Money May Change U.S. Calculations Abroad

Jun 17, 2011

As budget concerns multiply, money worries have entered the debate over foreign policy strategy.

Some policymakers cite fiscal savings as one compelling reason to begin a serious withdrawal of troops from Afghanistan next month.

And the Obama administration has had to be fairly modest in its diplomatic efforts regarding the emerging democracies of the Middle East and North Africa. Its proposed $2 billion aid package for Tunisia and Egypt falls far short of being a new Marshall Plan.

"The United States is caught in a vice where an incredible fiscal conservatism is working hard at rolling back deficits, and this is impacting foreign policy considerations in very serious ways," says Steve Clemons, a foreign policy strategist at the New America Foundation.

In Search Of A Constituency

Foreign assistance is never as politically popular as programs that benefit, say, farmers or schoolchildren. At a time when budgets are being cut, political logic seems to dictate cutting programs that mainly benefit people overseas. Especially in countries that lawmakers have grown wary about, such as Pakistan.

"There's no political constituency to keep foreign assistance alive," says Mark Helmke, a spokesman for Richard Lugar of Indiana, the senior Republican on the Senate Foreign Relations Committee. "The public thinks that foreign assistance makes up 30 percent of the budget, when it's one percent."

A Bloomberg National Poll in March suggested that more than 70 percent of Americans believe slashing foreign aid and pulling troops out of Iraq and Afghanistan would make a substantial dent in the deficit. Fewer than half believed the same thing about cutting Medicare or Social Security benefits, which comprise a far larger share of the federal budget.

"The wars in Iraq and Afghanistan and the extension of the United States around the world militarily are losing their political salience," says Gordon Adams, an American University foreign policy professor who helped oversee the defense budget during the Clinton administration.

"People don't like the wars," Adams says. "Iraq is done, as far as we're concerned. If you go into polling, what really matters to people is jobs, the state of the economy, the debt and the deficit."

Cuts To Foreign Aid Spending

The State Department's budget has doubled over the past decade, thanks to wars and concern about terrorism.

The Obama administration began with the hope that some of the flood of money still gushing toward the Pentagon could be redirected toward State, in order to strengthen diplomacy and development efforts alongside defense.

Secretary of State Hillary Clinton has warned Congress that serious fiscal constraints on this strategy would be "devastating to our national security."

The budget agreement that averted a government shutdown in April cut spending for State and foreign operations. The cut was only $500 million from the previous year's level, but it was $8.4 billion less than President Obama had proposed.

Further cuts are expected this year. On Wednesday, the House voted to cut foreign food assistance by 26 percent from current levels, although it rejected an amendment that would have eliminated funding for the Food for Peace program altogether.

'We Just Can't Afford It'

Dollars are also starting to drive the debate about Afghanistan. A small but growing number of Republicans are calling for a swifter troop withdrawal than the Obama administration is expected to propose next month, in part because of budget concerns.

"What's animated a lot of the conservative discussion is that it's costing so darn much," says Clemons, the New America senior fellow. "Money has been the pathway of conservative dissension."

Jon Huntsman Jr., the former Utah governor and ambassador to China, is expected to announce his bid for the GOP presidential nomination on Tuesday He made clear his concerns about the financial cost of war in an interview this week with Esquire.

"If you can't define a winning exit strategy for the American people, where we somehow come out ahead, then we're wasting our money and we're wasting our strategic resources," Huntsman said, referring to Afghanistan.

Regarding Libya, he said he never would have entered into the campaign.

"We just can't afford it," he said.

Spending In Afghanistan

Ronald Neumann, who served as U.S. ambassador to Afghanistan from 2005 to 2007, takes issue with the idea that budgetary concerns should shape American strategy in the war.

"This suggests we could lose the war for the wrong reasons," he says.

Characterizing a viewpoint he opposes, Neumann says, "This war is really important — it's really important that we keep Americans there, some of whom die, and we kill people — but if it costs too much, it's not worth it."

But financial considerations are an inevitable part of the calculation, says Rajan Menon, an international relations professor at Lehigh University and skeptic of the administration's Afghanistan strategy.

Spending $10 billion per month on the war is already a tough sell, given the state of the domestic economy, and will become even more dicey if the economy heads south, Menon says.

"Afghanistan is now costing more per month than Iraq," Menon says. "This to me is an unsustainable burden."

Strategy Wears A Dollar Sign

The debate over money for foreign policy will continue to take many forms. Many observers note that there is a limit to how much help countries such as Egypt can "absorb" without it having a distorting or even corrupting effect on its own economy.

"One has to be careful about saying budgetary considerations are the only factor here," says Anthony Cordesman, a national security analyst at the Center for Strategic and International Studies.

Some will argue that much of the money spent abroad is wasted, while others will contend that the U.S. provides foreign aid because it's in America's national security interest to do so.

For his part, Cordesman worries that American foreign policy could become pound foolish — that by not spending the money to combat a crisis in a particular country, the U.S. will end up confronting a worse crisis later.

"You end up wasting money in the guise of saving it," he says.

Getting Ready For A Hit

The impulse will be to cut back further in the coming years, not just because of concerns about the deficit, but because the military presence in Afghanistan and Iraq will shrink, says Adams, the American University professor.

"When the U.S. finishes military engagements, whether in Korea or Vietnam, you see reductions in the foreign policy budget as well, sometimes sharper than for the military," he says. "Sadly, I think that's what's going to happen here."

But as the military footprint begins to shrink, greater responsibility will fall to the State Department.

"It's evident that the American profile in both Iraq and Afghanistan is going to move from the Defense Department to the State Department account," says Helmke, the spokesman for Sen. Lugar. "And the State Department account is usually whacked."

House Republicans are planning to shift funds around in order to prioritize foreign aid spending in Iraq and Afghanistan. House appropriators plan to spend just under $40 billion for State and foreign operations this year, which would represent a cut of $8.6 billion. But, counting the money shifted to war-related spending, the net reduction is about $1 billion.

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