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Entrepreneurship and National Security

Aid has failed to deliver the promise of sustainable economic growth and poverty reduction.

Dambisi Moyo[i]

 

The U.S. spent $38 billion dollars on aid in 2010, and is the largest single aid donor. There are 21 U.S. government agencies responsible for delivering aid, ranging from the Department of State and USAID to the Departments of the Interior and Transportation. However, the U.S. is rated at poorly for efficiency and improving local institutions :

  • A World Bank ranking system puts the US among the lowest in foreign aid quality.
  • A 2005 GAO report stated that 1/3 of US federal food aid money spent on actually buying food while the rest is spent on administrative costs.
  • Consequently, steps have been taken to improve this: the Millennium Challenge Corporation, scores significantly higher than its US counterparts on these rankings.

Worldwide, aid effectiveness is poor: From 2005-2011, only 1 in 12 of the Paris Declaration effectiveness measures had been met.

Despite the large amounts of money that the US is spending, it is not being used efficiently nor is it promoting growth and security. ASP offers an alternative solution: supporting local entrepreneurship.

Expeditionary Economics is helping to clarify and focus DOD’s thinking on how the military can constructively participate in stability operations. But there is a greater role for the concept as a pillar of American strategic decision-making. This is a vital piece to creating not just a theoretical but also a practical, policy-level awareness in decision-making circles of the U.S. government of the need for U.S. to support entrepreneurship and small business development as a pillar of its strategic decision making.

The biggest challenge facing policymakers is not just handling stability operations, but how to properly engage with the local economy so that it can advance to a state where normal investment and development methods can take over – the so-called “pivot point” where aid becomes development.

 

ASP is breaking new policy ground in examining the national security implications and policies that derive from a proper understanding of the power of entrepreneurship and markets for American security.

 

ASP Asymmetric Operations Main Page

 

RESOURCES:

Entrepreneurship and National Security

Expeditionary Economics: A New Approach to Foreign Aid

PAST EVENT: Entrepreneurship and National Security

 


[i] Dambisi Moyo, Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa, Vancouver: D&M Publications (2010), p. 28

 

 

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