DENVER – The 16th Street Mall in downtown Denver is a pretty tree-lined pedestrian promenade of shops and cafés that last Friday night was a lively strip of taverns with live bands playing blues rock and country-folk rock music.
It is also home to a number of individuals who lug around all their personal belongings in bags. There is a Coalition for the Homeless in this city, and its mission is likely to get tougher in the months ahead.
The ranks of the homeless in the United States are expected to rise as the country goes through what analysts are describing as their worst recession since the Great Depression.
It’s a good time to shop in the US these days because of the weakness of the dollar (and the strength of the peso), and I see a lot of tourists (mostly speaking Spanish) in this city.
But it’s a summer of discontent in America. And the ratings of US President Barack Obama are taking a hammering together with Wall Street.
A Gallup poll taken Aug. 11 to 14 gave Obama a record low overall job approval rating of 41 percent. Approval of his handling of the economy slumped to a new low of 26 percent, from 37 percent in mid-May.
In a survey taken last month by the Pew Research Center, Obama’s overall approval rating was also down, at 44 percent.
“We haven’t seen people as disgruntled as they are right now,” Pew survey research director Scott Keeter told our group of visiting Asian journalists in Washington recently.
The Aquino administration is downplaying the impact of America’s economic woes on the Philippines. But a recession in the world’s largest economy always has a global impact. Especially when combined with Europe’s debt crisis and continuing unrest in the Middle East and North Africa.
Overseas Filipino workers are being sent home, with no alternative employment waiting for them. Most of them are resilient. As in the last financial crisis, OFWs are willing to take pay cuts rather than lose their jobs and return to the Philippines. In places such as Syria, OFWs are also ready to face security risks to remain employed.
Consumption and investments are down. Obama is again mouthing his campaign promise of bringing American jobs back to America and making US products in the United States. While this bucks globalization trends and there’s no certainty that American businessmen will cooperate, the rhetoric can aggravate market jitters.
There is another factor affected by weakened economies: foreign aid. That poses a problem for countries such as the Philippines that remain dependent on foreign assistance.
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A Pew survey conducted from May 25 to 30 this year showed a high 72 percent of Americans wanting their government to reduce foreign aid.
Foreign assistance is a key component of American diplomacy, and is considered by Washington as part of US national security.
But US politicians are sensitive to public opinion, and even more so with elections approaching. The Obama administration is currently preparing its budget proposal for fiscal year 2013, and the congressional debates can be bruising. The allocation for foreign assistance, which in fact accounts for less than one percent of the annual US appropriation, could shrink further as the recession deepens.
At best, there will be minimal reductions in US foreign assistance, but with tighter controls on utilization, in keeping with Obama’s policy of transparency in its aid program. An Office of the Director of US Foreign Assistance has been created, with its head reporting directly to Secretary of State Hillary Clinton. The US Agency for International Development is under this new office, which is tasked to carry out what Clinton has described as “smart engagement.”
Washington wants results for its aid. It wants to assist nations that will not need assistance indefinitely. It wants to work with countries that can utilize aid properly, and with governments that can implement necessary reforms.
The website of the new foreign aid office shows that apart from humanitarian, development and security assistance, the US wants its aid to help promote democracy and good governance overseas.
US diplomatic missions are required to submit annual reports on aid utilization by the recipient country. I don’t know how democracy and good governance can be measured, but the Philippines under President Aquino must be meeting the criteria, because the country has been included by the State Department in its “partnership for growth” initiative.
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American taxpayers are not the only ones who will take a closer look at the money they are giving away to people in other countries. Other major foreign aid donors are also suffering from budget constraints, and tightening their rules on aid utilization.
Those rules should be welcome news for the Philippines, where foreign-assisted projects, enjoying exemption from many transparency requirements and procurement rules, became sources of corruption in the past.
The most welcome development, of course, is when we can stop relying on foreign assistance for our needs.
Several of our Asian neighbors have done this. It’s good for national pride and self-respect.
It’s sensible to assume that Uncle Sam and other aid donors also prefer to help those who know how to help themselves.