The American foreign aid is one of the instruments used to extend American dominance in the world. In other words, it is a tool of foreign policy because it gives the US an advantage in the world politics. Reviews are made on the foreign aid yearly whereby the legislature and the executive agree on modalities of the instrument. Changes are made regarding the composition, objectives and the size of the aid.

Recently, the US has been forced to change its strategy following the 9/11 attack. Foreign aid is specifically used to safeguard the American interests related to security. Before the world wars, the US foreign policy was no-interventionist in nature. The policy changed after the Second World War mainly due to President Truman’s policy of containment. Communism was to be countered in all parts of the world using available mechanisms, including foreign aid. This paper analyzes the various types of foreign aid and how they were used during the Second World War, during the cold war and after the world wars.

The effectiveness of the foreign aid is also discussed.

Justification for the Foreign Aid

Various American governments have always come up with foreign policies aiming at enhancing the American national security. The first American foreign aid came in after the Second World, popularly referred to as the Marshall Plan (1948-1951). In the 1980s, the foreign aid policies aimed at taming the spread of communism. The states that were gaining independence at the time were prevented from adopting communist ideas since they could hurt the American dream of dominating the world. In this case, USSR was to be prevented from taking control of the Latin America, Southeast Asia and Africa.

Foreign aid was mostly given out in form of economic benefits and military assistance. After the Cold War, foreign aid policies took a new shape since states were held responsible, especially on matters related to governance. Foreign aid was no longer used to appease states to reject communism since USSR was no more. For instance, the US foreign aid focused on Middle East conflict system. The US utilized its military and economic power to bring sanity and tranquility in the Middle East societies. In Europe, the aid was used to restore democracy in the newly independent East European states.

The aid was also used to end drug trafficking in various parts of the Latin America. Consequently, the fall of the USSR reduced the American funding in the third world. After the 9/11 attack, foreign aid gained momentum where states around the Middle East such as Pakistan and India received military aid. American foreign policy makers noted that global development was vital in case national interests are to be realized (Calvocoressi 78). Foreign aid has been an issue that has raised a heated debate because realists view it as a tool used by the state to enhance its foreign domination.

In this sense, the government uses the foreign aid to improvement relations between Americans and other nationals in foreign states. This would give Americans an advantage since they would be in a position to produce and distribute goods easily in other states. Liberalists would argue that foreign aid is specifically used to help those in need. This is because the US is charged with a moral responsibility to help those in need.


Foreign policy formulators have justified foreign aid as a technique since it promotes the financial development and reduces poverty among the American citizens. The main objective of foreign aid as claimed by realists is to fulfill the American interest. Even though liberalists argue that foreign aid improves foreign states’ governance, the main aim is to command conformity, which is very important in trade. Other objectives of foreign aid include dealing with population increase, increasing access to fundamental education and health care, defending the atmosphere, supporting constancy in conflictive areas, caring about human rights, limiting weaponry propagation, intensification of alliances, and tackling drug manufacture and trafficking.

In case the above objectives are met, the US would achieve its national interests in the simplest way. Global security would allow American investors to participate in trade easily. It is upon the realization that poverty and few chances are the major causes of insecurity in the world. The US should therefore fund various programs in foreign states to limit the chances of political insecurity.

It is noted different foreign aid programs support different American aims and goals. However, foreign aid programs can be combined to fulfill the broader objective of the state. Multilateral and bilateral aid may combine to come up with a powerful policy that would best meet the demands of Americans. Military and economic aids exist to implement American wishes in the Middle East and South Asia.

Foreign aid policies in the Latin America aim at countering drug trafficking.

Types of Foreign Aid

The US government uses two major types of foreign aid to enhance its objectives. The two types differ because each of them has specific aims and objectives. Bilateral development assistance programs are mainly used to enhance sustainable financial growth and socio-political strength in the third world.

The funds released through this program are managed by the American agency, USAID. The funds are used to finance economic project, with long-term objectives. In the third world, the USAID uses the funds to promote microeconomic projects, which would help people sustain their own lives. Through the funds, various American dreams are achieved, such egalitarianism, ecological fortification, population control, and development of human wellbeing (Barston 56). Development plans that have received more fame in modern years consist of fundamental education, water and hygiene, and support for management of HIV/AIDS and other communicable infections. Additional bilateral assistance is channeled to specific agencies such as African Development Foundation, the Peace Corps, Inter-American, Millennium Challenge Corporation, and Trade and Development Agency. Bilateral assistance has been used variously to advance the American objectives.

For instance in Kenya, the US government collaborated with the World Bank and International Monetary Fund to introduce structural adjustment programs. The programs were aimed at opening up society in 1986 and creating an enabling environment for individual fulfillment. It can be reported that bilateral assistance has been successful in fulfilling the American objectives. On the other hand, the US has not been using multilateral form of assistance. A small share of the total funds is allocated to multilateral assistance. Multilateral funds are used jointly with funds from other states to fund social services. It can be observed that, the US rarely uses multilateral type of assistance because the national interests are not achieved.

Foreign Aid Programs

The Marshal Plan was aimed at reconstructing Europe after the Second World War. Europe had suffered huge losses since many people were killed while others were wounded. Many companies and factories in England, France, Germany, Italy, Poland and other parts of Europe had been destroyed. Europe could not exercise agriculture because farmers had been destabilized by the war.

Infrastructure was badly affected implying that goods could not be moved from one part of the region to the other. Between 1945 and 1947, the US came up with foreign direct investment programs to rebuild Europe. Through the UN, the US offered humanitarian aid to Greece. The Head of state, Harry Truman, appointed an expert named George Marshal.

The program under Marshal was named the European Recovery Program. The program was mainly aimed at rebuilding economies of the European states. The US government offered technical assistances and administrative advises to states in need such as Germany and Poland. In total, the European states received $13 billion, which involved relief food, fuel and farm machinery. The program was terminated in 1951 after realizing that all European states were stable. From the program, the US government benefited a lot because US firms could easily produce and distribute goods in the European continent. It can be observed that the program was successful because the American national interests were achieved.

Point Four program was another foreign aid assistance that aimed at uplifting the lives of the poor in the third world during the cold war. It was aimed providing technical skills and knowledge to the policy makers of the third world. Through the program, investment capital would move freely from the industrialize states to the less developed. The program was the fourth in President Truman’s agenda launched in 1949.

This was upon realization that Europe was already under the American control. The program would give the US access to the economies of developing nations, especially in Africa and South Asia. During the Cold War period, the policy was effectively used to win the states that were still confused on whether to adopt capitalism or communism. Public Law 480 (PL 480) was a food program that was aimed at assisting the developing countries faced by food shortages. The program has four major parts, the first part is managed by the US department of Agriculture while the three parts are managed by the USAID. Dwight Eisenhower signed the program into law in 1954. The main aim of the law was give American farmers a chance to export their products to countries facing deficiencies.

Through the program, American farmers were able to invest abroad since their commodities could be exchanged with other products. In 1961, F. Kennedy redefined the program, by renaming it Food for Peace. The US government could use the aid to demand for transparency and openness in the foreign states.

Good governance was liberalization of the economy was one of the requirements in case a particular state was to benefit from the program after the Cold War. During the Cold War, states could receive the aid by supporting American ideologies. In 1991, the US used the program to bar African states from attending an economic conference that would have affected American businesses in the continent (Domingo 13). Economic Support Funds are meant to help states recovering from wars, especially those in Africa. The US government would come up with various strategies on how to help the third world country to develop. The US utilizes this chance to achieve its national interests. For instance, trade barriers barring the US from accessing the economies of the third world are always reviewed during the formulation of policies. American businesspersons are always represented in key decision-making agencies in the third world.

Works Cited

Barston, Ronald. Modern diplomacy. New York, NY: Pearson Education, 2006. Print Calvocoressi, Ambrose. World Politics since 1945. 9th ed. New York: Longman, 2008.

Print. Domingo, Richard. The New Global Law. New York: Cambridge University Press, 2003.



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