After U.S. President Donald Trump was inaugurated in January 2025, one of his very first actions was issuing a 90-day freeze on all foreign aid. In subsequent weeks, Trump and the so-called Department of Government Efficiency (DOGE) – which, despite its name, is not an official government department – moved to more permanently dismantle the underpinnings of decades of U.S. foreign aid policy. The U.S. Agency for International Development (USAID) was effectively scuttled, with somewhere between 80 to 90 percent of its programs cut.
The Trump administration framed the cuts as necessary steps to combat waste and fraud. Analysts say otherwise, with experts pointing to the immense importance of foreign aid – both for increasing U.S. “soft power” and, more directly, helping keep the United States secure by defending against transborder threats like pandemics and terrorism fueled by poverty and state failure.
The Diplomat’s Shannon Tiezzi spoke to Larry Diamond, a senior fellow at the Hoover Institution and the Mosbacher Senior Fellow in Global Democracy at the Freeman Spogli Institute for International Studies (FSI) at Stanford University, about the benefits of U.S. aid and why it’s become so controversial.
“If you really want to ‘make America great’ or keep it great or make it greater, I can’t imagine a more self-destructive tactic for that overall goal then ending foreign aid,” Diamond says.
To start, could you go over the strategic value of U.S. aid? In the Indo-Pacific, specifically, do you think U.S. development assistance, whether through USAID or other agencies was actually working for the U.S. national interest?
There are two broad purposes to aid. One is more purely strategic, and the other is enlightened self-interest.
The purely strategic angle is that aid – both economic, including humanitarian and developmental, and military – helps to cement and sustain partnerships, and improves the ability to influence partners.
Unfortunately, we’re now virtually in another Cold War situation. There’s a world order element to foreign aid that has to do with alignment, alliances, solidarity, and influence – in the better sense of the word, rather than the maligned sense of the word, as it’s being deployed by China, Russia, and Iran. Aid helps in the cementing of partnerships and common purpose for a stabilizing world order.
In the Indo-Pacific region, the goal is to ensure not U.S. hegemony – as the PRC is, I think, maliciously depicting it – but a situation where there is no hegemony, which is why we use the term “free and open Indo-Pacific region.” Aid serves that broad purpose. It’s one of many instruments.
There’s a military dimension to aid. There’s an economic dimension in certain circumstances – more pertinent, probably, to Africa and the poorest countries of the world. But in the era of climate change, humanitarian assistance may be needed by all kinds of partners, even ones that are middle income or higher. There’s a humanitarian element.
On the enlightened self-interest side, the argument goes like this: if states collapse, it’s not going to be in the self-interest of the United States, Japan, Europe, or anybody else that would be providing assistance. We’re already running thin on the resources and patience to stem and resolve civil wars, and deal with the horrible consequences, including the blowback consequences of terrorism, of state failure and state decay.