Foreign Relations of the United States, 1977–1980, Volume XXVIII, Organization and Management of Foreign Policy

144. Memorandum From the Director of the Office of Management and Budget (McIntyre)¹

Washington, February 15, 1979

TO

• The Secretary of State
• The Secretary of the Treasury
• The Secretary of Defense
• The Attorney General
• The Secretary of Agriculture
• The Administrator, Agency for International Development
• The Director, ACTION
• The President, Overseas Private Investment Corporation
• Ambassador Henry Owen
• The Director, Office of Science and Technology Policy

SUBJECT

• Presidential Decisions on Foreign Assistance Organization

This is to communicate to you the President’s decisions on the reorganization of our foreign assistance programs, and to establish arrangements for implementing those decisions.

Presidential Decisions

The President has decided to establish an International Development Cooperation Administration (IDCA) as an independent agency within the Executive branch, whose Administrator will report both to the President and the Secretary of State, and will serve as the principal development advisor to each. The Administrator will receive foreign policy guidance from the Secretary of State and will consult with the Secretary before submitting his budget to the Office of Management and Budget.

The principal responsibilities of the Administrator of IDCA will be to establish and control the budgets and policies of the agency’s components and to make recommendations to the President concerning the appointment and removal of senior officials of each component. The Administrator will also have responsibility to ensure that development goals are taken fully into account in Executive branch decisionmaking on such matters affecting international development as trade and monetary decisions, and questions involving the relative priority of development and other issues.

The Agency for International Development will be transferred into IDCA, as will lead responsibility for policy and budget for the following international organizations: UN Development Program; UNICEF; OAS Technical Assistance Funds; UN Capital Development Fund; UN Educational and Training Program for Southern Africa; UN/FAO World Food Program; FAO Post Harvest Losses Fund; and UN Disaster Relief Organization. The President has independently decided to establish an Institute for Technological Cooperation which, when created, will also become part of IDCA.

Existing arrangements with regard to the multilateral development banks (MDBs) are to be modified as follows: (a) the Secretary of the Treasury will consult with the IDCA Administrator in the selection of candidates for the U.S. Executive Director and Deputy Executive Director positions in the MDBs, with any differences being reported to the President when names are proposed for his nomination; and (b) the IDCA Administrator is directed to advise U.S. Executive Directors on MDB projects and programs proposals.

The IDCA Administrator will replace the AID Administrator as Chair of the Development Coordination Committee and as Chair of the Board of OPIC.

The President decided to take no action now with respect to the Peace Corps. He has directed OMB to review alternative organizational arrangements respecting all ACTION programs, and will reconsider the possible relation of Peace Corps to IDCA in light of the conclusions of that review.

Implementation

The President’s decisions will be implemented by a combination of a reorganization plan, Executive orders, and agency delegations. OMB staff, in cooperation with State, AID, and Ambassador Henry Owen, will be responsible for relations with the Congress, the press and the public, will draft the necessary documents, and will lead Hill presentation of the proposal. Agencies will, of course, be consulted on a regular basis and may be asked to detail supporting staff to OMB on a temporary basis. The reorganization will be implemented within the overall budget and personnel ceilings allocated to the agencies for fiscal 1980.

Your cooperation and support is appreciated. Questions may be addressed to Peter Szanton (395-6800) or Eric Hirschhorn (395-3727).

1. Source: National Archives, RG 59, Records of the Under Secretary for Management (M), 1978–1979, Box 6, Chron February 7–16, 1979. No classification marking.