Kinsley High School
Kinsley, Kansas
Teacher: Dr. Galen R. Boehme 

 Overcoming Obstacles of the Millennium Challenge Account

By Alexis K. Dill
Grade 12

 

The MCA will have merit providing that we have global cooperation, that we concentrate more on a mutual benefit rather than a "me-first" attitude, and that we set attainable benchmarks.

The existing problem of foreign aid is that the money is sometimes misused and that the money is not directly given to the people who need it the most.  The MCA hopes to resolve this problem.  Banks are going to provide grants rather than loans so the people in need will not have to repay the money.  Also, tax dollars will be used to fund more NGOs and grassroots organizations rather than only government-sponsored organizations.  Using the funds for NGOs and grassroots organizations will allow the money to go more directly to the source in need.

The MCA will have more merit if we continue to stress global cooperation, especially with faith-based groups such as the United Methodist Committee on Relief.  The UMCOR uses cooperation to respond to crisis situations.  The UMCOR works in partnership with Churches Together International to fulfill their goals.  The Church World Service also uses cooperation as a key to produce partner relationships around the world.  When people cooperate with each other they have more strength and knowledge to accomplish goals.  Working in partnership requires talking, listening, learning and sharing ideas.  The CWS considers cooperation important by increasing the commitment of the local people. 

The CWS also encourages individual and community participation to continue the development process.  The CWS has 350 Self-Help Groups (SHGs) in Kandal, a province of Cambodia.  The SHGs work to encourage community decision-making, planning, and monitoring of activities.  The SHGs have monthly meetings to share information, exchange ideas, discuss problems, and collect savings.  Each group member agrees to save a certain amount of money each month.  The funds that are raised are used to make loans for members.  SHGs do not rely on the CWS for decisions about savings, loans, or interest payments.  Therefore, the SHGs have potential for working and functioning on their own.  The UMCOR and the CWS programs show merit because they show that money and progress will be made with cooperation. 

We must also concentrate on mutual benefit rather than a “me-first” attitude.  Partnership has to be based on trust and mutual benefit.  Mutual benefit requires both sides supplying and working towards the goals.  In an increasingly interdependent world, no one has a future unless we learn to work together.  We must equip everyone with enough voice and security to participate in shaping alternatives.  No government should have exclusionary power over the people of its jurisdiction.   

Mutual benefit concentrates more on benefiting all nations rather than just the United States.  If the United States helps developing countries, then we may have the support we need to fight terror.  Using mutual benefit will also increase cooperation.  By increasing the cooperation all nations will benefit by decreasing poverty, increasing the work force, and increasing development.  These benefits create a chain reaction.  When one goal is met, more benefit comes from that goal and will soon help to accomplish all of our goals.

The most important concept is setting attainable benchmarks. When benchmarks are unclear money will not be disbursed soon enough to the poorest countries, thus leaving the people in hunger and poverty for a longer period of time.  Money should be focused primarily on reducing poverty in the poorest countries.  Money should also be used for economic reforms, corruption, human rights, and a just government.  United States development assistance programs sometimes fail to meet their stated goals or benchmarks.  The MCA needs to adopt policies that advance economic freedom and not decrease the development.  The MCA will not replace existing development assistance programs, but it should complement foreign aid programs that are successfully working.

Benchmarks allow us measure the progress that has been made and allow cooperation in setting and achieving goals.  The MCA has merit for setting the goals, but the goals are not realistic.  The United States is to raise $10-$15 billion per year for 15 years.  This goal may put a burden on citizens of the United States.  Taxes may go up and some citizens may not be able to afford the increase.  For sufficient development we should take one step at a time instead of a very large step all at once.  Raising $10-$15 billion per year by 2025 would be a more realistic goal.  Setting realistic goals will increase cooperation between citizens and countries. 

The MCA is a step in the right direction, but we need to focus on global cooperation to raise money and set attainable benchmarks for gradual development.

Selected Bibliography Page

Bush, George W.  “Millennium Challenge Account.”  Paper in Singer Packet, 2003.  pp. 1à 5 January 16, 2003.  http://singerfoundation.org

“CWS Income and Expenditures-Fiscal 2002.”  Church World Service.  April 15, 2003.  http://www.chruchworldservice.org/cambodia/2000anual report/self-help.html

Edwards, Michael.  “Future Positive: International Cooperation in the 21st Century.”  April 21, 2003.  http://www.futurepositive.org/perface.html

“Ethiopia Famine: UMCOR’s Response.”  April 20, 2003.
 
http://gbgm-umcor/emergency/ethiopia.cfm

Faith Acton for People-Centered Development Policy.  “Testimony before the Foreign Operations Subcommitte Appropriations Committee U.S. House of Representatives.”  May 7, 2002, Singer Packet 2003.  January 16, 2003.   http://singerfoundation.org/current%20Contests/EssayContests/morerequiredreading2003.html

Fitzgerald, Sara J.  “The Millennium Challenge Account: Linking Aid with Economic Freedom.”  April 21, 2003.  http://www.heritage.org/Research/TradeandForeign Aid/bg1602.cfm

Mekay, Emad.  “Delight and Puzzlement Greet U.S. Aid Hike.”  April 17, 2003.  http://www.commondreams.org/headlines

“New Perspectives and Foreign Aid.”  April 21, 3003.  http://scmcnet.columbia.edu/dept/sph/popfam/npd/goals.html

“Remarks of Vivian Lowery Derryck, Assistant Administrator, Bureau for Africa.”  April 16, 2003.  http://www.usaid.gov/press/spe_test/spee...

“Working in Partnership.”  Church World Service.  April 15, 2003.  http://churchworldservice.com/annualreport2002/partner.html

Questions

Question #1: President Bush claimed that most funds for development do not come from international aid.  He mentions three things that do fund development.  What are they?

·        President Bush says development assistance should come from domestic capital, foreign investment, and trade.  Domestic capital is important because we can use the money we already have in the United States for development and the money will not leave the country.  Foreign investment is important because if the United States invests money into a business of a foreign country and that business makes money, then we will also make profit.  If the business in the foreign country is not a success, then we should withdraw our money.  Trade is probably the most important because we are not only helping ourselves, but we can also help other countries as well.  For example, if the United States gives a foreign country money to help start a business, then in return, we can have the products the business produces.  As a result, the foreign country is making money and so is the United States by selling the products this country sells to us in return.   

Question #2: President Bush reminded his audience that successful development in a third world country requires more than funds.  What two items did he mention in this regard?

·        President Bush suggests that for successful development citizens must be literate, healthy, and prepared and able to work to obtain successful development.  For a developing country to become developed, the people in the country must be educated.  People in developing countries should offer equal education to everyone. Developing countries also need to maintain their health.  Today, the United States is providing money for food and also to fight the AIDS disease.  Finally, these developing countries need to be prepared and able to work to support themselves financially.  These three criteria may allow more successful development than funds.

Question #3: When is money sometimes counterproductive, according to President Bush?

·        Money can be counterproductive because of corruption, unprotected property, closed markets, and negative fiscal policies.  When money is counterproductive it pays for bad policies, delays reform, and crowds out private investment.  This makes progress for poverty slim when the nations do not enact sound policies.  These reasons are valid because these reasons involve outright cash.  When one country gives another country outright cash the money is given to them with no strings attached.  Too frequently, the money is misused. 

Question #4: Describe the Millennium Challenge Account and include in your description what is anticipated from donors and recipients.

·        President Bush’s challenge is to help developing countries become self-dependent by focusing on free market, democracy, and rule of law by using the Millennium Challenge Account.  Accepting this challenge will hopefully take people out of poverty and expand opportunities for development. The Millennium Challenge also is concerned about terror. Terror involves development because when terror controls people, people do not generally work to improve their lifestyles.  The United States serves as a donor to help developing nations, or the recipients. By stressing economic security and just governments, the program hopes to unite the interests of the political, economic, and social unity of the people of the world.

Question #5: What are the three broad standards that President Bush expects the leaders of the developing nations to adopt?

·        By using the Millennium Challenge foreign countries must live by these criteria: Ruling justly, investing in their people, and encouraging economic freedom to receive more aid from the United States.  Foreign countries must live by ruling justly, a stable government.  Foreign countries also need to invest in their people by providing jobs.  By providing jobs, people will have a way of supporting themselves.  Foreign countries must also encourage economic freedom by providing jobs and money for their people to do as they please.  These are all important factors because these factors all lead to development.  As these countries develop, they become more self-reliant.

Question #6: Describe President Bush’s challenge to development banks and explain why or why not you favor it.

·        President Bush’s challenge is to have the banks provide half the funds for developing nations in the form of grants instead of loans.  This thinking gives the developing nations a second opportunity to rebuild their lives.  By our giving the money in the form of grants, developing countries are not obligated to repay the money, as they would have to do if the money were given as a loan. Grants will give developing countries the opportunity to buy food and clothes for themselves and their children.  By continuing this development the adults in developing countries will be able to find jobs.  The children in the developing countries will be able to go to school and earn an education. The grants will allow developing countries to stay out of poverty.

Question #7: What percentage of our national income (GNP) do you think the United States government committed to foreign aid in 2002?  First answer this question and then use the Internet to fine the answer.

·        My estimated percentage of the United States' income for foreign aid in 2002 is about 20 percent. My reasoning for this is the United States is committed to help developing countries. The United States is still aiding countries from past wars.  The correct percentage of income for foreign aid in 2002 is less than one percent. President Bush’s 2002 budget allots about $11.4 billion in economic assistance and about $4.3 billion for peacekeeping operations.  A survey polled shows that most United States' citizens estimated that about 24 percent of the national income is contributed to foreign aid.  Our people have an unrealistic understanding of the amount of foreign aid actually given.

Question #8: Describe and defend a “Me First” attitude.

·        The term “me first” describes the United States’ attitude towards foreign aid.  In order to help the developing countries the United States must be developed as well.  The United States is the most developed country, but we still have people in poverty and are still fighting against terror.  Our country is helping developing countries for our own benefit.  We are trying to draw in support from other countries to fight against terror.  To do this, we must first give a little and the developing countries will give back.  The United States and the developing countries will become close and cooperate with each other.  This will make development easier for all nations.

Question #9: Describe and defend a “Mutual Benefit” attitude.

·        The “mutual benefit” attitude relates to the “me first” attitude of the United States.  The “mutual benefit” concentrates more on benefiting all nations rather than just the United States.  One point is that we need to give to the developing countries before we can have anything in return.  If it works out as planned we will have the support we need to fight terror.  All nations will benefit by decreasing poverty, increasing the work force, and increasing development.  These three benefits all lead to one another.  The decreasing of poverty will take homeless people off the streets and give them jobs to support themselves.  The increase of the work force will allow more development to occur.  The development will allow more businesses to form and more money to be brought in to the nations.

Question #10: Describe three unsuccessful foreign aid programs operated by the U.S. government or private American citizens.

·        Three unsuccessful United States based foreign aid programs are the National Security Strategy, the Overseas Enterprise Funds, and U.S. AID.

First, the National Security Strategy’s focus is on United States’ foreign assistance and to those countries suffering political turmoil.  President Bush released the NSS in 2002.  The NSS does not secure failing governments because it does not offer vision, policies, or new resources to counter threats.  For a new strategy of “nation-rebuilding” in global crisis zones, the United States needs to be more aggressive and more intelligent.  The United States needs to assist failed and developing countries through targeted development and counter-terrorism assistance.

Next, the Overseas Enterprise Fund is used for generating more private investment in developing countries.  Private fund managers used taxpayer dollars as operating funds and investment capitol.  Taxpayers have committed $2 billion in guarantees and grants to the enterprise funds.  Foreign enterprise is encouraged as a way to “privatize” the delivery of foreign aid.  The Enterprise Fund has been mishandled and has had had little money in return.

Last, the U.S. AID has had its problems.  The United States has provided more than $1 trillion to foreign assistance since WWII.  In doing this, the United States has no evidence that our foreign assistance has created economic growth for developing countries.  In 1996 the United Nations reported that aid recipients had less money than they started with in 1980.  Forty-three of those countries were poorer than they were in 1970.    One occurrence was an investigation by the Office of the High Representative in Bosnia, which noted that about $1 billion of the “artificial” nation’s public money was previously stolen since 1995, while the West was contributing $5.1 billion in aid.  Artificial means that the government of the country is not intentionally recognized.

These three programs have obviously tried to contribute foreign assistance, but have not yet met their goals.

Question # 11: Describe three successful foreign aid programs operated by the U.S. government or private American citizens.

·        Three successful United States based foreign aid programs are connected with the Church World Service.

First, the Emergency Response Program is used for expanding the Iraq Humanitarian Crisis Appeal. The program does this by joining other groups like the Mennonite Central Committee and the Jubilee Partners National Council of Churches and Sojourners.  These groups work together to provide heath assistance for children.  They aid children that have been involved in the Gulf War of 1991.  The number of children who have died from the effects of the Gulf War range from 500,000 to 1 million.  The CWS believes that the children are our hope and future for the world.

Next is the Immigration and Refugee Program.  This program has helped the 35 million people that have been uprooted from their homes by war, poverty, and natural disaster.  All of these people have been taken away from their loved ones.  The CWS provides sponsors for the refugees.  These refugees are taken to refugee camps for these unfortunate people.  The refugee camps provide tent materials, food, and clean water.  They also put together groups to educate people.  CWS helps people begin new lives.

Last is the Sustainable Development Program.  This program aids people who are in poverty and are trying to escape powerlessness.  The program also provides education and innovation for all people.  This program is designed to help people help themselves.  It teaches people to make decisions that will positively affect their lives.

These three programs are successful because they have accomplished goals they have set.

Question #12: Steve Radelet, senior Fellow at the Center for Global Development, believes we can do both- take care of our own people and lend a helping hand to citizens of less developed countries.  Explain why you think we can or cannot offer aid to both.

·        Radlet suggests that the United States can take care of our own people as well as helping the citizens in developing countries.  The United States is very capable of doing both.  Although we are not yet financially secure, we do have enough resources to continue the development of our country and assist developing countries as well.  By helping developing countries, they will help the United States in our time of need to fight terrorism.  The developing countries may also assist the United States with financial matter.  This support results in mutual benefit.

Question #13: What do you think about Mr. Radelet’s assertion that “the administration is leaning towards a system in which eligible countries would write proposals describing their objective and strategy, how they would use the money, the benchmarks used for evaluation.  Giving recipient countries this responsibility is a revolutionary change in US foreign assistance.”?

·        I favor Radelet's suggestion.  By requiring developing countries to write proposals to receive financial assistance, the United States can wisely invest their money.  If the United States insists on aiding developing countries, then we must require these proposals.  The developing countries must describe how they will use the money to develop themselves.  They must also describe what references they will use for evaluation.  The proposals ensure the United States that we are helping the people who need it the most.

Question #14: Which of Mr. Radelet’s three concerns regarding the MCA concerns you and why?

·        Of the three concerns regarding the MCA, number one concerns me the most.  If the United States wants to aid developing countries we should aid the poorest countries first.  Developing countries that have sound development strategies should be helped first.  These developing countries are trying to make a difference in their development.  Other developing countries are not trying to make a difference, but are still in need of assistance.  By helping the poorest countries that are already trying to help themselves, the process of development will proceed faster.  The United States can then move on to other countries in need.

Question #15: There is evidence of an increase in negative world opinion towards U.S. foreign policy, not necessarily the American people.  To counter this negative perception of the U.S. some people want the U.S. to concentrate more on weapons of mass assistance and less on weapons of mass destruction.  Please comment.

·        The United States should concentrate more on weapons of mass assistance.  WMA includes money, volunteer work, education, heath care, and awareness.  These factors will benefit foreign policy.  Weapons of mass destruction include chemical welfare and bombs.  If the United States wants to help developing countries, we must make sure these countries do not have WMD.  The United States needs to ensure the safety of our people.

Question #16: What does the World Band recommends as the United State’s “just and appropriate share” to reach the millennium Development Goals by 2015?  Do you think our citizens can afford that kind of increase?  Defend your views.

·        The United States "just and appropriate share" is about $10-$15 billion per year for 15 years.  Our citizen may not be capable of affording this increase.  The sudden increase may put pressure on the citizens.  Our taxes may go up and individual citizens could run low on money.  A cooperative group may be a better idea.  If everyone comes together more money and progress will be made.

Question #17: What do you think about the request of faith Action for People Centered Development Policy’s request that tax dollars be used to fun, not only government-sponsored foreign aid programs, but “that funds also go to NGOs and grassroots organizations.”?

·        I favor using tax dollars to be used to fund NGO's and grassroots instead of only government-sponsored foreign aid programs.  The funds should go to the NGOs and grassroots organizations because the money goes more directly to that organization.  If the money goes to the government first, the money has to change hands many times before the money reaches its destination. Because the money changes hands frequently, people must be paid for handling the money.  Therefore, more money is lost than gained before it goes to the organization in need.  

Question #18: How many countries would be affected positively by heath-related investments according to the Commission on Macroeconomics and Health? 

·        Eighty-three countries will benefit from heath-related investments.  This benefit will give these countries a chance to be better educated.  By having more education these people will learn how to live a more sanitary lifestyle.  A sanitary lifestyle and an education will allow these people to find jobs and become financially secure.  Heath-related investments will surely benefit people who are in need.        

Question #19: According to the CMH, how much would be gained annually between 2015-2020 due to saved lives and increased economic growth, if an increased investment were made in global AIDS and other heath services?

·        Between the years of 2015-2020, $360 billion will be gained annually that we invest in heath-related services.  This is a lot of money, but if we invest now, the investment will soon pay for itself.  Of the $360 billion to be paid, the United States will provide $2.5 billion.  This amount is reasonable because as we save lives and increase economic growth, the amount of money the United States provides each year will go down.  The more people who are helped, the less money we ultimately have to pay each year.  The more productive these people actually are, the more likely they become self-sufficient. 

Question #20: Use the Internet for your research and name the two congressmen who introduced H.R. 4524.  Give a 2-line synopsis of that bill.

·        Congressmen Chris Smith, representative for New Jersey and John LaFalce, representative of New York, introduced the H.R. 4524 bill, which is the Debt Relief Enhancement Act of 2002. No competent country would pay more than five percent of its budget on debt service annually or ten percent if the country does not have a heath crisis, if the reasonable terms of this legislation were accepted.  In doing this, it would almost double current debt relief, cutting an additional $1 billion in debt service payments.  In return for the debt reduction the country is to use extra money to combat HIV/AIDS and poverty issues. In addition, the country is to incorporate anticorruption measure.  This act is from the Foreign Assistance Act of 1961.

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