Let's privatize charity

Carlos Alberto Montaner

The two news items, closely related, appeared simultaneously. One of them told about the innumerable scandals spawned by the distribution of federal aid to the hurricane victims in New Orleans. Hundreds of millions of taxpayer dollars vanished in a colossal tragicomedy of errors, ingenious swindles and excesses. Thousands of violations of the rules and instances of fraud, arbitrariness and abuse were committed by those who received help from the federal government, as well as those who dispensed it cheerfully and irresponsibly .

The other news item, which was a lot more encouraging, said that Bill Gates and Warren Buffett, the world's two richest people, were contributing more than 80 percent of their fortunes (with a combined value of nearly US$90 billion) to a foundation created by Gates to fight poverty and the misfortunes of the world's most miserable and wretched people. In a decision that made enormous common sense, most of that money will be spent curing or alleviating the effects of the 20 cruelest and severest diseases afflicting humanity, beginning with the feared AIDS. As elderly people in all cultures say: "First comes health." After that comes the rest of the pyramid of needs.

In contrast with the actions of the Federal Emergency Management Agency (FEMA), whose task it was to help the victims of Hurricane Katrina, Gates' foundation -- whose professional structure is highly motivated and well remunerated -- will distribute its substantial resources in an efficient and rational manner, carefully selecting the recipients and their purposes. For their part, the recipients will act with a lot more decency, among other reasons because they know that the people helping them are not obliged to do it.

What they will receive is a consequence not of a right but of the charitable vocation of a group of citizens eager to collaborate with their neighbors mired in tragedy. This is the tradition of the great private or semiprivate organizations, like the Red Cross, the League Against Cancer, Caritas, the Salvation Army, the Rotarians, Kiwanis, Lions and dozens of similar foundations and organizations that are linked to churches or lay civic institutions. In the United States alone, these groups collect and distribute every year, with reasonable efficiency, no less than US$260 billion, a figure that does not include the incalculable worth of the volunteers who provide services for free in numerous hospitals, schools and social aid centers throughout the country.

Why is the state so clumsy when dispensing charity? The reasons are varied. The first one has to do with the very nature of the transaction. To distribute other people's money fairly is always difficult. The politicians, who must assign the funds, usually see this task as part of the incessant public-relations campaign demanded by their profession. They want their pictures taken and the impression conveyed that they are intensely compassionate, even though they care less about the result of their solidarity with the needy than about the votes that the pictures can generate for them.

For their part, the donors, who are taxpayers, are not usually happy with the way the money is wasted, while the recipients accept those "public" resources with an attitude close to arrogance and downright ingratitude: the state has to help them. In their subconscious mind, public money grows on trees and is not the product of their compatriots' work.

The second factor that hampers public assistance is the bureaucracy. The regulations are infinite and the assistance can hardly be provided rapidly in the aftermath of unexpected catastrophes. The people who dispense it are usually poorly paid, lack a personal philanthropic drive, do not like to act quickly, and end up developing an evident antipathy toward the people they must help.

In addition, they frequently share with the people they help the same lack of caution regarding outlays. Between avoiding abuses and protecting the money given by anonymous taxpayers, and siding with people who are asking for help, flesh-and-bone people who demand aid angrily, federal employees find it easier to give money than to deny it, although deep inside they know they're making a mistake. After all, it's not their money.

Naturally, the solution to this problem is to remove from the state's hands much of the task the state performs so god-awful poorly and turn it over to civilian society as soon as possible. The private sector might never dispense charity perfectly, but it does it a lot better than the state. That's what experience has taught us.

July 2, 2006

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