Category: Effective Compassion

My commentary last week on the situation of the Silver Ring Thing has occasioned some conversation on the LewRockwell.com Blog (here, here, here, and here). The consensus on the faith-based initiative seems to be that, in the words of William L. Anderson, they “were pointing out at the beginning that this was a bad idea, and that taking the state’s money ultimately would mean that the state would be interfering with the larger mission of these religious groups.”

Contrariwise, Joseph Knippenberg, who blogs at No Left Turns and is a professor at Oglethorp University, writes in this week’s The American Enterprise online column that the faith-based initiative is being undermined by partisan Democrats and that it will have to continue under the diligent faithfulness of Republicans.

Citing the differences between the Republican and Democratic approaches, he writes of the former, “because the shekels come without unnecessary shackles, the effect of government funding isn’t necessarily homogenizing or secularizing. In a nutshell, this co-religionist hiring exemption enables government to cooperate with, but not dominate, a vigorous and diverse private philanthropic sector.”

The danger is, in Knippenberg’s view, that the faith-based initiative will become dominated by Democratic partisans, who “would force every government contractor into essentially the same bureaucratic mold. Every recipient of government funding would ultimately be simply an extension of the government, offering more or less the same services in more or less the same setting.”

But even if Knippenberg is right, and there is this vast difference between the approaches of the two parties, it merely serves to underscore my point about the unreliability of government funding. He is responding in part to this Washington Post story which notes the boon that Bush’s faith-based initiative has been to certain conservative-minded charities. (more…)

In this week’s Acton Commentary, “The North American Church and Global Stewardship,” I note that blessed with extraordinary material riches, Christians in North America are increasingly viewing their stewardship responsibilities in a global context. I look at one school in British Columbia and how their local building project also raised funds for a school in Sierra Leone.

Dennis DeGroot, principal of Fraser Valley Christian High School, writes and informs me, “The money keeps coming in for the school project. The students have far exceeded their goal. The total now at $36,000 and money still coming in.” He also says, “My long term vision for this is that all Christian schools would find partnerships like ours in the developing world; true partnerships where we learn from each other where real wealth lies.”

For some background, you can read my brief column in The Banner, “Building on the Tithe.”

Blog author: mvandermaas
Friday, March 17, 2006
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As mentioned in an earlier post, Acton was in Washington D.C. last week to honor the 2005 Samaritan Award-winning programs. But we managed to do a lot more than hold a reception for our honorees – almost all of them also met with members of Congress to impress upon them the value and importance of private charities in their communities.

We spoke with Karen Woods, Director of Acton’s Effective Compassion Initiatives, to get her perspective on a successful couple of days in our nation’s capitol. You can watch that interview by clicking the play button below.




Related items: Acton Senior Fellow Marvin Olasky was interviewed last week by NPR on the White House’s plans to increase faith-based grants. To read about Olasky’s Seven Principles for Effective Compassion, click here.

William Easterly, professor of Economics at NYU, has written a new book challenging the prevailing development orthodoxy of increased aid and the “big push” to combat poverty in the Third World. The White Man’s Burden: Why The West’s efforts to Aid the Rest Have Done So Much Ill and So Little Good, published by Penguin is to be released on March 20th.

I have only read a short bit of it so far, but what I have seen is refreshing. He questions the effectiveness of aid, pointing out that aid has been largely ineffective and more of the same is not the answer. In so doing he goes up against politicians such as Tony Blair and Gordon Brown, economists such as Jeffery Sachs, and rock stars such as Bono and Bob Geldof.

Sachs calls for increased aid and Blair speaks of a “big push” to bring about The End of Poverty. (Sach’s book is also v. interesting by the way) Easterly agrees with Sachs that extreme poverty is a tragedy, but while there is a lot of talk about poverty itself, he says there has been very little said

about the other tragedy of the world’s poor. This is the tragedy in which the West spent 2.3 trillion dollars in foreign aid over the last 5 decades and still has not managed to get twelve cent medicines to children to prevent half of all malaria deaths. The West has spent 2.3 trillion and still has not managed to get four-dollar bed nets to poor families

He contrasts the central planning inefficiency of the aid industry to the market’s ability to distribute 9 million copies of the sixth volume of Harry Potter books to the British and American economies in a single day.

There was no Marshall Plan for Harry Potter, no International Financing Facility for books about underage wizards.

Easterly makes the distinction between what he calls planners and searchers. Planners like Jeffery Sachs and Tony Blair advocate large scale attacks on poverty through aid and global initiatives. Planners operate from top-down schemes that are often well intentioned but have not worked. Searchers on the other hand avoid large scale plans and look for entrepreneurial solutions to solve problems that take into account incentives and accountability.

Despite the evidence, why do big plans remain so popular? Well, one reason of course is that planning schemes are inspiring. End poverty by 2025. Grandiose plans often have the support of big name politicians and celebrities and they promise a solution right away. Piecemeal solutions rarely inspire even when they work. Second, no one is accountable when the fail. And when they do fail the answer is do more of the same thing. The One Campaign is a perfect example. But popularity and good intentions are not a substitute for effectiveness.

A third reason is the prevailing allure of utopian schemes. Easterly writes that the planning approach to foreign aid is part of the what Karl Popper calls the “utopian social engineering” approach to problem. This approach has been tried and failed in diverse times and places such as the five year plans of the Soviet Union, the structural adjustment programs of the World Bank in Africa in the 1980s and 90s, and the “shock therapy” used on the transition economies after years of failed planned economies.

Utopianism is nothing new. Eric Voegelin saw Gnosticism and utopianism as the driving force of modern politics, and it appears to be the driving force of aid as well.

Maybe Easterly’s challenge will wake people up to the failures of planning and get them to respect the entrepreneurial capabilities of the people in the developing world. As Hernando de Soto has pointed out in The Mystery of Capital, there is no lack of entrepreneurial spirit in the Third World.

Instead of increasing aid and more top-down plans decrease regulation and barriers to starting businesses, and let local entrepreneurs and the markets find solutions that far away planners have been unable to accomplish.

Blog author: dphelps
Wednesday, March 15, 2006
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Go here for Acton’s new video, “Solutions,” which offers a real starting place for all of us who want to do something about poverty and hunger.

Touting the success of his faith-based initiative last week, President Bush noted that faith-based charities received more than $2 billion last year from the federal government. But even as Bush announced that the Department of Homeland Security would be the 11th agency to establish an office for the faith-based initiative, some groups are finding the money to be a mixed blessing.

An example is The Silver Ring Thing (SRT), which following a settlement between the ACLU and the Department of Health and Human Services, can no longer recieve federal funds under its current program. In this week’s Acton Commentary, “A Golden Opportunity for ‘The Silver Ring Thing’,” I note the temptation facing SRT “to acquiesce to the HHS regulations and attempt to rigorously separate the faith element out of the program.”

I conclude that “the temporary setback of the loss of government funding has the potential to be a long-term opportunity for The Silver Ring Thing,” in the sense that SRT can seek out private sources of funding and evade the strings that are inevitably attached to government funding.

“You can’t be a faith-based program if you don’t practice your faith,” said President Bush. He also said, according to the AP, “It used to be that groups were prohibited from receiving any federal funding whatsoever because they had a cross or a star or a crescent on the wall. And that’s changed, for the better.”

We can hope, however, that the faith element in religious charities is not merely restricted to mere display of a religious symbol, but pervades the charitable work of the organization. It’s this “damaging form of secularization: the kind that separates Christian faith from works,” that The Silver Ring Thing must resist.

David Kuo, a former deputy director of the White House faith-based office, criticized the administration for allowing the initiative to become “a whisper of what was promised.” Acton senior fellow Marvin Olasky, in an interview on NPR’s All Things Considered, expressed disappointment with the lower priority the faith-based initiative from the Bush White House.

But at least part of the difficulty the program faces comes from the problems posed by the enforcement of secularizing regulations by government bureaucracy. When asked about the impediments that governmental regulations put on their charitable work, one non-profit worker responded: “The complexities of the laws affecting part-time workers have made it impossible for us to hire candidates we could afford to pay. We have been amazed to learn that hiring even one part-time employee makes us a ‘pen-pal’ with a complicated array of government agencies.”

Read the whole commentary here.

Last Wednesday, I was privileged to attend the Samaritan Awards Gala in Washington, D.C. I have to say up front that Acton’s Effective Compassion events are probably the most enjoyable for me to attend because invariably one comes into contact with a group of very special, very dedicated people who are completely devoted to what our society would term “lost causes,” and having great success.

Ken Ortman

While there were a number of award-winning programs at the Gala this year, I’d like to take some time to focus on the 2005 Samaritan Award Grand Prize Winners, Ken and Sheila Ortman of Lives Under Construction Boys Ranch in Lampe, Missouri. Ken and Sheila were joined in D.C. by their daughter Melissa, who serves as the Development Director for the Ranch, and 7 young men who are currently residents in their program.

Sheila Ortman

Ken, Sheila and Melissa are wonderful people – remarkably kind, decent, and humble – who are doing amazing work with young men who come out of shockingly difficult circumstances. They are hard workers – Ken remarked during a conversation that he couldn’t imagine working at a job like mine, which involves a lot of sitting at a desk – who moved from their South Dakota farm to southwestern Missouri in order to start a new life working with troubled boys. And they are successful – the LUC program has a 92 percent success rate over the last 20 years, turning many young men away from lives of crime and substance abuse and toward a productive life in society. They do so by establishing a structured environment within which the boys can learn respect for God, authority figures, and gain a proper view of themselves as persons.

Melissa Ortman

We had the chance to meet 7 of the young men who live at the ranch, and the transformation in their lives is evident and remarkable. By all outward appearances, these boys were just like any other group of young people touring Washington, D.C. You’d never know that each of them had likely had severe drug or behavioral problems and numerous encounters with the law. They were a group of normal, if somewhat rambunctious teens.

The LUC Bunch on the Mall in Washington, D.C.

It is truly a blessing to meet people like the Ortmans, and it was great as well to watch the boys – many of whom were on their first trip to a large city. As I noted earlier, I always enjoy Acton’s Effective Compassion events, but having these young men along added a spirit and sense of adventure to this trip that will make it unforgettable for me.

If you haven’t done so in the past, I encourage you to check out the many fine charities like LUC Boys Ranch that are in our online Samaritan Guide, which is an excellent resource for anyone looking for effective private charities across the United States. Many of the programs in the guide are very small, but doing amazing work, and are well worth your attention and support.

I had an opportunity to talk with a few of the boys and with Ken, Sheila and Melissa. To hear my conversation with the Ortmans, click here (4 mb mp3 file). To hear from the boys, click here (1.9 mb mp3 file).

The news from across the pond today is that the UK government is announcing that it will miss its target set in 1999 to reduce the number of children in poverty by 1 million. According to the BBC, “Department for Work and Pension figures show the number of children in poverty has fallen by 700,000 since 1999, missing the target by 300,000.”

This has resulted in the typical responses when government programs fail: calls to “redouble” efforts and to increase funding, spin the results as a measure of success, and acknowledge that there is “still much to be done.”

But one member of the government seems to have an idea of the right solution. “The Conservatives’ David Ruffley, spokesman on welfare reform, said it was ‘disappointing’. He said his party agreed on the aim but not the means of reducing child poverty.”

“Child poverty is a scourge in society. And the numbers are too high. But what I think needs to be done is more creative and imaginative thinking,” he said.

Government should not be at the front lines of the fight against poverty for one simple reason: it does not create wealth. Entrepreneurs and commercial enterprises do. And as such government certainly should not be the only element in combatting poverty.

David Laws MP, Liberal Democrat Shadow Work and Pensions Secretary, gets at the heart of the issue when he says, “It is no surprise the Government is failing to deliver when the CSA is in chaos, tax credits are a mess and our lone parents employment rate is one of the lowest in Europe” (emphasis added).

That final point is crucial. Unless the government is going to create jobs for these parents in one of its many departments and bureaus, it falls to businesses to employ them. This is how it should be, of course, and any responsible poverty fighting strategy needs to reckon with this reality.

Bono and the One Campaign want us to sign a petition encouraging the government to spend 1 percent of the U.S. budget for aid to developing countries. The One Campaign states that this would “transform the futures and hopes of an entire generation of the poorest countries.”

Now I admire the intentions of Bono to fight against poverty and he puts his money where is mouth is. But how do we know that increased aid will make a difference? How will the money be spent? Billions of dollars of aid have poured into developing nations, often with minimal if any positive results. Why does increasing something that really hasn’t worked going to make it better. I would understand and support it if we saw results that aid really makes a difference in providing a foundation for sustainable growth that would enable developing nations to lift themselves out of poverty, but this has not been the case. Aid often goes to the hands of corrupt leaders or gets squandered away. Further it is too often connected to ideology that has little or nothing to do with development or poverty, e.g., population control. How many millions of dollars a year go into population control programs despite little or no evidence of a causal relationship between increased population and poverty? In fact, population can often be a positive element for economic growth. See Jacqueline Kasun’s book The War Against Population or Julian Simon’s the Ultimate Resource.

But what if the problem is not insufficient aid, but something else?
According to Hernando de Soto the problem is the Mystery of Capital. There are billions of dollars of “dead” assets in the developing world. Assets that cannot be turned into capital and thus can’t be an engine for economic growth. There is also a lot of saving in the developing world. De Soto writes:

Even in the poorest countries the poor save. The value of savings among the poor is, in fact, immense—forty times all the foreign aid received throughout the world since 1945. In Egypt, for instance, the wealth that the poor have accumulated is worth fifty-five times as much as the sum of all direct foreign investment ever recorded there including the Suez Canal and the Aswan Dam. In Haiti, the poorest nation in Latin America, the total assets of the poor are more than one hundred and fifty times greater than all the foreign investment received since Haiti’s independence from France in 1804.

He then writes:

If the United States were to hike its foreign aid budget level to the level recommended by the United Nations—0.7% of national income—it would take the richest country on earth more than 150 years to transfer to the world’s poor resources equal to what they already possess.

Because these assets are not properly documented with legal title etc, they cannot be turned into capital to start businesses and create wealth like they are in the developed world where we do this every time an entrepreneur mortgages his house to start a business. Now DeSoto’s work is not a panacea, but it addresses some serious problems that need to be addressed. It also recognizes that rule of law, private property, and economic and entrepreneurial opportunity are needed for development.

The One Campaign is exciting, and it is supported by host of cool people. But although it feels good it doesn’t mean that it is the answer. The problem is a lot more complex than the One people make it out to be, but their way has been tried and tried to little avail. Maybe government aid isn’t the answer after all.

An interesting piece in Tuesday’s Financial Times (registration req.) by Jagdish Bhagwati, economist at Columbia University. In the form of a letter to U2 front man Bono, Dr. Bhagwati offers a (I think) stinging criticism of attempts to save Africa through appeals for more governmental spending. (This is especially interesting since Bono plays off the songsheet of another Columbia economist Jeffrey Sachs.) If you can find a copy of the article, I highly recommend it, but in the meantime, here is a sample:

But, if you have erred in allying yourself with the development experts who wrongly focus exclusively on aid spending in Africa itself, a greater folly is to have tied your initiative to the aid target of 0.7 per cent of GNP. This target goes back to 1969 and has not been met except by a tiny fraction of donors, essentially the Scandinavian countries. The problem is that the target relates to government spending. Fiscal spending is subject to what economists call “hard budget contraints.” There are always many demands on the government. The US, for instance, has just had a colossal increase in spending on the Iraq war and on Hurricane Katrina relief and reconstruction…

How, then, are we to translate the enthusiastic altruism that you have generated, dear Bono, into larger, sustained flows of aid? Surely the answer is to go after personal, rather than governmental, flows…

So, if you take seriously the estimated audience for Live8 concerts at 2bn, halve it for those who were there for a lark or are impoverished themselves, and halve it again for those who attended the concerts twice, you would have half a billion who could sign up for an average pledge of $50 a head as a supplement to their normal giving, yielding a net sum of $25bn outright. The money would be worth almost twice that amount in actual aid, since they would be grants wheras most aid consists of loans that must be repaid.

This would mean abandoning some of your current allies. But you can do nothing less if your efforts are to yield results. In a recent interview, you said that you expected your music would endure forever but poverty would have ended in a hundred years. I wish you good luck on your music. But not even a hundred years would suffice to end poverty if you fail to correct your course.