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Current Article
Think Again: U.S. Foreign Aid
By Steven Radelet
Page 1 of 5
Posted February 2005
Shortly after a tsunami swept through the Indian Ocean last December, a U.N. official complained that the West was “stingy” with its relief donations. Stung by this criticism, the Bush administration increased its financial pledge tenfold overnight—while loudly asserting that the United States actually led the global pack in foreign aid. Is the world’s wealthiest country a scrooge or a savior?

“The U.S. Government Provides More Foreign Aid than Any Other Country.”
Yes. The United States gives more cash to developing countries than any other nation. Of the $69 billion in development assistance given by the world’s 22 top donors in 2003, the U.S. government contributed $16.3 billion, or just under 25 percent. But these sums mainly reflect that the United States is the largest and wealthiest donor country, accounting for 40 percent of the 22 donor countries’ total income. So, it should come as no surprise that the United States gives substantially more than, say Canada, which has one tenth the population and a much lower average income.

When U.S. foreign aid is measured on other scales, however, a different picture emerges. For example, the United States provided about $51 per citizen in official development assistance in 2002–03. That ranks it in 16th place among other major donors, behind Norway ($381 per citizen), the Netherlands ($203 per citizen), France ($96 per citizen), and the United Kingdom ($89 per citizen), among others. When aid is measured as a share of national income, the United States ranks dead last at 0.15 percent. Top givers include Norway (0.92), Denmark (0.84), Belgium (0.60), and Germany (0.28).

Moreover, foreign aid constitutes only a small share of the U.S. federal budget—much smaller than most Americans think. Surveys show that most Americans believe the federal government devotes 15 to 20 percent of the country’s expenditures to aid. The actual figure is far less than 1 percent; that’s less than one fourth of the budget share of 1965.


“America Is the Most Generous Country in the World if You Include Private Donations to Charities.”
No. Americans certainly rise to the occasion in times of crisis, as the outpouring of charitable giving to tsunami victims demonstrated. According to U.S. government figures, private donations to low-income countries through American churches, charities, foundations, nongovernmental organizations, and college scholarships was at least $6.3 billion in 2003. And such data almost certainly understate the actual amount of private aid. Some organizations do not respond to the government survey used to collect the data, and some important forms of contribution are omitted, such as volunteer time. Alternative estimates vary, with the upper-end figure (including gifts to more developed countries such as Israel and Russia) at $17.1 billion for 2000. By this estimation, private charitable donations per American total $58 per year—or about 0.16 percent of U.S. income—ranking the United States second among major donors in private giving (the first is Ireland at 0.22 percent).


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