Grant aid to Egypt: the more things change...

On April 15 of this year, the president signed the spending bill (pdf) which kept the government from shutting down. Despite the ouster of Mubarak two months earlier, grant military assistance to Egypt remained the same as in past years: a $1.3 billion Foreign Military Financing (FMF) earmark, cash that expressly "shall be available for grants only for Egypt." That's consistent with the language of past years, and the dollar amount has held steady (pdf) since the late 1980s.

As you'll know if you pay attention to the news, we still don't have signed appropriations bills for 2012; there's another shutdown threat for the end of the week. In fact, there's not even any talk of a full-year spending bill at this stage in the game: the Congress is just trying to pass legislation to keep the lights on through the middle of November, when they'll have to take this up all over again. (The stopgap bill is currently being held up by disagreements over how to pay for something like $6 billion in disaster-relief funding, which makes perfect sense when you think about the fact that we're dealing with something like 0.2% of the damn budget.)

What we do have, though, is an FY 12 State Department and Foreign Operations spending bill (pdf) that's made it out of committee in the Senate, which is something, I guess. Language in that bill (especially where it's consistent with language in the draft of the House bill (pdf)) will probably make its way into whatever legislation ends up appropriating money for FY 2012, whenever that happens. Here's what's new:

[U]p to $1,300,000,000 shall be made available for grants only for Egypt, including for border security programs and activities in the Sinai: Provided further, That prior to the obligation of funds appropriated under this heading for assistance for Egypt, the Secretary of State shall certify to the Committees on Appropriations that the Governments of the United States and Egypt have agreed upon the specific uses of such funds, that such funds further the national interests of the United States in Egypt and the region, and that the Government of Egypt has held free and fair elections and is implementing policies to protect the rights of journalists, due process, and freedoms of expression and association [p. 49 of the pdf]

(The House draft merely states that funds will be made available "with the expectation that the Egyptian military will continue to adhere to and implement its international obligations, particularly the Egypt-Israel Peace Treaty," which is also taken up later in the Senate bill. Of course, the SecState can waive that provision if deemed "important to the national interests of the United States," so there's that.)

Beyond the requirement for democratic and liberalizing reform, the certification provision is in there to make it clear that the post-Mubarak government can't suddenly re-imagine its military priorities and redesignate funds they'd previously committed to spend on U.S.-approved goods and services. It's not much for advocates of conditioned aid to latch on to, but it's more than the basically un-caveated aid written into previous spending bills. (All grant assistance is bound by the provisions of the Foreign Assistance Act, of course, which does require adherence to certain human rights standards, &c.)

Here's the bottom line: the money is still going to flow, whatever happens in the coming months on elections or civil liberties in Egypt. The distribution of military aid to Pakistan requires a certification that Pakistani government entities are fully cooperative in the fight against anti-Afghan insurgents and terrorist groups; ADM Mullen finally admitted last week that the USG can make no such declaration in good faith, and yet the aid still flows. The bilateral relationship with Egypt is much stronger and much more institutionalized, and many of the peculiar details of Egyptian aid are premised on the understanding and assumption of stability over the long term. (Egypt and Israel, for example, are exceptional among grant aid recipients in that they aren't required to pay the full balance of their purchase costs in the year of sales agreement; in fact, unspent aid is held by the U.S. in an interest-bearing account from year to year.) The money will keep on coming unless Congress acts to expressly block it.

One more thing that's worth noting in the Senate bill, however, is Sec. 7039(a):

Notwithstanding any other provision of this Act, funds appropriated by this Act under the heading ‘‘Foreign Military Financing Program’’ for assistance for Egypt may be transferred to, and merged with, funds appropriated for assistance for Egypt under the heading ‘‘Economic Support Fund’’ [p. 134 of the pdf]

This is interesting because it permits the transfer of money appropriated for military aid to an account used for economic assistance -- that is, to a fund specifically intended "for the purpose of improving the lives of the Egyptian people through education, investment in jobs and skills (including secondary and vocational education), and access to finance for small and medium enterprise with emphasis on expanding opportunities for women, as well as other appropriate market-reform and economic growth activities" (p. 135 of the pdf). It seems unlikely to happen, but the option's there.

Oh yeah, and while we're on the subject: PCCF is back! (See p. 10 of this pdf.) In the International Security Assistance section of the State budget! Instead of in the Defense budget! And with a billion dollars! That's $200 million more than the $800 million appropriated for FY 11! Foreign policy is saved from militarization! At least until somebody needs to slash a bil from the aid budget, anyway; then DoD will change the way it calculates inflation, or something, and slide that extra billion in under its catastrophically shrunken topline. Or something.

...but how? What can the U.S. do to provide effective relief in Somalia?

CAP's ThinkProgress Security has a guest post this afternoon from John Norris, Executive Director of the Sustainable Security and Peacebuilding Initiative at CAP, on the subject of wasted aid money to Somalia. Turns out the outside world has pumped something like $55 billion into that country since 1991, to little evident effect. Here's Norris's solution:

The world has been willing to spend billions on arms transfers, counter-terrorism efforts and military approaches, but sensible diplomacy and working at the local level to build durable peace agreements have usually been an afterthought. The United States and the international community needs to be much more principled and effective in delivering aid in order to help shape a functioning central government in Somalia that enjoys the faith and support of its own people.

Ok, but what does that mean exactly?

I'm no expert on Somalia (as my colleagues are eager to point out!), but my impression is that the security situation in much of the country would be prohibitive to the delivery of development aid or food relief. That means there'd need to be an effective military intervention before any of the humanitarian facts of the situation could be changed, and I'm not sure who has the appetite for that (aside from Ethiopia and AMISOM, to the limited extent they're currently engaged).

If you could start from scratch and set U.S. policy toward Somalia tomorrow, what would you do?

Afghanization hurt by U.S. budgeting practices?

The newest edition of Armed Forces Journal contains a piece by the great Joe Collins on "Afghanization," the natural and inevitable transition to Afghan lead in security and governance operations as coalition forces draw down. "In the end," Collins writes, "the next phase of this war effort needs not an Afghan 'face,' but an Afghan essence." The article lays out a series of reasonable suggestions for making this transition successful -- challenging as that will be.

Collins notes that continued efforts to train and mentor Afghan security forces and national defense institutions will be vital to a meaningful and sustainable transition. But one paragraph in particular really jumped out at me for the apparent misunderstanding it's based upon:

Throughout the process of transition, the U.S. must fence the resources devoted to the advisory and training units that are engaged in building the capacity of Afghan forces. It would be highly dysfunctional if the forces that are making the ANSF more capable have to compete with the shrinking combat forces for money. As we close in on December 2014, the worst of all worlds would be to take resources from those developing Afghan capacity to keep essential combat units in the fight. These drastic choices can be avoided if the Congress appropriates for the Defense and State departments the right amount of funds to keep the strategy in our exit strategy.

Funds that support the development of the ANSF -- from tactical training to the provision of materiel to ministerial and institutional mentoring -- are currently requested and appropriated primarily through the DoD's Afghan Security Forces Fund (ASFF) in the Overseas Contingency Operations account. (See the first page of this SIGAR pdf for a few more details.) Collins surely knows this, but his choice of words may create some confusion for those who do not. He's right to suggest that separate Departmental appropriations would help keep capacity- and capability-building funds conceptually and legislatively distinct from the money that facilitates U.S. combat operations, but the presumption or suggestion that this is current SOP is incorrect.

Military aid is typically appropriated to the State Department and provided to partner governments as grant assistance to be used for the purchase of U.S. military equipment and training. The large-scale training and equipping efforts in Iraq and Afghanistan have resulted in the creation of an unusual funding model and execution apparatus, in large part because of the significant U.S. troop presence in both countries. Security capacity-building funds for those states have been appropriated directly to Defense Department organizations in-country through ASFF and (in Iraq) ISFF; the U.S. training/transition commands in each country then use those funds to provide training and purchase equipment for the host nation.

This model makes some sense: it's consistent with the military's role as the USG lead for building security capacity in the host nation during combat operations, and it simplifies execution. It's also a bit misleading to suggest that capacity-building dollars aren't sufficiently "fenced" from combat operations funding, seeing as they are conceived, requested, considered, and appropriated under distinct headings (despite ending up with the same Department).

But there are a host of reasons that security assistance and other military aid should be dispersed by State in the peacetime "steady state," and both Congress and the White House seem cognizant of them. (An instructive example: the FY 2012 budget request is the first since the beginning of the war in Iraq to include military aid for that country in the form of State-managed Foreign Military Finance grants as opposed to ISFF. This is consistent with the "normalization" of U.S. security cooperation with Iraq in the wake of the withdrawal of the bulk of American combat forces. See specifically slides 8, 9, 26, and 33 in this pdf.) I am an extremely committed proponent of State's continuing responsibility for security assistance and other military aid. But take one look at what's happened with the Pakistan Counterinsurgency Capability Fund during the budget battles of the last year if you want to see how difficult it will be to adequately resource the training and equipping of ANSF through State Department accounts.

Here's the bottom line: I agree with Collins that security capacity-building funds are essential to our departure from Afghanistan and should be privileged over funds for continued U.S. combat operations, but I fear that in the current fiscal and political climate, a move to channel those funds through the State Department will make them more vulnerable to cuts and have the opposite effect to what's intended.

Am I missing something here? (More on development and security)

In an essay on Foreign Policy's AfPak Channel, Nancy Birdsall and two colleagues from the Center for Global Development argue for a new American approach to Pakistan assistance. They argue that a focus on security, failure to articulate clear objectives, and lack of transparency about how money is being spent have doomed the U.S. aid program there to failure. Indonesia is held out as an example of what Pakistan might become with more effective U.S. engagement.

Now, that nation is mentioned in the same breath as Brazil and India as an emerging power on the world stage and a force for regional security. Fundamentally, few threats to American interests and American lives now emanate from Indonesia. That is the hope and the promise of development in Pakistan, a promise the United States has a role to play in fulfilling. [emphasis added]

To which I can only respond: uh, what? Surely Birdsall and her colleagues are familiar with Jemaah Islamiyah, right?

Development and democracy haven't solved the problem of extremist violence in Indonesia, and it seems unlikely they'll do so in Pakistan. But viewing these two countries solely through the lens of terrorism misses the point. Birdsall et al are correct to write that "Pakistan's stability and prosperity are intertwined with the United States' own," and to note that this linkage is tighter than that with other countries. This isn't about terrorism, though -- it's about Pakistan's status as a nuclear weapons state, a seriously flawed democracy, and a nexus of fundamentally revisionist (that is, anti-status quo) Islamic extremism.

Pakistan can pose a threat to the U.S. both by being too strong and too weak, something that doesn't hold for Indonesia. It's not clear that state weakness is the cause of the "threats to American interests and American lives [that] now emanate from" Pakistan; policymakers should be cognizant of that reality before they spend money trying to replicate the Indonesian model (which, lest we forget, was achieved with minimal U.S. assistance).

This is yet another example of the sort of absurdities we're driven to by the insensate state-strength-as-security paradigm: the goofy quasi-assertion that with just a bit of well-targeted aid, we can make Pakistan as unthreatening to American interests as Indonesia.

The Will and the Wallet

I don't know how this happened, but I just noticed that our blogroll somehow omitted The Will and the Wallet, the Stimson Center's outstanding blog on budgeting for defense and foreign affairs. It's absolutely essential reading -- the very best there is on this subject. This should come as no surprise, considering who runs the show over there.

Today's post by Rebecca Williams on foreign aid in the context of deficit reduction is a great example of what they do so well: data-driven analysis and explanation, clear language, and excellent supporting graphics.

Add it to your blogroll. (I have, belatedly.) Read it. Learn things. Thank me later.

Memo to Jennifer Rubin: Israel's QME has nothing to do with the U.S. defense budget

In an unsurprisingly derivative and unconvincing argument about the need for GOP presidential aspirants to oppose cuts to the defense budget, the Post's resident expert-on-everything couldn't help but take a dig at the Obama administration's imaginarily insufficient future military support for Israel:

[The president] bragged at AIPAC :

Because we understand the challenges Israel faces, I and my administration have made the security of Israel a priority. It’s why we’ve increased cooperation between our militaries to unprecedented levels. It’s why we’re making our most advanced technologies available to our Israeli allies. And it’s why, despite tough fiscal times, we’ve increased foreign military financing to record levels.

That includes additional support — beyond regular military aid — for the Iron Dome anti-rocket system. This is a powerful example of American-Israel cooperation which has already intercepted rockets from Gaza and helped saved innocent Israeli lives. So make no mistake, we will maintain Israel’s qualitative military edge.

How’s he going to do all that if he keeps taking a chain saw to the defense budget? It is, as with his deficit plan and refusal to alter unsustainable entitlement programs, a refusal to level with the public and to lead.

It's funny you should ask, Ms. Rubin, because there's a perfectly good answer. And it speaks to the question of who it is, exactly, that refuses to level with the public.

Israel is the recipient of the largest share of American military assistance by an extremely large margin. How large? Just over $3 billion of the five and a half billion set aside for foreign military financing (FMF) worldwide, as a matter of fact. (The next-highest amount for a single country, as you may have heard in recent months, is Egypt's $1.3 billion.) This THREE BILLION DOLLARS A YEAR comes as part of a 2007 commitment by the U.S. government of $30 billion in military assistance to Israel over the next ten years -- a pledge that candidate Obama insisted he would honor, and that President Obama shows no sign of failing to honor. If that's not enough, Israel is the only recipient of U.S. military assistance permitted to use grant aid to purchase defense articles and services from its own armaments industry, not the U.S.

While we're on the subject, want to know something interesting about that military aid and its relationship to the defense budget? Well, there is no relationship between the two. FMF is a part of the International Security Assistance section of the Foreign Operations account... that's right, the State Department's budget, not the defense budget. You know, the one your buddies on the Hill want to slash?

Iron Dome is another interesting example. How could the U.S. possibly continue its financial support for an Israeli rocket and missle defense system in a time of shrinking budgets? Surely this would be among the first of the cuts, especially considering the Obama administration's manifest eagerness to betray the Jewish state. Strange, but recent history doesn't bear this out. The president requested $205 million in the FY 11 budget to help the Israelis pay for Iron Dome. In case you're worried about Congressional support, don't: the House approved the request by a 410-4 vote. And when shutdown-averting continuing appropriation finally passed last month, that $205 million earmark was included in a $415 million carve-out of the Defense RDT&E fund dedicated solely to Israeli cooperative programs. That was enough for PM Netanyahu to express "his deep appreciation for U.S. funding of the 'Iron Dome' rocket and mortar defense system" to President Obama during an April 18th phone call. I guess he's not worried about the bits of the U.S. defense budget that are dedicated to paying for Israeli defensive systems, at least.

And as for "making our most advanced technologies available to our Israeli allies," well, that doesn't cost us anything at all beyond what's been talked about above: the safe-as-safe-gets cooperative R&D account and the free money to purchase U.S. gear that's included in the foreign aid budget.

So "how's he going to do all that" if the defense budget gets cut? Easy: the same way we've been doing it all along.

Now who's refusing to level with the public, Ms. Rubin? Are you ignorant of these facts, or simply disingenuous?

Demanding good governance vs. meddling in internal affairs (UPDATED)

Josh Rogin has a very interesting piece up on The Cable this morning in which he reports on what seems to be a concerted message campaign by several senior officials in the Obama administration -- including Secretary of State Hillary Clinton, Treasury Secretary Tim Geithner, USAID Administrator Rajiv Shah, and senior representative to Afghanistan and Pakistan Dick Holbrooke -- urging Pakistan to reform its tax system (both by raising taxes on the wealthy and improving collection and enforcement mechanisms).

"This is one of my pet peeves: Countries that will not tax their elites but expect us to come in and help them serve their people are just not going to get the kind of help from us that they have been getting," Secretary of State Hillary Clinton told an audience Tuesday at the U.S. Global Leadership Coalition conference.

"Pakistan cannot have a tax rate of 9 percent of GDP when land owners and all of the other elites do not pay anything or pay so little it's laughable, and then when there's a problem everybody expects the United States and others to come in and help," Clinton said to a round of applause. She noted that Pakistan's finance minister is now presenting a package of economic and tax reforms.

Treasury Secretary Timothy Geithner, who was also on the same panel, drove home the message that countries who want U.S. development aid must adopt the reforms that Clinton is advocating.

"I've been doing this for a long time and I have never heard a discussion like this, where you have the secretary of state saying what she just said, which is recognizing that unless we are tougher on how we provide assistance...we should not be financing them at this level," Geithner said.

Panel moderator Frank Sesno noted that scaling back assistance to Pakistan, and countries like it, could conflict with other U.S. objectives in the region, such as bolstering the government's internal stability.

"All of these objectives are going to be in conflict at one time or another," Geithner responded. If the countries do not make the required reforms, "We're not going to be able to justify financing [them] on this scale," he said.

On Monday, Af-Pak envoy Richard Holbrooke made a similar plea while appearing on the Rachel Maddow show.

"Their maximum tax rates are much lower than ours, and there's a lot of tax evasion there, as has been well reported. And we can't ask American taxpayers to pay the burden if the Pakistanis don't raise their own revenue," Holbrooke said. "So I don't want to leave people with the impression we're going to pay for the reconstruction
phase."

In an interview, USAID Administrator Rajiv Shah told The Cable that the multi-billion reconstruction effort that Pakistan faces in the wake of the flood crisis is "going to be much more successful" if Pakistan adopts the Obama administration's suggestions to ""implement a stronger tax regime that's ... more effective."

Looks like a full-court press to me. So far as I can tell, this is really revolutionary stuff. We're less surprised in the modern global security environment by one state taking an interest in what previously might have been considered to be the sovereign internal affairs of another, what with economic interconnectedness, so-called "superempowered individuals" and sub-state actors, and so on, but isn't this even a step beyond what we're used to seeing? It's one thing to say "we'd like to see the Pakistanis using the F-16s we're selling them to prosecute counterinsurgency operations on their northwest frontier rather than to defend against an imagined Indian threat," and it's quite another to say "we wish the Pakistanis would teach more math to third-graders." Yesterday's commentary seems much closer to the latter.

But even more than all that, here's what really worries me: are we so sure that we understand Pakistan's internal politics well enough to give guidance (or make demands) about potentially inflammatory domestic issues like taxation? Most of us are prepared to acknowledge that Pakistan at least has the potential to become -- if it's not already -- the most dangerous country in the world for the U.S., right? I don't really have enough area knowledge to say this for a fact, but it seems to me that one way to accelerate that development is to contribute to the sort of socio-economic/class stratification that could imperil the government from yet another direction, piling yet another threat on to that posed by the challenge of religious extremist groups/parties and those agitating for land reform and other measures of economic equality (who are already susceptible to manipulation by Taliban-type groups mentioned latterly).

Basically what I'm asking is this: are we sure we should be asking the Pakistani government to piss off rich people at the same time they're pissing off poor people, conservative people, very religious people, Indians, Baluchis, and Pashtuns? It might be good politics in the U.S. -- fair enough that people get annoyed about pumping U.S. aid dollars into a country that can't effectively collect its own legally and morally justified receipts -- but shouldn't the priority here be maintaining the stability of the Pakistani government?

Would be very interested to have actual Pakistan experts weigh in here (as well as all you development folks).

UPDATE: Whoops, in my rundown of people the government has pissed off, I forgot to include the military.