The brutal impact of the US’s foreign aid cuts

President Donald Trump, seated at his White House desk on February 3, looked straight at the camera and sought to justify the decision to halt tens of billions of dollars in United States aid. He alleged it was funding contraceptives for Palestinian terrorists.

“A hundred – think of it – a hundred million dollars of condoms to Hamas. Condoms to Hamas,” he complained.

It was an extraordinary claim, not least because less than a week earlier, on January 29, Trump had asserted that the amount of US aid going to fund condoms for Hamas was half that amount – $50 million.

In reality, as fact checks by multiple media outlets found, and various officials and experts attested after Trump’s initial claim, not a single dollar of US aid had been spent on condoms for Hamas. As is his wont, Trump had simply doubled-down on the bullshit.

The preposterousness of his contention was lampooned by Nicholas Kristof, the two-time Pulitzer prize-winning columnist for The New York Times who specialises in matters of aid and development. In a February 6 Facebook post, he calculated that given the cost of male condoms to the government – 3.3 cents each – every Hamas fighter would have to have sex 325 times each day of the year to use up $100 million worth of condoms.

“That might wipe out Hamas as a fighting force more effectively than Israeli bombardment,” Kristof quipped.

The disinformation appears to have emanated from Elon Musk’s youthful coterie of men working for the White House’s Department of Government Efficiency (DOGE), a body of dubious legal status set up by Trump on January 20 under the leadership of the world’s richest person with the mission of slashing US government spending.

These small-government ideologues, variously tagged Muskovites, Musketeers or Muskrats, are going through US departments and agencies like the proverbial dose of salts, seeking evidence of waste, mismanagement and corruption.

It appears that one of them, in examining spending by the United States Agency for International Development (USAID), mistook Gaza, a province of Mozambique, for the occupied territory of Gaza, Palestine.

The stupidity would be funny if it weren’t so serious.

Mozambique has one of the world’s highest rates of HIV/AIDS. According to United Nations data, as of 2023 some 2.4 million of the country’s people, including 150,000 children under 14, were living with HIV.

The prevalence was 8.3 per cent among men aged 15 to 49, and 14.5 per cent among women in the same age group. The situation was made only slightly less grim by the fact that the rate of new infections has roughly halved over the past decade, due to more testing and, yes, greater use of condoms. The death rate has declined by about a third due to the greater availability of antiretroviral drugs.

USAID was providing condoms there, along with life-supporting drugs, according to the USAID archives. Up-to-date information on its programs is hard to find because the agency’s website has been taken down.

However, thanks to the contents of an urgent cable sent by the US ambassador to Mozambique, Peter Vrooman, to Trump’s secretary of state, Marco Rubio, and obtained by The New York Times last week, we know USAID supported 40 active “lifesaving and emergency active field programs” and more than two million people dependent on the provision of antiretroviral drugs.

Those programs are now in chaos, across Africa and the world. As the Times reported: “Two weeks into President Trump’s sweeping freeze on foreign aid, H.I.V. groups abroad have not received any funding, jeopardizing the health of more than 20 million people, including 500,000 children.”

It’s not just funding for HIV prevention and treatment that has stalled but also programs to combat diseases such as malaria and tuberculosis, and other health and medical assistance to the poor in more than 100 countries, along with emergency food aid. Also halted are a diverse range of other programs, from the clearing of unexploded ordnance to climate adaptation and more, delivered by US agencies, often in concert with international bodies such as the World Health Organization, and NGOs.

Relative to the size of its economy, the US is not a particularly generous aid donor. In 1970, the UN set a target for developed countries to spend 0.7 per cent of their gross national income (GNI) on official development assistance. Only a handful of European nations meet or exceed that benchmark. The average is 0.4 per cent. American aid equates to about 0.2 per cent of its GNI, and the proportion is about the same for Australia. Our government contribution has roughly halved as a share of GNI since the mid 1970s.

Simply due to the size of its economy, however, the US is – was – the world’s largest aid donor, contributing about US$70 billion a year. The bulk of it, some $44 billion in 2023, was through USAID.

Trump and Musk have made the agency a particular target of their cuts to government spending. The day he took office, Trump signed an executive order putting a stop to “new obligations and disbursements of development assistance funds to foreign countries”.

This specifically included cooperative work with “non-governmental organizations, international organizations, and contractors pending reviews of such programs for programmatic efficiency and consistency with United States foreign policy, to be conducted within 90 days of this order”.

Trump’s executive order rationalised the action on the basis that the “foreign aid industry and bureaucracy are not aligned with American interests and in many cases antithetical to American values”.

The order did provide for waivers for life-saving humanitarian programs such as those relating to medical services and food, shelter and subsistence assistance. However, as the US Council on Foreign Relations said in a report on the effects of the order, “because there has been no clarity provided on how to interpret the waivers, no money has actually moved, and the freeze has overall forced mass layoffs and furloughs”.

The Vrooman cable further testified to this reality, as did a report released on Monday by the inspector general of USAID.

“Recent widespread staffing reductions across the Agency … coupled with uncertainty about the scope of foreign assistance waivers and permissible communications with implementers, has degraded USAID’s ability to distribute and safeguard taxpayer-funded humanitarian assistance,” the report said.

Among other disastrous consequences, it said, “this uncertainty put more than $489m of food assistance at ports, in transit, and in warehouses at risk of spoilage, unanticipated storage needs, and diversion”.

Because most of the agency’s staff had been furloughed or placed on administrative leave, the report said, USAID programs now were “susceptible to inadvertently funding entities or salaries of individuals associated with U.S.-designated terrorist organizations”.

The response of the Trump administration was to shoot the messenger. Paul Martin, USAID’s inspector-general, was promptly sacked by email.

Trump’s executive order, with its commitment to a 90-day review to ensure “programmatic efficiency” and consistency with US foreign policy, gave the impression of orderly process. His commentary, that of Musk and leaks to the media suggest otherwise.

Trump has claimed USAID was “run by a bunch of radical lunatics, and we’re getting them out”. In posts to his social media site, X, Musk labelled USAID a “criminal organisation” and said it was “time for it to die”. He boasted of having put the agency “through the wood chipper”.

As well as the website, the signage outside USAID’s headquarters has been taken down. Reportedly, the plan is to reduce staffing from more than 10,000 to a couple of hundred.

In response to the claim that the aid organisation was “antithetical to American values”, many in the sector pose the question, which American values?

Many in the aid and development sector point to Project 2025, the detailed playbook prepared by an array of right-wing organisations led by the Heritage Foundation ahead of November’s election, of which Trump claimed no knowledge but which his administration now closely follows.

In a blog post last June, Dr Cameron Hill, senior research officer at the Development Policy Centre at the Australian National University, foreshadowed what now appears to be happening, based on analysis of the Project 2025 blueprint.

The manifesto, he wrote, called for “a rejection of some of the foundational settings of contemporary development policy and programming, including gender equality, advancing sexual and reproductive health, addressing climate change, and other programs associated with what it calls ‘a self-serving and politicized aid-industrial complex of United Nations agencies, international non-governmental organizations (NGOs), and for-profit contractors’.”

Project 2025 demanded the removal of all terms including the word “gender” from USAID websites, publications, policies, contracts and grants. Ditto all references to “reproductive rights” or “reproductive health”. It called for a “pro-life executive order” to apply to US-based and foreign NGOs, “public international organizations, and bilateral government-to-government agreements”.

It advocated the abandonment of the agency’s policies, programs and directives designed to advance the Paris Climate Agreement.

“Everybody knew that an incoming Trump administration was likely to be negative about aid and the role that it plays,” says Matthew Maury, the interim chief executive of the Australian Council for International Development. “But nobody had expected the approach that was going to be taken, where the stop-work orders were issued, which meant that all projects that USAID was doing around the world were stopped immediately.

“Schools have been shut. Food programs have stopped. Clinics have been closed. Vaccination programs have stopped. Life-saving medicine isn’t being delivered. Refugee services have been stopped. Humanitarian responses have been stopped. Across the board, countries have been impacted by this.”

There are also knock-on effects beyond USAID itself, he says.

“For NGOs, and especially for local civil society organisations who don’t have big reserves and who are dependent on these legal agreements done for the programs that they’re running, many of them have had to let staff go, immediately pause everything or close their offices.

“We’re already getting reports of examples of people having died,” he says.

The full impact is yet to become apparent, says Melissa Conley Tyler, program lead of the Asia-Pacific Development, Diplomacy & Defence Dialogue (AP4D). Many aid organisations are reluctant to speak up because they still hold hopes of being re-funded at the end of the 90-day assessment period.

False hopes, in many cases, she suggests.

“We can be pretty certain that important projects will be cut in relation to climate, gender equity and inclusion, women’s rights, reproductive rights. If you have a program that’s in any of those areas, you can assume it’s not going to be funded,” she says.

In relative terms, the Pacific – the region of greatest concern to Australia – is less affected by the withdrawal of American aid than most. Data compiled by the Lowy Institute shows the US ranked fifth among donors to the region over the period 2018 to 2022.

It provided about $1.1 billion, compared with $4.8 billion from top donor Australia, and behind Japan, the World Bank and New Zealand, and barely more than China.

However, notes Conley Tyler, under the Biden administration the US was lifting its commitment, motivated by concerns about growing Chinese influence. Thus, the Trump moves equate to a massive act of geopolitical self-harm.

Tyler tells The Saturday Paper she already knows of one major project where the Chinese have stepped in to fill the aid vacuum. She declines to name it.

Last week she briefed politicians in Canberra, arguing that Australia now needed to increase its effort. She refers to the way Australia stepped up after the Boxing Day tsunami of 2004.

“That transformed the way that we were seen, particularly in Indonesia, but more widely in the region. I think we have to think of this in the same way – that is, provide emergency funding to keep Australia’s development sector operating.”

Obviously, she says, “Australia can’t make up all the slack for the US worldwide. That’s impossible, but we can think about what we can do ourselves, particularly in our region, and what we can do with our partners.”

Australia is a less generous donor compared with not only many other developed countries but even its own past efforts.

Under the Howard government, aid made up about 1.12 per cent of the federal budget. Under the subsequent Labor government it grew to about 1.2 per cent.

Then it was slashed. The first budget under prime minister Tony Abbott lopped $8 billion from aid. Further cuts took that reduction to more than $11 billion. Under the Albanese government, it has modestly increased but remains less than 0.7 per cent of federal spending.

The hope of the aid sector is that Labor will meet the current crisis with more money. The concern is that an incoming government under Peter Dutton could cut spending further.

Said one aid official: “There’s definitely a fear that Dutton might draw inspiration from the US, particularly now that (right-wing MP) Jacinta Price has been appointed to run the Australian equivalent of DOGE.”

Calls for Australia to follow the Trump/Musk lead are already bouncing around the right-wing echo chamber. Last week, for example, Sky News host Andrew Bolt nominated aid funding as an easy place for a Dutton government to cut.

The Saturday Paper contacted the offices of Foreign Affairs Minister Penny Wong and Minister for International Development and the Pacific Pat Conroy to ask if the government will lift its spending in response to the Trump-induced crisis.

There was no response, other than some backgrounding from one staffer, to the effect that aid spending was always hard to sell to the electorate, “especially during a cost-of-living crisis and approaching an election”.

No response came from the office of Peter Dutton and the shadow minister for international development and the Pacific, Michael McCormack, on whether aid should be increased or cut.

To the extent that either of the major parties is concerned about Trump’s behaviour, it appears, they are focused on the threat of tariffs.

The Greens’ spokesperson on international aid, Senator Mehreen Faruqi, condemned Trump’s move as “a callous political attack on international human rights which will cost lives, inflict suffering and result in a closure of vital health and gender equity programs”, and “a catastrophic blow for nations in the South Pacific who are already paying the price of the climate crisis”.

“Not only should the Albanese government be putting pressure on the US to reverse this reckless aid freeze but they should immediately step in and increase Australian aid, which is well below our fair share as it is,” she wrote in an email.

Of course, the Greens have no power to act.

Meanwhile, Trump and Musk held a joint media conference in the Oval Office on Wednesday, Australian time, where they again emphasised their determination to slash the “corrupt” USAID.

Musk, standing beside the president’s desk, with one of his many children – named X Æ A-Xii – sitting on his shoulders, also fielded a question on the inaccurate claim that US aid money was funding condoms for Hamas.

“Some of the things that I say will be incorrect and should be corrected,” he said. “Nobody’s going to bat 1000. We will make mistakes, but we’ll act quickly to correct any mistakes.”

So, one tiny concession to one enormous, tragic global reality. It will make no difference to the world’s sick and hungry. 

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