"Private charity outpaces, outperforms foreign aid"
- From: Mike <yard22192@xxxxxxxxx>
- Date: 1 May 2007 07:10:26 -0700
http://www.washtimes.com/specialreport/20070429-122223-6928r.htm
Private charity outpaces, outperforms foreign aid
By Tom Carter
THE WASHINGTON TIMES
Published April 29, 2007
For more than 10 years, Pastor Kirkland Walton of St. Peter's Baptist
Church in Glen Allen, Va., has passed a separate collection plate for
Africa on Sundays.
That offering is then passed on to Africare, a charity that was
just awarded four stars, Charity Navigator's top ranking, for
delivering more than 90 percent of each dollar it receives to Africans
in need.
"The African-American community has always been in the trenches in
our own community, and we understand that there is a tremendous need
to remember our brothers and sisters in Africa," Mr. Walton said.
In the past five years, Africare has given more than $300,000 in
donations from black churches throughout the United States.
"People know that when they give to Africare, they're investing
directly in programs that reach the people of Africa," said Africare
President Julius E. Coles.
According to Africare and certified by Charity Navigator, more
than 93 cents of every dollar spent by Africare during the 2006 fiscal
year went to program-related expenses -- about $37 million spent on
development work and humanitarian aid.
Charity Navigator lists more than 100 charities dealing with some
aspect of Africa -- food, water, sanitation, HIV, persecuted
Christians, saving wildlife -- and 44 earned four-star ratings.
Africare -- which is funded in part by U.S. government money,
dozens of other Africa charities and parishes such as Mr. Walton's --
is just one example to illustrate that Americans are hands-down the
most generous people on the planet.
In 2005, Americans donated more than $95 billion to the developing
world. That is almost four times what the U.S. government gives in
foreign aid and many times more than what Europeans give in public and
private donations, according to a study by the Hudson Institute, to be
released next month.
"There is a whole new world of philanthropy out there, and it is
being led by the United States," said Carol Adelman, director of the
Hudson Institute's Center for Global Prosperity.
The U.S. government is often criticized for being stingy. Despite
spending more than $2.3 trillion in development aid since the early
1960s, it ranks just 23rd among the top 25 developed nations in terms
of government aid as a percentage of national income.
Private donors step in
But since 1990, private philanthropy has far exceeded government
funding. U.S. private donors coughed up an estimated $95.2 billion in
2005 -- nearly four times the $27.6 billion spent in official foreign
aid -- for schools, orphanages, medical clinics, supplies and other
development programs in Africa, Latin America, Russia, Eastern Europe
and Asia.
Bill and Melinda Gates and Warren Buffett got the headlines for
private pledges of billions of dollars in health and education
programs abroad, but much more comes from ordinary, churchgoing
American families.
"It comes down to religiosity, those who go to church. Those who
go to church donate more than those who don't," Mrs. Adelman said.
According to Arthur C. Brooks, author of "Who Really Cares:
America's Charity Divide, Who Gives, Who Doesn't and Why it Matters,"
91 percent of people who attend regular religious services donate to
some charity or another each year, as opposed to 66 percent who rarely
or never go to church.
"Religious people donate more money than nonreligious ones, even
to secular causes. And since America is a more religious nation than
are most European democracies, charitable giving here occurs at a
higher rate," Mr. Brooks writes.
Official government aid is usually calculated as a percentage of
gross national income (GNI), formerly known as gross national product,
or GNP.
The U.S. government devotes just 0.22 percent of its GNI to
foreign aid, while Norway's government, which ranks No. 1, gives 0.94
percent.
However, in total amounts, the United States government and
private donors spent nearly $123 billion in overseas assistance in
2005, six times more than any other nation. Britain followed in second
place with $19.8 billion and Japan in third with $19.68 billion.
"American colleges and universities give more in scholarships to
foreign students than Norway, Finland, Sweden or Denmark each gives in
[total] foreign aid," said Mrs. Adelman.
Colleges and universities donated $4.6 billion in foreign
scholarships in 2005. Churches and religious organizations gave $5.4
billion. Secular organizations gave an estimated $16.2 billion, which
includes volunteer time, or the labor of Americans who traveled abroad
to build churches and schools, or work in clinics.
Money for home
By far the largest figure in U.S. private donations came from
remittances, money that immigrants send home. According to the Hudson
study, U.S. immigrants sent home -- mostly to Latin America -- $61.7
billion in remittances in 2005. In other words, two-thirds of U.S.
private philanthropy overseas is in the form of remittances from legal
and illegal immigrants.
Using figures from the Inter-American Development Bank, the World
Bank and the U.S. Bureau of Economic Analysis, the Hudson study found
that the estimated 12.6 million immigrants living in the United States
earn about $500 billion a year, and more than 10 percent of that is
sent home.
"Some people say we should not include these figures, because that
is just family members giving to family, but the studies clearly show
that remittances reduce poverty," Mrs. Adelman said.
She said there is no way to determine if the immigrants sending
remittances home are legal or illegal immigrants, but the 12 million
figure is often used to describe the number of illegal aliens in the
United States.
Mrs. Adelman said the foreign-aid community is loath to include
remittance figures, because it undermines the argument that more
government foreign aid is needed.
"Regardless of the motive, remittances are reducing poverty, and
it is a significant flow," she said. "Remittances are probably the
greatest poverty-reducing agent in the world today."
Regardless of their status, she said, Latin American immigrants in
the United States are donating in church, forming hometown
associations, holding bake sales, collecting donations and
participating in "traditional American philanthropy."
And Latin American immigrants tend to be religious. Many are
devout Catholics and follow the pattern that religious people tend to
give.
Jeremiah Norris, also at the Hudson Institute and a researcher on
the report, said that the remittance number is underestimated by as
much as 50 percent.
"This number does not count the material goods sent home -- the
Nike sneakers, or refrigerators and appliances that are sent home," he
said.
Some organizations are uncomfortable with the Hudson findings, but
"our numbers have not been challenged," Mr. Norris said. He also
maintained that private aid is far more efficient than relief that is
controlled and distributed by the government.
Much money, little effect
Last month, a Canadian government committee on foreign affairs
concluded that, after 40 years of aid, little has been done with its
$12.4 billion in bilateral assistance to propel Africa from economic
stagnation or to improve the quality of life on the continent, Mr.
Norris said.
The committee found that Canada's International Development Agency
was ineffective and ordered an immediate review, with the possibility
of closing it down or folding it into another agency.
A study produced by the Cato Institute, a libertarian think tank,
in 2006 -- titled "Does Foreign Aid Help?" -- concluded that "the
empirical evidence on the effectiveness of foreign aid is
discouraging."
The Cato report by Simeon Djankov, Jose G. Montalvo and Marta
Reynal-Querol said that "recent literature ... provides ambiguous
results on whether [government] foreign aid helps or hinders
developing countries."
In fact, "foreign aid has had a negative impact on the democratic
stance of developing countries, and on economic growth by reducing
investment and increasing government consumption," said the study.
Another problem is that U.S. government aid is tied up with
multiple legal constraints. Food aid purchased with U.S. tax dollars,
for example, must be bought from American farmers and shipped on U.S.
ships.
Inefficient aid
This makes U.S. food aid far more expensive than if it were bought
in the region, and in the event of a drought, it takes much longer to
reach those in need. In addition, food aid bought in the region could
put money in the pockets of the farmers most in need and prime the
local economy.
Rep. Jim McDermott, Washington Democrat, touched on this issue
when he reported to his colleagues in testimony in 2003 regarding the
HIV epidemic in Africa "that 53 cents out of every dollar that we put
out for AIDS never left Washington, D.C."
But it is not all Washington's or London's fault.
In his new book "The Bottom Billion," Oxford economist Paul
Collier dissects the failure of foreign benevolence to drag the
developing world out of poverty.
Mr. Collier identifies corrupt governments as one of several
problems. In one heartbreaking example, he followed funds released by
Chad's Ministry of Finance to rural health clinics. Just 1 percent
reached the intended. Ninety-nine percent went into the pockets of
corrupt officials.
As a result, Mr. Norris said, more than 50 percent of health care
delivered in Africa is delivered by missionaries working for private
charities.
"The proselytizing end has diminished. They are really focused on
development," he said.
"We do not oppose government aid," the Hudson Institute's Mrs.
Adelman said. "I don't say that all government aid is a waste of
money, just that certain forms don't work."
Disaster relief has worked pretty well, she said. National-
security support funds, such as the aid that has gone to Israel, Egypt
and more recently Pakistan, "has a mixed record."
"It is development aid that hasn't worked very well at all," she
said.
But Mrs. Adelman said she is optimistic, because American
churches, mosques and synagogues have stepped into the gap.
"We are very positive about what is going on in the private sector
regarding giving. We are very high on churches. It is the private
sector where the action is, where the future is."
.
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