On Tuesday the President will unveil the Administration’s FY15 budget and begin yet another round of negotiations with Congress on funding priorities. The decisions will ultimately have a real impact on the international stage, so here is what’s worth watching once the budget is announced:
- Cut or Not Cut? The first item to watch is whether or not international affairs programs receives an overall cut, and if so how big will it be? Will it be a small “haircut” or disproportionately cut compared to other non-defense programs? Remember, the Murray-Ryan budget deal brokered last December left little room for increasing discretionary programs for this year — only about $600 million overall. So no programs are getting much of an increase. The good news is that Secretary Kerry is a tough negotiator, and the Administration is well aware of the important humanitarian and diplomatic security needs throughout the globe.
- How Much for War Funding? Over the past three years, some funding for international programs has come from the Overseas Contingency Operations account (OCO) to cover the enormous cost of diplomatic and development efforts in Frontline States and some of the emergency and unanticipated security costs in other hotspots. These additional funds (upwards of $10.5 billion last year) have been vital sources of funding but have to be absorbed into base funding as we withdraw from two wars. Unfortunately, some years, the Administration limited their request for OCO resources to only Afghanistan, Pakistan, and Iraq despite consistent Congressional direction to expand the scope of OCO.
While we are strong advocates for increased base funding, we have encouraged the Administration to make a more realistic OCO request and maintain current levels ($6.5 billion) to deal with humanitarian crises in Syria and elsewhere. So watch if the Administration’s OCO request includes some expansion beyond the Frontline States to deal with these crises.
- Presidential Initiatives? Budgets always provide roadmaps of priorities – both programmatic and country. The Administration has several priority programs – food security, global health, climate change, Power Africa – and it will be interesting to see how the budgets of key agencies are affected. Here are a few items to watch:
- Presidential Initiatives – Will the Administration continue to ask for strong funding for key priorities such as Feed the Future, global health, and their most recent effort in Power Africa? How will a re-energized focus on climate change impact the international scene?
- Given the crises in Syria, Central African Republic, and South Sudan, how will humanitarian crises, peacekeeping and continued security requirements be reflected in the budget?
- As the U.S. and Europe try to shore up the Ukrainian economy with a rapid aid package, what pressures might that place on other spending?
- Will the Administration attempt to build on partial gains made recently on reforming U.S. food assistance?
- How will the budget reflect challenges in places like Egypt, Afghanistan and Pakistan?
- Continued Commitment on Reform? A signature of this Administration has been to build on the reforms of the Bush era in bringing accountability and transparency to our foreign assistance programs. Last year the MCC scored highest on the Aid Transparency Index, making the Corporation the most open aid agency in the world. USAID Forward has led the way with a significant scale-up of its evaluation and learning capacity so we can better understand what impact our programs are making. Will we see continued investments in operating funds at USAID, State Department and other smart power agencies and what will happen with new efforts in science, technology and innovation?
There are lots more questions to ask, and we will be up late into the night as soon as all the numbers come out to answer these and other questions about how we see the budget impacting international programs.
The spotlight will quickly shift to Capitol Hill, where Secretary Kerry and other Administration officials will defend the President’s request in hearings and where Chairman Ryan is expected to mark up a competing FY15 budget in March.