Unless Congress appropriates funds it has already authorized for the major international lending banks, assistance to the "neediest countries and people" will be cut, according to Assistant Treasury Secretary C. Fred Bergsten.
Bergsten said he recognized that Congress is not always happy with the way such institutions -- mainly the World Bank -- lend funds, but he said the "advantages to the United States of channeling an important share of its aid through the banks outweigh the inherent disadvantages of our being unable to work our will unilaterally in them."
He said Congress and the administration should come to an agreement on just what goals the United States seeks in lending through international institutions and said that promotion of human rights could be one of the goals.
In a speech to the International Development Conference, a private group concerned with developing countries, Bergsten noted that the Congress is $835 million short of appropriating funds that the United States has pledged to the World Bank, the Inter-American Development Bank and the Asian Development Bank.
"The administration believes that it is absolutely imperative to structure funding for our past pledges this year," Bergsten told the confrence.
Bergsten noted that some House members last year sought to amend appropriations bills to "prevent use of U.S. funds for loans for the production of certain commodities or to certain countries." He noted that the banks cannot accett earmarked funds.
Bergsten noted that the recent increases in U.S. contributions to the banks -- even if they have been below Congressionally pledged levels -- justifies increased Congressional scrutiny of not only broad policies but also to actual aid and lending programs.
"The issue, as in many other aspects of U.S. foreign policy, is how to reconcile the constitutional responsibility of the administration to execute U.S. international affairs with the responsibility of the Congress to exercise its power over the purse."