The MCC, one of President Bush’s key foreign aid initiatives, is facing severe budget cuts from Congressional appropriators.   Although the president requested $3 billion for the fund for FY2008, the Senate markup of the FY2008 State-Foreign Operations Appropriations bill left the MCC with $1.2 billion.  House appropriators had cut it to $1.8 billion.  The fund, which operates under the apparently innovative principle that “aid is most effective when it reinforces good governance, economic freedom and investments in people,” has had its critics since its inception, but defenders claim it needs “time and money” to prove itself. As a budget fight, even one over foreign aid, the MCC budget isn’t too hot a topic. However, one of the more interesting tactics used by MCC defenders is linking of U.S. foreign aid cuts to the foreign policy of rising “star” (as Lou Dobbs likes to jingoize it) China, which “is making inroads in Africa and the rest of the developing world by offering funding in return for resources like oil and minerals to feed its rapidly growing economy.”  The budget issue is unlikely to be resolved until the fall.