Devex Pro Insider: The alternate realities of US foreign aid

This is a special Saturday edition of Devex Pro Insider from Senior Reporter Michael Igoe. For the next few months, this newsletter will tackle some of the biggest questions about the future of U.S. foreign aid, with insider reporting and analysis delivered straight to your inbox. This week, the U.S. State Department formally absorbed the remains of USAID, bringing an end to the agency’s 64-year run as an independent pillar of U.S. foreign policy. Legally, USAID still exists — its responsibilities are etched into federal statutes — but what remains is a hollowed-out shell that will be consumed with the “legacy activities” of shutting itself down, “until legislation authorizing the Secretary of State to abolish the agency is enacted and implemented,” according to an internal State Department white paper I obtained. The proposal laid out in this document — which was previously reported by Bloomberg and attributed to senior DOGE official Jeremy Lewin — paints a stark before and after: USAID’s global workforce of over 10,000 staffers could be replaced by a skeletal team of just 32, responsible for closing out contracts, liquidating assets, and managing lawsuits. The dismantling alone could cost more than $6 billion and stretch on for months, or longer. But the cost is not only financial. Instead of treating USAID’s personnel — spread across over 100 countries — as a national asset, the Trump administration has treated them as expendable, or worse, branded them as “criminal” and “radical lunatics.” It’s a decision that may reverberate far beyond this political moment. Last weekend, as USAID officials braced for unemployment and an uncertain future in a decimated sector, that tension boiled over. It started with a thank-you email. “The USAID workforce represents the very best of American values and generosity. That legacy will endure,” wrote Kenneth Jackson — who has been “performing the duties” of USAID deputy administrator for management and resources — in a message to USAID’s remaining staff last Friday. Many of these officials were terminated on July 1. A second group is scheduled for dismissal in early September. “From the entire leadership team at USAID, we thank you for your dedication and your service on behalf of our great Nation,” he wrote, alongside instructions to “exercise a maximum telework posture” under the subject line, “Thank You and Next Week.” USAID staff, who have watched the Trump administration engineer the collapse of their entire professional field in less than six months, did not seem receptive to Jackson’s thanks. Several broke their silence over the leadership decisions that have led to this point. “Destroying 60 years of American good will and power working for petty men with jealous egos must have presented you with many opportunities to do the right thing,” one person wrote in reply to Jackson’s email, under the pseudonym “USAID’s Ghost.” “However, you managed to not do that time and time again.” (I have confirmed the author was a USAID foreign service officer.) “Spare us your thanks,” wrote another USAID official in response to Jackson’s message. “Your actions have led to hundreds of thousands of preventable deaths since January. Many more millions will die before the year is up.” “You speak of legacy while standing atop the rubble you helped create,” read another response. “The idea that we should be ‘grateful’ for being forced to assist in our own professional executions is beyond insulting.” ICYMI: Thousands of USAID staffers compete for just 300 new roles ‘The biggest tragedy of all’ USAID’s workforce was not only large — it was global. And its elimination has stripped the U.S. government of a unique international asset: a cadre of foreign development professionals who brought deep regional expertise and local trust to U.S. aid efforts. These foreign service nationals, or FSNs — local professionals who staffed USAID missions around the world — worked alongside American officers, often for decades, performing critical duties on behalf of the U.S. government in places where few others could. Their responsibilities ranged from project and financial management to monitoring and evaluation, to operational support — and came embedded with contextual knowledge and relationships. In a Devex Pro briefing this week, longtime aid veteran Jim Kunder called the loss of USAID’s roughly 4,500 FSNs “the biggest tragedy of all.” “These are people who devoted their lives overseas, sometimes at great personal risk, to support U.S. humanitarian and development goals around the world,” Kunder said. In his view, the loss is not only human but strategic. “It was an inconceivably valuable strategic asset to the United States of America, and we’ve somehow managed to jettison all these people just at the time when we finally have peer competitors around the world again who are looking forward to recruiting these individuals,” he said. With USAID’s global presence receding, those same governments are moving quickly to expand their own development footprints in the void left behind. Read: The emotional fallout of mass USAID and NGO layoffs An ‘impending train wreck’ While much of the alarm over USAID’s dismantling has focused on everything that was cut, there is another, paradoxical problem: everything that wasn’t. The USAID workforce that managed tens of billions of foreign aid dollars is mostly gone, but even if Congress rubber-stamped Trump’s harshest proposed budget cuts, there would still be tens of billions of foreign aid dollars to manage. On a recent trip to Colombia, Susan Reichle, who spent many years at USAID and rose to agency counselor, got a glimpse of what that might look like. “There’s going to be a small — not even an office — but a unit within the embassy at Embassy Colombia that will be managing all foreign assistance for South America. $550 million. Five people — two expats and three locals. That’s criminal,” Reichle told me in the same Devex Pro briefing. According to Kunder, the pattern holds across the State Department, where — according to his calculations — the amount of foreign assistance managed per capita employee will jump from $1.7 million at USAID to $12.8 million. “I'm getting anecdotal evidence that this is not outsiders telling the story. There's all sorts of cable traffic within the State Department from panicked ambassadors pointing out that they can't manage all of this stuff,” Kunder said. He predicts “a two-year absence of U.S. soft power from the world stage, because it’s going to take that long for them to figure out how to do this with this dramatically reduced staff,” and calls the mismatch between personnel and funded programs an “impending train wreck.” Watching that train wreck play out in slow motion has some experts wondering if the administration wants foreign aid programs to succeed at all. “They want this to fail,” said Reichle. “This is their way of finally getting rid of this, because they do not believe in foreign assistance.” According to these experts, the congressional appropriations process currently underway on Capitol Hill offers a short window of opportunity to intervene — and particularly to push lawmakers to demand the higher staffing levels necessary to stave off disaster. Read: State Dept takeover of USAID is an 'impending trainwreck,' experts say MAGA (Making Aid Great Again) On Tuesday, Secretary of State Marco Rubio published a blog post titled “Making Foreign Aid Great Again,” officially kicking off a foreign assistance rebrand that will see all U.S. aid projects and products stamped with the American flag, instead of “a rainbow of unidentifiable logos.” “Recipients deserve to know the assistance provided to them is not a handout from an unknown NGO, but an investment from the American people,” Rubio wrote. His statement rehashed a litany of criticisms of previous U.S. foreign aid efforts — citing a “thorough review of thousands of programs,” which concluded that USAID systematically failed “to ensure any programs they fund advance our nation’s interests.” “Beyond creating a globe-spanning NGO industrial complex at taxpayer expense, USAID has little to show since the end of the Cold War. Development objectives have rarely been met, instability has often worsened, and anti-American sentiment has only grown,” Rubio wrote, promising that under the State Department’s leadership, foreign assistance “will be delivered with more accountability, strategy, and efficiency.” The rebuttal to Rubio’s criticisms and allegations came in the form of a peer-reviewed “retrospective impact evaluation” published by The Lancet on June 30, the day before USAID’s dissolution. Using “sensitivity and triangulation analyses” and “dynamic microsimulation models,” an international team of researchers found that USAID prevented 91 million deaths over the last 21 years. They projected that the funding cuts pursued by Trump’s administration could result in 14 million preventable deaths over the next five years. “USAID funding has had a crucial role in improving global health, particularly by reducing mortality from poverty-related diseases and saving the lives of millions of adults and children. Current and proposed US aid cuts—along with the probable ripple effects on other international donors—threaten to abruptly halt and reverse one of the most important periods of progress in human development,” they wrote. Rubio has previously dismissed as “lies” any claim that the destruction of USAID has caused people to die. The chair of the House Foreign Affairs Committee, Rep. Brian Mast, a Republican from Florida, recently singled out an individual Boston University professor whose “Impact Counter” sought to put similar numbers to the cost of reducing and reorganizing U.S. aid programs. In a letter to Boston University’s president, Mast attacked the methodology used to create the Impact Counter and accused the institution of “serving as a platform for the weaponization of academia, where federally funded professors are spreading disinformation about the ongoing reorganization of USAID and its consequences.” Boston University declined an interview request. Background reading: 'No children are dying on my watch,' Rubio says Plus: Death, reform, and power — Rubio spars with Senate over USAID cuts Room for debate In addition to the obvious tragedy described by The Lancet study and other efforts to measure the cost of USAID’s dismantling, there is another: the absence of any real debate. During Trump’s first administration, anti-aid voices tried to convince him to slash spending, but the president simply didn’t care that much about it, says Jim Richardson, the former director of the State Department's Office of Foreign Assistance, who was present in the Oval Office when those arguments were made. The difference this time, Richardson says, was a single person: Elon Musk. Musk pushed for cuts, Republicans on Capitol Hill didn’t know “how to handle” him, and the result “showed that the bipartisan consensus around foreign assistance either didn't exist or it was way too fragile,” Richardson says. It is in that sense that the end of USAID should be the beginning of something else. “Right now, the American people actually have heard more about USAID than they did in the last 63 years,” said Reichle. “Let's get out there. Get out into your churches, your mosques, your Rotary clubs, your community. Talk about what we do. Talk about what was lost.” If the last week is any indication, the people who have worked at USAID are ready to have that debate. + The Trump Effect: Explore our dedicated page to catch up on all the latest news, in-depth analysis, and exclusive insights on how the Trump administration’s policies are reshaping U.S. aid and global development.