Sept. 11 and beyond

George W. Bush at the Kasisi Children’s Home in Zambia. Amid costly wars in Iraq and Afghanistan, Bush was able to launch two notable initiatives: PEPFAR and MCC. Photo by: Shealah Craighead / The Bush Center

President George W. Bush had a profound impact on how U.S. assistance was managed and directed during his tenure, and his legacy is a complicated one.

Bush galvanized support for a massive effort to turn back the HIV and AIDS pandemic through the creation of the President’s Emergency Plan for AIDS Relief and established the Millennium Challenge Corp. and its innovative and data-driven approach to development. He dramatically increased the budget and staffing levels at the U.S. Agency for International Development as well.

But that record is also balanced against very poorly managed wars in both Iraq and Afghanistan, and massive assistance programs in those two countries (as well as Pakistan) that were most notable for their extraordinarily high costs and limited achievements.

It comes as no surprise then that no administrator has been more intriguing to evaluate than Andrew Natsios (2001-2006). Natsios was certainly well-steeped in development and humanitarian policy when he became USAID administrator, and as one former USAID employee said, Natsios “cared desperately about development.” He had served as an assistant administrator running USAID’s humanitarian bureau in the first Bush administration and been vice president of the large American nongovernmental organization, World Vision.

[Andrew Natsios] deserves praise for keeping the range of USAID programs in other countries relatively uncontaminated by the fervor of post-9/11 “war on terror” ideology that was pervasive at the time.

Natsios has a savvy understanding of the administrative and political hurdles to development, and his essay, “The Clash of Counter-Bureaucracy and Development,” is a must read for anyone trying to understand the institutional complexities faced by any USAID administrator. Natsios inherited an agency battered after the 1990s and much in need of revitalization, and he is well-known for his forceful personality and point of view.

Natsios landed in hot water in June 2001 when he said many Africans couldn’t handle the regime required to take antiretroviral drugs because they “don’t know what Western time is.” Following outrage from AIDS activists and others, Natsios officially apologized.

Natsios also lost two major bureaucratic battles early in his term. As President Bush pushed forward with a pair of large new multibillion-dollar assistance initiatives — creating MCC and PEPFAR — he rather pointedly placed both outside of USAID, tacitly reinforcing the notion that it was easier to create something new than it was to fix the multitude of problems at USAID. Some have suggested that the turf battle over PEPFAR significantly damaged Natsios’ standing within the administration, although Natsios has denied this.

Much of Natsios’ tenure was defined by massive reconstruction work in Afghanistan and Iraq, following the U.S. invasions of both countries. Reconstruction efforts in both Iraq and Afghanistan were almost catastrophic in their early failures, and Natsios took deserved grief for his wildly off the mark insistence that U.S. rebuilding costs in Iraq would not exceed $1.7 billion.

What can we learn from the different stances USAID administrators have taken with regard to military engagement abroad? John Norris shares some lessons learned in this video interview.

Yet, only so much blame can be apportioned to Natsios for Iraq and Afghanistan, and the Bush administration would have been far better served if it had listened to Natsios and his experts on the ground instead of putting administration allies with little or no post-conflict experience in charge of reconstruction. At several junctures, Natsios was openly critical of the emphasis the White House, State Department and Pentagon placed on spending money rapidly rather than wisely. Natsios also deserves praise for keeping the range of USAID programs in other countries relatively uncontaminated by the fervor of post-9/11 “war on terror” ideology that was pervasive at the time.

In general, Natsios handled the substantial influx of new resources into USAID after 9/11 reasonably well. Unfortunately, Natsios’ time at the agency ended on a sour note. As the State Department contemplated stripping budget and policy authority from USAID and shift these functions to Foggy Bottom, a move Natsios would naturally and strongly oppose, he appeared to be squeezed out of his post.

As he moved over to become the president’s special envoy to Sudan, Natsios appeared exhausted with the long-running battles with the State Department. He said that he left USAID because he’d “done what he could do within the constraints of the position.”

Views on Natsios from USAID staff were more divergent than any other administrator.

[Randall] Tobias seemed to have no qualms about Sec. Rice’s plan to strip out budget and policy authorities from USAID and place them in State.

Natsios’ successor, Randall Tobias (2006-2007), was a rapidly rising star in the Bush administration. Formerly the CEO of pharmaceutical giant Eli Lilly, Tobias had achieved a can-do reputation as the first U.S. global AIDS coordinator.

While standing up the massive $15 billion PEPFAR program was not without some hitches, Tobias was widely regarded as an effective manager and had the personal clout to have his voice heard and respected by the president and the secretary of state. He was positioned to be Sec. Condoleezza Rice’s key point person in overhauling how the United States delivered foreign aid as part of her “Transformational Diplomacy” agenda.

Randall Tobias is the shortest-serving USAID administrator thus far. Photo by: U.S. State Department

But two factors place Tobias near the bottom of the list. First, Tobias seemed to have no qualms about Sec. Rice’s plan to strip out budget and policy authorities from USAID and place them in State, a major downgrade of U.S. development capacities and a demoralizing signal to staff that Tobias’ was going to go along to get along. Second, everything came crashing for Tobias in April 2007, when he became ensnared in the scandal of a high-priced Washington prostitution ring. Tobias’ insistence that “no sex” was involved and that he only had the “gals come over to the condo to give me a massage,” were unconvincing, and he had called the service repeatedly on his government-issued phone. He resigned the day after the allegations surfaced, leaving USAID sullied in the process.

In his earlier role as the AIDS coordinator, Tobias had supported measures to cut off funding from U.S. NGOs trying to slow the spread of the pandemic by reaching out to sex workers. Tobias is the shortest-serving of the USAID administrators, and his tenure was disastrous.

[Henrietta Fore] planted the seeds of public-private partnerships at the agency, an area that has grown into one of the most prominent and important for USAID.

Given her relatively brief reign as administrator, it would be tempting to dismiss Henrietta Fore (2007-2009) as little more than a caretaker. However, a closer look at her record suggests some substantial and important contributions.

She was the first and only woman to run USAID, and was well-served by her earlier stint as a political appointee at USAID under the first President Bush when she served as an assistant administrator running the Asia bureau.

Henrietta Fore restored morale and confidence in the agency. Photo by: CSIS / CC BY-NC-SA

Taking leadership of USAID after Tobias’ collapse, Fore markedly improved the esprit de corps at USAID and recaptured, without ruffling feathers, some of the budget and policy turf that had been recently ceded to the State Department. This effort was considerably facilitated by the fact she was just coming out of the chief management job at the State Department where she had helped seize some of these very same authorities. Where you stand on USAID’s relative independence often comes down to where you sit.

Perhaps most importantly, Fore established the Development Leadership Initiative, with the goal of doubling USAID’s foreign service staff by 2012. The initiative was an essential palliative given that the agency’s staff had shrunk to about half the size it had been 20 years earlier, and rebuilding the agency’s human capacity was essential if USAID was to be anything more than a contracting agency.

Fore brought very few political appointees along with her, relying heavily on USAID career staff to fill key positions and garnering greater support from the staff in doing so. Fore also planted the seeds of public-private partnerships at the agency, an area that has grown into one of the most prominent and important for USAID. Her time leading the agency was brief, but very positive.

[President Barack] Obama has not created a new agency or initiative on the scale of MCC or PEPFAR, but has generally committed his administration to better refining and using existing tools.

President Barack Obama’s record on international development is obviously still being written. He wound down the wars in Afghanistan and Iraq, although aftershocks continue and development work proceeds under increasingly difficult circumstances. Despite facing a generally hostile Congress and a push for austerity across much of the federal budget, Obama has defended USAID’s budget surprisingly effectively.

In the prevailing budget environment, Obama has not created a new agency or initiative on the scale of MCC or PEPFAR, but has generally committed his administration to better refining and using existing tools, including through new programs like Feed the Future and the Global Health Initiative. The results of all this have been mixed and infighting between the White House and the State Department marked the early period during which development strategy was being defined, most notably by competing reports — the Quadrennial Diplomacy and Development Review from the State Department and the Presidential directive on global development policy.

Secretary of State Hillary Clinton and USAID Administrator Rajiv Shah discuss the QDDR

Although never nominated, Alonzo Fulgham (February to December 2009) served as the acting USAID administrator for most of 2009, and deserves mention. As one former USAID staffer argued, Fulgham deserved “sainthood” for doing “a great job in a terrible situation” — running a large international agency without the full political backing of senate approval as the increasingly impatient aid community waited word of a nominee.

After wrangling over development strategy led to a long delay in appointing a USAID administrator — a delay so long it bordered on gross negligence — Rajiv Shah (2009-Present) took the helm almost a year into the president’s first term.

A physician by training, Shah briefly served as an undersecretary and the chief scientist at the Department of Agriculture and had thus been through the arduous vetting and confirmation process. He joined the Obama administration from the Bill & Melinda Gates Foundation, where he spent seven years and was director of agricultural development.

In 2010, just six days after Shah was sworn in, the devastating earthquake hit Haiti, and helping lead the response dominated much of Shah’s early days in office. So where does Shah fit within the pantheon of USAID leaders? It is hard to disagree with the assessment of a senior USAID staffer who said, “The jury is going to be out for a while.”

[Rajiv] Shah brought a consistent emphasis on agriculture and technology to USAID, and helped restore the agency as a key player in agricultural development.

Shah is smart, ambitious and capable. His relationship with Secretary of State Hilary Clinton was sufficiently strong that he was able to restore many of the policy and budget functions that had been stripped away during the Bush administration, but not so strong that he was able to entirely wrest budget control away from State.

Much of the first-ever QDDR was set in motion before Shah arrived, and he largely steered clear of the bureaucratic debates it churned up. But he did use the QDDR as a chapeau under which he bundled a number of his key reforms and initiatives branded somewhat amorphously as “USAID Forward.”

USAID Forward revived the sensible practice of implementing country-specific development strategies, and led the agency to also release a series of formal policy papers on thematic issues on everything from global health to countering violent extremism. Not surprisingly given his background, Shah brought a consistent emphasis on agriculture and technology to USAID, and helped restore the agency as a key player in agricultural development.

Under his leadership, and generally in line with global trends, Shah has made USAID’s program and budget data more transparent. Building on the earlier work of Henrietta Fore, Shah has placed considerable emphasis on the potential of public-private partnerships.

Perhaps Shah’s most important initiative has been procurement reform and its plan to direct a higher percentage of the agency’s grants and contracts to actors in the developing world rather than to U.S. NGOs and for-profit firms. The reasoning behind the effort may have been sound — more than 90 percent of all USAID grants and contracts were going to U.S. firms and NGOs — but the procurement reform rollout was handled poorly, and caused considerable Sturm und Drang.

Perhaps [Rajiv] Shah’s most important initiative has been procurement reform and its plan to direct a higher percentage of the agency’s grants and contracts to actors in the developing world.

By USAID estimates, it has more than doubled the aid dollars flowing to local partners, and a 2013 study by Oxfam America found that local development leaders gave USAID positive marks for the reforms. But an analysis by Devex found that this effort to move funding to a broad range of local organizations remains in its early stages: The top 20 local recipients of USAID funding in 2013 received nearly half of all such funding.

The most frequent staff and Capitol Hill complaint about Shah has been that he has what one staffer called an “initiative du jour” administrator who has tried to implement new ideas and plans too rapidly for them to fully take hold in the system. Shah’s instinct for good development practice has not always been coupled with a sufficiently sophisticated sense of political judgment about how to effect such change. It remains to be seen whether the numerous changes Shah put in place at the agency will prove durable under his successors.

Spring 2014 saw USAID in the news frequently. In March 2014, Alfonso Lenhardt was nominated as USAID’s deputy, amid widespread concern in the development community given his rather glaring lack of previous development experience. In April 2014, a controversy erupted over USAID’s management of a “Cuba Twitter” program designed to covertly sow dissatisfaction with the regime in that country.

At nearly the same time as the Cuba Twitter story broke, USAID launched its Global Development Laboratory, a cornerstone effort into which Shah invested years of work, but which, like many of the other reforms he has initiated, remains a work-in-progress.

What do we learn from looking back at the evolution of leadership at USAID and the track records of respective administrators? Read the last article in our five-part series to find out.

Click here to view our complete interactive series exploring the history of USAID, its administrators and US foreign aid. Join the conversation with our community on social media using #USAIDhistory and don't forget share this series with fellow development professionals, researchers and academics.

About the author

  • John norris

    John Norris

    John Norris is the executive director of the Sustainable Security and Peacebuilding Initiative at the Center for American Progress. He previously served as the executive director of the Enough Project at the Center for American Progress and was chief of political affairs for the U.N. Mission in Nepal back when the country was emerging from a decadelong war. Earlier in his career, John worked at the State Department and USAID.