TIME: Almanac 1993/TIME Almanac 1993.iso/time/072390/0723006.000

Text File | 1992-08-28 | 3.8 KB | 86 lines

                                                                                WORLD, Page 35

AMERICA ABROAD

Uncle Sam as Tightwad


By Strobe Talbott


    At the economic summit in Houston, the West Europeans
proposed aid to the Soviet Union and restrictions on greenhouse
gases. Their American hosts privately grumbled about how
expensive those proposals were, then publicly resorted to the
oldest cop-out in the book -- form a committee and study the
problem. The U.S. has a new motto: better to buy time than
spend money, and if someone has to pay, better it be someone
else. That's why the Germans and the Japanese, with their deep
pockets, are particularly welcome at gatherings like last
week's.

    George Bush's presidency was only a few minutes old when he
said, in his Inaugural Address, "Our funds are low. We have a
deficit to bring down. We have more will than wallet."

    The poor-mouthing has not stopped. A year ago, Bush visited
Poland to applaud reform there. Solidarity wanted $10 billion
in Western aid. Bush responded with a little more than $100
million, or about 1 cents per dollar requested. "That's all we
can afford," explained the leader of the free world and the
richest nation on earth.

    Once the foremost dispenser of largesse to poor countries,
the U.S. has fallen behind Japan in total assistance. When
foreign aid is measured as a percentage of gross national
product, the U.S. is the least generous of all the advanced
industrial democracies.

    To its credit, the Bush Administration has been trying to
foster prosperity, democracy and political stability in a
number of Latin American nations by relieving some of the debt
they owe foreign banks, many of them in the U.S. But rather
than ponying up additional dollars to underwrite the loss to
the lenders, the Bush Administration is asking Western Europe,
Japan and international financial institutions like the World
Bank to foot the bill. So far, Japan is the only country
willing to come up with new money. No wonder the debt-relief
scheme that seemed so promising a year ago is turning out to
be a disappointment for all concerned.

    Last month Bush gave a stirring speech about the need for
"a new economic partnership" in the western hemisphere and
announced an initiative to improve the climate for private
investment throughout Latin America. Once again, however, the
numbers did not match the rhetoric. The plan obligates the U.S.
to contribute a mere $100 million. That's about one-fifth the
cost of the damage done to Panama's economy by looting in the
wake of the U.S. invasion last December.

    "When you look at what the Administration is doing compared
with what it's saying, you've got to ask, `Where's the beef?'"
says C. Fred Bergsten, director of the Institute for
International Economics in Washington. "There's a pattern here:
the right policies keep coming up short because they're so
woefully underfunded."

    Part of the reason for the parsimony, as Bush said in his
Inaugural, is the federal deficit. The U.S. is going to have
to reduce its own indebtedness before it can adequately address
the needs of Poland or Mexico.

    The President has finally acknowledged that shrinking the
deficit will entail raising taxes. The U.S. has the lowest tax
level of any country among the seven represented in Houston
last week. That is a distinction that should inspire neither
pride nor optimism in Americans. They will end up with the
foreign policy they deserve -- which is the one they are
willing to pay for. It won't be possible to remain a superpower
on the cheap. If the U.S. lets other countries control the
purse strings of international development, the reins of
leadership will inevitably also pass into other hands.