Authors: Richard Nixon
The debate over U.S. foreign aid is waged between two extremes. Some say we should cut government-to-government aid and increase private investment. Others insist that more government-to-government aid, rather than more private investment, is the answer. In fact, neither will work without the other. Government-to-government aid should be used as fertilizer to prepare the ground for private investment and thus for economic growth. Aid must be conditioned on the recipient country's willingness to adopt policies that will attract more private investment, because private investment brings with it something government aid does not: the technical expertise and training programs that will produce real progress for the recipient country's economy.
Private investment has an additional advantage: It is not limited by budget restraints in the donor country. Its only limitation is the investment climate of the recipient country. We must base our policy on the recognition of the fact that our strength, both at home and abroad, is not what we do through government but what we do through the private sector.
We should also explore how we can do more, through modification of personal and corporate income taxes, import and export tariffs, and other devices to encourage American businesses to do more business abroad.
Part of the intellectual flotsam of the 1960s and 1970s was the notion that the multinational corporation was an international outlaw, sucking cheap labor and natural resources out of the Third World and giving nothing in return. In fact, big business has already done a great deal to spur economic development in the Third World. It should be encouraged to do more.
Fear of foreign competition and loss of jobs is contributing to rising support for protectionism. While this is admittedly a painful immediate problem, in the long run we gain by having more prosperous countries in the Third World. Our two best
customers in the world are Japan and Canadaâboth highly developed countries.
No matter how much aid the West provides, it undercuts itself by establishing trade policies that hurt Third World countries. Some nations, including the United States, discourage economic development by imposing tariffs on finished or partially finished goods from a country but not on the raw materials from the same country that go into those goods. The West also hurts the Third World, in which 70 percent of the poorest people depend on agriculture to live, by price supports for domestic crops that otherwise might well be imported. Eliminating policies such as these will cause short-term hardship at home, but will enhance the prospects for economic growth in the Third World, and in so doing make all of us more prosperous and secure in the long term.
To launch an effective program for economic progress for the Third World is a formidable task. Our goal cannot be achieved unless several conditions are met. First, we must restore bipartisanship in foreign policy. The great foreign-affairs initiatives of the postwar yearsâthe Greek-Turkish aid program, the Marshall Plan, the rebuilding of Japanâwere bipartisan initiatives. Bipartisanship in foreign policy was one of the major casualties of the Vietnam War. It is crucially important that our Third World initiative begin as a bipartisan effort and stay that way. Economic development does not happen overnight, but a change of attitude in a democracy often does. Unless we decide at the outset that our effort to win the Third World war will not be a political football, there will always be the danger that in the future a President or the Congress, eyeing the next election, will punt and give the ball back to the other side.
The United States cannot afford to have its leadership bitterly divided over our policy for dealing with conflict in the Third World. On the one hand, hawks emphasize the importance of defending American interests and of helping Third World governments that are fighting the spread of communism.
On the other hand, doves emphasize the importance of helping only those governments that respect human rights and that strive for economic development with equity. Both sides are only half right.
If the hawks and doves take a hardheaded look at the political facts of life in the Third World, they will find themselves seeing eye-to-eye with one another. For doves this means ending their romance with the idea of revolution. Too often this has led them to lavish uncritical praise on anyone who claims to act in the name of the people, no matter how violent or destructive his actions may be. Revolutions seldom produce democracy, and in the post-World War II period revolutions from the left never have. This does not mean that we must never support a revolutionary cause or that we should turn our backs on those striving for political and social reform. It does mean that we need to be patient with countries whose systems are imperfect, and that we should be skeptical of those who claim they will produce the millennium overnight. While democracy works for the nations of the West, instant democracy is neither possible nor desirable for most of the Third World.
Hawks must also reexamine their position. They must recognize that there are economic and political causes of revolution. The United States could regain its military superiority over the Soviet Union and still lose the Third World war. We must disabuse ourselves of the notion that national strength is measured solely by military power and that simply by having enough of it we can feel secure. Doves must recognize that to stay on the sidelines and to fail to do what is necessary to prevent the victory of a repressive Communist regime is immoral. Hawks must understand that using the specter of the Communist threat to justify the status quo or repression by the right is also immoral.
Second, it is essential that foreign economic issues be given equal status and consideration with political and military issues in the office of the President. Some will contend that foreign economic policy receives the attention it deserves because
of its position on the organizational charts of the National Security Council and the State Department. This is not true. Highsounding titles do not give power and influence. Only direct access to the President does.
In the NSC, political and military issues receive first priority; economic issues have been and continue to be treated as second-priority matters. In the State Department, economic officers, with very few exceptions, are second-class citizens. The fairhaired boys in the Foreign Service who go to the top and become ambassadors are political officers. It is therefore no surprise that, with a few notable exceptions, the quality of economic officers is lower than that of political officers.
Foreign economic policy is an orphan, with second-level bureaucrats in the State, Commerce, and Treasury departments squabbling over custody. This is why economic policy decisions are often at odds with political decisions, particularly where East-West trade issues are involved.
During World War II, the United States recognized the importance of economic power by setting up a Board of Economic Warfare. Today we need a Foreign Economic Policy Board to concert the use of our economic power in the Third World war. It should be given the same status as the National Security Council. It should answer directly to the President, because only he is able to knock heads together when the bureaucrats in the various agencies involved with foreign economic policy engage in Washington's favorite sport, fighting for turf. Policies governing trade, foreign aid, loans, and support of international lending agencies must be coordinated to serve American foreign policy interests. A process must also be established for enlisting the cooperation of the private sector in serving those interests. It makes no sense for the government to cut off aid to hostile nations while American banks continue to make huge loans to those same nations.
Third, this is a task for all of the industrial nations of the West, not just the United States. Europe's GNP exceeds ours, and Japan's could equal ours by the end of the century. Japan spends two-tenths of 1 percent of its GNP on foreign economic
aid, as does the United States. But we spend 7 percent of our GNP on defense, compared with nine-tenths of 1 percent for Japan. We can understand Japan's political problems, which make it difficult to spend more than 1 percent of its GNP on defense. But as the second richest nation in the free world, Japan should pay for the free ride it is getting on the military front by a corresponding increase in its economic assistance to Third World countries.
Our diplomatic initiatives should include a major effort to enlist the Soviet Union in joining us in cooling crises in the Third World. While this may seem unrealistic since the Soviet Union stirs up many of the crises and profits from most of them, we must not overlook the fact that they have other priorities as well. They want nuclear-arms control as we do. What destroyed any chance of Senate approval of SALT II was not the alleged flaws in the agreement but the Soviet invasion of Afghanistan. There is no way the Senate will approve any agreements in the future for arms control when the Soviet Union is blatantly supporting revolutions that threaten our interests in areas like Latin America and the Mideast.
While the Soviets want the world, they do not want war. A conflict in the Third World that involved the interests of both the United States and the Soviet Union could escalate into world war. And as a major nuclear power, the Soviets are concerned about the proliferation of nuclear weapons, just as we are, and about the possibility that an international outlaw like Qaddafi might acquire such weapons.
Therefore, while they will continue to proclaim their support for wars of national liberation, they will stop short of any action that could escalate into a suicidal world war. When a nation has to make a choice between ideology and survival, survival always comes first. We should challenge the Soviet leaders to peaceful competition in the Third World. If they can produce progress for people and not just power for Third World dictators, we say, “Welcome to the club.”
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I do not underestimate the cost or complexity of launching a peaceful revolution for progress in the Third World. But we have the economic resources. We have the skilled manpower and the brainpower. Our national interest requires it. There is only one nagging question. British strategist Sir Robert Thompson once wrote, “National strength equals manpower plus applied resources times will.” Do we have the will to undertake such a bold initiative? Americans don't like to play a role on the world stage. Vietnam eroded our will to do so. But America is a great nation. Great nations must be mature enough to accept the fact that you do not win all the time. Defeat is never fatal unless you give up, and America must never give up. We must not turn away from our responsibilities in the world. If we refuse to play a major role, the rest of the free world will be at the mercy of totalitarian aggressors.
We must continue to play that role, not just for others but for ourselves. A world one-third rich and two-thirds poor will never enjoy real peace. America cannot be at peace in a world of wars. Where freedom is destroyed anywhere, it is threatened in America. We cannot have a healthy American economy in a sick world economy. By providing more economic aid now, we reduce the possibility of having to provide more military aid later.
I believe the American people are ready to accept this challenge. Defeatism, indifference, and malaise are not American characteristics. Optimism, compassion, and high-spiritedness are. We are a people who are never satisfied with the status quo. Americans are always striving for something better. We must put those qualities to work beyond our borders. We must be as impatient with the status quo in the Third World as we are at home.
The best way to slow down and eventually halt the locomotive that propels the Communist offensive in the Third World war is to deny it fuel. If a program for progress gives people in target countries the promise of a peaceful revolution,
those who are trying to incite violent revolution will run out of gas.
In the past, being against Communist aggression has been reason enough to mobilize public opinion in support of American foreign policy. Our self-interest in this great initiative is obvious. But Americans will respond even more enthusiastically if the case is presented in idealistic terms.
In World War I, being against the Kaiser and German militarism was a powerful incentive for our war effort. But Woodrow Wilson's greatest contribution to our eventual victory was that he presented our effort in idealistic terms. We were fighting “a war to end wars,” a war “to make the world safe for democracy.”
In World War II, Hitler and Hirohito made very convenient enemies to be against. But Roosevelt and Churchill inspired the people of the free world by presenting in idealistic terms not just what we were fighting
against
but what we were fighting
for
âfor the Four Freedoms and eventually a new world organization that would initiate an era of peace.
Throughout our history our greatest Presidents have called upon Americans to participate in great causesâcauses that were bigger than themselves, bigger than America, as big as the whole world itself. Thomas Jefferson said, “We act not for ourselves alone but for the whole human race.” Lincoln proclaimed, “We shall nobly save or meanly lose the last best hope of earth.” Theodore Roosevelt declared, “Our first duty as citizens of the nation is owed to the United States, but if we are true to our principles we must also think of serving the interests of mankind at large.” Speaking at Independence Hall on July 4, 1913, Woodrow Wilson said, “A patriotic American is never so proud of the flag under which he lives as when it comes to mean to others as well as to himself a symbol of hope and liberty.”
Appeals to our highest ideals have never failed to move Americans to support great causes. To make the world safe not only for ourselves but for others is a great cause. Even greater is the challenge to give millions of people in poor nations a
chance to share the blessings of freedom and progress we enjoy.
Our defeat in Vietnam was only a temporary setback after a series of victories. It is vital that we learn the right lessons from that defeat. In Vietnam, we tried and failed in a just cause. “No more Vietnams” can mean that we will not
try
again. It
should
mean that we will not
fail
again.