US may shelve aid for needy abroad
The sudden, unexpected failure of the 1980 US foreign aid bill to be passed by Congress last week threatens to send international disaster relief into a tailspin.
Unless there is a radical change in the course of events, American aid experts fear that drastic cuts will now be necessary in US relief for destitute countries like Cambodia and Guatemala, and that US aid credibility could plummet in the eyes of rich and poor countries alike.
On the verge of the anticiv pated final passage of the foreign aid bill, the Congressional Budget Committee reported last week that Congress already has reached its 1980 budget ceiling.
The report, in effect, rules out higher spending called for by the aid bill. US aid programs can still go on at last year's spending levels. But increased budgeting needed for recent global emergencies has fallen through.
Relief for the starving in Cambodia, for the devastation wreaked by war in Guatemala, hurricane in the Caribbean and earthquake in Italy -- these are efforts for which the Carter administration had promised major US assistance. But without the foreign aid bill, it will be difficult to find funds to back the promises.
The events could also impact development projects around the globe that are supported by international lending banks. The United States is a key contributor to the banks. They had been counting on increased US donations to offset inflation and provide for new global needs. But without the bill, US support will be drastically less than expected.
American contributions to the World Bank, for example, will fall from the bill's $328 million figure back to last year's funding of $163 million. This could reduce the US voting power in the bank. And depending upon how much other nations contribute, the US could lose its veto in the bank. That power is reserved only for donor countries that contribute more than 20 percent of the bank's funds.
It is still too early to chart the full repercussions of US aid events in the international community. But many countries express bewilderment, the World Bank's Peter Riddleberger says.
"Her we have gone into hard bargaining at international aid negotiations," he says, "with the US urging other donor countries to keep pace with its own efforts to contribute to these projects, and now the US itself seems to be pulling out. These countries wonder what's going on. And will this signal to poor countries that the US says one thing and does another?"
In the final analysis US foreign aid has been caught in the crunch of a general budget-cutting craze.
Specific aid jeopardized by recent events includes the planned increase in disaster relief funding from $20 million to $73 million (aid for Cambodia refugees, the victims of the Utalian earthquake and the Caribbean hurricane); $ 75 million in emergency aid for Nicaragua; a $16.5 million increase in support planned for the AFrican Sahel region; and a $196 million appropriation to fund refugee and emergency aid under the US Food for Peace Program. In addition, State Deparment officials had been counting on the new aid bill to help repay about $30 million that has already been spent in aid to Cambodia.
The community of aid analysts in the Congress and State Department, stunned and in considerable disarray, are now scrambling to find resources for world regions most in need.
Some emergency aid for such regions could be found through transferring funds from other aid programs, through a new congressional budget resolution, or new funding legislation. But these options face formidable challenges.