Motives, Focus of U.S. Aid Shifting : Foreign policy: The emphasis is on political effect rather than altruism. This benefits Eastern Europe and Panama instead of Africa.

At the headquarters of the U.S. Agency for International Development, the walls are covered by poster-sized photographs of African villagers happily at work on U.S.-supported projects intended to pull them out of poverty.

The photos mislead. American foreign aid has shifted sharply to Eastern Europe and Panama--areas not so abjectly poor--as the motives have shifted from altruistic to political.

“The United States has more immediately at stake in the success of Eastern Europe and Panama than it does in the more traditional focus of this agency because the traditional focus is far more long-term,” Mark Edelman, acting AID administrator, said in an interview.

Consequently, just as federal benefits programs have increasingly aided middle-income individuals in recent years, U.S. foreign aid seems to be turning toward middle-income nations. Critics say that while Eastern Europe and Panama undeniably need help, they do not need it as desperately as the world’s truly poor nations, most of them in Africa.

“We cannot turn our backs on the situation in Eastern Europe or Panama,” said Ronald Levin, a former U.S. aid mission director in Africa and Panama. “If you take a long-term view, you may say that another generation will go by before what happens in Africa will be important to us. But if we were to pull back now, we would subject ourselves to a considerable loss of prestige which may come back to haunt us later.”

The U.S. government has pledged almost $1 billion to support political and economic reform in Poland and Hungary, although Congress has appropriated only about half of that amount so far. Secretary of State James A. Baker III has dangled the prospect of similar aid to Czechoslovakia, East Germany, Bulgaria and Romania if they continue to move toward democracy and free-market economies.

And in Latin America, the Bush Administration proposed a $1.1-billion package of aid and trade concessions to rebuild the Panamanian economy after the U.S. invasion and two years of American economic sanctions aimed at forcing out dictator Manuel A. Noriega. Senate Minority leader Bob Dole (R-Kan.) added to the debate by proposing a 5% cut in aid for top recipient nations, including Israel, to provide more for Panama and the reform-minded countries in Eastern Europe.

For the current budget year, by contrast, Congress has earmarked $565 million for all of the poorest countries in Africa south of the Sahara.

“We work so hard to get some money for Africa and (we are told) there is no money around and suddenly there are large amounts for Eastern Europe,” complained Robert S. Browne, staff director of the House Banking subcommittee on international finance.

“If one concedes that the sole purpose of foreign aid is short-run political, I suppose there is nothing wrong with that,” Browne said. “From a long-run perspective, the countries that should get the aid are the poorest. . . . We would like to think that at least a portion of the aid program is motivated by humanitarian concerns.”

Acting AID Administrator Edelman says Eastern Europe and Panama are demanding far more of his time and attention than the development aid programs for the poorest nations, which have been the agency’s staple for decades. “Time, like money, is a zero-sum game,” he said.

Edelman insists that the money for Eastern Europe and Panama will not come out of funds intended for Africa, although he admits he does not yet know how the new programs will be financed.

Rep. David R. Obey (D-Wis.), chairman of the House Appropriations subcommittee on foreign aid, said the money should come out of the Pentagon budget, a proposal the Administration is likely to reject.

“The nature of the threat in Europe has changed greatly,” Obey said. “The threat that comes from the possibility of an Eastern Bloc attack on Western Europe is practically non-existent.” He said that shifting some of the money traditionally spent on the defense of Western Europe to development in Eastern Europe would be “a very good investment.”

Obey said the programs for Eastern Europe and Panama will be very expensive, far too expensive to finance by shifting money away from programs for the world’s poorest countries or by dipping into the budgets of U.S. domestic agencies. He hinted that the ultimate cost will far exceed the $2 billion already promised. “The American people will get a very fat bill for 10 years of stupidity in Panama,” he said. “We also will be asked to pay for openings in Eastern Europe. The American support for the President’s Panama policy will evaporate quickly if the people get the idea that reconstruction of Panama will be paid (for) by reducing domestic programs.”

Over the years, the focus of U.S. foreign aid programs has changed repeatedly, swinging back and forth between “trickle-down” research and infrastructure projects and “hands-on” efforts to help people in poverty-racked villages.

In 1973, Congress ordered AID to concentrate on programs intended to improve the daily life of the world’s poorest people, mostly in the remote villages of Africa.

By 1980, however, that approach was largely discredited. Critics maintained that the programs delivered resources to the least productive elements of society, which were unable to use the help very well even to improve their own individual lives.

When Ronald Reagan moved into the White House in 1981, he turned AID over to the primary critics of the programs of the ‘70s. The Reagan Administration abandoned village-level programs in favor of training, research and--especially--support for nations that were ready to abandon socialism and central planning in favor of free-market economics.

“The basic philosophy which came in with the Reagan Administration will stay,” Edelman said. “What we are talking about is the private sector. The enterprise funds for Poland and Hungary are part of that same policy.”

Some critics of the Bush Administration say that African programs may be shortchanged just when they are starting to work.

Edelman maintained that most countries of Africa have already embraced the private sectors of their economies and are unlikely to return to statism.

But Robert Bates, a Duke University expert on foreign aid, said the United States and the West have never given Africa “the intensity of effort” necessary to produce dramatic results.