The shutdown of USAID and the deeper crisis behind it

“Why did you start driving inDrive?”

It’s my go-to icebreaker with drivers in Pakistan. Lately, the answers have been unsettlingly similar. “I used to work in the development sector,” one man told me. “Then I lost my job.”

I’ve heard that line — or a version of it — too many times to dismiss as coincidence.

Since the United States pulled the plug on its aid apparatus, the fallout has been immediate. On the surface, the shutdown of USAID is being framed as just another abrupt policy reversal — a bureaucratic casualty in an era of disruption. But look closer, and it reveals something far more profound: the cumulative weight of domestic and international tensions that have been simmering, both within and beyond the US for decades.

Cycles of aid, cycles of distrust

The first source of strain lies beyond US borders. From its inception as a Cold War instrument, American foreign aid has been shaped by an enduring tension between its declared objectives of development and altruism and its underlying strategic and political calculations.

This duality has long been apparent to the recipient elites and the broader public alike. During the Cold War, many governments acquiesced, in part because Western donors faced little competition and alternative sources of assistance were scarce. That landscape has since changed. As non-traditional donors, most notably China and the Gulf states, have expanded their presence, and as domestic political incentives within recipient countries have shifted, scepticism toward USAID has become more explicit and politically salient.

In countries such as Pakistan, where mistrust of American intentions runs deep, US assistance is often perceived less as generosity than as intrusion. What is now framed as a backlash against American aid is better understood as the culmination of a long-simmering tension and a legacy of mutual misperceptions between donor and recipient.

Pakistan’s experience with US foreign aid agency illustrates this dynamic with particular clarity. American assistance to Pakistan has never been linear or predictable; instead, it has unfolded in cycles closely attuned to Washington’s shifting strategic priorities. During the Cold War, aid was channelled primarily through a security-alliance framework aimed at containing the Soviet bloc, with economic assistance tightly coupled to military cooperation. These flows........

© Dawn Prism