The Great Reset of American Aid

For the last several months, I have been working with a former World Vision employee writing a memoir about his odyssey as an African aid worker. He now works for the UN. As I type this, he’s in the midst of closing health clinics and sending home those who work there. (He estimated about 45 percent of the budget from his work comes from the US.)

Personally, my wife and I are former Peace Corps volunteers in Africa and spent 2022 in Sri Lanka when she worked as a USAID subcontractor. The company she worked for has just let go of three-quarters of their staff and the Chief of Party she worked with is packing to return home.

In the past few weeks, President Trump’s freezing of US foreign aid has had immediate and dramatic effect. Whether or not it was the right thing to do—or if he really had a legal right to do it—is not why I write this. As is often said in entrepreneurial circles, “In every crisis there is an opportunity.” This, I believe, is such a “crisi-tunity.” While it certainly would have been better to proceed more gently with fewer lives risked and disrupted, we have to question how Foreign Aid has come to be seen as “bloated” and in need of a total reset. How did we get to this point and how can we do better in the future?

Maybe it’s time to recognize that there’s something wrong with looking to the US government for the majority of the world’s humanitarian aid and development needs. Watching one administration within its first week shut down the majority of assistance being provided across the globe shows how risky this dependence has become to those who need it the most.

Limiting Liability

In his book, Servant Leadership, Robert Greenleaf admonishes that “institutions, as we know them, are designed to limit liability for those who serve through them.” The same, I believe, can be said for those who give to them. Foreign aid, as well as donations to non-government organizations, are “institutions” we have created to help facilitate meeting the obligations we naturally feel to fellow human beings in need. In emergency situations, we desire to be of help, but we can’t each drop everything, fill a plane with supplies, and fly to a disaster area to hand out food and blankets whenever there is a crisis. Instead, we do that through institutions.

The United States builds good will around the world through foreign aid. And it has found over the years, it is better to send that aid through specialists on the ground rather than doling money out to foreign governments, who too often build nicer homes for their officials instead of alleviating the suffering of their most needy.

The thing is, the greater the distance between the donors and helpers on the ground, the less likely money will be efficiently used to provide help. This is not just because of corruption on the ground—as I saw first hand when I was in the Peace Corps—but because of a loss of focus on the true goals of humanitarianism. It’s just not a question of oversight; it’s a question of investment and involvement. We’ve fallen into a process that alleviates the feeling of obligation to help others, but doesn’t necessarily improve the wellbeing of those we seek to help. There are a number of reasons for this, not all of which are within our control, but many are.

The truth is, we can do better—and that better may mean we need a sturdier and more direct mechanism to improve the status of the world’s poor than US Foreign Aid.

A Focus on Resiliency

Human beings have a powerful skill: We can set goals and accomplish them. Yet as leadership expert Bob Harrison cautions, setting goals can be dangerous, as we tend to limit our focus on that goal to the exclusion of everything else. Goals that measure profit margins can be this way, as we can focus on maximizing short-term profits while undermining long-term growth. We lose sight of the bigger picture. 

Another layer is we tend to set goals that are according to our paradigms, which can be limited and short-sighted. Thus, for example, we set a goal for disaster relief and mitigation, but solve it in a way that not only ignores resiliency, but actually undermines it. We keep people from dying in the short term, only to set them up for failure and prolonged suffering in the years after we leave.

In the wake of the 2010 Haiti earthquake, for example, needs were so severe and the infrastructure so poor that aid organizations set up their own camps and worked independently of local governance to help those on the ground. This dynamic led to aid organizations competing for territory, duplicating services, and in some cases neglecting other critical needs. Why? Disasters create a feeding frenzy for increasing nonprofit income. As long as a disaster is in the news cycle, people want to help, and the more an NGO shows up there, the more money it can raise. The sad thing is, once that disaster is replaced in the news cycle, the donations dry up even though the needs don’t. This makes it all the more important to increase donations while one can. It puts pressure on NGOs that can distract from their primary mission. 

Although this helped Haiti in the short-term, the country was no better off when the NGOs left. In fact, it may be worse because Haiti’s infrastructure was left less able to help its people if another disaster hits—and there is less pressure to do so knowing international aid will swoop in to save the day. It’s a frustrating catch-22.

My point isn’t that international aid is futile—in reality, it is vital—but after decades of the greatest prosperity the world has ever experienced, the poorer nations are still getting poorer while the rich nations keep getting richer.

In his 2010 acceptance speech for the Nobel Prize, Jimmy Carter sited this “growing chasm between the richest and poorest people on earth” as the greatest problem facing the twenty-first century, because, as he put it: “The results of this disparity are at the root of the world’s unresolved problems, including starvation, illiteracy, environmental degradation, violent conflict, and unnecessary illnesses that range from Guinea worm to HIV/AIDS.” Thus closing this economic gap helps solve, literally, a world of problems. While we still need cleaner energy, better healthcare, etc., closing this gap would also aid in those efforts. 

Perhaps it’s time to do more than “text xxx to give $10” to whatever organization is grabbing airtime as we watch the effects of a disaster on the nightly news.

As the wealthiest nation on earth, we have much more to offer the rest of the world than just our donations.

The Power of Proximity

The world is smaller than it has ever been due to improved communications and innovative technology. When I jumped on a Zoom call to talk with a client in the US from Sri Lanka—a 12.5-hour time difference—I realized I was in a completely different world than the one I lived in as a Peace Corps volunteer in the Central African Republic. Back then, I would wait weeks for a letter to arrive and have to drive hours to make a phone call. Today, not only can I instantly send money to help someone, say, in India, but I can send my presence. From my suburban home, I can get on a zoom and troubleshoot with a local change maker. The more valuable investment here may be in relationship.

Giving money is a wonderful thing, and we should all be generous, even if only because it is good for our souls. But money only goes so far in solving problems. Expertise is needed. Systems need to change. People on the ground need to be able to take care of themselves not only so the pressure on wealthier nations to do so is lessened, but more importantly so their own creative capacity and human dignity is expanded. More than money, this requires mentors. Certainly you’ve heard it said, “As one person you might not change the world, but you can change the world for one person.” And consider how one entrepreneur who starts a business, potentially changes the world for everyone he or she employs.

One of the things my wife and I have seen time and again while living abroad is that the sense of entrepreneurship in the average person in a developing country is less than that of the average child in the US running a lemonade stand. Their cultural paradigms are not as individualistic and “all things are possible” entrepreneurial. Their sense of agency is much different. 

Sharing what we know and practice every day as business-minded individuals not only helps people become more resilient, it also helps them to help others.

A New Mandate

Imagine if US companies took on solving a global need as part of their mission. After all, the business of business is solving problems. We set goals to be profitable, but what if we added another component to our bottom line?

In their book, Completing Capitalism: Heal Business to Heal the World, Bruno Roche and Jay Jakub offer a more complete form of capitalism that mobilizes and generates human, social, and natural capital along with financial capital. In her book, Doughnut Economics: 7 Ways to Think Like a 21st Century Economist, Kate Raworth suggests that if we set different goals for our economies—one’s that revitalized our environments and communities rather than impossible endless GDP growth that demands mass consumption and exploitation of resources—development and lifting people out of poverty might just become a way of doing business. In Putting Purpose into Practice: The Economics of Mutuality, Bruno Roche and Colin Mayer explore how such operating models empower businesses to thrive by meeting the needs of the world. Which begs the question: What if we made human flourishing the primary business of doing business? What if profitability weren’t the only measure of success—or even near the top of the list in importance?  

The election of Donald Trump to a second term in the White House (whether you voted for him or not) is a sign that America is not happy with the status quo. We have problems that not only face our nation, but the world we are an integral part of, and in many ways, we lead. At the same time, government cannot do what business can.

It’s business that creates jobs, that turns solving problems into sustainable cash flows, and that raises people out of poverty. (I know governments like to take credit for this, but unless they are handing out government jobs, it’s businesses that are paying those salaries.) Government and nonprofits play important roles, but business is where problems are actually solved. Yet although business has the greatest muscle for creative problem solving, as an entrepreneurial society, have we become too narrow in our thinking about which problems we solve?

Why leave the exportation of expertise to government agencies and nonprofits? What could American business leaders offer to help local actors solve problems, address issues, and meet needs? What might you offer if you could reach across the globe and share what you know with one other person?

The great American reset of foreign assistance need not only be disruptive in the way government is run, perhaps it should also be a signal we have other ways of making a difference besides government spending—in fact, ways that are far better. Maybe what is needed is not so much our financial capital as our intellectual capital. We all live on the same small planet, and what happens in one part is no longer isolated from all the others.

Perhaps it’s time to do what we do best to empower those less fortunate—from building businesses to developing transformational leaders to streamlining processes—instead of relying on large funding mechanisms that so far have had little effect on alleviating increasing disparities. 

How might you empower someone on the other side of planet to change their world?