Facts and First Principles of American Foreign Aid

“If our Founding Fathers wanted us to care about the rest of the world, they wouldn't have declared their independence from it.” 

-- Stephen Colbert

Last week, the Wall Street Journal released the results of a new poll on Americans view of foreign policy. As is often the case with foreign affairs, Americans seem to simultaneously desire tougher engagement and greater isolationism.

55 percent of those surveyed believed that “We need a president who will present an image of strength that shows America's willingness to confront our enemies and stand up for our principles." Indeed, as applied to President Obama, 36 percent of respondents agreed that “He is too cautious and lets other countries control event,” compared to only 15 percent who claimed he is “too bold and forces issues with other countries.”

At the same time, 47 percent of Americans are calling for a “less active” foreign policy, with only 19 percent calling for a more active policy.

Isolationism has been a theme throughout American history, on both sides of the political spectrum. Even God Bless America seems to promote this view, its opening line referencing the storm clouds gathering “far across the sea.”

After over a decade of war in Iraq and Afghanistan (one of which was launched/fought under ostensibly false pretenses) and the longest recession since the Depression, it’s understandable that many would seek strength through a retreat from global affairs.

And yet, the views of the majority of Americans are informed by a gross misunderstanding of what foreign aid is and how much of our budget it makes up. As shown in the chart at left from the Center for Global Development, the percentage of the federal budget going to foreign aid has declined significantly over the past half century.

Despite this clear trend, Americans consistently believe that the U.S. spends over one quarter of its entire budget on foreign aid (see chart from a recent survey conducted by the Kaiser Family Foundation). Indeed, only four percent correctly stated that foreign aid makes up one percent or less of the federal budget.

Lest one think that the facts are irrelevant to the public’s consideration of foreign aid, consider that Kaiser found a dramatic shift in sentiment when Americans are told about the actual facts.

Armed with the facts, citizens change their views—a lesson policymakers could learn to emulate—and indeed, they are right to do so, not only because America has a duty to play a leadership role in combating global poverty, but because many elements of foreign aid have proven to be some of the most effective uses of government funds. 

In its 2014 annual letter, the Bill and Melinda Gates Foundation calculated that since 1980 alone, foreign aid has helped to save 100 million children at an average cost of about $5,000 per life: a bargain so good the only question is why we don’t do more.

As America continues to look back at our own Civil War at its 150^th anniversary, I’m reminded of what John Stuart Mill wrote in The Contest in America in 1862:

War is an ugly thing, but not the ugliest of things: the decayed and degraded state of moral and patriotic feeling which thinks that nothing is worth a war, is much worse…A man who has nothing which he is willing to fight for, nothing which he cares more about than he does about his personal safety, is a miserable creature who has no chance of being free, unless made and kept so by the exertions of better men than himself. As long as justice and injustice have not terminated their ever-renewing fight for ascendancy in the affairs of mankind, human beings must be willing, when need is, to do battle for the one against the other.

While the battles of Baghdad and Kabul come to a close, the war on preventable disease and extreme poverty wage on. Are we willing to fight to end those scourges, if not with blood, than with treasure?

We ought to be, and not because there isn’t suffering in our own backyards that demands our concern and attention—there is—but rather because our lives and liberty are degraded by casting aside our gaze and pretending like our wealth is ours to hoard, rather than a tool to be used to bring justice, peace, and a modicum of dignity to all people, everywhere.

Silence Over Sacrifice: Generational (In)Equity in American Politics

“The ultimate test of man’s conscience may be his willingness to sacrifice something today for future generations whose words of thanks will not be heard.”

-- Gaylord Nelson, Senator from Wisconsin (1916-2005)

In February, BSB wrote that one of the “First Principles” of American Politics should be to “assume that present sacrifice for future benefit is the appropriate path,” and that, “The burden of proof should be on those who would take today and pay tomorrow, not the other way around.”

All too often, however, whether the topic is wages, housing, pensions, or the fight to combat the catastrophic effects of climate change, we are quick to sell the next generation short to avoid sacrificing our own benefits/lifestyle.

As Joanna Weiss highlighted in the Boston Globe last week, 26 states currently provide a modified minimum wage for teens, ranging from offering teens 85 percent of the minimum wage and allowing substantially lower wages for short-term work to exempting students from the minimum wage altogether. Weiss concluded, “Who’s to say, based on age, that their work is less valuable than anybody else’s?”

In New York State, teens make the same minimum wage. However, the State recently enacted a tax credit that subsidizes the wages of 16-20 year olds, making the effective wage of a teenager lower (from the employer’s perspective).

As important as wages are to success in New York, perhaps nothing is more closely tied to opportunity than housing. The dreams of youth coming to Gotham—whether from small, rural towns in Massachusetts or metropolises from across the sea—invariably run into the reality of New York’s affordable housing crunch.

Last week, Harry Siegel of the New York Daily News once again noted what many economists across the political spectrum have said for years about New York’s housing market, “the more subsidized housing we have, the more outrageously expensive it gets for everyone not lucky enough to have it.”

And as you would expect given that housing, like wages, is a zero-sum game, older people are vastly overrepresented among subsidized housing units. As shown in the table below from the Furman Center’s 2012 Annual Report on the State of NYC’s Rent-Stabilized Housing, people over the age of 65 are much more likely to reside in rent-regulated, public, and other subsidized housing than the young.

Most acknowledge that the only way out of this conundrum—save for an unwinding of NYC’s rent-stabilized housing program (disclosure: I live in a rent-stabilized unit on Manhattan’s Upper East Side)—is to build more housing. And the only way to do that in New York City is to build up.

However, as Siegel adroitly points out, this solution once again pits the generations against one another, creating, “a fight between those of us already here, protecting what we have, and the needs of those who might join us — between the city’s present and its future.”

A third area where this type of generational clash frequently takes place is government pensions. In 2012, New York recently enacted Tier VI—a new benefit tier for employees entering City/State service after April 1, 2013. Tier VI asks future employees to pay more for fewer benefits than Tier V employees (disclosure: I am a “Tier IV” member), continuing a long tradition of “pension reform” that solves present problems by borrowing from future employees. As the Fiscal Policy Institute found, the average Tier VI employee will receive a pension with a value that is 39.8 percent lower than currently provided under Tier 5.

While some insist that “reliance” on benefits should prevent them from being impaired in any way, that ideological rigidity necessarily assumes that the benefits of future workers/veterans should be sacrificed to maintain the status quo.

Some interest groups have recognized the generational tension in politics and sought a path forward. Common Sense Action and the Bipartisan Policy Center have created an Agenda for Generational Equity (AGE), which seeks to protect today’s seniors and future generations through entitlement reform and investments in education and development that improve mobility and opportunity.

However, while AGE is an ambitious and well-meaning effort, it falls short by failing to use the language of sacrifice, of tradeoffs, in rendering its judgment. Indeed, the AGE appears to want readers to have their cake and eat it to—implying that there is a way forward in which all will be healthier, happier, wealthier, and without any additional burden (tax or otherwise).

It is yet another example of how sacrifice has become a verboten term in American politics. How this came to pass is something of a mystery, particularly given how we have historically revered sacrifice (whether of life, liberty, or treasure) as one of the pinnacles of a democratic society.

On the other hand, concerns about generational equity are nothing new. Nearly 30 years ago, Steven Greenhouse of the New York Times wrote that the very term “Generational equity” was slowly creeping into the political discourse as economists, “assert that the generation in power is blithely passing the bill to its successors.”

No one is blameless in this story—from the politicians who are too scared to level with constituents, to the constituents themselves, who allow politicians to infantilize them by reveling in the fiction that solving problems is painless and that merely saying that nothing is more important than our children is more important than actually backing up that sentiment through collective sacrifice.

In the end, sacrifice shouldn’t be a dirty word in American politics; it should be something to which we all aspire.

Millennials and the Restoration of the American Dream

“[The American Dream] is not a dream of motor cars and high wages merely, but a dream of social order in which each man and each woman shall be able to attain to the fullest stature of which they are innately capable, and be recognized by others for what they are, regardless of the fortuitous circumstances of birth or position.”

-- James Truslow Adams, The Epic of America, 1931

Earlier this week, Pew Research once again noted that Millennials (corresponding roughly to those born between the early 1980s and 2000) “are at risk of becoming the first generation in American history to have a lower standard of living than their parents.” This subject has been of great consternation to many writers in recent years, as Millennials continue to grapple with being the generation who came of age during the worst economic collapse since the Great Depression (see here or here or here).

When the subject came up in my own workplace this week (a place full of Millennials lucky enough to be in gainful employment), it raised a number of issues:

·      How do we measure “standard of living”?

·      Depending on the definition, is it even a problem that our generation may have a lower standard than our parents?

·      Is the standard of living calculation inappropriately disassociated with indicators of happiness?

On this third point, I highly recommend taking a gander at the 2012 World Happiness Report, in which Columbia University Professor Jeffrey Sachs stated:

In an impoverished society, the focused quest for material gain as conventionally measured typically makes a lot of sense…[because] [e]ven small gains in a household’s income can result in a child’s survival, the end of hunger pangs, improved nutrition, better learning opportunities, safe childbirth, and prospects for ongoing improvements and opportunities in schooling, job training, and gainful employment.

However, as Sachs notes, the same calculus is not true at the other end of the income spectrum—in developed nations like our own where the majority of Americans do not worry about the “basic necessities” of food, clothing, medicine, and shelter. In these societies, not only do increases in living standards not lead to the same rise in happiness, but they also lead to “disorders of development” like obesity, diabetes, addictions, and the decline in social trust/community institutions.

Perhaps more importantly, in a world in which wealth is often extracted—directly or indirectly—from the consumption of the planet’s natural resources, these gains often come at the expense of the world’s poor, both by siphoning off the wealth of developing nations and by increasing the risks of climate change, which hits the poor the hardest.

All of these concepts are topics for future posts, but today I want to focus specifically on how we measure “standard of living” and whether the measurement that has emerged in Post-War America—which is grounded in “disposable income”—has led us away from the things that truly matter to happiness.

In A Consumers' Republic: The Politics of Mass Consumption in. Postwar America, Lizabeth Cohen, Harvard Professor and Dean of the Radcliffe Institute (disclosure: I am her former research assistant), wrote that consumerism became such a powerful force in mid-20^th Century America that people began to equate “free choice as consumers with political freedom.”

Indeed, from the Kitchen Debate between President Richard Nixon and Soviet Premier Nikita Khrushchev, to President George W. Bush imploring Americans to continue to consume in the wake of the September 11 attacks, the vision of the American Dream laid out by James Truslow Adams in the midst of the Great Depression seems to have slipped further and further from our grasp.

As I noted in a piece for the Harvard Law Record in 2008:

The conspicuous consumption of the post-war consumer age has replaced a fulfilling vision of the American Dream with a vacuous conception of liberty and success. No longer is the rallying cry to make it in the New World in a new way-your way-but rather to make it in the New World via the tired, trodden path of swiping credit cards and compiling symbols of status.

That conception of the Dream deadens the soul of a Nation. It stands in contrast to our most venerated modern conception of the Dream—that issued by Rev. Martin Luther King Jr. on the steps of the Lincoln Memorial over 50 years ago. The Dream listed the following factors: that all men are created equal, that people of different backgrounds will sit together at the “table of brotherhood,” that freedom and justice will reign across our land, and that our children will not be “judged by the color of their skin but by the content of their character.”

That gets me to Millennials—that generation simultaneously chided as lazy and lauded as idealistic. If indeed we are not to match the standard of living of our parents, what are we to do? Here’s an idea: destroy, once and for all, the perversion of the American Dream that arose with the consumerism of the 20^th century and restore the Dream to its historic roots.

That doesn’t mean shirking from the challenge of poverty and injustice. To the contrary, it means addressing the scourge of poverty in America—even as it entails sacrifices by the middle and upper classes—so that all people have the opportunity to pursue happiness in accordance with the lives they have imagined for themselves.

We may not be the richest generation; but if we end up the happiest, the freest, the most tolerant, we will have accomplished something far greater for our world and ourselves.