Despite Tug-of-War, USAID Gains Leeway on Food Aid

The Obama administration gained some ground during this Congress in its bid to change the way the United States buys and delivers emergency food aid to hungry people around the globe.

However, groups that opposed the administration’s plan say they succeeded in stopping the White House from achieving sweeping changes.

The administration and its opponents have each declared victory, but the tug-of-war between them over how the United States — the world’s top humanitarian food aid donor — provides food assistance seems likely to continue. The direction of the Food for Peace program has been a contentious topic over the years, causing divisions among key players such as agriculture groups, food processors and nonprofit food aid organizations.

The recently signed 2014 farm bill gives the U.S. Agency for International Development and the Department of Agriculture more leeway to use money to buy emergency food closer to areas of need. USAID also would be able to cut back on the criticized practice of selling U.S. food abroad to raise money for nonemergency development projects.

But the Obama administration failed to persuade Congress to shift up to 85 percent of the Food for Peace funding out of the USDA and into USAID. Also largely unchanged is the policy of buying most humanitarian food aid in the United States and then shipping it to overseas destinations aboard U.S.-flagged ships.

The Obama administration and supporters of the change say the current practice is inefficient and reflects the 1954 origins of the program. Its original goal was to aid not only the hungry of the world, but also U.S. agriculture and shipping.

The administration’s call for greater flexibility drew support from the Democratic-leaning National Farmers Union, and multi-national food giant Cargill.

But Ellen Levinson, who represented a coalition of unions, shipping companies, agriculture groups and others opposed to the administration’s proposal, said the would-be reformers reached too far.

The Alliance for Global Food Security, led by Levinson, developed a campaign that highlighted potential job losses in the U.S. commercial shipping fleet and the closing of a market for some U.S. farmers and processors. The campaign also played to lawmakers’ emotions by noting that more cash purchases overseas would mean fewer bags of food with a U.S. logo to remind recipients which country provided the aid.

Sen. Mark Pryor, chairman of the Senate Agriculture Appropriations subcommittee, pulled one of the bags out for display when Agriculture Secretary Tom Vilsack testified in defense of the administration’s plan. The Arkansas Democrat seemed unswayed by Vilsack’s assurances that up to 55 percent of the money could still be spent in the United States.

Now Levinson says her coalition will review the new rules and guidelines proposed for the small shifts in food assistance.

“We’re focused on the regulatory process. That’s most important,” Levinson said. “We have to make sure that they are streamlined and that they are usable and practical in the field.”

Christopher Barrett, an agriculture and development economist, said Levinson’s group is a winner because most U.S. food aid, known as in-kind aid, will continue to be bought in the United States and transported to disaster areas. Governments, nonprofit groups and nongovernmental organizations distribute the food.

But Barrett said provisions in the new multiyear farm bill will also allow administration officials to build on earlier efforts under President George W. Bush to revamp U.S. food aid. The two administrations shared a bipartisan view that the United States needs to buy food closer to emergency areas, a practice used by other food aid donors such as the European Union.

“Ideally, USAID and USDA should have total flexibility in choosing cash and or in-kind. The in-kind should be readily available, as should cash,” said Catherine Bertini, a current advisory board member to USAID and a former director of the United Nations World Food Programme.

The administration sees a victory. In a round of recent press calls, USAID Administrator Rajiv Shah said the 2014 farm bill and spending bill represent a congressional nod to the need for greater efficiency in food aid. “America can only maintain its role in the world in humanitarian aid as long it is effective and efficient,” Shah said.

For example, USAID will now be able to limit the practice of monetization of food aid to Bangladesh. Under monetization, the United States ships food overseas, where it is sold and the proceeds distributed to U.S. nonprofits in the regions to pay for nonemergency development projects to address long-term hunger.

In 2011, the Government Accountability Office questioned the practice, noting that USAID and the USDA often netted less in the sales than it cost to buy the food in the United States and transport it on U.S.-flagged vessels. The GAO, the investigative arm of Congress, said the U.S. food sales also had the potential to depress market prices, which undercut local farmers in poor countries.

Shah also said the 2014 farm bill and the spending bill will allow the United States to feed 800,000 more people because of the greater flexibility to buy food in regions closer to areas in need. The farm bill converts an expired small pilot program to a permanent one with $80 million a year in authorized funds over the life of the five-year bill for local and regional food buys.

Overall, though the purchases will only account for about 3 percent of food aid spending, supporters see it as a toehold in their push for broader change.

The administration’s original proposal debuted to bipartisan objections from House and Senate Agriculture appropriators and authorizers because it would have moved funding out of their committees’ jurisdiction and out of the USDA budget. Lawmakers said it looked as though the administration wanted to dismantle the program.

The plan appeared dead, but House Foreign Affairs Chairman Ed Royce and ranking Democrat Eliot L. Engel sought to keep much of it alive. They lost a close 203-220 vote on a floor amendment to the farm bill that would have limited monetization and allowed up to 45 percent of food aid money to be used for purchases overseas.

Royce, a California Republican, and Engel, a New York Democrat, got another chance to advocate for change in international aid as farm bill conferees. House Agriculture Chairman Frank D. Lucas recently said the compromise reflected in the final version of the farm bill that became law does not reflect a change of heart on his part.

“There were forces pushing from all directions and ultimately putting together a consensus to pass something a lot of folks, including me, had to make some adjustments both big and small. I prefer to think of this as a small one,” the Oklahoma Republican said.

Lucas said it appears the administration wanted to tap the USDA budget because it would not win congressional support for additional foreign aid money for disaster food aid.

“If the administration simply wanted to spend more cash money on cash programs, then they need to get the foreign aid bill pumped up. Obviously, they couldn’t get that so they wanted to reallocate part of these [Food for Peace] resources,” he said.