Unintended Consequences: The Harm of Commercialized Charity

Galveston, TX, October 10, 2008 -- Food prepared by Southern Babtist Covention volunteers is loaded onto a Red Cross IRV for distribution in Galveston. Working with The Salvation Army, this kitchen has prepared over one million meals since September 14, the day after Hurricane Ike struck. FEMA photo by Greg Henshall

I wear TOMS everywhere. Whether it’s sockless and 35°C on the beach, trekking through ancient ruins in a forgotten corner of the world, or slipping and sliding across patches of snow and ice on the sidewalk, my TOMS have seen it all. A large part of the appeal, for me, is the “one for one” ideal that company espouses: for every pair of shoes I buy, they give one to someone in need. On the surface this seems perfect, but is everything as it seems? Could I actually be doing more harm than good?image02

  *Infographic courtesy of Oxfam America*

To begin, we must start with the larger picture. Despite popular belief, the United States only spends, as of 2015, only around 0.17% of its Gross National Income (GNI) on international humanitarian assistance. While this number is still quite large (amounting to around $31.08 billion or around $80.37 per person), Oxfam America estimates that the average American believes that around 30% of the federal budget is spend of foreign aid. Why this disconnect?  What’s more, the Trump administration has announced its intentions to heavily slash both domestic and international assistance programs in favor of increasing America’s national defense budget.
It is important to note that while the US is one of the largest benefactors of international aid globally, ranking the most generous country by the World Economic Forum in 2015, other countries (e.g., Sweden) actually provide aid that amounts to close to 100% of their annual GNI. The popular little quips “quality over quantity” and “work smarter not harder” ring true, however. While sending lots of monetary aid is certainly positive and won’t be turned away, the more important aspect to focus on is how it is utilized. We need the aid money to be used more effectively and sustainably rather than just shoveling money at the problem and hoping it goes away.

What happens if this is not the case?
According to The Diplomat, because there is no change in the system that lead to the inequality in the first place, monetary donations are often voided as they go directly into the pockets of the elite – leaving those who need the aid the most penniless. This phenomenon is most evident in the case of the Occupied Palestinian Territories, where around 72% of all aid sent to the Palestinian people is diverted into Israeli coffers and may even support the existing apartheid.

Similarly, Ian Birrell at The Guardian speaks of situations all around the world where naïve Westerners are lured into charity or volunteerism (i.e., combining volunteering and tourism) schemes that actually perpetuate the cycle of inequality that they intended to fix.
It’s relatively easy to pick out the more obvious offenders where the rich pay to hand out food to impoverished families or where sightseeing and other various cultural experiences make up the bulk of the trip. What about the more covert ones? *Cartoon courtesy of Courtney Willett*
Birrell goes on to explain how there has almost become a black market that capitalizes on our desire to help others (read: Inflating our own self-worth and/or social standing). For example, some “orphanages” in Cambodia are said to use children that are purposefully kept in less-than-humane conditions to pray on the feelings – and wallets – of western visitors. Or, in Ghana, where some “orphanages” will let young voluntarists do unnecessary work with the children. After wave and wave of temporary visitors, many of these children grow up to have serious abandonment issues.
Voluntary Service Overseas has claimed that the volunteerism industry is a form of neo-colonialism. After all, what right do unqualified teenagers and the rich elite have to impose their desires to “do good” in developing countries that they know and care nothing about?
This is not just an international phenomenon. Domestic aid organizations fall into the same traps and we must be wary picking the ones we give out money to. The main culprit in American aid organizations is the misdirection of funds away from their intended purposes. Do you know how your money is being spent?

Together, the Tampa Bay Times and the Center for Investigative Reporting published a list of “America’s Worst Charities” that ranks domestic aid organizations by a variety of criteria – one of which being percentage of funds that goes towards direct cash aid towards their respective causes. Surprisingly, six of these charities (including Project Cure and the Defeat Diabetes Foundation, among others) spent a total of 0% of donations on direct humanitarian support. The report seems to be incomplete as it fails to mention other forms of aid other than direct financial support, but the numbers are telling. The National Narcotic Officers Associations Coalition, for example, apparently raised $5 million in the past 10 years while paying around $4.2 million back to solicitors. With a noted 0% in direct financial support, where did the other $0.8 million go?

*Cartoon courtesy of Courtney Willett*

Whatever the answer, the money hasn’t gone towards supporting legislation and representation of national narcotics officers, like the organization would have you believe. That isn’t good enough. Sadly, this is not an isolated incident because, according to Reader’s Digest, there is no law in place that prevents charities from lying to potential solicitors in order to receive donations.

How do we make our charity efficient and sustainable, then?

Sorting between the aid organizations that make effective use of monetary donations, aren’t supporting the volunteerism industry, and to actually tackle the source of the problem rather than the solution can be quite a timely (and exhausting) endeavor. So how should we do it?image03
One of the most important things to know is how a charity or aid organization spends the money it receives. The general consensus is that if an aid organization spends more than 1/3rd (33.3%) of its funds on “overhead” (i.e., administration and management fees, salaries, and other costs associated with making the charity run smoothly and efficiently), it is being dishonest and, well, not very charitable. To do this, simply go online to one the various charity  watchdog organizations that police how much (and on what) charities are spending. The three main staples are the BBB Wise Giving Alliance (www.give.org/), Charity Navigator (www.charitynavigator.org/), and Charity Watch (www.charitywatch.org/).
Regarding volunteerism and other unintended consequences, the best thing to do is ask. The topic of good humanitarian aid versus bad humanitarian aid is a topic that is well-worn in both the academic and public spheres. Many popular news organizations and even academic journals publish highly informed op-eds about volunteerism or the negative effects of charities and/or aid organizations. Don’t forget to play to your strengths, as well. If a chance to go teach micro-economics in Honduras when you are neither an expert in economics nor fluent in Spanish may mean that this organization or particular opportunity isn’t right for you.image01
The most important thing is to find an organization that avoids the pitfalls mentioned earlier is by setting up sustainable infrastructure to prevent the recurrence system of inequality from crashing down again. Likewise, trust organizations that support the locals. Does your organization provide the means for a community to sustain themselves after you’re gone, or is it just creating a system of dependency that paves the way for larger corporations to come in and monopolize the entire process?
All in all, the Center for International Disaster Information claims that if you don’t have the time to fully research the organization you’re donating to, it’s often better to not donate at all until you can put in quality research time. They also recommend that, before donating, ask you questions like this: “Do the aid agency photos show the aid recipients as people with dignity and ability or do they show them as helpless victims?”
So, where does this leave us?
The Matador Network sums it up rather nicely: “TOMS [dumps] shoes in places where people might otherwise be employed to make them. … Shoelessness, such as it is, is a symptom of a much bigger and more complex problem. And while donating a pair of shoes helps shoelessness, it does not help poverty. Things like jobs help poverty. Jobs making things like shoes, for example.”

Have I been saving the world one pair of shoes at a time? No. But that can change. With a little research into organizations that effectively use monetary donations, we can start creating a culture that values the honesty and virtue of charity rather than commodifies it.

View Sources ∨




Countries That Give The Most In Foreign Aid Statistics

The Dark Side of Foreign Aid

72 Percent Of Aid To Palestine Ends Up ‘In Israeli Hands’




How Charities Spend Your Money: Eye-Opening Truths to Read Before You Donate



What to look for when evaluating an aid agency

7 worst international aid ideas


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