Financial Aid To Other Lesser Developed Countries example essay topic

President George Bush's new foreign policy and establishment of the Millennium Challenge Account is the best solution possible for dealing with the problem of financial need of other poverty stricken countries. Across the world there are many countries which do not have such prosperous economies as we do. For many years, America has been loaning money to these countries for them to use, to try to bring up their economy. However, corruption of foreign leaders, and other factors have caused this money to be used for other purposes. Recently, President Bush stated that "Combating poverty is a moral imperative, which has made U.S. foreign policy a strong priority". (Helping Developing Nations, 1).

Bush has not only continued to follow this policy of loaning money, but he has improved on it in many ways, causing the economies of the poor countries to broaden. As stated by John Kenneth Galbraith "The only sound way to solve the problem of poverty is to help people help themselves". (Galbriath, 235). At the Inter-American Development meeting in Washington D.C. on March 14, 2002, the President gave an important speech where he announced a 50 percent increase in the annual amount of money given to foreign countries with financial need. Getting into his speech, the President states "Development is not always easy, but the conditions required for sound development are clear.

The foundation of development is financial security, because there can be no development in an atmosphere of poverty, chaos, and violence". (Presidents Announcement, 3). President Bush is trying to show his audience that there is definitely a need for countries like us to help out poorer foreign nations. Then Bush gets into the corruption and misuse of the money that we have been giving to these countries by stating "In many poor nations, corruption runs deep. Private Property is unprotected, markets are closed, and monetary and fiscal policies are unsustainable. When nations refuse to enact sound policies, progress against poverty is nearly impossible.

In these situations, more aid money can actually be counterproductive because it subsidizes bad policies, delays reform, and crowds our private investment". (Presidents Announcement, 4). These negative effects are causing problems for the people of America and of the other undeveloped countries. This is why George Bush calls for a new approach to the financial needs of the developing countries. His new vision unleashes the potential of those who are poor, instead of locking them in a cycle of dependence. This new vision looks beyond arbitrary inputs from the rich, and demands tangible outcomes for the poor, and looks very promising.

The president goes on to state "Today I call for a new compact for global development defined by new accountability for rich and poor nations together. Greater contributions from developed nations must be linked to greater responsibility from developing nations. The U.S. will lead by example in increasing our development assistance by $5 billion over the three next budget cycles". (The President's Announce mnet, 4). Then he goes on to talk about how the money will be put into a new Millennium Challenge Account, which will be used towards problems for these countries like fighting AIDS, computer instruction to young professionals, selling and trading goods, textbooks and educational training, and technological advances in farming and harvesting.

The lack of these things is what is causing these nations to be poor, and behind compared to the rest of the world. The new amount of money; $10 billion, will now be closely tracked so that the possibility of money laundering and corruption will be prevented. It seems that the president as made this new foreign policy virtually perfect and I also believe that it is. However, many people still disagree with many aspects of his foreign policy. They feel that there are many flaws, but they have not read the details carefully enough.

Many of them felt hat corruption is inevitable, and that the money we give to these countries will be used for counterproductive practices. There is, however, only one example of this kind of money laundering occurring. "In Zambia, the former Chief of Justice Mathews Ngu lube, quit his position after groups demanded that he be prosecuted for allegedly receiving a bribe from the former president, Fredrick Chi luba. The bribe consisted of $168 thousand American dollars, and the two were immediately caught doing this". (Zambia, 2). Now, with the new foreign policy, every transaction that occurs will be monitored.

Since the money is kept in the Millennium Challenge Account in the World Bank, everything is monitored. This is much different from the old policy, where we just gave the money to the country (s) in need. Now we can efficiently and carefully monitor what the money is used for. Also, the new foreign policy states that the donor of the money has the final say in whether or not the money can be used for something. For example, if the country wanted to take out $400,000 for guns, because they feel threatened or something, we could deny this, and not allow them to take out the money. Also, critics say that the country could report an increase in education, in a particular major city, but nothing has been accomplished with the education of the other areas of that nation.

Well, with the new policy, special investigators are there to make sure the money is used fairly and evenly, so that all young children have an equal and better chance of learning. I feel that this part of the debate is closed, because now American politicians and citizens should not complain that we are getting our money stolen, because we are not, we are only helping out people in need. Another argument that critics have is that we should not be giving away our money to others who are less fortunate Well, I strongly disagree with this because as a more developed, and fortunate country we do not have a major problem with poverty, famine, and lack of education. How would these critics feel if they were in Madagascar, suffering from AIDS, with no education, no job, but still trying to make it in the world? Would they not want help? Of course they would, and due to this we should be helping out the less fortunate, because we do not have hearts of stone.

On a related issue, many critics are against giving out so much money, because it might hurt our own economy, because they are poor countries, we may never get the money back. I'm sure that President Bush thought of this also, but regardless, these people need help. The new foreign policy has changed the loans, to grants, which basically means that since these nations are so far into debt with us, we will just give them money, which they do not have to pay back, ever. However, people say, "if your going to give grants out, why not just cancel their debts completely?" Well, in response to this, if we were to cancel the billions and billions of dollars that were owed to us, then we would definitely see negative effects within our economy. President Bush and the administration have carefully considered every aspect of this new policy, and I believe they have come up with the best remedy possible. So who exactly is involved in getting the money from the Millennium Challenge Account, and what are the criteria for receiving aid?

Some of the 12 important criteria that a country must meet includes "The three year moving average for inflation is less than 20%, public administration is transparent and publicly available, weighted average tariff rate is less than 35%, non-salary spending on basic education per school aged child amounts to 9% of government revenue, the judiciary is independent, and a free press exists". (MCA eligibility criteria, 3). There are twenty countries that have met these criteria, and are in the process of receiving financial aid from the MCA. They include Armenia, Bangladesh, Benin, Bolivia, Georgia, Ghana, Guyana, Honduras, India, Lesotho, Madagascar, Mali, Mongolia, Mozambique, Nicaragua, Soe Tome and Principe, Senegal, Solomon Islands, Sri Lanka, and Tanzania. Some of these countries have such a small population, that it is hard for them to even produce enough goods and fill the available jobs, which causes the poverty within the country. "Their combined population is about 1.3 billion, with all but 170 million in Bangladesh and India".

(MCA eligibility criteria, 2). The amount of money that these countries end up producing is directly sent out to repay off some of their debts. This is why President Bush began to give out grants instead of loans; so that they didn't have to worry about paying off their debts. "Poor countries shouldn't be sending their scarce recourses to the richest countries and institutions in the world; they should be allowed to invest in their people, in health, and in education".

(Press Release, 1). This quotation is very important because it is true. Countries are never going to become economically stable if all they do is take their profits, and pay off their debts with it. They should concentrate on things that will help them get out of poverty. So what exactly would we get in return for helping out these countries? All that President Bush asks for is, "We expect nations to adopt the reforms and policies that make development effective and lasting.

The world must help to encourage developing countries to make the right choices for their own people. Good government is an essential condition of development, so the MCA will award nations that root out corruption, respect human rights, and adhere to the rules and laws". What the President is saying is that our government will reward nations which follow the way of life that will make their economy prosper, and have more educated children, for the betterment of their nation. So what exactly does this all mean, and how does it relate to the theme of "Wealth and poverty". In short, the aspect is not fully concerned with the wealth and poverty of only America, but this topic spans to incorporate many countries around the world. Since America is considered to be a wealthy country; even though we do have our fair share of poverty, we should be humane enough to help out the needy, in other countries.

In America, homeless people and uneducated people are considered failures, but in reality, some of them didn't even have a chance, because they were born in to this lifestyle. We help them out here, by means of the Salvation Army, and charities, so why not also help out the people in other countries who have the same problems. Even though there are more people, and they are not our responsibility, we should be humane enough to at least try to give them a chance at life. Usually the income that these people live on, allows them to barely get by, because they work for such cheap wages. In the words of Robert B. Reich "The benefits of cheap labor do not come without certain costs. Usually these burdens are borne by those foreigners who do not have good paying jobs like the ones within advanced economies like the United States".

(Reich, 293) What Robert Reich is trying to say is that, the poor people of the poverty suffering countries are, and have been, paying for their lack of opportunity, only because they are not as well financed and educated as our country is. This is why President Bush has redeveloped the foreign policy, to allow them not to have to repay their new loans, but to allow them to have a chance to become more educated. Even still, there are people that disagree with the concept of giving out free money to these countries. They feel that nothing will actually be accomplished. However, in the past, there are a few examples of how this financial aid has benefited some of the countries in concern. Research has shown that 40% of the money given out is being directed towards education, and 25% towards healthcare.

For example, "Tanzania ended fees for grade school, and Benin ended fees in rural areas, giving millions of children the chance to go to school. Honduras will offer three more years of free schooling". (Debt Relief, 2) This information, taken from the Episcopal Church's website shows that we are indeed helping. The money which we send out in aid is helping to put many children into school so that they do have a chance to succeed. As stated by Senator Patrick Leahy, "Foreign aid will not solve the world's problems, but it will make a difference, especially combined with U.S. leadership" (Wall Street Journal, 1).

Other countries, such as Mali, Mozambique and Senegal are also planning to increase spending on HIV / AIDS prevention, to slow the rapid spreading of the disease. Bangladesh, a nation that was once a symbol of famine, has been able to transform its agricultural economy; rice production is up by 70% since the 1970's. John Kenneth Galbraith is a strong believer of many of the topics discussed in this paper. He believes in a concept called insular poverty, which is where a large group of people, within a society are poor and helpless, which is exactly what is happening in many foreign countries. Galbraith states, "To eliminate poverty efficiently we must invest more than proportionately in the children of the poor community. It is there that high quality schools, strong health services, special provision for nutrition and recreation are most needed to compensate the very low investment which families are able to make in their own offspring".

(Galbriath, 255). What Galbraith is stating, is that poor children should be well educated, and this thought combined with President Bush's actions is the best solution possible to this problem because it gives the future of the nation a chance to get better, with more educated youth. Many people blame only the citizens of the poor foreign countries for the debt and poverty, but in reality, it's the government officials also. Government officials believe that "In the world of international finance there is one inexhaustible resource, one player that can always be made to pay: the poor". (50 Years is enough, 1). This is true, many people do blame the poor for many things, but many of them never really even had a chance.

Their leaders, who are the rich could care less about the poor, and give them very little financial help. This is actually what is dragging their country down into poverty. If they were to help out the poor, their economy would most definitely prosper. This is proved by the examples already listed, and they show that when they were given money, by way of foreign loans, many countries were able to see an increase in education, less famine, and reduction of homelessness. Statistics show that "Today entire societies are imprisoned, their children starved and deprived of health care and education, and yet the logic of international account balances exonerates the bankers who insist on seeing their profit line grow at the expense of entire generations of poorer people". (50 years is enough, 2.) Indeed, something had to be done about this problem, and this is why we have had a foreign policy of loaning money to these countries.

However, with the new policy, I feel that it is much better, because countries don't have to worry about repaying their new debts, because we are granting the money, and also helping them set up better governments which will protect the poor. In conclusion, I feel that the new foreign policy that was set up by the Bush administration is the best possible way to deal with aiding many poor foreign countries. I feel that Congress had carefully looked of this policy, and agreed to it because they feel the same way that I do. I feel giving financial aid to other lesser developed countries is necessary, but has been abused. Now with Bush's new policy, there will be a special Millennium Challenge Account, which closely monitors those who receive the aid money, and what it is used for. I believe that when a person or even a country is in need of help, that another person or nation which is more developed should definitely give them help.

As humanitarians, how can we watch other nations fall apart, and people die of hunger and starvation because they did not have the opportunity to receive a good education as a child? I agree with President Bush in the fact that "The people of the developing world can live in a world where their children's dreams are ignited by liberty and learning, not undermined by poverty and disease. They should be able to live under governments which deliver basic services and protect basic human rights". (Presidents Announcement, 6). When governments repress and punish these gifts, no amount of aid is sufficient enough to lift people from poverty, and no aid should be given to the leaders of these types of governments. Instead, the citizens, who will be better educated and more aware of government actions, should elect new leaders, who will use the money for the betterment of their nation.

When governments honor these gifts, every nation can know the blessings of prosperity". This is showing how important it is for other governments to have sound policies, and to become somewhat like Americas government. This is why America is prosperous, when compared to some other countries; because we have good strong policies and strong morals. If we could get other countries to pursue this, then "The poor wouldn't be getting poorer" and Reich would have to write another essay.

However, as of now poverty does survive, in both a physical matter of lack of food, poor clothing, and no healthcare, but also on a moral level in the fact that people should feel inclined to help another whom is in need. This draws on a statement made by Galbraith, "The only sound way to solve the problem of poverty is to help people help themselves". (Galbriath, 235) I firmly believe that Bush's new policy is perfect in every way, and that Galbraith and Reich would agree with it because it involves aiding other individuals in times of need. 1.

Birdsall, Nancy. "Selecting for Success and Reaching the Poorest": MCA Eligibility Criteria Can Do Both. October 28, 2002. The Center for Global Development. November 29, 2002...

2. "Global Poverty and Development: Debt Relief Enhancement Act of 2002". Episcopal Church, USA. November 29, 2002.3.

Global Poverty and Development": Press Release. April 18, 2002. The Episcopal Church, USA. November 29, 2002. web justice / article 44. asp. 4. Global Poverty and Development": President's Announcement.

May 2002. November 29, 2002... 5. "Helping Developing Nations". March 14, 2002.

The White House, November 30, 2002... 6. Jacobus, Lee A. A World Of Ideas: Essential Reading for College Writers, Sixth Edition. Boston: Bedford / St. Martins, 2002.7. Phillips, Michael M. and Vande Hei, Jim. "Foreign-Aid Boosts Set Off Confusion Within Whitehouse" The Wall Street Journal: Eastern Edition.

March 20, 2002. November 3 2002.8. Tactile Pictures. "50 Years Is Enough: Debt". 50 Years Is Enough Network. November 30, 2002.9.

"Zambia: Former Chief Justice Under Fire". July 2, 2002. Africa Online. com. December 2, 2002.