Photo: Dennis Vega, President & CEO of Pact, meets with local health practitioners during a visit to New Masala Urban Health Centre in Ndola, Copperbelt, Zambia, in 2025.
For decades, there has been an insider debate on the optimal “home” for foreign assistance within the U.S. government. Should the government retain an independent aid agency, or would consolidating those capabilities within the State Department drive better alignment between these related arms of U.S. national security? Having worked in senior roles at the State Department and USAID across four administrations, Republican and Democratic, and on Capitol Hill, I was in the middle of those debates. Across administrations and shifting political priorities, it was never fully resolved, only managed.
The Trump Administration’s decision to close USAID has changed the question. It is no longer whether consolidation of foreign assistance into the State Department will happen, but whether it will be structured in a way that makes foreign assistance more effective and strategically coherent over the long term.
The answer will determine whether consolidation strengthens American foreign policy or quietly distorts it.
The case for consolidation has rested on the premise that coherence has been lacking, that development programs operated too independently of the strategic direction of American foreign policy. This premise is worth examining because analyzing the problem can help clarify what consolidation should accomplish to be considered a success.
For decades, the Secretary of State has exercised strategic oversight of foreign assistance. Country assistance plans and major funding decisions required State Department approval, even before the Trump Administration’s consolidation. The White House and the Office of Management and Budget approve foreign assistance priorities and funding before submission to Congress. Foreign assistance accounts are not only appropriated by Congress but heavily directed, and both Republican and Democratic congressional committees reviewed foreign assistance programs prior to funds being released, offering additional opportunities to assess alignment.
Strategic alignment may have been embedded in these longstanding processes, but it is true that it was not always realized in practice. The case for consolidation addresses genuine coordination problems: duplicated country-level relationships, inconsistent messaging, and the absence of a unified strategic interlocutor. These are real problems worth solving.
But consolidation itself does not resolve the deeper tension between foreign policy and development policy, which is not a product of institutional fragmentation but rather of two related but fundamentally different missions operating in the same space. Consolidating the institutions does not erase that difference, but it does risk masking a productive tension between the two.
There are two distinct problems that consolidation creates: one visible in the historical record, one embedded in the quieter logic of how institutions operate.
Diplomacy and development policy are deeply intertwined, but they are not the same mission. Both require strong relationships and are shaped by geopolitical conditions. However, diplomacy is inherently more directly reactive to shifts in the government-to-government relationship. It must maintain working channels under pressure and respond to short-term geopolitical changes in ways that development programming, with its longer horizons and community-level anchoring, should not be expected to match.
Development operates on a fundamentally different timeline. When done right, it builds institutions, strengthens governance, and improves health infrastructure, food security, and economic resilience. Even humanitarian and disaster response, where the immediate crisis demands urgency, address fallout that spans generations and requires long-term investment to truly resolve. Development measures success over years and decades and depends on absorptive capacity, sequencing, and sustainability. Those conditions cannot be accelerated by short-term diplomatic pressure alone.
When these missions operate according to their own logic while remaining strategically aligned, they can powerfully reinforce each other. Diplomacy can pave the way and create conditions for sustainable development and true partnerships with host governments and communities. Development can foster conditions that lead to stability and productivity. When development is subordinated to diplomacy, rather than being allowed to work alongside it, it too often is set up to fail. And when development fails, diplomacy pays the price.
The tension between these missions is real, persistent, and not a partisan problem. Republican and Democratic administrations have struggled to coordinate them while allowing sufficient space for both. The establishment of an independent aid agency separate from the State Department was not a perfect solution, but it was a deliberate design choice. It gave the development mission a distinct institutional home, allowing it to foster its expertise and maintain an independent voice in policy deliberations.
Consolidation changes that design but does it solve the tension, or simply make it less visible?
Looking back at the last two decades of major foreign assistance failures, a pattern emerges: political urgency overriding development discipline. These failures were primarily the result of political decisions involving both diplomatic and development professionals, each accountable to different things. State Department leadership is rightly focused on geopolitical relationships; that is the job, and it naturally aligns with the immediate priorities of an Administration under pressure. Development leadership is accountable to different questions: what communities need, what institutions can absorb, and what will last. In high-stakes moments, those orientations have historically pulled in different directions, and that tension, although uncomfortable, has often produced better outcomes than either perspective would have reached alone. Consolidation risks eliminating this.
This is not a partisan issue. In Iraq and Afghanistan, the Bush Administration and to some extent the Obama Administration deployed resources for reconstruction on political and military timelines, and the gap between disbursement and local institutional capacity proved costly. the Special Inspector General for Iraq Reconstruction documented at least $8 billion in waste, fraud, and abuse out of roughly $60 billion appropriated for Iraq reconstruction alone.
In 2014, the Obama Administration’s U.S. Strategy for Engagement in Central America was launched to respond to the surge of unaccompanied minors at the border. Roughly $2.4 billion was appropriated to address root causes of migration across the Northern Triangle. But political urgency drove implementing agencies to disburse large sums on unrealistic timelines, reducing impact measurement to counting activities rather than assessing outcomes. A 2019 Government Accountability Office review concluded agencies lacked a plan capable of measuring progress toward core objectives.
These tensions ran through the Biden administration as well, on issues ranging from Gaza, where the scale of civilian humanitarian need pressed hard against the bounds of the U.S. relationship with Israel, to Sudan, where geopolitical relationships with actors on both sides of the conflict complicated any clear humanitarian mandate.
Across those administrations, the development perspective often did not prevail. But it was present at the highest levels of government and shaped the choices made: the scope of what was attempted, the conditions attached, and the off-ramps preserved, even when it could not determine the outcome.
The lesson is not that the strategies were wrong, the urgency was unjustified, or the agencies were misaligned. It is that political urgency compressed long-term development agendas into short-term timelines, and asked programs to deliver results they could not fully achieve under those conditions. The system has not historically had a reliable mechanism for holding that tension productively, and consolidation risks making that problem significantly worse.
The deeper risk is not about political crisis. It is about the ordinary pressures of institutional life. Even in the absence of an acute political moment, diplomatic culture tends toward what bilateral relationships require. Maintaining government access, protecting working channels, and managing partner sensitivities are not failures of judgment; they are the legitimate imperatives of diplomacy. But when development and diplomacy share the same institutional home, those imperatives tend to crowd out development logic by default.
That matters because development contributes a distinct form of strategic knowledge. USAID understood how governments function inside a country, not as counterparts in a negotiation but as institutions with their own capacities, politics, and limits. It held wide-ranging and deeply rooted relationships with civil society, local leaders, and communities, leading to durable engagement that advanced American interests. It understood how ordinary people in a given country experienced their government, their economy, and their relationship with external actors, including the United States.
That knowledge is a different kind of strategic literacy. Diplomacy sees a country and asks: what can we negotiate? Development sees a society and asks: what can we build, with whom, and over what timeline? Both questions shape long-term U.S. interests. Neither is subordinate to the other.
Recent experience in Ethiopia illustrates that distinction in practice. I was Chief of Staff at USAID when evidence emerged that Ethiopian government forces were diverting food assistance from conflict-affected populations. As the Agency worked to address this situation, which was exacerbating life-threatening conditions for millions of people, we faced significant pressure from other parts of the U.S. government to preserve the Ethiopian government’s role in aid delivery. That pressure was rooted in maintaining the broader foreign policy relationship and avoiding a confrontation that could complicate other objectives. USAID’s institutional independence helped forge a nuanced approach. Raising critical humanitarian and development perspectives forced a diplomatic effort to negotiate more limited government involvement rather than simply acquiesce to it. The result was far from perfect. But the balance struck was meaningfully closer to what the affected population needed and depended on an institution that could hold its ground.
I will be the first to acknowledge that in the most difficult geopolitical moments, the development perspective did not always prevail. But even in those circumstances, the independent development perspective was known. Can a consolidated, absorbed development function maintain that presence as U.S. foreign policy forges ahead?
While consolidation may increase efficiency, policy friction is likely to decrease. This may feel like a win in the short term, but it can also concentrate risk in ways that are not immediately visible but deeply consequential.
In an era of great power competition, the pressure to treat foreign assistance as a rapid response signal will only grow. The temptation to respond to strategic rivals with speed, through rapid funding obligations, high-visibility projects, and quick disbursements, is understandable. Yet the evidence on what builds durable influence points in a different direction: programs that work demonstrably well, partnerships that last, and credibility that accrues through consistency. These goals are reinforced by an institutional voice empowered to ask not just whether a program is technically feasible, but whether it will be trusted, used, and sustained by local people. In the long term, we can weaken our ability to achieve lasting positive impact that exceeds short-term gains in agility.
The consolidated architecture is new, but the pressure on it is immediate. It is too early to know how the consolidated structure will manage that tension in the contexts before it. Engagement with Venezuela and Iran each involves precisely the kind of situation where political urgency, diplomatic imperatives, and development discipline pull in different directions, where the geopolitical stakes are high, the bilateral relationships are fraught, and the humanitarian and civic needs on the ground are critical. How the State Department navigates those situations will be among early tests.
Meeting that pressure requires getting the architecture right. The answer is not to restore bureaucratic silos or to resist the State Department’s authority. But accepting consolidation as inevitable is not the same as accepting it as sufficient. The deeper challenge is that the State Department is now being asked to hold two separate but distinct institutional missions simultaneously. That is genuinely difficult. Historically, the system distributed that tension across institutions in part because it is hard for a single institution to do both well under pressure.
The task ahead is not procedural. It is not a checklist of safeguards appended to an otherwise unchanged architecture. The State Department must deliberately institutionalize the counterweight that consolidation has absorbed, building into its own structure the mechanisms for dissent, the longer view, and the relational knowledge that once resided in a separate institution.
First, the State Department and the National Security Council must ensure that the development and humanitarian perspectives have a genuine seat in high-level policy deliberations – not a separate lane or a dissenting annex. It means that when decisions are made about how the United States engages in a country, there is a voice in the room that can speak to what communities on the ground need, what local institutions can absorb, and what the long-term consequences may be. The prior structure provided that voice through institutional separation. The consolidated structure must provide this deliberately and purposefully.
Second, the State Department must adjust its own mandate to internalize what it has absorbed. Development should not be treated as another tool in a familiar toolkit but as a genuinely different way of engaging that demands different incentives, timelines, and definitions of success. A bureaucracy that applies identical incentives, promotion criteria, and success metrics to both will produce results that satisfy neither. Development leadership inside the State Department should carry distinct career tracks and country teams should include development officers whose advancement is tied to development outcomes.
Third, the State Department must create a framework to hold itself accountable to that distinction. This means evaluation functions that can produce findings that maybe uncomfortable. It means program leadership rewarded for durability, not speed. And it means maintaining the bipartisan congressional relationships that have historically served as an external check on the temptation to use assistance as a short-term signal.
Fourth, and most fundamentally, the State Department must protect the relational and civic knowledge that USAID accumulated over decades: the understanding of how societies work from the inside out, who holds trust in a community, what local institutions can absorb, what foreign engagement looks like from the receiving end. That knowledge was built through sustained field presence, experienced local staff, and technical expertise at every level of programming. It does not transfer automatically in a reorganization. It lives in people, relationships, and institutional cultures that are difficult to rebuild. Critically, much of that knowledge now resides in implementing partners that carry operational relationships on the ground. Whether the consolidated structure preserves or severs its working relationships with those knowledge carriers is as consequential as any internal reorganization.
Consolidation is underway. The State Department must absorb not just a set of programs but a unique institutional perspective, one that sees the world differently, operates on a different timeline, and has historically served as a check on the kinds of commitments that are easy to make and hard to sustain.
The consolidated structure is new, and its design is not yet fixed. Congressional oversight committees, State Department leadership, and the broader foreign policy community all have a stake in whether it is built in a way that preserves what U.S. development cooperation has historically gotten right, while sharpening what it did not.
Alignment is necessary, but subordination is dangerous. The difference between the two is precisely what consolidation must be designed to protect.
