How to Actually Fix Foreign Aid

Foreign Policy

by David Miliband

February 19, 2026

AI-Generated Deep Dive Summary

The Trump administration's significant cuts to U.S. foreign aid, including the closure of the U.S. Agency for International Development (USAID) and termination of over 80 percent of grants and contracts, have had profound consequences globally. Other major donors like the UK and Germany followed suit, leading to a nearly 40 percent reduction in UN humanitarian funding, down to $15 billion in 2025. This drastic decline has left millions without essential aid, with estimates showing that up to 1.6 million lives could have been saved had funding not been cut. The International Rescue Committee (IRC) alone lost services for 2 million people and saw reductions for another 6 million, while half of the health facilities it supports closed or lost critical services. The U.S., once a cornerstone of global humanitarian aid, has now vacated its leadership role, leaving a void in supplying essential resources and setting standards. While recent multibillion-dollar commitments from the U.S. to the UN Office for the Coordination of Humanitarian Affairs and the Global Fund are welcome, they must focus on outcomes to address growing needs effectively. This situation reflects the "Kindleberger Trap," where the world lacks a dominant power willing and able to provide global public goods, at a time when conflicts, displacement, and climate stress are at their highest levels since World War II. The crisis also stems from misconceptions about foreign aid. Many Americans believe it constitutes a significant portion of federal spending—around 25 percent—but in reality, it's just over 1 percent of the budget. These myths contribute to the perception that aid is wasteful or ineffective, despite overwhelming evidence of its impact. The

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Originally published on Foreign Policy on 2/19/2026