The Foreign Service Journal, March 2003

MARCH 2003 • AFSA NEWS 11 THE MILLENNIUM CHALLENGE CORPORATION AND USAID Reinventing Development Assistance? BY JUDY SLATER, AFSA USAID FORUMS MANAGER B y the time this article goes to press, the Bush administration will have prepareddraft legislationfor creation of theMillenniumChallengeCorporation, a public corporation tasked with manag- ing the administration’s Millennium Challenge Account. The concept of the MCAhas beenwell-received bymembers of the international development field, including theNGO-PVOcommunity, and by both political parties. However, AFSA USAIDcautions about the devil lurking in the details. Both advocates and skeptics have published fact sheets, opinionpieces, studies and reports since Bush first announced the creation of a Millennium ChallengeAccount inMarch 2002. There are stillmany unknowns. It is hard topre- dict how such an institution will be struc- tured, functionand succeed incarryingout the “fresh approach to aid” that the Bush administration has proposed. We at USAIDneed to understand that a new U.S. federal development corpora- tionmanagingup to$5billionper yearwill have direct implications on our agency’s way of doing business, workload, devel- opment assistance delivery objectives and Foreign and Civil Service careers. To address these issues, in December 2002 AFSAbegan a series of openmeetings and online correspondencewithUSAIDover- seas personnel, and established a special Web site to solicit input from as many AFSAmembers andotherUSAIDandState employees as possible. On Jan. 22, AFSA President John Naland met with MCC Chairman- designateColinPowell and strongly urged the inclusion of experienced USAID ForeignServiceofficers in themanagement and implementation of the MCA at both the Washington and country levels. In February 2003, an interagency MCC working group andmembers of theOffice ofManagement andBudgetwroteandsub- mitted a draft bill to Congress. We want toensure that employee concerns reach the committees studying this bill. During our December meetings, pro- fessionals from USAID and State ques- tionedhowtheMCCwill affect their careers and the work they do, who will be eligible to work for the corporation, what will be the incentives andbenefits of beingdetailed there, andhow, under theMCCprograms, participating countries will prepare pro- posals, implement programs, andprovide adequate programmonitoring and finan- cial accountability. We think theseprocess- es should heavily involve overseas USAID missions. USAID has decades of institutional memory andoverseas presence and thou- sands of person-years of professional experience in all of the difficult tasks and responsibilities enumerated above. It makes eminent sense for the newMCC to drawonUSAID’s body of knowledge and experience. SeniorBushadministrationoffi- cials recognize thewealthof “best practices” developed by USAID, but we want to see in detail how USAID missions will be involveddirectly. For instance, willUSAID and MCC programs overlap, conflict, or create synergies? Or, will MCC missions eventually replace USAIDmissions, mak- ing some USAID functions obsolete? We hope not. The Hill and the interagency MCC working group should realize that block grants, host-country contracts andnation- al development programs arenotnewideas. The MCC legislation should take into account the career development needs of our government’s ForeignService cadre— indeedof all the government’s international development professionals. USAID has beentherebefore, inevery sense. It hashan- dledprocedural andonsiteneeds via itsmis- sions and has testedwhat works andwhat does not work for similar large-scale pro- grams in countless countries. We concur that theMCCis agood idea, especially if it is a response to some of USAID’s cumbersome, overlybureaucratic approaches to development. However, USAID has learned many lessons it can share with the MCC staff. Big money thrown at development and amore selec- tive eligibilityprocess for less corrupt grantee countries lookspromisingonpaper, but the bottomline remains—host countrieswill get the most out of the millions of dollars that will flood their national accounts only if themanpower andexpertise already exist on the ground. And they do. The best way the MCC can succeed in its “innovative mission” is to ally with USAID and coordinate efforts. USAID already hasmechanisms inplace to review grant proposals and implement grant programs. The two institutions should ini- tiate a joint pilot programinaneligiblehost country as soon as possible. Such a pro- gramwould be a practical application of a possible alliance and it couldoccur imme- diately, within the current legislative frame- work. TheMCCworkinggroupandOMB could gather performance data about the programandtest its success rateand impact. Cooperationbetween the twodevelopment assistance institutions would serve U.S. interests and the host countries better than the agenciesworking separately but simul- taneously toward similar goals. USAIDas an institution is in the best position tohelp the MCC succeed. We hope that the Hill is listening, and will take concerned employees’ comments and suggestions into account as it revises the MCC bill. AFSAUSAIDhas a createdadiscussion forum on the AFSA Web site at www.afsa.org. C ontact the AFSA USAID officeat(202)712-0843. AFSA’sUSAIDVP JoePastic’s e-mail is jpastic@usaid.gov, and AFSA USAID Forums Manager Judy Slater’s e-mail is aidproject@afsa.org. ▫ The best way the MCC can succeed in its “innovative mission” is to ally with USAID and coordinate efforts.