3
Foreign Assistance Act of 1961. Combined with a concurrent White House pledge to contribute
$10 billion over five years for stemming the AIDS/HIV epidemic, the aid initiative was
comparable in magnitude to the Marshall Plan following World War II.
President Bush considered three institutional options for placing the MCA within the
foreign-aid bureaucracy (see Lancaster, 2002). The first would fully integrate the account within
an existing unit such as the Department of State or the U.S. Agency for International
Development (USAID). A second option involved creating a separate MCA staff with its own set
of funding procedures and programs, but keeping the account within an existing unit. In both of
these cases, the new program would be expected to follow established operating procedures and
reflect the organizational culture of its bureaucratic home. Thirdly, an entirely new government
agency could be created to run the account, one that would be free of the constraints imposed by
institutional subordination.
This third option was ultimately chosen by the White House. Bush called for the creation
of a Millennium Challenge Corporation (MCC) that would be detached from cabinet-level
departments or other aid-granting institutions in the U.S. government. From the perspective of
the Bush administration, the bureaucratic segregation of the MCC, whose modus operandi would
be based upon a recipient-driven “foundation model” of aid delivery, would be one of its primary
assets (see Birdsall, et al, 2002).
Despite the White House's enthusiasm for the new aid initiative, members of Congress
proved skeptical during the appropriations process. The funding originally approved for its first
year amounted to just $994 billion, well below the administration's request of $1.5 billion for
Fiscal Year 2004.
1
Bush, who pledged to seek $3.3 billion in MCC funding in 2005, later
trimmed his request to $2.5 billion and received $1.5 billion from legislators. His request of $3
billion for 2006 fell below his initial $5-billion target, although Bush vowed to reach that level of
funding in Fiscal Year 2007.
2
Members of Congress, who ultimately control funding levels for all
1
The MCA appropriation was initially just $650 million, but the Bush administration
raised the level of first-year funding to $1 billion by shifting money to the MCA from other
international programs.
2
The White House faced similar congressional resistance for his five-year, $15-billion
Convention