A much overlooked casualty in the government shutdown debacle was foreign aid. How was it affected, and what are the future ramifications?
For the most part, foreign aid was left untouched by the government shutdown. As the New York Times explains, USAID functions off of a multi-year funding program, therefore it is not tied to yearly appropriations. So, all future contracts and grants made prior to October 1, 2013 should still be running and will be paid for. This is because, under the Obama and the previous Bush administration, development is listed as a security issue. All travel scheduled before the shutdown will go ahead as planned yet, during the shutdown, only emergency travel was authorized.
Those hardest hit by the shutdown were the workers in USAID that had to be furloughed since their salaries were tied to the yearly appropriations. In addition, the government was not prepared to respond to humanitarian emergencies because of a lack of immediate funding. Though the federal aid system is highly complex, it is difficult to analyze how certain sectors in the aid community were affected.
The biggest problem to come out of the shutdown was the loss of predictability and confidence in USAID, raising doubts about its effectiveness. These doubts, in addition to the sequestration cuts enacted by the government after they were unable to reach a deal, hurt the foreign aid community in the United States and throughout the world with across-the-board cuts.
According to NBC News, the government shutdown cost the United States an estimated $12.5 million dollars an hour. The Fitch credit rating agency also stated that it was planning to downgrade the United States’ credit rating if the government did not reopen. With financial uncertainty due to political brinkmanship becoming a more common occurrence these days, it will be difficult to determine the future of foreign aid and who will be most affected.