Earlier this week, the Government Accountability Office (GAO) delivered testimony to both House and Senate committees regarding the significant delays in implementing the Millennium Challenge Account (MCA) and in spending the roughly $2.5 billion previously appropriated by the Congress. The GAO testimony highlights the unacceptably slow pace of implementation and delivery of assistance to the developing world, calling into question previous Bush Administration claims that the MCA has been a great success and raising real doubts about the MCA's capacity to serve as an effective agent of development assistance under the Bush Administration's leadership.

Bush Administration has failed to deliver on its promise of "a major new commitment" to the developing world. On March 14, 2002, President Bush announced his proposal for the MCA, a major new initiative to provide foreign assistance to the developing world. The President promised "a major new commitment by the United States to bring hope and opportunity to the world's poorest people," and announced, "I carry this commitment in my soul." Three years after his promise, however, and two years after Congress passed the MCA into law, President Bush has yet to deliver on his promise. The MCA has not contributed a single dollar of foreign assistance to a developing nation. Furthermore, the President has not requested the $5 billion per year he promised for the account in any of the four budgets he has submitted to Congress after he announced the initiative.

In two years, the Bush Administration has obligated only two percent of MCA funds. The developing world is facing a series of destabilizing crises, including the AIDS pandemic, intractable poverty, floods of migrants and refugees, that not only cripple development efforts, but also represent threats to the security of the U.S. and the world. MCA funds could be a critical tool in confronting these crises; however, the Bush Administration has failed to get these funds into the areas of the world where they are needed most. The GAO reports that the Millennium Challenge Corporation (MCC), the agency responsible for implementing the MCA, has only signed an agreement with one nation, Madagascar, worth only $110 million. Worse still, this $110 million will be made available over four years, meaning that only $55 million - two percent of the $2.5 billion appropriated through two years by Congress - has been obligated for the MCA's first two years.

GAO identifies management concerns in the MCC. Though President Bush signed the MCA into law over 15 months ago, the GAO noted that the MCC has not:

• "completed a strategic plan or established specific implementation time frames;"
  
  
• "established annual performance plans, which would facilitate its monitoring of progress toward strategic and annual performance goals and outcomes and its reporting on such progress internally and externally;" or
  
  
• "specified deadlines for proposal submission or publicly declared the limits or range of available funding for individual compacts." "According to U.S.-based NGOs," the GAO reports, "the lack of deadlines has caused some uncertainty and confusion among eligible country officials."
  
  

The MCC's funding decisions have lacked transparency. The GAO further reports that the MCC has selected 16 countries in each of two years to be eligible for MCA grants. Of these 32 selections, five countries failed to meet the MCC's own criteria, but were deemed eligible for funding anyway. Sixteen other countries met the criteria, but were deemed by the MCC ineligible for funding. According to the GAO, the MCC provided no justification to Congress for these decisions.

The MCC has failed to reach out to non-government organizations with extensive experience in international development efforts. Administration officials have pledged repeatedly to work with non-government organizations (NGOs) in the implementation of the MCA and to draw upon their extensive experience in development efforts in the developing world. Yet, the GAO reports, "some U.S-based NGOs have raised questions about the involvement of NGOs in this country and of civil society groups in compact-eligible countries. Environmental NGOs told us in January 2005 that MCC had not engaged with them since initial outreach meetings." Further, "representatives of several NGOs commented that MCC lacks in-house expertise and staff to monitor and assess civil society participation in compact development. In addition, U.S.-based NGOs expressed concern that their peers in MCA countries have not received complete information about the proposal development process." As a result, the MCC is failing to make use of its most valuable allies in the fight for progress and prosperity in the developing world.

President Bush has used the MCA as an excuse to cut funds for traditional programs. The Bush Administration has consistently advertised the MCA as a complement to, rather than a replacement of, current foreign assistance programs. However, in the President's Fiscal Year 2006 proposed budget, the MCA would receive an increase of $1.5 billion, while several other programs would receive cuts. These include proposed decreases of $286 million for Child Survival and Health programs, $345 million for Development Assistance, and $44 million for international organizations such as UNICEF and the UN Development Fund for Women. At a February 2005 Senate Foreign Relations Committee hearing, Secretary of State Rice even made a direct link between decreasing funds in core development accounts and providing funds for the MCA. Asked why the Administration is cutting the Freedom Support Fund for countries of the former Soviet Union, Secretary Rice stated that the cuts do not reflect "any diminution in our interest in the continued democratization of the former states of the Soviet Union," but that "fortunately, Georgia has become a Millennium Challenge Account country."

The Bush Administration has failed to develop a strategy to deliver aid to the world's poorest countries. Despite the President's assurances, the Administration has yet to develop a strategy to aid the world's poorest and most troubled nations. MCA is obviously not the solution. Of the 16 nations selected for MCA funding eligibility for Fiscal Year 2005, only one - Mozambique, is among the 30 poorest nations (as measured by the World Bank's per capita GNI indicator) and only 7 nations are among the 50 least developed countries in the world (as measured by the United Nations). The Bush Administration has even created a "tier two" program for MCA, which exclusively targets funding on more developed and prosperous nations. So, while the least developed nations of the world continue to confront mounting economic, humanitarian, and security challenges, the Administration sits idly by, with no overarching strategy or plan to help.