It was part of John F. Kennedy's New Frontier: a government agency to work with developing countries around the world and spread democracy in the process.
Fifty years later, the U.S. Agency for International Development faces skepticism from other countries about its true purpose and warnings from critics who say it has strayed too much into the world of clandestine operations.
The imprisonment in Cuba of USAID subcontractor Alan Gross, who secretly brought in communications equipment to the country, has raised questions whether the aid agency has endangered its workers, even those who operate in the open.
During five trips to the island nation, Gross told those who asked that he worked with a Jewish humanitarian mission while bringing in laptops, iPods and other technology for Jewish communities. He was arrested and sentenced last year to 15 years in prison after he set up satellite Internet communications using specialized technology to prevent detection by Cuban authorities.
Critics say such covert work should best be left to intelligence agencies, not a development agency like USAID.
"USAID's mission is best served when it does things in a transparent manner," said Joseph Siegle, a researcher at the Center for International and Security Studies at the University of Maryland. "USAID risks losing its credibility if it goes outside that approach."
The tactics also trouble William Fisher, who managed economic development programs for the State Department and USAID for more than 30 years.
"I may be a traditionalist, but I don't think there is a place for this secret work at USAID," he said.
If the aid agency gets a reputation for doing secret work, governments that normally welcome its traditional aid work could become more suspicious, he said.
"It certainly puts USAID workers, consultants and staff at great risk," Fisher added. "If they act like the CIA, instead of an aid agency, it seems to me that it would threaten USAID's very basic mission."
Others maintain that the agency must work to spread democracy even in hostile countries, or its aid programs will fail.
"The relevant question is: Do we expect aid programs to be effective in undemocratic countries?" said John Norris, a former USAID disaster expert and an analyst at the Washington-based Center for American Progress think tank. "And we know pretty well that they won't work."
USAID has said that its contractors don't perform covert work, but act discreetly to ensure their workers' safety and the safety of those they are trying to help. Yet the agency has often had to counter accusations and suspicions about its aims in countries that don't trust U.S. motives, putting inexperienced workers at risk, experts say.
"USAID doesn't have the professional expertise, it doesn't have the same kind of feel or touch for these operations that the (CIA) would," said Lawrence Wilkerson, chief of staff for Secretary of State Colin Powell from 2001 to 2005 during the Bush administration. "You get people in trouble this way, especially in a country that is antagonistic."
USAID recently redesigned the website for its Pakistan programs, said Danny Cutherell, a Pakistan analyst at the Center for Global Development. The new version seeks to show specific development objectives and results, and describes in detail how the work is carried out. The change followed the August kidnapping of an aid worker whose company was funded by USAID. Al-Qaida claimed responsibility.
"The discussion (in Pakistan) was how do we know what this guy was doing? A lot of people believe that USAID is a front," Cutherell said.
President Kennedy created USAID in 1961 as the principal agency to help countries recover from disaster, overcome poverty and strengthen democratic reforms. Since then, it has helped build new governments in more than 100 developing countries.
The current chief, Raj Shah, says democracy promotion is central to that mission. U.S. officials say Gross' tactics were necessary in Cuba, where USAID has no field workers because such work is considered illegal there.
Without a doubt, many governments around the world remain wary of U.S.-financed democracy projects.
A week ago, Egypt's military government referred 19 Americans and 24 other employees of nonprofit groups to trial on accusations they illegally used foreign money to foment unrest in the country. The groups, including the National Democratic Institute and the International Republican Institute, both recipients of USAID assistance, say they were carrying out basic instruction in elections and democracy and were not favoring any one group.
Earlier, in August, the USAID director in Egypt left the country in a row with Egyptian authorities over U.S.-funded democracy activities.
Despite such challenges, the agency, overseen by the U.S. secretary of state, says it has a record of success in building democracy. It points out that the number of democratic countries grew from 58 in 1980 to 115 in 1995. Of the world's 57 newly minted democracies, USAID says it provided government training and assistance in 36 of them.