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Behind closed doors: Safeguarding US aid in 2011 budget deficit talks

By Ivy Mungcal13 November 2012

In his book, “Price of Politics,” investigative journalist Bob Woodward chronicled the closed-door negotiations that led to the Budget Control Act of 2011. Photo by: Eliza Villarino

As the U.S. Congress kicks off a “lame duck” session on Tuesday (Nov. 13), details on the negotiations behind the 2011 deficit reduction deal have emerged.

Investigative journalist Bob Woodward, who’s currently associate editor of The Washington Post, unveiled Nov. 11 a “confidential document” he said was the “last offer” the White House made to House Speaker John Boehner amid budget deficit talks last year. In the document, the White House proposed to reduce spending, including of the Department of State, by at least $1 trillion over the next 10 years.

The proposal was rejected at the time by Boehner over party pressure not to accept compromise. It is, however, expected to be a starting point of negotiations during the “lame duck” session on how lawmakers can avoid sequestration, which now looms after a bipartisan and bicameral committee failed to agree on what exactly to cut.

The documents come on top of Woodward’s already extensive coverage of the closed-door negotiations leading to the Budget Control Act of 2011, which he chronicled in his book “The Price of Politics” released in September.

The book offers an interesting look at administration efforts to protect the U.S. aid budget from suffering severe cuts as part of the deficit reduction deal. According to Woodward, one of the sticking points during the negotiations was on how to structure budget cuts, which eventually led to the security and nonsecurity categories.

The administration’s concern at the time: Where best to lump international affairs spending? Woodward writes:

“Now the question was the whether the State Department foreign assistance programs would be more vulnerable to cuts competing with Defense or other federal domestic education and health programs. Foreign assistance was important to Secretary of State [Hillary] Clinton, [then Director of the Office of Management and Budget Jacob] Lew’s former boss. He went to the Oval Office.


‘Mr. President,’ he said, ‘before we commit to this, I just want to make sure that the numbers that I’ve done on the back of an envelope have some relationship to the real numbers.’ It was a clever idea, but he wasn’t sure if they should be for it or against it.”

The so called 150 account — which covers international affairs spending — was eventually put under the security category alongside discretionary appropriations for the departments of Defense, Homeland Security andVeterans Affairs. Woodward says this was after Lew’s close scrutiny of the proposal:

“The State Department foreign assistance programs could be eviscerated, Lew worried. It took him more than an hour to check on what precisely had been in the administration’s previous proposal, but he finally told the president it looked okay.”

Whether or not this was a good decision now remains to be seen. Negotiations to avoid sequestration, which could cost the U.S. Agency for International Development up to $100 million, are expected to dominate congressional talks until the end of the year. Meanwhile, U.S. aid advocates, among other members of the development community, have said they are ready to defend international affairs spending.

Among these advocates is anti-poverty campaigner Bono, who is set to visit Washington this week to meet with senior administration officials and lawmakers as part of ONE’s campaign to protect foreign aid programs from budget cuts. Bono also appeared Nov. 12 before an audience of students and nonprofit leaders at Georgetown University to highlight the importance of social movements. He’s also set to join World Bank President Jim Yong Kim for a webcast discussion on Nov. 14.

Read more on U.S. aid reform online, and subscribe to The Development Newswire to receive top international development headlines from the world’s leading donors, news sources and opinion leaders — emailed to you FREE every business day.

About the author

Ivy mungcal 400x400
Ivy Mungcal

As senior staff writer, Ivy Mungcal contributes to several Devex publications. Her focus is on breaking news, and in particular on global aid reform and trends in the United States, Europe, the Caribbean and the Americas. Before joining Devex in 2009, Ivy produced specialized content for U.S. and U.K.-based business websites.


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