Back to Work - Bill Clinton [22]
When he was in office, the former secretary of defense Bob Gates, a Republican, repeatedly said that an adequate foreign assistance budget for the State Department is essential to our national security, and he urged Congress not to cut foreign aid. Some of Secretary of State Clinton’s most important work to build a world with more partners and fewer adversaries has involved the wise investment of relatively modest amounts of your tax money to educate and empower women and girls, fund small loans for poor people to start businesses, help developing countries secure needed energy at lower costs, and reduce the enormous toll of death and injury that results from cooking with charcoal by distributing 100 million clean cookstoves.
So what’s a well-intentioned conservative to do? Actually, he or she could do a lot, hopefully with bipartisan support, if willing to take on lobbyists for private contractors—alas, also bipartisan—dedicated to protecting the way foreign aid is spent. Too much of the money appropriated for foreign assistance, sometimes more than 50 percent, never reaches the nations or the people it’s designed to help, largely because it is channeled through U.S. contractors who take a lot of it off the top for overhead and administrative costs both in the United States and in the affected country. If we gave a higher percentage of the money to local governments with proven records of honesty, transparency, and ability, or to locally operating nongovernmental organizations with low overhead costs and proven capacity to do the job, we could educate more kids, save more lives, raise more farmers’ incomes, bring clean water, decent housing, and electricity to more people, and make more friends.
In one African country where my foundation works, a U.S. contractor said it would take six months and cost $3 million to complete a project required before U.S. aid could be released to buy lifesaving drugs. Six months was too long and $3 million too much for the relatively simple project. Our people did it in six weeks for $80,000. Changing this system is a task ready-made for bipartisan reform.
But that’s still not where the money is. Medicare, Medicaid, Social Security, the defense budget, and interest on the debt claim eighty-five cents of every federal tax dollar. The entire rest of the budget, called discretionary nondefense spending, claims only 15 percent. Included in that 15 percent are our investments in the future—in education, infrastructure, clean energy, research. Our quality-of-life budget is also there—in a clean environment, safe food, air traffic control, a safe workplace, and much more.
If you’re an antigovernment activist who wants to do away with all this stuff, you might use the deficit as an excuse to eliminate as much of the 15 percent as you can, but you won’t get rid of the deficit; you’ll probably force increases in state taxes to pick up some of the activities; and you’ll reduce the productivity of our workforce, our rate of economic growth, and our quality of life.
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1 You can find more about the specific examples of deficit reduction possibilities I mention in this chapter and many others besides in the GAO report at http://www.gao.gov/ereport/gao-11-318sp.
CHAPTER 4
So What About the Debt?
EVEN THOUGH OUR IMMEDIATE PRIORITY SHOULD be putting people back to work and restoring healthy economic growth, the rapid increase of our national debt over the next ten to twenty years, if not addressed, will cause us big problems. When I took office in 1993, after the debt had quadrupled since 1981, it was 49 percent of GDP.1 By 2001, after four years of declining deficits followed by four budget surpluses,2 total debt had dropped to 33 percent of GDP and was projected to be eliminated completely by 2013, assuming both the tax structure and PAYGO spending restraints were maintained.
From 2001 to September 2008, tax cuts, spending increases, and weak job growth (fewer taxpayers, more benefits users) doubled the debt again. Then the recession hit, and the tax relief