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US Congressional Committee Debates Development Aid Cuts

Rajiv Shah, the head of the U.S. Agency for International Development, warned that Republicans' proposed budget cuts would have a devastating affect on foreign aid programs. Shah appeared before the House Foreign Affairs Committee to talk about his budget requests for next fiscal year.

Foreign aid currently accounts for about one percent of the federal budget. Shah was asked about a current Republican proposal known as HR-1 - which would take away $120 million from his budget.

"The cuts to the humanitarian account and the cuts in HR-1 overall for U.S. aid would be absolutely devastating," he said.

Shah said his agency would have to slash programs to prevent food riots, famines and malaria outbreaks, while disaster relief efforts would be put at risk. He warned that the cuts could end up costing America a lot more if the U.S. military has to be deployed in the future to deal with problems that humanitarian workers could have dealt with now.

Still, a number of Republicans on the committee, including Mike Kelly of Pennsylvania, argued that the U.S. cannot afford to spend billions of dollars on aid when it has to borrow 40 cents for every dollar spent.

"We don't want to stop helping people around the world. But at what point do we come to the realization that we are truly broke," he said. "We are in denial."

New York Republican Ann Marie Buerkle talked about the many Americans who are losing their homes or unemployed because of the economic crisis.

"How do we justify spending this money in other countries, and not having it available for the American people," she asked.

She put that question to Daniel Yohannes of the Millenium Challenge Corporation. It was created by Congress in 2004 to invest in countries that undertake economic reforms. Seventy percent of its funds go to countries in Africa.

Yohannes pointed out that 75 percent of U.S. trade now is with countries that benefited from the Marshall Plan, which helped Europe rebuild after World War II.

"This is about our future. This is about our security," he said. "This is about our prosperity. This is building the next set of emerging economies. This is about trade investment opportunities for American businesses. If we leave these countries alone, then in effect we are giving these countries to our competitors."

Democrats overwhelmingly opposed cuts in develpment aid.

Representative Donald Payne of New Jersey pointed to the current military expenditures in Iraq and Afghanistan.

"It makes no sense at all when we talk about spending less than one percent of our GDP on trying to help people live, we spend trillions of dollars on killing people," he said.

The ranking Democrat on the foreign affairs committee, Howard Berman of California, said polls show the average American thinks the U.S. should spend 10 percent of the government's budget - or 10 times the current amount - on foreign aid.