Rockridge High School
Taylor Ridge, Illinois
Teacher: Barbara Downey

Millennium Challenge Account (MCA)
By Mike Wright
12^th grade

Since its birth on July 4, 1776, the United States has developed into the world’s most prosperous and dominating force in both wealth and military force.  The idea of the Millennium Challenge Account (MCA) is to share this wealth with developing countries. The President has pledged that the United States would increase its core development assistance by 50 percent over the next three years.  This would result in an annual increase of $5 billion by FY 2006.  This money will go only to those countries that govern justly, invest in their people, and encourage economic freedom.  However, due to a recession Americans are suffering and with the possibility of a tax increase for Americans because of this program, America cannot afford the Millennium Challenge Account.  The Millennium Challenge Account is a step in the right direction, but regulating where the money is going is nearly impossible.  In addition, some countries may become dependent on this money, or some countries that are cut may turn to terrorism against the United States.  These problems are only a few of the many problems that make this plan is a waste of time, money, and effort.

The Millennium Challenge Account does have positive aspects.  The United States is a wealthy country but does not give much foreign aid.  Only one tenth of one percent of the Gross National Product (GNP) is put towards foreign aid.  This money going to foreign aid does not always go directly to helping the needy.  Some of the countries receiving the money use it for other government programs.  These alternative programs are usually corrupted by the country receiving the money or the country giving the money.  When this happens, no poor or undeveloped communities benefit.  The money going to developing countries will be very difficult to follow.  These countries may have a schedule, but how can the United States be 100 percent sure all the money is going where it should?  It cannot, because too much money is being spread out though several developing countries and each year more countries are added to the list. 

Instead of throwing money where it may or may not be used properly, why not send the money to the poor communities of America?  Leave the portion of foreign aid the way it is.  Americans need money here, so the government needs to send the money to poor communities or toward the education programs of America.  Americans need help first; once all American families can live healthy lives and receive a good education, then the government can concentrate on other countries.  Money used in the United States for Americans is much easier to monitor and everyone knows exactly where it is going.

With our economy in a recession, low-income American families are having enough trouble adapting to the changes.  If this program goes into effect, Americans may be taxed for the funding of the program, leaving these low-income families to struggle even more. High-income families might be fine with the taxes and even an increase in taxes, but the government should think of the poor. The public will not be pleased with more taxes; it will cause more problems for the United States and its economic struggles.  The timing is completely wrong for this program.  We should rebuild our economy and then try to rebuild or at least form the foundations of other countries’ economies.

When the money does go to these developing countries, some countries may become dependent on it.  What do we do then?  As long as the United States is handing out money, these counties will gladly take it, put it to minimum use, and receive a check the following year.  The program would then be hurting America rather then helping us.  Other countries that put the money to good use may very well cancel out any forward movement they have made, sending some countries right back where they started.  Programs such as Food for Peace did this by taking food from the United States, which left all farmers in developing countries with a surplus of food, which was thrown out.  If this were to happen with the Millennium Challenge Account money, it would not help anything. 

The money is supposedly going to non-corrupted governments, but what about those countries that are cut out of the money.  Some will most likely become more corrupt, because the United States has left them out again.  The powerful leaders of these countries will tell the people lies about the United States, which could cause the people of these countries to hate the United States even more.  This could lead to more terrorists groups coming after Americans.  America is already on the brink of war with Iraq; the last thing Americans need is more of these groups endangering their lives and the lives of their loved ones.  The Millennium Challenge Account will be forgotten if war occurs due to the concentration on the war. 

If the money of this program were put towards the United States and its problems on the home front, it would save a lot of time, money, effort, and overall problems for the government and its people.  There are other places this money needs to be going.  Though foreign aid is important, it can wait until some other more important national and world problems are taken care of first.

Questions

Q1- President Bush claimed that most funds do not come from international aid.  He mentions three things that do fund development.  What are they?

A1- The foundation is security, because there can be no development in an atmosphere of chaos and violence.  Successful development also requires citizens who are literate, who are healthy, and prepared and able to work.

Q2- 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?

A2- Contrary to popular belief, most funds for development do not come from international aid--they come from domestic capital, from foreign investment, and, especially, from trade.

Q3- When is money sometimes counterproductive, according to President Bush?

A3- When nations refuse to enact sound policies, progress against poverty is nearly impossible.  In these situations, more aid money can actually be counterproductive, because it subsidizes bad policies, delays reform and crowds out private investment.

Q4- Describe the Millennium Challenge Account and include in your description what is anticipated from donors and recipients.

A4- The Millennium Challenge Account is a fund that helps poor countries battle economic failure.  These countries must root out corruption, respect human rights, and adhere to the rule of law.  These nations should invest in better heath care, better schools, and broader immunization.

Q5- What are the three broad standards that President Bush expects the leaders of developing nations to adopt?

A5- These standards are ruling justly, investing in their people, and encouraging economic freedom.

Q6- Describe President Bush’s challenge to development banks and explain why or why not you favor it.

A6- He challenged development banks to provide up to half of the funds devoted to poor nations in grants instead of loans.  I agree; grants instead of loans are a good idea.  Poor nations in debt are not getting anywhere.  There needs to be a cut off point though; otherwise, the poor nations will become dependent on the money and not improve their economy.

Q7- 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 find the answer.

A7- I guessed 8.9 percent.  The actual percentage is one tenth of one percent

Q8- Describe and defend a “Me First” attitude.

A8- The “Me First” attitude is a self-attitude, worry about your own country instead of helping others.  Try to build up your country’s economy and forget about the rest of the world.