US Aid Programs in the Post-World War II Period - Essay Example

Discuss the main objectives, interests and strategies of US aid programs in the post-World War Two period, both during the Cold War and after thecollapse of the Soviet Union. Describe and asses both American assistance through bilateral and multilateral channels, including their efficacy and limits. Include the Marshal plan, the Point Four Program PL 480 Food Aid and Economic Support Funds (ESF). Also shed light on the size and distribution of US bilateral and multilateral assistance. What were the preferred methods of distribution and who were the recipients. Although it may be tempting to view US foreign aid in the post-war era as a type of benevolent gifting to the lesser developed regions of the globe, the fact of the matter is that each and every foreign aid decision in means by which loans, foreign direct investment, trade preference, or need was directed had a definitive purpose and goal in mind. As a result of the Second World War, the United States was placed in a unique position of authority in a newly differentiated bipolar global system. Undisputed dominance within the Pacific allowed the United States to extend trade to regions of the world that it had not fully integrated with previously. The presence of United States military personnel on outposts as diverse as Guam, Gibraltar, Cyprus, Norway, and a litany of others allowed for the formation of the new empire in which the United States would come head-to-head for a period of approximately 40 years with the Soviet Union. Within such a dynamic and such a level of understanding, the rationale and motivation for engaging in the Marshall Plan is readily seen. Again, although the Marshall plan has been incorrectly viewed by many historical sources as merely a means to rebuild Europe after the devastation of war, the ulterior motive that drove this was twofold. The first reason why the United States actively engaged in the Marshall plan was as a means to rebuild the economies of Europe that had been so devastated by the result of World War II. Although the Marshall plan called for unimaginable levels of foreign aid to be given to the governments of Western Europe, this level of money, although unprecedented, was seen, by and large, as a type of investment. Although the United States emerged from World War II is the most powerful nation on earth, it nonetheless required robust economies in order to trade with and derive economic benefit. Secondarily, the Marshall plan was instituted as a means of providing a solid bulwark against the encroachment and seemingly never-ending advance the Soviet Union was making into central and parts of southern Europe. Whereas the old dictum is true that it is impossible to buy your friends, the United States attempted to do just this, surprisingly successfully, by instituting a liberal policy of economic development within the shattered shell of a war ravaged Europe. After the collapse of the Soviet Union and the conclusion of the Cold War era, the United States approach to aid remained necessarily concentric upon trade, interests, and strategic rivalry. In such a way, even a cursory review of the level and extent to which the United States utilized foreign aid reveals a situation in which aid is invariably utilized as a leverage point. However, it must not be understood that the United States foreign aid is divisible into a single category. Rather, this analysis will briefly engage with some of the key functions and affects the different types of aid and appropriations had with regards to how developing nations have been affected as well as the key limitations in which such programs necessarily espoused. The second of these aid programs which will herein be discussed is known collectively as the Four Point Program. Instituted under Pres. Harry Truman, the four-point program was actually a reaction to social and aid programs that the Soviet Union had extensively developed around the world. As a function of showcasing and power of the Soviet ideal, the Soviet Union ridiculed the Western capitalist nations for the fact that they had no way to directly improve upon the lives, help the misery, and reduce the squalor that untold millions around the world had to face on a daily basis. Embarrassed at such an eventuality, Pres. Truman hastily put together what came to be known as the Four Point Program. As such, the program suffered fundamentally from an overly broad scope and uncertain place with regards to how it must integrate with the rest of the world as compared to the existing levels of aid the development programs that were already instituted. Accordingly, the key limitation of Truman’s program was the fact that it was only appropriated during his term in office; and even during the years which was appropriated, it was misunderstood and ineffectively utilized as a means of serving the purpose to which it was originally intended. Similarly, with regards to PL 480, this refers to Dwight D Eisenhower’s Agricultural Trade Development and Assistance Act (Public Act 480). Again, although at face value it came across as a means of allowing the United States to presume a role of beneficiary to many Third World nations that were suffering from the effects of famine and hardship, the reality of the matter was that it merely provided a means through which the American farmers could directly cell their excess product to the US government who intern would allow Third World nations to pay for this product in their own current seats. This particular scheme was affected due to the fact that it not only promoted trade, but also allowed for excess US product to serve the dual demand of integrating a further level of friendship in operation with other nations and finally lessening the hardships of poverty and famine. The effectiveness of this program was of course limited to the fact that the currencies that were oftentimes received from these nations were merely a token gesture and ultimately not worth the paper that they were printed upon. However, the United States was not seeking to gain monetary benefit such agreements; rather, it was attempting to promote agricultural production within the United States as well as integrating level of friendship and cooperation with nations that make otherwise fall under the umbrella of Soviet protection within the world. Another component of US foreign aid is with regards to what is known as Economic Support Funds. This is with regards to a specific function of USAID’s budget scope. Within this particular aspect, USAID, and by extension the United States, seeks to provide a level of subject matter expertise with regards to a developing nation and how it should seek to allocate and maximize its resource potential. In such a way, experts in these respective fields are dispatched via USAID’s structure and seek to provide a level of oversight and discussion with key stakeholders in the host nation. Naturally, such a process has a distinct drawback and limitations of necessarily skewing the results of any such analysis in favour of further trade favourable agreements with the United States. Unfortunately, the needs of the nation in question are not always fully represented as the United States and its interests are given preferential treatment with regards to the manner in which the given economy might seek to grow and develop. Again, in much the same way as many of the other aid programs that have been discussed seek facilitate further trade and integration with the United States, USAIDs Economic Support Funds are utilized in very much the same manner. Though it can be stated the United States has engaged in several aspects of multilateral aid, the broad majority of aid United States has engaged with over the past several decades has been bilateral. Bilateral aid and should be defined as government to government aid. Moreover, bilateral aid is given with a specific purpose in mind - not only to ameliorate given situation; it is intended to affect ulterior motives as well. For instance, an example of bilateral aid that had an ulterior motive would necessarily be with regards to the way in which the United States had supported a military dictatorship for nearly 40 years within Egypt. This was of course done as a means of ensuring the Suez Canal remained open for business and the trade routes of the world, so vital to the United States and its allies, remained unchallenged and unmolested. Likewise, the main recipients of the majority of US bilateral aid over the past several decades are the following nations: Egypt, Israel, India, Indonesia, Bangladesh, Turkey, Portugal, Pakistan, Philippines, and Syria. Although it would require a thesis length dissertation to discuss the reasons why each of these countries is represented at their respective numerical rank, the reader can and should understand that each of these countries, perhaps with a solitary exception of Bangladesh, represent a strategic interest which the United States has sought to maintain by appropriating a high level of aid as a means of ensuring continued cooperation with the United States. 1) Provide a general overview of the reasons for the establishment and evolution of the General Agreement on Tariffs and Trade (GATT), the importance and results of the 8th round of negotiations – the Uruguay Round – between 1986 and 1994, and its conclusion leading to the creation of the World Trade Organization in 1995. Discuss the key elements and outcomes in the subsequent trade talks in Seattle, Doha and other venues. Explain the main issues of concern and differences in the positions of the developed and developing countries and how this led to the subsequent impasse. Ultimately, GATT (General Agreements on Tariffs and Trade) was instituted as a result of the Bretton Woods meetings which underscored the need for the world to integrate with the new dynamic that would help to protect against future collapse and monetary crisis. One of the ways in which the framers of the Bretton Woods agreement understood that this could be affected was by institutionalizing a level of agreement with regards to tariff and trade between all nations in the system. Initially, this understanding of how GATT what impacts upon each and every system of trade and governance was intended to grow into what was termed as the International Trade Organization. However, due to a number of drawbacks and the fact that many nations were not willing to ascribe a level of support for such a broad an overarching plan of international cooperation, only GATT remained as a vestige of what the ITO was originally envisioned to be. Nonetheless, this general agreement on tariffs and trade came to be fundamental hallmark of the way in which many of the nations in the global system interacted with one another as compared to the dynamics that existed prior to the outbreak of World War II. Whereas many international and economic agreements ultimately end up in the dustbin of history prematurely, GATT is an example of one which has somehow survived the test of time. Although it cannot and should not be argued that GATT is beneficial to each and every member of the system, it does at least hold the potential to be beneficial if the nation in question integrates with it in an effective manner. Likewise, as a function of understanding the means by which GATT developed and has morphed over the years, the preceding analysis will seek to shed a level of light upon the means by which the different rounds of negotiations and GATT have helped it to evolve, stay relevant, and continue to engage a larger and larger number of stakeholders within the global environment. As has been discussed, GATT was originally intended as but a portion of the ITO. However, due to the fact that the ITO never fully materialized as a result of disagreement within the international stakeholders, it was not until the Uruguay round, the eighth round of multinational trade negotiations which was conducted within the framework of the General Agreement on Tariffs and Trade, that the ghost of the ITO was resurrected in the form of the World Trade Organization (WTO). Moreover, when GATT was originally signed in the year 1948, only 28 member states were represented within the agreement. However, within the eighth round of GATT multi lateral trade negotiations (MTNs), fully 123 countries were represented. This small factor helps to underscore the level and extent to which GATT was able to be beneficial and promising as a means of economic development within the world system; so much so that a greater and greater share of countries sought to integrate with its membership at each and every further iteration of the MNCs that were held. Due to the fact that GATT had been successful were so many other iterations of international trade agreements had failed, it was determined that the failed prospect of the ITO (International Trade Organization) would be resurrected in the form of the WTO. Although the name was ultimately different, few other aspects of this entity were changed from the original conception that was put forward as early as 1947. However, it should not be understood by the reader that the World Trade Organization somehow usurped the authority that GATT had previously placed upon the means by which individual member nations integrated with one another. Rather, GATT remained as something of an integral component of WTO agreements. In this way, the strength and resiliency of this supra governmental organization was built upon the tried and proven resilience that it been displayed over the past 40 years with reference to the way in which GATT had positively benefited the member states that sought inclusion within the World Trade Organization. Moreover, the eighth round of multinational trade negotiations relating to GATT sought to extend rules relating to trade with regards to areas that it previously been exempt. This necessary inclusion sought to place items as diverse as agriculture, textiles, services, intellectual property, and investment policy all under the umbrella of GATT. Previously, the loopholes that had existed with regards to these specific areas have made trade distortions evident with regards to the member states. Such trade distortions necessitated the Uruguay round more so than did the need to create the World Trade Organization. Due to the overall increase in the level and complexity of the globalized economy and the inclusion of the information age into the framework by which decisions and economic choices were made, the Uruguay round was perhaps the most important of all rounds of updates and changes to GATT since its formation until the present time. In between the eighth round of multinational trade negotiations relating to GATT and the WTO, member states were intending to meet within Seattle Washington as a means of discussing pertinent issues relating to the way in which the WTO and GATT were continuing to evolve. This particular round of meetings was referred to as the Millennial Road. However, due to the fact that a high level of protests were evidenced outside the meeting place in what came to be known as “The Battle of Seattle”, the meetings were never held and simply postponed to the ninth round of multinational trade negotiations set to begin in 2001 in Doha Qatar. Although the Millennial Road negotiations never took place, it was intended that these negotiations should focus a level of emphasis on for distinct issues: trade facilitation, transparency in government procurement, and trade competition. Due to the fact that these issues had previously been raised and other multinational trade negotiation meetings, it was determined that Seattle would be the place and time in which these were discussed. However, due to extenuating circumstances that had been enumerated upon above, these issues were pushed off until the ninth round; also known as the Doha round. Whereas a relatively high level of cooperation has defined the previous rounds of multinational trade negotiations that had been such an instrumental part in the development and Pollution of GATT in the WTO, the ninth and current round of development negotiations in Doha have been far less promising than those which have previously been discussed. As one might assume, as the level of membership and participation in the multinational framework of the WTO has expanded, so to as the divide she developed nations and a block of undeveloped nations. Ultimately, the developed nations are led by the European Union, the United States and Japan. Conversely, those nations that disagree with the approach that the developed nations have taken with regards to issues as broad as agriculture, nontariff barriers, services, trade remedies, and industrial tariffs have proved to be a stumbling block to the level in which the WTO can continue to develop a level of progress. Ultimately, this dissenting group of nations has formed something of its own independent economic block; oftentimes referred to as the BRICS (Brazil, Russia, India, China, and South Africa). Although it is not into that this analysis point of fact that the WTO has reached membership acid is now beginning to exhibit signs of stress and failure, it must be noted that the key concerns of underdeveloped nations and the means by which they have formed a bloc to represent these concerns is an issue that should not be taken lightly with regards to the future of WTO and international trade. Whereas the WTO was originally founded on the principle of an understanding and belief that free trade was beneficial to each and every nation within the system, what is beginning to be seen as a potential for a division of the world based upon several economic blocs. As time has proven over and over again, protectionism with regards to tariffs and subsidizing/dumping products on other markets is not the means by which global wealth can be generated for anyone. Within such an understanding of this framework, the reader/student must come to the realization that recent events, which have been demonstrated with regards to the extent to which the WTO is capable continuing to expand and integrate needs of its compounded parts, is diminishing Read More