Calls for Foreign Aid Reform Amid Funding Cuts

Experts argue for a more targeted, innovative, and outcome-driven approach to global humanitarian assistance.

Feb. 26, 2026 at 12:31am

Got story updates? Submit your updates here. ›

Nearly a year after the Trump administration shuttered the U.S. Agency for International Development and terminated over 80% of U.S. foreign aid, global humanitarian funding has been slashed by 40% compared to 2024. Experts argue this has led to a dramatic human cost, with an estimated 1.6 million lives that could have been saved if funding wasn't cut. They call for reforming the foreign aid system to be more focused on war-torn states, driven by accountability for outcomes rather than inputs, and embracing financial and technological innovations.

Why it matters

The dismantling of the U.S. foreign aid apparatus has left a major void in global humanitarian assistance at a time of rising conflict, displacement, and climate-related crises. Reforming the aid system to be more efficient, targeted, and innovative could help address growing global needs.

The details

The article outlines several key issues with the current foreign aid system that contributed to its dismantling, including perceptions of waste and ineffectiveness, a mismatch between where aid is directed and where the greatest needs are, and a lack of financial and technological innovation. It argues that aid should be more focused on the world's poorest and most conflict-affected regions, with a greater emphasis on accountability for outcomes rather than just inputs. The author also calls for increased investment in anticipatory action, debt swaps, and parametric insurance to better prepare for and respond to crises.

  • Nearly one year ago, the Trump administration shuttered USAID and terminated over 80% of U.S. foreign aid grants and contracts.
  • In 2025, the United Nations' humanitarian funding was slashed by nearly 40% compared to 2024, totaling only $15 billion.

The players

David Miliband

The author of the article and the president and CEO of the International Rescue Committee (IRC), a major humanitarian aid organization.

Joseph S. Nye Jr.

The late political scientist who popularized the concept of the "Kindleberger Trap" that describes a moment when the world lacks a dominant power willing to provide global public goods.

Charles Kindleberger

The economist whose ideas on the provision of global public goods formed the basis for the "Kindleberger Trap" concept.

Rachel Glennerster

The president of the Center for Global Development, who has argued that aid would be more effective with simpler, more targeted interventions in the places that need it most.

Got photos? Submit your photos here. ›

What they’re saying

“The human cost over the last year has been dramatic. The Center for Global Development estimated that up to 1.6 million lives could have been saved if U.S. funding wasn't cut.”

— David Miliband, President and CEO, International Rescue Committee

“For decades, the United States was an anchor in humanitarian aid, steadying supply chains, underwriting emergency response, and setting global standards. Now, the anchor is gone.”

— David Miliband, President and CEO, International Rescue Committee

“The median aid project is worth under $100,000 and tries to do too much with too little. Aid would go further with radically simpler interventions in far fewer places that need it the most.”

— Rachel Glennerster, President, Center for Global Development

What’s next

The article does not mention any specific next steps, as the focus is on the need for broader reforms to the foreign aid system.

The takeaway

The dismantling of the U.S. foreign aid apparatus has created a major void in global humanitarian assistance, highlighting the need for a reformed, more targeted, innovative, and outcome-driven approach to foreign aid that can better address the world's growing crises and needs.