Robbing Peter . . .

President Bush, sometimes encouraged to do even more by Congress, has responded with substantial generosity to the pressing new needs of Eastern Europe, notably Poland and Hungary, and now the challenge of rebuilding Panama after the American military intervention. Most Americans, we among them, applaud this response and count it as consistent with the American tradition of encouraging freedom and responding with compassion to emergencies.

But Americans also need to know that there is an illusion to all this. The response has been budget neutral, respectful of President Bush’s personal commitment to block any new taxes, and the unwillingness of Congress to challenge this proposition. So every new gesture of generosity and encouragement of renascent democracy is being done at the expense of other needy nations. In effect, Poland and Hungary and now Panama are being helped at the expense of Africa, Asia and the rest of Latin America.

The foreign-aid budget for this year has actually been cut by the President and Congress, with $2.371 billion set aside for development assistance and $3.205 billion for economic security funds. That is scarcely half of 1% of the federal budget. Meeting the growing needs of the most desperate nations of Africa, Asia and Latin America is complicated by agreement between the White House and Congress to continue earmarking funds for specially favored nations, notably Israel with $1.2 billion, Egypt with $850 million and Pakistan with $120 million. When funds for Eastern Europe, and now for Panama, are deducted, substantial cuts for most other nations are required.

As matters now stand, the U.S. Agency for International Development is in the midst of adjusting its program for the year that began Oct. 1 to the reduced resources appropriated in November. So it is little wonder that agency officials report that they do not yet know who is going to get hurt and how much. Calculations are clouded also by indecision on how much money will actually flow to Eastern Europe this fiscal year. The authorization of aid for Eastern Europe was more than $800 million for this and next year, but the appropriation was $532.8 million and the actual expenditure may be closer to $300 million this, the first year, according to officials. There is no estimate as yet of aid required for Panama, where the devastation done by American military forces, and the economic losses in the anarchy that followed American intervention, must be in the hundreds of millions of dollars.

The decision of the President and Congress to aid Eastern Europe at the expense of Asia, Africa and Latin America contrasts with the newly approved foreign-aid agreement of the 12 members of the European Community. They have agreed to initiate new assistance for Eastern Europe while also increasing their economic assistance and trade with 68 developing nations over the next decade. That decision makes the European Community “the world’s principal donor,” in the words of Manuel Marin, European Community Commission vice president for development.

The vision and commitment of the European nations are to be commended. Most of them face national budget problems more complex than those of the United States. Nevertheless, they have recognized the long-range importance of world development which, beyond the appeal of compassion, will influence the economic viability of all nations. So, too, is the American commitment to be praised. But it will risk as much as it gains unless it is matched with additional funds so that Eastern European development is not bought at the expense of Asia, Africa and Latin America.