Perspective: The American imperative in a changing world order

By Dan Runde | January 17, 2023

“Soft power” is the term coined by political scientist Joseph Nye Jr. that describes power wielded by persuasion, not force.

With China on the rise and Russia uprooting international norms around conflict and sovereignty that have prevailed since post-World War II, there is now one great, overarching goal of U.S. soft power: to enable a better alternative to what our competitors are offering the developing world as a means of preserving the liberal, international world order. Today’s great power contest will not be fought in Beijing or Moscow, but rather in Naypyidaw, Palau, Guatemala, Buenos Aires, Kiev and Antananarivo. This will require a major rethinking and revamping of U.S. soft power tools.

China and, to some extent, Russia are filling vacuums that the U.S. has left behind in the areas of infrastructure, trade, education and leadership in the multilateral system. It’s not enough to simply encourage developing countries not to take vaccines or infrastructure money from a rival superpower; the U.S. must offer or enable a compelling alternative in these sectors and beyond, and in doing so, convince people around the world to realize its vision of shared universal values: freedom, prosperity and the pursuit of happiness.

To that end, how, what and where the U.S. government spends its foreign aid should be looked at in light of the world’s new and emerging challenges. Now is the time for a new bipartisan consensus on the challenges before us, a consensus on how to apply various forms of our national power to confront the challenges of the moment.

Ultimately, America’s long-term interests are best served by supporting the rise of like-minded partner countries that can help us maintain the rules-based liberal world order. 

The United States should remain the “first phone call” in a moment of crisis or global challenge. Failure or unwillingness to address complex and global problems such as COVID-19 puts the U.S. “social license to operate” as a global hegemon at risk. The U.S. will need to work with allies and the private sector, and think about levers that are not necessarily foreign aid but are a first cousin of foreign aid. The stakes for revisiting and refreshing our soft power toolkit have never been more urgent.

How did we get here?

Over the course of U.S. history, its foreign assistance has often met the moment through innovative and ambitious programming, such as the Marshall Plan or the President’s Emergency Plan for AIDS Relief. 

U.S. policymakers would do well to remember what worked well in these programs when designing future initiatives to address priorities such as the energy transition, digital transformation, global supply chains and other areas for development assistance. 

The history of U.S. foreign assistance is defined by four distinct eras: post World-War II, the Cold War, post-Cold War and 9/11 and the global war on terrorism. These four moments in time helped to prioritize foreign assistance spending and directives, as well as prompt the creation of new institutions and initiatives to address the challenges at the time. Arguably, the U.S. has not had a major revamping of foreign assistance since it pulled back from the global war on terrorism. 

The Marshall Plan was the first ambitious, U.S.-led foreign assistance program that aided the reconstruction of Europe in the aftermath of the destruction of World War II. At the time, the Marshall Plan was seen through the lens of an emerging great power competition with the USSR and was viewed in tandem with the 1949 North Atlantic Treaty that established NATO. 

The country driven, catalytic, multiyear design of the Marshall Plan persists today as part of the DNA of American assistance programs.

It was not until the early 1960s that foreign assistance took the next big step forward, spurred in part by the publication of “The Ugly American” and the election of John F. Kennedy to the presidency. As part of a series of responses to the book and the threats from the Soviet Union and a Communist China, Kennedy launched the Foreign Assistance Act of 1961, which created the United States Agency for International Development and consolidated five previous development agencies into one. His administration also created the Peace Corps, which introduced a cadre of young people to the developing world.

The aid model that arose in the Kennedy years largely held sway in the U.S. for the next 10 years, as the deepening Cold War played out in different parts of the world. From the mid-1960s, U.S. foreign aid attention spread into Africa, Asia and the Middle East. Aid efforts, often of limited duration, have been at least partially motivated by the geopolitical imperatives of the times, most often the Cold War fear of Soviet expansion. 

What had been full-throated bipartisan support for foreign aid began to weaken in the 1970s, leading to a set of reforms collectively called “New Directions.” These reforms set a trajectory for much of our foreign aid work for more than 30 years. In 1989, the ground shifted again when the Berlin Wall came down, and the Soviet Union, the existence of which had been either explicitly or implicitly driving so much American development work, collapsed.

The fall of the USSR caused the United States to do some reordering of its soft-power priorities, looking to assist with democratic reforms, privatization and the development of market-based economies in Eastern Europe and the former Soviet Union, but also reducing funding and attention to other relationships.

The terrorist attacks on Sept. 11, 2001, signaled the next and most recent fulcrum moment in aid and development. The attacks and the subsequent invasions of Afghanistan and Iraq led to a search for non-military responses. The immediate post-9/11 period saw an enormous uptick in aid spending, highlighted by major new initiatives.

At the behest of the Bush administration, Congress established the Millennium Challenge Corporation, a foreign aid agency that would operate independently of the U.S. Agency for International Development and the State Department. The administration also committed to the U.S. President’s Emergency Plan for AIDS Relief, the largest commitment by any nation to address a single disease in history until the advent of the COVID-19 pandemic.

The Obama and Trump administrations built upon initiatives of their predecessors. The Obama administration emphasized development in its national security strategy and promulgated the first U.S. Global Development Policy. The administration undertook an updated version of the Alliance for Progress, called the Alliance for Prosperity, for Central America with the driver being uncontrolled migration from Central America, as well as the creation of Power Africa. 

The Trump administration came in with a limited appetite for global initiatives, including most forms of soft power. The administration proposed 30% cuts to foreign aid, the elimination of OPIC and EXIM in its first year and the elimination of USTDA all four years. It also took a very transactional approach to providing development assistance, which undermined the long-term approach associated with most development success stories.

Where do we go from here?

Russia and China are going to be rivals to the U.S. for the next 20 or 30 years, but they are not one and the same. Each has its own intentions and motivations, and the response of the U.S. and its partners will have to be multifaceted, drawing on every tool at our disposal. The long-term goal for U.S. leadership should be a world based on broadly shared values and ideals, not a world whose rules are set by China and Russia. And we should work to pull as many countries as possible toward that liberal international order, assuming those countries want to join. 

Before the Ukraine invasion, the U.S. assumed great power competition would not be fought with armies, but rather with ideas and economic engagement. In the words of former Defense Secretary Robert Gates, “If we can avoid war with Russia and China, our rivalry with them will be waged using nonmilitary instruments of power — the same kind of instruments that played a significant role in winning the Cold War: diplomacy, development assistance, strategic communications, science and technology, ideology, nationalism and more.”

The invasion of Ukraine by Russia threatens to dismantle the international, rules-based order, but has also severely isolated Russia from the West both economically and politically. Conversely, the West — including Europe, Australia, Japan and others — has remained united in condemning this egregious provocation. The United States should use this moment to strengthen and consolidate its bilateral relationships with its allies, as well as reaffirm the importance of multilateral bodies, in order to minimize damage to the liberal world order from Russia.  

Assuming the U.S. is not prepared to cede global leadership to China and Russia, then it will have to make some significant changes. Countries that don’t want to become vassal states of others need to have the option to shape their own destiny in the community of nations, with the finger on the scale toward market economies and, over time, liberal democracies. 

To that end, there are several areas of the U.S. soft-power toolkit that need a major rethinking. First, Congress should conduct a bilateral aid review and a multilateral aid review across U.S. government agencies and across U.S. involvement in the 200 or so multilateral agencies that the U.S. recognizes. The UK and other U.S. allies have done similar reviews before, and the United States should follow suit.

Second, the U.S. should reorganize its foreign assistance systems in order to have one person in control of all foreign assistance. That person should be the head of the U.S. Agency for International Development. The head of the agency should control the budget of all foreign aid programs at the State Department, as well as all other agencies of the U.S. government. This has been tried before, in the Bush administration, but the position lacked formal authority over assistance programs in different agencies like the Department of Defense or Department of Agriculture.

Third, the U.S. government should renew commitments to long-term education and training. Such programs have been hampered by resource limitations, regulators’ unrealistic expectations, monitoring limitations and visa restrictions. Making it easier for international students to study in the United States and increasing the number of exchange programs will help to foster goodwill and understanding about the United States abroad.

Fourth, the U.S. should work with its allies to lead the commanding heights of the multilateral system, including the complex web of agencies and institutions at the United Nations, and international financial institutions like the World Bank and the International Monetary Fund.

Fifth, the U.S. should recapture its leadership on global anti-corruption efforts, democracy and governance issues. Sixth, the government needs new legislation to reorient U.S. soft power so funds can be better allocated and are readily available to respond to global crises. 

Finally, all of the above will likely require more training of our personnel and preparing the next generation of foreign service officers and development practitioners to spend extended periods of time in failed states or “security ambiguous” contexts.

It is critical that the United States organize and lead global coalitions of the willing while remaining a standards maker, not becoming a standards taker. The U.S. must lead from a position anchored in principles and empirical evidence of what works. If the keys to enduring peace and prosperity are political and social stability, economic vigor and self-sufficiency for a continually increasing number of countries, development offers the best path forward. 

The challenges ahead are substantial and require both immediate attention and persistence over the coming decades. Meeting those challenges will require committed leadership. But who will lead?

The United States has demonstrated its positive impact repeatedly in the past and is uniquely capable of carrying out that responsibility. The U.S. must move swiftly and boldly, but wisely, efficiently and with international support, to build the global future based on common security, shared democratic values, sound economic principles and broadly inclusive opportunities.