Elon Musk on Monday said he was working to shut down the US foreign aid agency (USAID), in a move that could hit major recipients in the Middle East and North Africa hard.
The billionaire, who is leading President Donald Trump's efforts to shrink the federal government, discussed the agency in a talk on X with former Republican presidential candidate Vivek Ramaswamy and Republican senator Joni Ernst. Mr Musk said his Department of Government Efficiency aimed to close USAID.
"It's beyond repair," Mr Musk said, adding that Mr Trump agrees it should be shut. “Time for it to die,” he added on X.
USAID is the world's largest single donor. Seven of the top 10 recipient countries of the agency's money are in the Middle East and Africa, according to figures from the US State Department. They include Ethiopia, Somalia, Syria and Yemen.
former mission director of USAid in Gaza and the occupied West Bank
The US disbursed $72 billion of assistance around the world in the fiscal year 2023, boosting efforts to support issues including women's health in conflict zones and access to clean water. The country provided 42 per cent of all humanitarian aid tracked by the UN last year.
USAID, an independent agency, has a budget of more than $50 billion. It is responsible for more than half of US foreign assistance, while its blue and red font is ubiquitous in developing nations around the world. The agency has more than 10,000 staff.
On Monday, Secretary of State Marco Rubio said he is the acting director of the agency, though he has "delegated that authority to someone". Mr Rubio, who was speaking from El Salvador, said that many of the agency's functions are going to continue, but they "must be aligned with American foreign policy".
Also on Monday, Democratic Senator Brian Schatz said he would place a “blanket hold” on all of Mr Trump’s State Department nominees until the administration’s attack on USAID ends, the Wall Street Journal reported.
Its website appeared to be offline on Monday and an Instagram page that publicises its work had been taken down.
Mr Trump has assigned Mr Musk to lead a federal cost-cutting panel. Asked on Sunday whether Mr Musk was doing a good job, the President said: "He's a big cost-cutter. Sometimes we won't agree with it and we'll not go where he wants to go. But I think he's doing a great job. He's a smart guy. Very smart. And he's very much into cutting the budget of our federal budget."
Since taking office 11 days ago, Mr Trump has embarked on a major government makeover, sacking and sidelining hundreds of civil servants in his first steps towards downsizing US bureaucracy and installing more loyalists. He has ordered a global freeze on most US foreign aid as part of his "America First" policy, a move that has sent shock waves around the world.
Speaking more broadly about cutting US expenses, Mr Musk estimated the Trump administration could cut $1 trillion from the US deficit next year. He also claimed "professional foreign fraud rings" are stealing vast sums of money by masquerading as or creating fake digital US citizens, but did not offer any evidence to support his claim.
Former US president John F Kennedy created USAID in 1961 with an executive order, which followed an act by Congress stipulating the reorganisation of foreign assistance programmes.
Some observers in Washington have questioned the legality of closing the agency. “There's a legal and a practical matter,” said Dave Harden, who served as the mission director of USAID in Gaza and the occupied West Bank from 2013 to 2016.
“Taking down the website and merging it in a slimmed down fashion to the State Department, and having it kind of embedded under, like a relatively minor bureau, almost in the State Department, is symbolic of, really, an unconstitutional, illegal attempt to remove a statutorily independent federal agency that has been around since 1961,” he told The National.
Mr Harden fears Mr Trump’s efforts to change foreign assistance programmes will hurt Americans. “This is a structural change in philosophy to America and its place in the world, whether it's the diminishment of soft power, whether it's a collaborative approach to complex problems like, let's say, climate change, or whether it's just a zero-sum trade war with our closest neighbours, allies and trading partners," he said. "It's just an ethos that will end badly for the United States and for the American people.”
