion dollars in global health that, in addition to prioritising the fight against AIDS, malaria, and tuberculosis, will be used to improve local health systems.

On technological innovation, she recalled the role played by United States in driving the so-called Green Revolution, pioneering mass immunisation techniques, and promoting solar-powered laptop computers.

“There is no limit to the potential for technology to shrink obstacles to progress,” she said, citing State Department support for tech company initiatives in Mexico to report gang-related activities; in Iraq to promote transparency in government; and in the Democratic Republic of Congo to bring mobile banking to rural areas.

*Jim Lobe’s blog on U.S. foreign policy can be read at

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