Bruce Bartlett

The other day, a United Nations official accused the United States of being ?stingy? in terms of aid to tsunami victims in South Asia.  After criticism from the State Department, the official clarified his position.  Americans are not being stingy in helping tsunami victims, only stingy in terms of overall foreign aid as compared to other countries.
 
This is a familiar attack, which comes up annually when the foreign aid appropriations bill is before Congress.  But let?s look at the facts.  According to the Organization for Economic Cooperation and Development in Paris, in 2003, the world?s major countries gave $108.5 billion in combined foreign aid.  Of this, the U.S. contributed $37.8 billion or 35 percent of the total.  The next largest foreign aid contributor was The Netherlands, which gave $12.2 billion, following two years in which it was actually a net recipient of foreign aid.

 The claim of stinginess, however, comes from a different calculation?foreign aid as a share of national income.  In 2003, U.S. foreign aid came to just 0.34 percent, well below the world leading Dutch at 2.44 percent.  Other big contributors are Ireland (1.83 percent), Norway (1.49 percent), and Switzerland (1.09 percent).  The U.S. would have to triple foreign aid just to reach the lowest of these contributors.

 The first thing one notices when looking at the big foreign aid contributors is that they all spend very little on national defense.  According to the Stockholm International Peace Research Institute, in 2002, The Netherlands spent just 1.6 percent of its gross domestic product on defense.  Norway spent 2.1 percent, Switzerland spent 1.1 percent, and Ireland spent a piddling 0.7 percent.  By contrast, the U.S. spent 3.4 percent?and this was before the Iraq war.  It?s easy to be generous with foreign aid when another country is essentially providing your defense for free.

 Another thing one notices is that the foreign aid data are only for ?official? (i.e., government) aid.  The data are sketchy, but by all accounts Americans are far more generous in terms of charitable contributions than the citizens of any other country.  A 1991 study found the United Kingdom to have the second largest percentage of private charitable giving.  But in 2003, charitable giving amounted to 8.6 billion pounds or 0.8 percent of GDP in the U.K., according to the Charities Aid Foundation, compared to $241 billion or 2.2 percent of GDP in the U.S., according to the American Association of Fundraising Counsel.


Bruce Bartlett

Bruce Bartlett is a former senior fellow with the National Center for Policy Analysis of Dallas, Texas. Bartlett is a prolific author, having published over 900 articles in national publications, and prominent magazines and published four books, including Reaganomics: Supply-Side Economics in Action.

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