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Obama and the global development agenda

Written by Simon Maxwell

Like everyone else, I am inspired by the oratory of Barack Obama. I had tears in my eyes during his speech at the Democratic Convention, and again in Chicago the night of the election. No doubt, his inauguration speech will have the same effect.But, here is a list of things that won’t happen the day after Barack Obama is inaugurated as the President of the United States: handing key decisions on foreign policy over to the UN; agreement to a Doha trade deal; a legal commitment to carbon reduction on the scale needed to limit global warming; an immediate lift in aid volume to 0.7% of GNP; and a complete reorganisation of the US aid machinery. The US was ranked 17th out of 22 in the Center for Global Development’s Commitment to Development Index in 2008. It is unlikely to leapfrog into first place overnight. Oh well.

Actually, the real risk may be that the USA, like some other donors preoccupied with the global financial crisis, becomes focused entirely on domestic problems and turns away from the development ‘project’. What price free trade or free movement of labour when General Motors is at risk and jobs are being lost across the country? The US administration will be struggling, like everyone else, with the problem of ‘doing development in a downturn’. It will need to be reminded, forcefully, that poverty reduction is not only a moral imperative, but also in the long-term interests of the USA. Let us hear no more of the protectionist talk that came from candidate Obama during the campaign.

The point that development is mutually beneficial is not new. It was central to the analysis of the Brandt Commission in the 1980s, with the vivid image that rich and poor countries were on the same vessel: if the end containing developing countries were to sink, then inevitably the end containing developed countries would follow.

More recently, the idea has been central to US foreign and development policy. Andrew Natsios, former Administrator of USAID, writing in 2006 in Development Policy Review, expressed it forcefully, as follows:

‘‘Pure’ development, that is development abstracted from foreign policy concerns  . . . is not likely to be sustainable over the long term.’

Today, the link between foreign policy and development is widely recognised. At ODI, for example, we work extensively  on how foreign policy and development connect.

When it comes to the USA, overseas development assistance (ODA), to Africa at least, has historically increased as rapidly under Republican as under Democratic administrations. The country’s record is not stellar by international standards, with the latest figures from the Development Assistance Committee of the OECD showing aid still at less than 0.2% of GNP. Nevertheless, US ODA doubled, roughly,  in real terms during the eight years of the Bush Presidency, with increases in traditional programmes as well as new initiatives like the Millennium Challenge Corporation (MCC) and the President’s Emergency Plan for AIDS Relief (PEPFAR), the HIV/AIDS funding window. With much still to do if Gleneagles and other pledges are to be met, as the DATA Report 2008 reminded us, development, and particularly the commitment to Africa, can be seen as a Bush success story.

In ideological and quantitative terms, this gives President Obama something to build on – and my guess would be that there will be changes in tone, but no major shift in strategic positioning, certainly in the short-term. It is pretty likely that development will be pursued in what Andrew Natsios termed ‘transformational’ terms, and that national self-interest will be balanced with humanitarian instincts.

The changes of tone will not be trivial, and certainly we can expect – and hope - that President Obama will work hard to build international consensus. There will also be an inevitable re-thinking of the relationship between military and developmental intervention, especially in Afghanistan and Iraq, with repercussions for countries such as Sudan or Zimbabwe. Indeed, this is already underway, under the auspices of Central Command, now led by General David Petraeus.
In terms of specific reforms, the US development community has its own wish-list, and the think tanks are on the case. There has been an extended debate about the need for a single agency to run overseas aid, along the lines of the UK’s Department for International Development (DFID), and about how to reduce the extent of Congressional earmarking of funds for specific activities, and other political control of aid spending. I’m told that USAID is subject to something like 300 separate earmarks, effectively removing all room for manoeuvre on something like 98.5% of the budget.

In addition, we in Europe are often taken aback by the number of different agencies involved in US development cooperation, and by the number of different funds and programmes. Budget support is another issue, with Europe making greater progress than the USA in moving away from free-standing projects and chanelling aid money directly to developing country government budgets that aim to address national priorities. And don’t ask about tied aid, especially food aid. In 2004, I gave a lecture at the Center for Global Development (CGD) in Washington, paraphrasing George Bernard Shaw to talk about ‘Two Continents Divided By a Common Vision of International Development’. Not much has changed.

For the future, the CDG has produced a comprehensive agenda, in a book edited by Nancy Birdsall, entitled ‘The White House and the World: A development agenda for the next US President’. It covers a wide range of issues, from health and education, to trade, engagement in fragile states and climate change. There are also proposals on how to reform the complex and over-managed machinery of development cooperation.

From our perspective in Europe, it is important that there be US engagement and leadership in international development, not only because of the size and weight of the US in the global economy and politics – but also because of our shared history and values. That is one reason why we in ODI have invested significantly in building strong links to our colleagues in the USA, for example through the German Marshall Fund’s Transatlantic Task Force on Development. We hope engagement will intensify under a new administration. And, yes, multilateral reform, a trade deal, a climate deal, and more and more effective aid are all on the agenda for 2009.