Insights from Bush Institute global health expert Hannah Johnson
The Millennium Challenge Corporation (MCC) was created more than 20 years ago by President George W. Bush as an innovative tool for U.S. foreign investment. Since then, MCC has enhanced U.S. national and economic security and helped lift more than 300 million people out of poverty across the world.
Executive Director of the George W. Bush Institute David J. Kramer and Senior Advisor Monica Vegas Kladakis recently reflected on MCC’s enduring value for American national security and influence around the world. MCC has delivered astounding success in supporting U.S. interests, at the cost of a small fraction of the U.S. budget. Eliminating the program risks ceding ground to China and Russia.
What makes MCC unique is its emphasis on country ownership, enforcement of rigorous standards for selecting partners, and later monitoring progress and assessing results. The program requires partner countries to uphold democratic governance, investment in people, and policies supporting economic freedom, along with transparency, accountability, and achievement to qualify for and maintain U.S. support. MCC has also maintained essentially flat funding, making it a great deal for the U.S. taxpayers. MCC is a model for other U.S. development initiatives, including the President’s Emergency Plan for AIDS Relief (PEPFAR), particularly around ensuring clarity and accountability during its transition towards country ownership. Applying a similar approach would allow countries to gradually take on the fight against the HIV/AIDS epidemic while ensuring long-term sustainability and continued progress.
Ally Updates
MCC is not the only foreign assistance program that can serve as a model for PEPFAR’s transition towards country ownership. In a recent article for KFF, Jennifer Kates discusses six graduation approaches that PEPFAR might adopt, based on programs such as the Global Fund to Fight AIDS, Tuberculosis and Malaria, Gavi, the International Development Association, and MCC. Across all these approaches, income, co-financing capabilities, and a series of data-informed metrics emerge as impactful ways to define a graduation threshold. As PEPFAR moves toward country ownership, these metrics, coupled with key prevalence criteria, can be especially effective. The piece is a great example of the prudent strategies that will enable PEPFAR to successfully transition countries away from U.S. support without backsliding after decades of progress.
Figure of the Week
46%
In a recent survey conducted by UNAIDS on the status of countries’ HIV commodity stocks and supply chains between February and April 2025, 46% of countries had reported supply chain management issues. Following the release of the lifesaving PEPFAR waiver, countries have slowly regained access to HIV treatment and care. However, intricate health systems supported by PEPFAR are difficult to shut off and turn back on. As a result, even when HIV commodities exist in country, they may not always be reaching health facilities. This has led to reports of patients facing shortages that may undermine trust in U.S. support and reliability.
Bush Institute Insights
It remains unclear whether proposed cuts to State Department funding may affect PEPFAR’s operations. Nicole Bibbins Sedaca, the Kelly and David Pfiel Fellow at the Bush Institute, recently discussed the proposed funding cuts for diplomatic and foreign assistance. As Bibbins Sedaca argues, such cuts would weaken America’s soft power throughout the world and only necessitate increased military spending in the long run. The United States’ soft power, Bibbins Sedaca writes, “depends on the direct contacts and relationships that our diplomats build and the goodwill our foreign assistance promotes.”
PEPFAR too depends on a bedrock of diplomacy and goodwill to succeed. Local diplomacy teams are necessary to run PEPFAR efficiently, as well as to keep the program transparent and accountable. Further cuts to the State Department could erode the diplomatic infrastructure that supports PEPFAR on the ground.
In the News
- In a recent opinion piece for Fox News, former White House Director of National AIDS Policy Joe O’Neill outlines the need for both a strategic internal review and efficient funding for PEPFAR. He states that keeping the program funded should be a bipartisan priority, especially given that PEPFAR’s strategy and tactics are “undeniably working with an incredible return on investment.”
- Professor Francois Venter, a clinician researcher at Wits University, wrote an op-ed in the Daily Maverick that details the unraveling of the health system delivering HIV care in South Africa. He previously led large PEPFAR-funded HIV programs in the country and recounts the incredible success of the program in the region and calls on the government to urgently address a renewed health epidemic that is “all preventable.”
- Bloomberg reports that recent changes to U.S. foreign investment may pose challenges for the rollout of lenacapavir, a long-acting injectable drug developed by Gilead. Seen as a potential gamechanger for HIV prevention, lenacapavir would allow women to protect themselves discreetly, avoiding the societal stigma often associated with daily antiretroviral use. The drug is already approved in the U.S., European Union, and several other countries for treating people with multidrug-resistant HIV.
