Agency for International Development. The Foreign Assistance Act of 1961 created the Agency for International Development (AID), a semi‐autonomous organization within the State Department which became the central bureaucracy responsible for economic aid programs. The agency's predecessors included the Economic Cooperation Administration, which implemented the Marshall Plan; the Mutual Security Administration (1951), which continued economic and military assistance to Western Europe and began addressing the needs of underdeveloped states; and the International Cooperation Administration (1955). Using loans, food assistance, and technology transfers, among other methods, AID sought to enhance the productivity and overall market expansion of less developed nations. By the 1990s, the agency operated in more than one hundred countries, with two thousand employees in the field, and nearly ten thousand contractors.

Although concerned with the economic growth of poor nations, agency policies also reflected the real and perceived needs of the American political economy. AID officials proclaimed that their programs sought to foster a thriving private sector in the Third World and to guarantee an open door in recipient nations to foreign private investment, particularly from the United States. The agency's efforts to build a strong private business community in the less developed world contributed to the larger U.S. strategy of creating stable governments capable of resisting communist or economic nationalist movements that were anticapitalist.

AID programs sought the integration of developing countries into the global marketplace. The agency often pushed these countries to limit their social spending, increase privatization, and promote the export economy. Starting in the 1980s, for example, AID urged recipient nations to develop nontraditional, capital‐intensive crops for export. This policy of promoting export‐led growth aimed at alleviating the crushing levels of international debt that many third world countries had incurred during the oil‐price rises of the 1970s. Critics pointed out, however, that it destabilized traditional farming in many places, increasing poverty while simultaneously creating new markets for U.S. and other petrochemical and agribusiness corporations.
See also Federal Government, Executive Branch: Department of State; Foreign Aid; Foreign Relations; Foreign Trade, U.S.

Bibliography

Frances Moore Lappe,, Rachel Schurman,, and and Kevin Danaher , Betraying the National Interest, 1987.
Vernon W. Ruttan , United States Development Assistance Policy: The Domestic Politics of Foreign Economic Aid, 1996.

Nathan Godfried

AGENCY FOR INTERNATIONAL DEVELOPMENT

AGENCY FOR INTERNATIONAL DEVELOPMENT. In 1961, the U.S. Agency for International Development (USAID) was created to coordinate bilateral nonmilitary assistance to foreign countries as part of a global campaign to counter the appeal of communism. At first, USAID focused on large-scale infrastructure projects. During the 1970s, however, emphasis shifted to addressing the basic needs of the poorest members of society by promoting health, nutrition, rural development, and family planning programs. In the 1980s and 1990s, the agency turned many of its operations over to private, for profit contractors, and channeled aid programs into development of the private sector.

Throughout its existence USAID had to respond to critics from the right, who complained that foreign aid was a waste of taxpayers' money, and those from the left, who argued that the agency was guided more by ideological anti-communism than by the need to alleviate poverty. USAID officials responded by pointing out that four-fifths of the agency's funds for foreign assistance were spent on goods and services provided by American businesses, and that the total amount of U.S. foreign aid was low, falling below 0.2 percent of the gross national product in the 1990s, placing the United States last among major donor countries. Ideological concerns were often apparent in the selection of recipients. For example, South Vietnam alone absorbed more than 25% of USAID's worldwide budget in the 1960s.

BIBLIOGRAPHY

Berríos, Rubén. Contracting for Development: The Role of For-Profit Contractors in U.S. Foreign Development Assistance. Westport, Conn.: Praeger, 2000.

Porter, David. U.S. Economic Foreign Aid: A Case Study of the United States Agency for International Development. New York: Garland, 1990.

Ruttan, Vernon W. United States Development Assistance Policy: The Domestic Politics of Foreign Economic Aid. Baltimore: Johns Hopkins University Press, 1996.

Max PaulFriedman

See alsoForeign Aid .

Agency for International Development (AID), federal agency created (Sept., 1961) to consolidate U.S. nonmilitary foreign aid programs. Originally an agency in the State Department, it has been a component part of the U.S. International Development Cooperation Agency, along with the Overseas Private Investment Corporation, since 1979. AID administers bilateral assistance to more than 80 countries as development assistance and as economic support funds. Development aid targets agriculture, rural development, nutrition, health, education, population planning, and market-oriented development. Economic support funds are flexible grants to sustain or restore economic activity. AID also administers Food for Peace (with the Department of Agriculture), disaster assistance, a housing guaranty program, scientific and technical aid, and the Women in Development program. In the 1980s and 90s AID stressed the development of open, democratic societies, and promoted the dynamism of free markets and individual initiative in developing countries, including the newly independent states of the former Soviet Union. Other principles governing AID's programs include concern for individual economic and social well-being, responsible environmental policies, and management of natural resources.

Agency for International Development (AID) US government agency that carries out assistance programmes designed to help less-developed countries develop human and economic resources and increase production capacities.

http://www.usaid.gov