While you are partly correct about the outcome of such spending, your assertion that USAID does not spend the money is a strange claim. It’s like saying a wholesaler runs the business of a small merchant to whom it sells goods.
USAID does indeed spend the money; the contractors are the beneficiaries.
Different contractors. Some contractors spend the money directly in the target countries and domestic contractors oversee those contractors. I’m talking about the domestic contractors who are “spending the money” for USAID.