Categorized | Sharkansky_Ira, USA

Giving foreign helps rather than hurts the U.S. economy

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By Ira Sharkansky

Ira Sharkansky

JERUSALEM — An internet friend sent me a video screed from an Atlanta television station that presents, in the most inflammable language, the old saw about too much foreign aid while Americans suffer. Even worse, some of that aid goes to refurbish mosques in unfriendly Cairo and elsewhere. 
 
The images tweaked not my anger, but my inclination to criticize.
 
The principal mosque story concerned the rescue of a building due to a US AID project to upgrade Cairo’s sewers. The mosque benefited from better drainage of rainwater along with lots of other properties due to a standard kind of US AID venture.
 
And how much should the world, including Israel, thank the United States for all its foreign aid sent at the sacrifice of programs to benefit Americans, and weighing heavily on American taxpayers?
 
Some context would be useful.
 
The United States has provided a great deal of foreign aid since World War II. However, it has been contributed as part of American self-interest. Beginning with the Marshall Plan and continuing until today, aid has meant to make the world safer, more profitable, and more congenial for Americans. Members of Congress from export-oriented districts have supported aid, most of which is tied to the purchase of American goods or services.
 
The aid comes from the world’s richest economy in the aggregate. The American GDP in absolute terms is 2.5 times larger than the second largest economy (China, followed by Japan, Germany, France and Britain).
 
Americans are not the richest on a per capita basis, but they do rank #7 among almost 200 countries. Richer are the folks in tiny energy producing places, as well as those of Luxembourg, Singapore, Norway and Hong Kong.
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American taxpayers have no right to cry, or even moan. They pay a smaller percentage of their resources to all levels of governments than the residents of any other western, developed country. 
 
And how does the US compare to other donors?
 
The United States is the world leader in total aid, but lags significantly in aid as a percentage of its economic resources.
 
One has to be wary of the numbers. A general problem is that countries promise more aid than they actually deliver. And aid comes under different categories. On a measure of “development assistance” which may not include military stuff, the United States ranks 19th out of 23 countries with respect to the amount of development assistance given in relation to national resources. By this measure, the countries most generous are Sweden, Norway, Luxembourg and Netherlands.   

On a measure of countries receiving intergovernmental development aid as a percentage of their resources, Israel ranks way down the list, #97 out of 120 countries. 
 
Shouldn’t an Israeli (who is also an American taxpayer) be grateful for what the United States provides?
 
Sure, and I am. By some measures, the United States gives more aid to Israel than any other country. By other measures, however, the “aid” the United States has allocated in recent years to Iraq and Afghanistan dwarfs that given to Israel.
 
Individual Americans and others, mostly but not entirely Jews, also contribute to the Hebrew University and numerous other Israeli institutions.
 
Keep it coming. It helps. Bur realize that most of the money contributed by American Jews for Jewish causes stays in the United States. For some time now, both Americans and Israelis have agreed that American Jewry is more needy than Israel.
 
And Americans should not overlook some of their own benefits from aid to Israel.
 
Almost all of the US government aid goes to Israel’s defense sector, which helps the US by helping to keep a lid on what might happen in the Middle East, as well as supporting technology that feeds back into the American defense effort.
 
El Al buys Boeing, thanks largely to US government pressure, despite some of its technocrats preferring Airbus. Israel has, arguably, pursued more moderate policies toward Gaza, Lebanon, the West Bank and Iran that its own leaders would have wanted, due also to pressure from Washington.
 
Millennia ago, Jews learned the costs of challenging world leaders Babylon and then Rome. Religious and secular Israelis recount those experiences whenever a serious clash with the United States appears possible.
 
More important than American aid at a crucial point in Israel’s history was aid (“reparations”) from Germany. That did not come without a great deal of protest about accepting “blood money,” but  it provided almost 90 percent of state income in 1956.
 
Beyond Germany’s payments to the Israeli government, reparations to individuals for personal losses benefited many families. My father-in-law accepted substantial amounts for his loss of a career in Germany, while rejecting money for family members sent to the death camps. Varda grew up in a middle income home, but without a grandmother or uncle.
 
Do the American people suffer because money goes to foreign aid rather than to domestic needs?
 
Mostly likely not. Public services have never been high priorities in the United States. On a list of 29 countries, the United States scores #2 in personal wealth (GDP/c) and #20 in expenditures per capita on welfare and education. 
 
It is not possible to be sure about everything that ought to be assigned to “foreign aid,” or to know all the motives and payoffs. Some years ago, a source in India proclaimed its country a world leader in foreign aid, counting the value of all the Indians who had migrated overseas to work.
 
That was equal in quality to the nonsense broadcast by WSB TV in Atlanta.

*
Sharkansky is professor emeritus of political science at Hebrew University.  He may be contacted at [email protected]

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