Emergency food aid provided by the US government to many of the poorest people in the world saves millions of lives every year. It could save millions more if it were run efficiently.
The Food for Peace program, which will spend $1.36 billion this year and is the principal means by which the United States delivers food aid to war-torn countries and disaster-ravaged regions, does much good.
However, as AEI scholar Dr. Vincent Smith notes in this recent analysis, the program has many problems. It mandates that nearly all food aid delivered through the program be sourced from the United States and that nearly 50% of that food be shipped via US-flagged vessels. Such mandates raise the cost of delivering one ton of food by roughly 65%. Who are the primary beneficiaries of this added cost? Private shipping companies whose vessels are used to carry aid.
These mandates also lengthen the time needed to deliver aid to areas of need by about seven weeks. That is not a recipe for responding quickly to overseas disasters.
Conservatively estimated, ending the practice of requiring that US flagged vessels ship a certain percentage of food aid would free up $150 million in aid dollars.
Additionally, much US-sourced food aid is converted back into funding for food aid projects via the inefficient process of monetization. In this process, food aid shipped from the US is sold in local markets by NGOs; the proceeds are used to fund the NGO’s projects. Most NGOs earn 70 cents for each dollar spent purchasing, shipping, and marketing the food they monetize. Ending monetization would save about $100 million per year that could be put to much better use providing aid through other programs.
Conservative estimates suggest that such reforms would free up resources to serve at least 4 million more children and adults who are in great need.
Arguments against such changes have little basis in fact, as Dr. Smith describes in this recent Senate testimony. The path toward reform is straightforward, with more reliance on markets to deliver more aid to more people more quickly, and with very little downside.
from AEI » Latest Content http://ift.tt/1ICYEng
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