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How the Red Cross Raised Half a Billion Dollars For Haiti and Built 6 Homes

An anonymous reader points out an investigation from NPR and Propublica into how the Red Cross spent the $500 million in relief funds they gathered to help Haiti after the country was devastated by an earthquake in 2010. They found "a string of poorly managed projects, questionable spending and dubious claims of success." While the organization claims to have built homes for 130,000 people, investigators only found six permanent homes they could attribute to the charity. The Red Cross admitted afterward that the 130,000 number included people who had attended a seminar on how to fix their own homes.

"Lacking the expertise to mount its own projects, the Red Cross ended up giving much of the money to other groups to do the work. Those groups took out a piece of every dollar to cover overhead and management. Even on the projects done by others, the Red Cross had its own significant expenses – in one case, adding up to a third of the project’s budget." The Red Cross raised far more money for Haiti than any other charity, but is unwilling to provide details on where the money went. In one case, a brochure that extolled the virtues of one project claimed $24 million had been spent on a particular area — but residents of that area haven't seen any improvement in living conditions, and are unable to get information from the Red Cross. The former director of the Red Cross's shelter program said charity officials had no idea how to spend the money they'd accumulated.

11 of 235 comments (clear)

  1. They throw money at shit they don't need... by kiphat · · Score: 5, Insightful

    Having witnessed first hand how the Red Cross spends its money on IT infrastructure it doesn't need, I refuse to give them a single dime.

    1. Re:They throw money at shit they don't need... by ErikTheRed · · Score: 5, Interesting

      Having witnessed first hand how the Red Cross spends its money on IT infrastructure it doesn't need, I refuse to give them a single dime.

      This! I've seen this in other large "non-profits" as well. It's like they don't even know how to do more with less (I own two businesses and could speak volumes on the subject) - they just declare that they "need" more money, fundraise, and then blow it out the way their high-priced consultants tell them to. I don't think they're necessarily evil, but they are run by people whose good intentions far outweigh their management skills (to be charitable, pun intended).

      --

      Help save the critically endangered Blue Iguana
    2. Re:They throw money at shit they don't need... by Anonymous Coward · · Score: 5, Informative

      Though not about the Red Cross, I have two anecdotes about Haiti relief efforts. A 20 year old friend of mine wanted to help so he signed up with a charitable organization to travel to Haiti and help. He used all of his savings to pay for plane tickets, housing, meals, and to donate to the program. He also did it using his 2 week vacation time for the year. They were assigned to teams of about 10 each of college aged Americans. They were given shovels, rakes, and wheel barrows and told to clean up the destroyed shanties. They worked morning until night while the locals watched them. Each week part of the group left and a new group arrived. Some stayed for one week, some for two, others for 2 months. This was going to be a year long project or more to clean the ruined shanties from the valley and hillside. A bulldozer and backhoe could have done it in a month or less, then they could begin rebuilding. The big question is why were the locals that would benefit from all this work not helping? They just stood around and watched. This was unskilled labor anyone could do it.
      The other is our local university has a charitable student org that was also getting students to self pay to go help "Rebuild Haiti". All they ended up doing was teaching English.
      Waste, waste, everywhere.

    3. Re:They throw money at shit they don't need... by ShanghaiBill · · Score: 5, Insightful

      All they ended up doing was teaching English. Waste, waste, everywhere.

      How is teaching English a waste? Haitians speak a creole, that is unintelligible to even standard French speakers. This isolates them from the world economy, and is part of the reason they have 15% of the per capita GDP as the neighboring Dominican Republic, where standard Spanish is spoken. English lessons should be very useful.

  2. Debunked already. by Anonymous Coward · · Score: 5, Informative

    This has already been debunked on skeptics stackexchange http://skeptics.stackexchange....

  3. Re:Haiti government by frovingslosh · · Score: 5, Funny

    Absolutely. they could have built more than 6 homes for Haiti government officials with it, and very nice homes too.

    --
    I'm an American. I love this country and the freedoms that we used to have.
  4. Local charity by vivaoporto · · Score: 5, Insightful

    This and many other examples like

    - PETA euthanizing more animals than they shelter
    - UNICEF expenses of 52 million dollars (pdf) in expenses related to management and fundraising (out of a 600 million dollars budget, and that's one of the best managed ones out there)

    show that it is much more efficient to donate time or money locally instead of to big organizations.

    Donate to your local food bank, soup kitchen, volunteer some time in the retirement home, the satisfaction will be the same and the effects will be much more efficient. Or, at the very least, don't screw people over, it is more than enough if you can do that.

    Why should you donate anything to help someone in the other side of the world while people needs your help in your own neighbourhood?

    1. Re:Local charity by grcumb · · Score: 5, Informative

      - UNICEF expenses of 52 million dollars (pdf) [unicefusa.org] in expenses related to management and fundraising (out of a 600 million dollars budget, and that's one of the best managed ones out there)

      (I'm not even going to comment on PETA because they have jack shit to do with the current conversation.)

      You are actually complaining about an administrative overhead of 9%? Seriously?

      For comparison, Apple's OPEX was a little over 25% of revenues as of March 2015. Google's was a little less than 25%. Microsoft's was 22%

      These are all operations that have significant global logistical operations, and involve a combination of scale and skill in their day-to-day operations.

      I assisted UNICEF (as a local 'fixer') with their operations when cyclone Pam hit Vanuatu. (See here for a blow-by-blow account.) It is emphatically true that costs are very high in the immediate aftermath of a disaster. Spending time nickle-and-diming over expenses can cost lives. We needed phones, cars, room to work (their local HQ was damaged), food and water, and sufficient staff and infrastructure to move hundreds of tonnes of food and supplies at a time.

      For the record: The Red Cross and UNICEF were the first organisations to deliver emergency supplies, because they had the foresight to pre-position materials and equipment in-country prior to the disaster. That was money well-spent.

      And yet... and yet the biggest problem we faced was middle management second-guessing the people at the operational level, failing to support them because of the expenses they were incurring. And this fear continues to permeate precisely because of stories like this.

      Let's be perfectly clear: It was the AMERICAN Red Cross that screwed up so royally here. Not the International Red Cross, which provides unique and necessary services throughout the world.

      You wouldn't tar every single technology company with the same brush as games maker Electronic Arts (who really do deserve their own special circle in Hell). So why, when one NGO manages their way to disaster, does giving to charities suddenly become unwise?

      I have witnessed—up close and in more detail than anyone could ever want—the effects of disaster. I'm still working to document the many successes and failures of cyclone Pam. And I will say without hesitation that the mantra here in Vanuatu was 'we will not be another Haiti'. Haiti really was a clusterfuck from start to finish, mostly because of the local government's inability to control and coordinate the response. In Vanuatu, government officials stayed on the front foot, and were unafraid to take NGOs to task when they first refused to cooperate.

      People need to be reminded: Disaster zones are shitty places to work. They are in fact some of the worst places in the world. And on top of this there are indeed thousand-dollar-a-day careerists who descend on them as a matter of course. But for every one person like that, there are hundreds of dedicated professionals who have devoted themselves simply to helping out. Many of them work on a purely voluntary basis. Mistakes get made every day, for countless reasons, but not least because in a post-disaster situation, you're working with whatever information you've been able to gather by word of mouth; you've got virtually no means to coordinate your efforts, and you cannot know what the worst-affected areas look like until you go there yourself. On top of all that, you're working as much as 20 hours a day, resting for maybe 10-15 minutes at most, and eating whenever someone stuffs an emergency ration into your hand.

      Not to put too fine a point on it, It's really fucking hard.

      So yes, rag all you like on the American Red Cross.

      --
      Crumb's Corollary: Never bring a knife to a bun fight.
  5. Re:Not donating to private charities is easy by kenj123 · · Score: 5, Insightful

    you could move to a paradise country with no taxes. I think Somalia doesn't have a national tax.

  6. Re:Haiti Money went through the Clinton Foundation by amicusNYCL · · Score: 5, Informative

    I don't have any love for Hillary Clinton, but before I accept your claim that she is the personification of evil, do you mind providing a source for any of the claims you're making there?

    I was watching an interview

    What interview?

    with this minister

    Which minister?

    there is nothing to show for it but a couple projects that were photo ops

    Do you really believe that? Over 9,000 homes were built, at a minimum, not to mention consumables like food and water, as well as temporary shelters, repairs to existing structures, and money for rent.

    This is the woman people want for president

    Are you trying to say that she personally approves or disapproves of all Clinton Foundation work in Haiti, which in turn somehow oversees all international efforts? That everything that happens is traced to Hillary personally? Her husband founded the thing, that's why it was originally called the William J. Clinton Foundation. Hillary joined the thing in 2013 (which is several years after the 2010 earthquake, in case you're curious), and she said she was going to work on issues concerning women, small children, and economic development.

    Or, is this what you wanted to talk about:

    The 26-member international Interim Haiti Reconstruction Commission, headed by Bill Clinton and Haitian Prime Minister Jean-Max Bellerive, convened in June 2010. That committee is overseeing the US$5.3 billion pledged internationally for the first two years of Haiti's reconstruction.

    The commission was critiqued by Haitian groups for lacking Haitian civil society representation and accountability mechanisms. Half the representation on the commission was given to foreigners who effectively bought their seats by pledging certain amounts of money. An international development consultant contracted by the commission was quoted as saying, "Look, you have to realize the IHRC [commission] was not intended to work as a structure or entity for Haiti or Haitians. It was simply designed as a vehicle for donors to funnel multinationals' and NGOs' project contracts."

    Because, for a minute there, you sounded like just another political idiot taking any opportunity to bash whoever you don't like. But surely that's not the case, right?

    --
    "Our two-party system is like a bowl of shit looking at itself in a mirror." - Lewis Black
  7. Re:Not donating to private charities is easy by Anonymous Coward · · Score: 5, Interesting

    you could move to a paradise country with no taxes. I think Somalia doesn't have a national tax.

    And you could move to north korea, where the government knows what's good for you.

    Sure, and if you drink too little water you die and if you drink too much water you die - so therefore it's impossible to drink a healthy amount of water.

    The interesting thing to me is that there are also countries where people have it pretty good. And it's not just about race, culture, religion, etc.. For example, there are huge differences between North and South Korea.

    In the countries at the top of the world happiness report (e.g. the Scandinavian socialist countries), an ordinary person can have a secure comfortable life even if they make the occasional mistake, have a nice work/life balance, and aren't particularly smart or lucky. On the other hand, in the countries at the bottom of the list, even people who don't make any major mistakes in their lives, and work really hard and are even quite smart - are often still trapped in insecure lives without basic necessities.

    Now, I'm not necessarily in favor direct wealth or income redistribution (taking tax money from rich people and giving it directly to poor people to spend however they like). But there are a lot of indirect things that governments can do - that really do work to insure that ordinary people have secure comfortable lives. Some things are even a bit outside the box - such as functioning as an employer of last resort during major recessions and depressions.

    Anyway, I'm not an expert but, for Slashdotters who are genuinely concerned about inequality, there's a really good YouTube video of a discussion with Paul Krugman and Robert Solo that's quite inspiring.