How Much Does the U.S. Really Spend on Foreign Aid?

It’s frequently pointed out that we’re not going to balance the budget by cutting foreign aid. We spend only about $50 billion a year on foreign aid, which isn’t much compared to a $1.6 trillion deficit, let alone our roughly $14 trillion in debt. Foreign aid counts as not much more than 1% of our $3.5 trillion budget.

But does that really capture the whole U.S. foreign aid package? Aren’t we defending a whole bunch of countries, either explicitly (by being part of the North Atlantic Treaty Organization or some other treaty) or implicitly (such as the Republic of China, AKA Taiwan)? Doesn’t that count as aid?

Consider the following list of countries, many of which are great tourist destinations because — thanks to us — they’re not being invaded.

NATO members: Albania, Belgium, Bulgaria, Canada, Croatia, Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Lithuania, Luxembourg, the Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Turkey, and the United Kingdom. Call that 550 million people.

Allies in Asia and the Pacific: Australia, Japan, New Zealand, the Philippines, Singapore, South Korea, Taiwan, and Thailand (plus any number of Pacific islands). Call that 350 million.

Oh, and the United States of America, recently weighing in at 310 million.

Total: Roughly (but probably low-balling it) 1.2 billion. That’s comparable to the population of either China (1.34 billion) or India (1.21 billion), but spread out over an enormous area, including thousands of miles of coastline and sea lanes.

And that’s not counting a bunch of European countries that aren’t (yet) part of NATO. Bosnia and Herzegovina, Macedonia, and Montenegro are all in the process of joining NATO, and former USSR members Georgia and Ukraine may also sign up. Ireland isn’t in NATO, but there’s no way we’re not defending them. We’ll also defend Finland and Sweden. And the only non-NATO countries bordering land-locked Austria and Switzerland are: Austria and Switzerland. (We’re definitely not letting anyone invade Austria again.)

Of course, we’re currently in Afghanistan and Iraq, we’ve already liberated Kuwait once, and it seems like we’d come to bat for Israel and Saudi Arabia (unless they’re fighting one another, in which case it gets complicated). We’d likely do the same for other countries in the Americas, too.

Granted, of the countries that make up the aforementioned 1.2 billion, some depend on us less than others (Turkey), some help us militarily more than others (the U.K.), and some kick in to help pay for hosting our troops (Japan). But we’re still picking up most of the tab, and a whole bunch of people are benefiting, either directly or indirectly.

In particular, we effectively subsidize pretty much every European government’s health care plan by reducing their military and defense spending. If we pulled out of NATO, European countries would drastically increase their defense spending. Where would they find the money? They’d cut social spending.

It says a lot about the U.S. economy that we’ve been so prosperous and competitive with all these countries despite the fact that we’ve been subsidizing them with our defense spending, despite the fact that they’re living under our roof. And it says a lot about them that they haven’t been able to eat our lunch even while we’ve been buying them lunch.

Now, I’m not necessarily arguing that we should quit any of these defense treaties in order to balance our budget. But we should be honest that our defense spending is foreign aid, even if it doesn’t fall under the “foreign aid” heading.

The U.S. gets lambasted for having only 5% of the world’s population but using a quarter of the world’s oil, or having a fifth of the world’s wealth, or accounting for two-fifths of the world’s military spending. Maybe that’s all true. But we also defend at least 15% of the world’s population. We’re a nation of of 310 million defending four times our own population.

How’s that for foreign aid?