In recent years, U.S. officials have shown increased interest in transferring certain social welfare functions of the U.S. government to nongovernmental organizations, both commercial and not for profit. Such organizations have expressed interest in and, according to U.S. officials, have demonstrated the ability to use federal funds to serve a wider pool of beneficiaries and help meet the U.S. governments objectives in a variety of areas. One of these areas is the delivery of U.S. foreign assistance to developing countries and countries transitioning from communism to market-oriented democracy. Many nongovernmental organizations active in international development have years of experience working overseas and have received millions of dollars in funds from private sources as well as the U.S. government for this work.

Foreign Assistance: USAID Relies Heavily on Nongovernmental Organizations, but Better Data Needed to Evaluate Approaches

Assessing Aid determines that the effectiveness of aid is not decided by the amount received but rather the institutional and policy environment into which it is accepted. It examines how development assistance can be more effective at reducing global poverty and gives five mainrecommendations for making aid more effective: targeting financial aid to poor countries with good policies and strong economic management; providing policy-based aid to demonstrated reformers; using simpler instruments to transfer resources to countries with sound management; focusing projects oncreating and transmitting knowledge and capacity; and rethinking the internal incentives of aid agencies.

Aid organizations like Oxfam, CARE, World Vision, and Catholic Relief Services are known the world over. However, little is known about the relationship between these private voluntary organizations (PVOs) and the federal government, and how truly influential these organizations can be in the realm of foreign policy. Indeed since the end of the Second World War, humanitarian aid has become a key component of U.S. foreign policy and has grown steadily ever since. This history of interaction deflates the common claim that PVOs have been independent from the federal government, and that this independence has only recently been threatened. Global Compassion is the first truly comprehensive study of PVOs and their complex, often-fraught interaction with the federal government. Rachel McCleary provides an ambitious analysis of the relationship between the two from 1939 to 2005. The book focuses on the work of PVOs from a foreign policy perspective, revealing how federal political pressures shape the field of international relief. McCleary draws on a new and one-of-a-kind data set on the revenue of private voluntary agencies, employing annual reports, State Department documents, and I.R.S. records, to assess the extent to which international relief and development work is becoming a commercial activity. She outlines the increasing financial dependence of these organizations on the federal government and the consequences of that dependency for various types of agencies, as well as the often competing goals of the federal government and religious PVOs. As a result, there is a continuing trend of decreasing federal funds to PVOs and of simultaneously increasing awards to commercial enterprises. Focusing on the interplay between public and private revenue, the discussion ends with the commercialization of foreign aid and the factors most likely to influence the future of PVOs in international relief and development. In this thought-provoking and rigorously researched work, Rachel McCleary offers a unique, substantive look at an understudied area of U.S. foreign policy and international development, and provides a crucial analysis of what this relationship holds for the future.