SEATTLE — The first of October marked the beginning of the U.S. Federal Government’s 2015 fiscal year. The budget for the coming year totals $3.9 trillion. The U.S. Agency for International Development, the primary foreign assistance arm of the federal government, accounts for $20.1 billion, or less than one percent of the overall budget.
Over the next year, USAID will use their budget to fund projects focused on ensuring food security in Africa, ending preventable child deaths, fighting global climate change and providing life-saving responses to vulnerable populations. $77 billion will go toward providing electricity to Africa, thanks to the newly-passed Energize Africa bill, and another $151.3 million will go to developing “private-sector, market-driven resources, which drives down costs and yields a better return for the American taxpayer,” according to USAID.
In the coming year, USAID will spend $2.8 billion on assistance in Iraq, Afghanistan and Pakistan. For this investment, USAID will work with the respective governments toward long-term economic stability. Along with this lofty goal, USAID will also use these funds to “support democratic reforms, including the rights of women.”
On the military side, the War in Afghanistan, which is scheduled to officially conclude with the withdraw of U.S. troops on December 31, will cost $85.4 billion in the coming year. This total does not account for the newly-minted bilateral agreement, which will keep 9,800 troops in Afghanistan for the foreseeable future. For this staggering annual investment, the payoff has been unclear, at best, to the American taxpayer.
The economy of Afghanistan has been decimated by the ongoing combative situation between the resilient Taliban forces and Western troops in the past two decades. According to the CIA’s latest estimate, given in 2008, Afghanistan is facing an unemployment rate of 35 percent. This figure not only signals a crisis regarding fundamental humanitarian issues (i.e. increased rates of poverty, crime, malnourishment, etc.), but in economic terms, Afghanistan’s situation represents an enormous opportunity cost.
Consider that the U.S.’ most profitable trading partner in the Middle East is the United Arab Emirates, a tiny, oil-rich nation to the southwest of Afghanistan. In 2014, the U.S. exported in excess of $13 billion to the tiny nation, whose citizens number a mere four million, or half the population of New York City. In the same calendar year, the U.S. exported only $584 million in goods to Afghanistan, whose population is nearing 30 million.
The question from an economic point of view is whether it makes more sense in the long term to continue to invest $40 in war to every dollar spent in aid to war-torn nations like Afghanistan. If the 2,210 lost lives in Operation Enduring Freedom don’t serve as a wake-up call to re-think U.S. foreign policy, will the economic payoff of investing in the future of Afghanistan be enough incentive to spur change?
In what is viewed as a watershed year in Afghanistan for USAID, 2015 may hold a glimmer of hope for the future. Speaking before the House Committee of Foreign Affairs, Donald Sampler, Assistant Administrator and Director of the office of Afghanistan and Pakistan Affairs, linked the loss of American lives and the future development of Afghanistan. “USAID always keeps in mind the enormous sacrifices made by Americans to build a secure and stable Afghanistan, and we fully understand the need for constant vigilance, particularly during this delicate transition period,” he said.
In a region of the world whose economy has proven fertile time and again, it will be interesting to see how USAID’s investment will pay off in the coming year and beyond.
– Casey Hobbs
Sources: USAID 1, USAID 2, Defense.gov, CIA 1, CIA 2, U.S. Census 1, U.S. Census 2, World Atlas, New York Times
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