Though formally established on November 3, 1961, by President John F. Kennedy, USAID’s origins trace back to the Marshall Plan of reconstruction of Europe after World War II and the Point Four Program established by President Harry S Truman. Prior to the 1961 Foreign Assistance Act, political and military aid were not distributed separately from economic and development aid. Although the two functions remain distinct, various USAID programs address both security and development objectives.
When asked why the United States should develop its foreign assistance program, President Kennedy stated:
“The answer is that there is no escaping our obligations: our moral obligations… our economic obligations… and our political obligations… To fail to meet these obligations now would be disastrous; and, in the long run, more expensive A program of assistance to the underdeveloped nations must continue because the Nation’s interest and the cause of political freedom require it.”
Since that time, USAID has undergone many changes, one of the most comprehensive in 2006. That year, President George W. Bush announced that he would name Ambassador Randall Tobias as the nation’s first Director of U.S. Foreign Assistance (DFA), who would serve concurrently as Administrator for USAID.
The DFA has a rank equivalent to that of Deputy Secretary of State and is responsible for ensuring that foreign assistance is used as effectively as possible to meet broad U.S. foreign policy objectives. In addition to direct responsibilities for USAID and Department of State foreign assistance funding and programs, the DFA provides strategic direction and guidance to all other foreign assistance programs delivered through the various agencies and entities of the U.S. Government, including the Millennium Challenge Corporation and the Office of the U.S. Global AIDS Coordinator.
USAID remains an independent organization, but in giving a single individual both jobs, Secretary of State Condoleezza Rice said she hoped to “see the best of both worlds,” that is, to integrate the strengths of the State Department with those of USAID, align the two agencies’ priorities and foreign assistance activities, improve their effectiveness and ensure efficient use of their funding, all with the goal of better meeting America’s overseas development challenges.
Reaction to this major change in the administration of USAID was mixed. While some argued that making the Administrator of USAID concurrently Director of Foreign Assistance boosted the status, effectiveness and viability of the aid agency, others considered the action a “stealth merger” with the State Department and have expressed concern that USAID’s long-term development goals would be compromised.