Ed Royce and Ted Yoho Outside Witness Testimony: House State Foreign Operations FY25

By Ed Royce and Ted Yoho | July 25, 2024

Thank you, Chairman Diaz-Balart and Ranking Member Lee, for the opportunity to submit testimony for your consideration as your subcommittee drafts the Fiscal Year 2025 State, Foreign Operations, and Related Programs Appropriations bill.

As you begin your work on the FY25 SFOPS bill, America faces a daunting set of global challenges including the conflicts raging in Ukraine and Israel-Gaza, emboldened adversaries such as China, Russia, Iran, and North Korea who are increasingly brazen in their efforts to undermine U.S. influence and interests, and a national security crisis at our southern border. America has not faced such serious threats to our global leadership and our way of life since the peak of the Cold War competition with the Soviet Union more than forty years ago.

These international challenges and threats come at a time when the U.S. economy is under-performing and when our national debt has sky-rocketed to nearly $35 trillion. Righting our fiscal ship will require fundamental and painful reforms that invariably will include reductions in federal spending.

Amid these many challenges and threats, American foreign policy can only succeed if we leverage all of our sources of national power, and invest in programs that maximize value and return to the U.S. taxpayer. One such source of American strength is the legacy of global humanitarian and development assistance over the last 75 years that has set us apart from our geopolitical rivals and enshrined the United States as a force for good in the world. At its best, U.S. foreign assistance can be a major driver of global stability and a critical means to advance our foreign policy and economic interests across the globe.

While foreign aid has always signaled American compassion to our allies and to vulnerable populations, today’s foreign assistance also must rise to meet the dual challenges of spiking geopolitical competition and unrest abroad and acute fiscal challenges at home. In this context, we must call on foreign aid to be even more efficient and effective and to be tightly aligned with American foreign policy, economic, and national security interests. As you craft your FY25 appropriations bills, we offer four specific recommendations to maximize the effectiveness of our foreign assistance and to ensure that it best serves U.S. national interests.

First, we must put economic growth at the center of our foreign aid strategies and programs. Unlocking the power of the free market to achieve sustained economic growth is the only lasting solution to eradicate extreme poverty, and it puts our partners on a path to move from aid to trade. The Millennium Challenge Corporation (MCC) and the U.S. International Development Finance Corporation (DFC) represent the tip of the spear when it comes to U.S. Government efforts to spur investment, trade, and economic growth in developing countries. Both the MCC and the DFC require expanded tools and authorities to maximize their development impact in a broader set of countries. USAID also has a critical role to play in supporting economic growth. Substantial USAID investments in health, education, and agriculture enable partner countries to chart a path towards increased prosperity. However, USAID must do more to support market-based economic growth through increased investments in programs that improve governance and financial management, as well as trade and investment.

A second requirement for U.S. foreign assistance is that we must remain focused on addressing the root causes of human suffering and on maintaining our global humanitarian leadership. If we choose to ignore the conditions of the most vulnerable and oppressed, we invite the destabilizing effects of conflict, violent extremism, mass migration, and economic failure. Strategic foreign assistance investments can prevent and mitigate these forces of destabilization, including many of the fundamental drivers of the current migration crisis at the U.S. southern border. Continued investments in global humanitarian assistance and in programs such as the President’s Emergency Plan for AIDS Relief (PEPFAR), the President’s Malaria Initiative (PMI), and Feed the Future will contribute significantly to promoting brand America and to combating the influence of adversary nations across Africa, Asia, and Latin America. As former Republican Senate Majority Leader Bill Frist once said: “medicine and healing are a currency for peace, and people don’t go to war with countries who saved their children’s lives.”

An often underappreciated component of effective U.S. foreign assistance is how the U.S. Government leverages its leadership position within international organizations. The United States played the lead role in establishing the World Bank and United Nations systems, yet we have ceded leadership and allowed our adversaries to increase their influence within these multilateral institutions. Renewing U.S. leadership at these international organizations requires an honest assessment of the value they provide and a more aggressive posture to exert our influence. We should adopt the same type of multilateral aid review model that our colleagues in the UK and Europe apply, in order to make our investment decisions based on organizational performance and in alignment with U.S. national interests. The U.S. is the largest funder and shareholder in the vast majority of international organizations, and we must take back the power in these relationships in order to maximize the benefits of U.S. participation. The U.S. also must continue to lead within independent multilateral organizations that have demonstrated unique value for money and development impact, such as Gavi, the Vaccine Alliance and the Coalition for Epidemic Preparedness Innovations (CEPI).

Lastly, we must ensure that limited foreign assistance resources achieve their maximum impact by putting evidence and cost-effectiveness at the center of USAID’s work. Specifically, we urge your subcommittee to prioritize USAID’s capacity to design, implement, measure, and innovate development and humanitarian assistance programs. USAID’s Office of Chief Economist (OCE), established in 2022, plays a key role enabling the agency to achieve the greatest impact with the fewest taxpayer dollars, as well as helping USAID respond to global challenges like changing market conditions, economic shocks, and severe debt distress. OCE works to promote the use of cost-effectiveness evidence and macroeconomic evidence in USAID decision-making, and helps the agency more precisely prioritize its economic strategies, policies and initiatives. Given that USAID expends between $30 billion to $40 billion per year on programs and operations, it is absolutely vital that OCE be given the comparatively very modest level of funding needed to integrate best practices throughout the full continuum of program and award design through post-project performance measurement.

The repeated refrain in the news these days is that “the world is on fire,” but we must resist the temptation to respond to mounting global threats and challenges by looking inward. The best antidote to a world in chaos and disharmony is a strong United States that is willing to lead and to build and leverage the types of partnerships and alliances that are necessary to achieve global influence. Smart and effective foreign aid is but one pillar of such a foreign policy strategy, but it can play a force multiplying role in advancing US interests across the globe.

Ed Royce served in Congress from 1993 to 2019 and was the chairman of the House Committee on Foreign Affairs from 2013-2019. Ted Yoho served in Congress from 2013 to 2021 and was the chairman of the House Foreign Affairs Subcommittee on the Asia Pacific from 2017-2019.