This is an archived USAID document retained on this web site as a matter of public record.

Remarks of J. Brian Atwood

George Washington University Elliott School for International Development Washington, D.C.

January 22, 1999

My thanks to the Elliott School and the Overseas Development Network for sponsoring this important series of lectures and for inviting me today. As George Washington University marks one hundred years of teaching international affairs, and the Elliott School celebrates its first decade of leadership, I offer congratulations to you both.

The timing of your invitation is good because I am in the final months of my tenure as Administrator of USAID. For me, this is a time both for looking back at what we have accomplished and forward to the challenges that remain.

Today, in keeping with your theme of lessons for the 21^st century, I’d first like to look at the great experiment in international development that the United States began more than fifty years ago, with President Truman’s Marshall Plan and Point Four program of worldwide technical assistance, and continued with President Kennedy’s creation of the U. S. Agency for International Development.

I call these programs an experiment because, throughout human history, nations have lavished vast amounts of money trying to conquer one another, but never before, to my knowledge, have great nations spent their treasure trying to build up other, less developed nations.

President Truman, in announcing his Point Four program, said, "Only by helping the least fortunate of its members to help themselves can the human family achieve the decent, satisfying life that is the right of all people." Not long after those revolutionary words were spoken, the great English historian Arnold Toynbee predicted that Truman’s call for wealthy nations to aid the world’s poor "will be remembered as the signal achievement of the age."

I think Toynbee is correct, but since those first heady days a great deal has happened that neither he nor Harry Truman could have anticipated.

Today, we live in an era of globalization, in which ideas, technology, and capital flow freely around the globe in ways unimagined a half-century ago. Globalization has unleashed market forces while reducing the constraints of geography. It has hastened financial integration, new types of international trade, and the diffusion of ideas. It has enlarged the role of multinational corporations, non-governmental organizations, and international organizations, often at the expense of the nation state. And it has heightened the need for international institutions to manage the flow of trade and information, and to coordinate national policies in an increasingly interdependent world.

All this certainly sounds like progress, so why is it that today many nations in the developing world fear globalization so much?

Put yourself in their shoes. Many of these nations, with our encouragement, are trying to become stable, democratic, open market societies. They look to us for help and inspiration, yet they know it took us more than a hundred years, and a Civil War, to build our democracy. They know they don’t have that long because democratic change carries with it heightened expectations and modern communications carries news about what others have achieved.These new democracies are trying to create the financial institutions, the rule of law, and the skilled workforces that will attract foreign capital, yet each year their populations soar and the costs of providing health care and education soar as well. Still, despite all the problems, many of these countries were making real progress until the recent Asian financial crisis focused the glare of international scrutiny on their still imperfectly formed economies and political systems.

Some, like Indonesia, imploded because of crony capitalism, phony democracy, and weak banking systems. Other, stronger nations, were hit by contagion, by which I mean the irrational impulse of money managers, in a time of uncertainty, to forgo any and all risk in favor of absolute safety.

Nations with stronger democratic systems like Thailand and Korea have begun to recover. Russia, as we know, has defaulted on its international loans and has a less predictable future, though its democracy is stronger than its economic system. Today, the world is watching to see whether the Brazilian democracy can produce the tough reforms demanded by the global market place.

In short, this is not an easy time for globalization. There are demagogues around the world who want to blame the problems of their countries on the West, particularly on the United States. And their case against us has a superficial appeal. Where is the money going that is being withdrawn from their central banks? Much of it is heading for safe investments in the U.S.

We need to be concerned that the financial crisis could cause a backlash against free markets that could undermine our efforts to create a stable global economy. We need to be concerned that more countries like Malaysia might seek to deal with international market pressures by closing the door on them. That is a prescription doomed to failure.

Countries that are suffering the impact of the financial crisis need help -- the developed world has promised its help -- but what is happening? Even as billions of dollars of private investment are being withdrawn, so is official development assistance.

• In 1996, the bilateral donors of the industrial world, and the international financial institutions, provided $55.4 billion for development assistance.
• In 1997, that figure dropped to $47.6 billion. The projections are that it will fall again, to less than $45 billion, when we have the figures for 1998. What message are we sending? Put yourself in the shoes of the developing world leaders. They see us champion the advantages of globalization yet the industrial nations are deriving the benefits and writing the rules. Even then, we don’t invest more in helping the new market democracies and the poorest nations to reform their systems and join the enlarged global market place.

We correctly have raised the alarm bells about global warming, yet our own political system freezes us into ever increasing emissions of greenhouse gas. The average American uses 40 percent more electricity than the average person in the developing world.

India, a country of 950 million people uses about 85,000 megawatts of electricity. The United States, a country of 260 million people, uses 850,000 megawatts.

Meanwhile, countries in the developing world are growing four times as fast as we are. They must achieve economic growth rates in the 8-10 percent range just to keep up with their population increases.

Put yourself in their shoes. Their banks have less and less liquidity as short-term capital is moved to Europe and the United States. Official development assistance for the West is at the lowest point it has been in 50 years. How long can these democratically elected governments last? What kind of backlash are we going to experience?

Look ahead to the years when the students of George Washington University will be in their prime professionally. Look ahead to the year 2020. The world will have a billion and a half more people. Four out of five of them will live in the developing world.

Will 20 percent of the world’s population possess 80 percent of the world’s wealth? What will our weather be like if global warming gets much worse? How high will the seas rise? How many droughts? How many storms? How many floods? Will we be able to continue feeding the world? These are all questions your generation should ask itself, for you will either be the victims of our neglect or the beneficiaries of our vision.

The era of globalization obviously poses as many risks as it does opportunities. We need to pursue the opportunities aggressively for we do not have the luxury of turning back to a simpler age.

One indisputable necessity is American leadership in development. Over the years we have tapped into the rich vein of our society for the research, the ingenuity, the experience, the organization and the "can do" attitude that has created a common purpose among the member states of the donor community. Today, through USAID, we still lead in delivering sustainable health care, family planning services, HIV/AIDS prevention, agricultural development, environmental protection, microenterprise lending, education, economic and democratic development.

In all this, the United States is no longer acting alone. Today’s "Marshall Plans" are collective efforts in which we work with other governments and private organizations as well. The developed nations of the world form a donor community which assists developing nations both through bilateral action and through multinational organizations such as the World Bank.

This donor community began to emerge in 1968, when experts such as Paul Ehrlich were predicting the mass starvation of hundreds of millions of people -- and saying nothing could be done to stop it. He said we would have to practice triage, abandoning certain parts of the world altogether.

Fortunately, the industrialized nations came together as never before to meet this challenge. In 1968, leaders of seventeen nations met in Easton, Maryland, to plan a stronger, more coordinated approach to international development.

To meet the immediate prospect of mass starvation in India, the developed nations first donated massive amounts of food, then made the long-range investments that helped India dramatically increase its food production -- in what came to be known as the "Green Revolution."

Other programs focused on disease. Smallpox was eliminated, and dramatic progress was made in many other areas, such as public health, education and family planning. Here are some of the changes in the developing world between 1968 and 1998:

-- Literacy rose by almost fifty percent. -- The average woman now has half as many children, three not six. -- Infant mortality has been cut in half, and now five million fewer children die each year.-- The percentage of people with access to clean water has tripled.-- The average per capita income has increased by more than sixty percent.-- And life expectancy has risen by more than a decade.

We can also make some reasonable projections about what might have happened without the foreign assistance programs of the past thirty years. Without the family planning initiatives alone, there would be five hundred million more people. And they would be living and dying in a world far more crowded, more polluted, and more afflicted with famine and violence.

Our investment in foreign assistance has not only relieved human misery, but has built stronger nations that have become trading partners with the United States. Over the years, at least twenty-five nations have "graduated" from foreign aid, many to join the ranks of donor countries. Today, we export more to some countries in one year than we gave them in foreign assistance during the 1960s and 70s.

Still, inevitably, even as some challenges are met, new ones emerge. Smallpox has been eradicated but today we support the world’s largest HIV/AIDS prevention program. In the post-Cold War era, we face more civil wars and localized struggles like those in Bosnia and the Congo. And we are increasingly focused on threats to the world’s environment. To cite just one statistic, tropical rainforests are being destroyed at the equivalent of one football field per second -- which translates, on an annual basis, to the loss of an area three times the size of France. These lost forests can no longer absorb the greenhouse gasses our industrialized age produces, hence the earth is a warmer, more dangerous place.

Recently, the international community set goals for the year 2015. They include cutting world poverty in half; reducing infant mortality by two-thirds; reversing current environmental losses; providing primary education for all the world’s children; ending gender discrimination in education; and making family planning available to all who want it.

These are ambitious goals, but the money and the technology exist to reach them. The question we in America must ask is whether we have the will to reach them. Today, U.S. foreign assistance programs are lower, in real dollar terms, than they have ever been. In terms of gross national product, we supply the least foreign assistance of any major industrialized nation.

This is a tragic decline. We have to ask whether our nation is going to turn away from the great experiment we embarked on fifty years ago.

To do so, I submit, would be terribly shortsighted, because America’s future security and prosperity are inexorably interwoven with those of the entire world. The post-Cold War era offers countless opportunities for us to bring about political and economic reform. If we desert the developing nations, we invite more chaos, more suffering, more failed nations, more civil wars and terrorism. We risk putting ourselves into the kind of danger from which our military forces cannot protect us.

We have made great progress in the past half-century. We have the tools to build an international structure that will sustain peace and stability. We have created an international legal regime that promotes a common vision of human rights and democratic practice. We have a United Nations that is more capable of enforcing Security Council resolutions, and we are creating a World Trade Organization that is establishing common rules for trade.

We know that such needs as education, health care, family planning, women’s rights, and environmental reform are interrelated and must be addressed across the board -- and we have the dedicated professionals who can help nations implement them.

Perhaps most importantly, we know that strong, democratic and transparent institutions are the soundest vehicles for social progress.

We have a wealth of hard-won knowledge -- but will we act on it?

In a new book called "Which World?," author Allen Hammond puts forth, in rich detail, several scenarios for the 21^st century, all based on existing trends.

In the most optimistic scenario, which he calls Market World, economic reform and technological progress lead to global peace, prosperity and stability on an almost utopian scale.

But in a darker scenario he calls Fortress World, the developed nations fail to address economic injustice and environmental decline, and the result is ever-rising levels of protectionism, conflict, disease and terrorism -- lives of misery for the great mass of humankind in the developing world and lives of isolation and fear for the richer countries.

Which will it be? Progress or chaos? The choice belongs to us -- to the developed nations, to the United States, and ultimately to us as individuals.

When I was young, I chose a career in international affairs because it seemed like the most interesting and rewarding work I could imagine -- and I have not been disappointed. Today I hope that many of you will choose the same path. As the new century begins, the world looks to your generation to carry forward the great humanitarian experiment that began more than half a century ago.

"Let us go forth and lead the land we love," John Kennedy said in his Inaugural Address. Today, it is the entire world we must lead -- and serve -- if we are to be true to our history, our interests and our highest ideals.

Thank you.

This is an archived USAID document retained on this web site as a matter of public record.

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