The Unfulfilled Promises of USAID

In January 2021, the trump administration, alongside initiatives spearheaded by figures like Elon Musk aimed at streamlining government spending, implemented significant cuts to USAID’s budget and programs. This decision left several European allies – Sweden, Norway, and the Netherlands – in a precarious position. These nations had entrusted millions of dollars to USAID for joint development projects in low-income countries,specifically for initiatives like Water and Energy for Food (WE4F).

The central question became: would these funds be allocated as intended, or would they be returned? As of 2021, no clear answers were provided.

“It’s a concern for us, especially as we want our partner organizations to be compensated for the work they have put into the programs,”

Julia Lindholm, spokeswoman for the Swedish government’s international development agency.

This lack of transparency ignited concerns about the U.S.’s commitment to international partnerships and its adherence to financial agreements.

In 2023, about 40%, or $17.2 billion (€16.5 billion), of the USAID budget went to eastern Europe, according to theparliamentmagazine.eu. But even that allocation is now under scrutiny.

WE4F: A Program imperiled

WE4F, a collaborative effort between USAID and European partners, aimed to empower farmers in developing nations with innovative technologies to enhance food production sustainably. The program sought to reduce reliance on strained water resources and climate-damaging energy sources.

The impact of WE4F was designed to be significant, directly benefiting millions who rely on these technologies for food production and security. The program’s goals aligned with broader U.S. interests in promoting global stability and food security, mirroring initiatives such as the U.S. Farm Bill’s international food aid programs.

As Lindholm emphasized, the failure to disburse or refund allies’ donations directly impacted “6 million of the poorest and most vulnerable farmers in the world who are dependent on the technologies for their food production and food security.”

The consequences of these funding disruptions extend beyond immediate financial losses,potentially undermining long-term development goals and straining diplomatic relations.

Broader Implications for U.S. Foreign Policy

The USAID funding freeze has contributed to a narrative of wavering U.S. commitment to international agreements.This perception is further fueled by past actions, such as questioning NATO’s mutual-defense pact and imposing tariffs on key allies. These moves collectively erode trust in the U.S. as a reliable partner in global initiatives.

Marco Rubio stated that 83% of USAID contracts were canceled. Lawsuits emerged over the administration’s abrupt cancellation of contracts, forcing partner organizations to lay off workers and driving some out of business.

Former U.S. officials, including former Defense Secretaries Chuck Hagel and William Perry, and former CIA director Michael Hayden, voiced strong concerns about the administration’s actions, stating that canceling the contracts “sends a message that this administration does not feel bound by those regulations — regulations on which every business that works with the United States relies.”

According to them,the mass canceling of thousands of USAID contracts was flouting U.S. financial regulations and “destroying the United States’ credibility as a reliable partner.”

counterarguments and Alternative Perspectives

While the abrupt cuts to USAID funding faced widespread criticism, some argued that a more targeted approach to foreign aid was necessary. Proponents of this view, like Trump and Musk, often described foreign assistance through USAID as a “fraud and scam.” These individuals advocate for focusing U.S. development efforts on combating China’s influence and boosting U.S.trade opportunities.

However, critics contend that such a narrow focus neglects the broader national security benefits of development programs, which aim to foster stability, reduce refugee flows, and prevent conflicts by promoting prosperity in developing countries. This debate highlights the ongoing tension between prioritizing immediate economic interests and investing in long-term global stability.

The Road to Resolution

faced with unanswered inquiries, Sweden, Norway, and the Netherlands initially sought clarification from USAID regarding the status of their funds. Frustration mounted as these inquiries went unanswered, leading to warnings about potential media engagement to highlight the issue.

The U.S. government, under court order, has since begun addressing some of the outstanding debts, disbursing approximately $2 billion that USAID owed when the funding freeze was implemented. However, significant challenges persist, including staffing shortages at USAID headquarters, hindering efforts to reconcile accounts and process refunds.

Despite these challenges, donor partners are actively exploring alternative avenues, to ensure a responsible completion,” Lindholm said by email, indicating a shift towards self-reliant action in the face of uncertainty.

Looking Ahead: USAID in 2025

As of March 2025, the long-term implications of the 2021 USAID funding disruptions remain a subject of debate.While the U.S. government has taken steps to address outstanding financial obligations, the damage to its reputation as a reliable partner may linger. ongoing discussions about the future of U.S. foreign aid policy will need to consider the lessons learned from this episode, balancing fiscal duty with the strategic importance of international development initiatives.