Yet More Aid To Dependent Dictators By Bill Walker
(2009-12-24 at 20:22:13 )

Yet More Aid To Dependent Dictators by Bill Walker

On December 16 President Obama signed the omnibus appropriations bill. It
included H.R. 3081, a doubling of foreign aid from pre-Obama times, to
48.764 billion dollars. By comparison official US foreign aid in 2006
totaled less than 23 billion dollars.

This is all money which the US has to borrow from foreign taxpayers, as
the US is 12.1 trillion in debt not counting Social Security, Medicare,
or prescription drug benefit obligations. Those are estimated by the head
of the Dallas tentacle of the Federal Reserve to put the real total debt
at over 100 trillion.

Some people would think that when you can not pay your own debts, that
borrowing more to give away would be slightly irresponsible. But those
are the kind of bitter people who cling to their guns and religion, and
will never amount to anything. Important people, the kind who win the
Nobel Peace Prize in their spare time, know better. As the Parable of the
Dishonest Steward says in Luke 16, it is smart to give other peoples
money away to outsiders when you fear you may soon lose your position.
And there has been lots more Christmas gifts for outsiders in the recent
budget besides the Official Foreign Aid.

You might think that I am about to mention the trillions that have been
given to the large money-center banks, insurance companies, investment
houses, and other deserving causes. Nope. Not gonna bring them up. We all
know that the financial industrys dealings with politicians are
completely disinterested and pure. This article is strictly about the
Money That Funds Evil Foreign Tyrants, Not Our Patriotic Home-Grown
Variety.

There is a similarity between off-the-books Aid To Dependent Dictators
and the bank bailouts, though. The money for both is simply printed by
the Fed and handed to the lucky recipients without any time-wasting
linkage to Congress, the budget, or any of that boring stuff. Ever since
the passage of the Monetary Control Act of 1980, the Fed has simply
Monetized Foreign Debt when our foreign policy geniuses needed to fund
some deadbeat dictator or bail out the bank that lent to him. Back then a
guy named Ron Paul raised the first alarm about the first bailout under
the Act. It was a matter of a critically important hundred million or
thereabouts for the past-due debt of the Sudan. Without that early
funding, how could the central government of the Sudan have become strong
enough to oversee the genocides in Darfur?

Just in case grants and direct US bank loans are not enough, dictators
and oligarchs also have large international credit facilities through the
World Bank and IMF. The World Bank lent out a little less than 50 billion
last year, much of it to governments which the Bank says Have Little
Access To Credit Markets (thats because they do not pay anyone back).
This money does not appear on government budgets. Where does the money
come from? The World Bank borrows it, of course.

The IMF has also begun to borrow heavily. The LA times reported in 2008
that In just the last four years, the IMFs total loan portfolio has
shrunk from $105 billion to less than $10 billion; over half of the
current portfolio consists of loans to Turkey and Pakistan. But China and
Russia have committed to buying tens of billions of IMF bonds, financing
a whole new round of loans to governments.

War: The Health of The (Puppet) State

Arguably even more expensive than the Direct Monetary Subsidies To
Dictators and Elected Kleptocrats Like Karzai have been our Military
Commitments To Prop Them Up. The wildly spinning counter at costofwar.com
says that the Iraq and Afghan occupations have cost about 946 billion as
I write this. Costofwar.com tracks just the direct appropriations, using
Congressional Research Office Figures.

Economist Joseph Stiglitz attempts to count the cost of propping up the
Sunni tribal leaders and Kabul warlords more accurately, including such
expenses as disabled veterans long-term care, the higher oil prices
(remember, oil was $25 a barrel before 2003), etc. His book last year was
titled The Three Trillion Dollar War. Unfortunately for Stiglitz, the
book came out before Obama escalated the Afghan war with $30 billion+
worth of new troops and Contractors, expanded our use of robot assassins
into Pakistan and Yemen, etc. It is near-certain that three trillion will
turn out to be an underestimate.

Past US foreign aid has gone to Idi Amin, Julius Nyerere, Joseph Stalin,
Fidel Castro, and Pol Pot, even after Pol Pot killed 25% of Cambodias
population. We also gave money to North Vietnam, helped fund the Taliban
government of Afghanistan, gave nuclear reactors to North Korea, and back
in the day helped the Pakistani spy agency ISI build up a real gung-ho
guy named Osama Bin Laden. And of course it was also the ISI which made
the Taliban powerful enough to take Afghanistan in the first place.

Of course the excuse is that things would be worse without our help.
Frankly I am not buying it. Worse than Pol Pot? Just exactly how could
anyone be worse than Pol Pot? Any worse and there would not be anyone
left to do the killing. I do not think anyone thinks that the Taliban or
Kim Il were worthy causes either.

US foreign aid policy since 1945 has been based on the idea that
dictators just need a few bucks till payday, and then they will
straighten out, give up genocide, etc. But just like your brother-in-law
that keeps skipping his AA meetings, all this money really does is let
the dictators keep their genocide habit going. If their money comes from
the US, why bother with the messy annoyances of having to allow a
domestic middle class, trade, freedom, etc.? Much easier to just live off
the aid checks and shoot anyone who mouths off.

Even in the early days, when some of the foreign aid was going to less
Genocidal Governments under the Marshall Plan, it still did not work.
Most of the Marshall Plan money went to England and France, built up
their bureaucracies, and left them way behind Germany and Japan. Contrary
to myth, Germany actually got less than no aid because their reparation
payments were bigger than their Marshall plan share.

Foreign aid does not help our security, unless you think the North Korean
and Pakistani nuclear bombs are going to help us. It does not help
foreigners security either. In many cases all we have done is supply both
sides of conflicts with larger weapons. What sense does it make for us to
buy expensive armaments for both Egypt and Israel, for both Pakistan and
India?

Foreign aid does not help economic development; every rich nation on
Earth has built itself up by work and trade, not by aid programs. Foreign
aid certainly does not help the American economy.

Practically no American voter likes foreign aid, or borrowing the money
to pay for it. Thoughtful foreigners like our support for their
oppressors even less. Yet it is the fastest-growing budget item.

How Can We End Foreign Aid?

Publicize it, here and abroad. Those Chinese taxpayers need to know about
the $800 billion their fearless leaders have donated to fund the US
Government. Libertarian think tanks need to track foreign aid, both
official and off-the-books. We need to add all the pieces of the Aid
Puzzle together. As Dirksen would have said today: A trillion here, a
trillion there, and pretty soon you are talking about real money.

The Dishonest Steward counts on Americans being too lazy to check the
books. Our job is to make the bottom line figures on the many programs
that make up the Aid To Dependent Dictators easy to find. When enough
Americans know how many trillions have been stolen from them over the
decades since 1945, the Dishonest Steward may indeed have to find a new
job.

December 24, 2009

Bill Walker is a research technologist. He lives with his wife and four
dogs in Grafton NH, where they are active in the Free State Project.

Copyright © 2009 by LewRockwell.com. Permission to reprint in whole or
in part is gladly granted, provided full credit is given.