Where Does Foreign Aid Actually Go?
Published February 2025 · Editorial Investigation
Table of Contents
The United States spends roughly $50 billion per year on foreign aid — a number that sounds enormous until you realize it's about 1% of the federal budget. But “only 1%” still means real money flowing to real places, and the question isn't just how much — it's where, why, and whether anyone's checking if it works.
~$50 Billion / Year
Total U.S. foreign aid — about 1% of the federal budget, but more than the GDP of most recipient countries.
1. The Top Recipients
Excluding domestic spending, here are the countries receiving the most U.S. federal dollars. Note: this includes all federal spending abroad — military contracts, USAID grants, embassy operations, and more — not just traditional “aid.”
Japan, Germany, and South Korea top the list — but that's mostly military basing costs, not aid. The real foreign aid story starts further down: Kenya, Ukraine, Jordan, Israel, Haiti, South Africa, Ethiopia. These are the countries where USAID, PEPFAR, and humanitarian programs concentrate.
The dirty secret of “foreign aid” numbers: Much of the spending in allied countries like Japan and Germany is actually the cost of maintaining U.S. military bases abroad — not humanitarian assistance. The categories blur by design.
2. What Are We Buying?
Foreign aid isn't one thing. It's a grab bag of programs with very different goals — and very different track records:
Approximate category breakdown of U.S. foreign assistance
Health (42%)
HIV/AIDS (PEPFAR), malaria, maternal health, vaccines. The strongest track record — PEPFAR alone has saved an estimated 25 million lives.
Military & Security (22%)
Arms sales, military training, counterterrorism. Goes to allies like Israel, Egypt, Jordan, Ukraine. The most politically contentious category.
Economic Development (16%)
Infrastructure, agriculture, trade capacity. Mixed results — some programs show strong ROI, others fund consultants writing reports about other consultants.
Humanitarian / Food Aid (12%)
Emergency disaster response, refugee support, food programs. Hard to argue against feeding people in famines — but chronic dependency is a real concern.
3. The USAID Explosion — and Collapse
USAID's budget tells the story of an agency that ballooned during COVID, then got caught in the crosshairs of budget hawks. From $16.7B in FY2017, it surged to $24.1B in FY2022 — a 44% increase — then crashed back to $12.3B in FY2025, a 26% decline from where it started.
Source: agency-growth.json, USAspending.gov
The COVID-era surge included pandemic response funding routed through USAID — vaccines for developing countries, emergency health support, food security during lockdowns. Some of it was genuinely lifesaving. Some was the kind of emergency spending that governments love because it bypasses normal scrutiny.
“USAID's budget grew 44% in five years, then crashed 49% from its peak. Nobody planned for either.”
4. The Biggest Awards
Where does the USAID money actually land? The top contracts and grants reveal familiar patterns: a handful of massive implementing partners — Chemonics, FHI 360, Johns Hopkins, JSI, Abt — that function as a permanent foreign aid industrial complex.
The biggest single contract? Chemonics International — a DC-based firm most Americans have never heard of — holds a $6.7 billion USAID contract for global health supply chain management. That's one contract, one company, nearly $7 billion.
5. Is It Working?
The honest answer: it depends on which program you're asking about.
What Works
PEPFAR / Global Health
25M+ lives saved. Malaria deaths down 60% in target countries. Vaccination rates up. Clear, measurable outcomes.
What Doesn't
Nation-Building / Governance
Afghanistan ($145B), Iraq, Haiti — decades of “capacity building” with little to show. Corruption eats the funds.
Health programs work because they have clear metrics (people treated, vaccines delivered, deaths prevented) and independent monitoring. Economic development and governance programs fail because they're measured by inputs (money spent, workshops held) rather than outcomes (did the economy grow? did corruption decrease?).
6. The Hard Questions
Foreign aid is the rare issue where left and right should find common ground. Progressives want it to work for humanitarian reasons. Fiscal conservatives want to stop wasting money on programs that don't. Both should demand the same thing: ruthless accountability.
Instead, what we get is a binary debate: “cut all foreign aid” vs. “any cuts are heartless.” Neither position is serious. The serious questions are:
- Why does USAID fund “democracy promotion” in countries that have shown zero interest in democracy for decades?
- Why do the same 10 Beltway contractors capture the majority of USAID contracts, year after year?
- Why can't we scale the programs that work (PEPFAR, vaccines) and cut the ones that don't (nation-building)?
- Is security aid to Egypt and Jordan actually buying us security, or just subsidizing autocrats?
A dollar spent on PEPFAR saves lives. A dollar spent on a governance workshop in a failed state buys a consultant a plane ticket. Taxpayers deserve to know which dollars are doing which.
“The question isn't whether to fund foreign aid. It's why we keep funding the parts that don't work while pretending we can't afford the parts that do.”