CARE Turns Down Federal Funds for Food Aid
Monday, August 27, 2007
CARE, one of the world’s biggest charities, is walking away from some $45 million a year in federal financing, saying American food aid is not only plagued with inefficiencies, but also may hurt some of the very poor people it aims to help.
CARE’s decision is focused on the practice of selling tons of often heavily subsidized American farm products in African countries that in some cases, it says, compete with the crops of struggling local farmers.
The charity says it will phase out its use of the practice by 2009. But it has already deeply divided the world of food aid and has spurred growing criticism of the practice as Congress considers a new farm bill.
’’If someone wants to help you, they shouldn’t do it by destroying the very thing that they’re trying to promote,’’ said George Odo, a CARE official who grew disillusioned with the practice while supervising the sale of American wheat and vegetable oil in Nairobi, Kenya’s capital.
Under the system, the United States government buys the goods from American agribusinesses, ships them overseas, mostly on American-flagged carriers, and then donates them to the aid groups as an indirect form of financing. The groups sell the products on the market in poor countries and use the money to finance their antipoverty programs. It amounts to about $180 million a year.
Neither the Bush administration nor members of Congress are looking to undo the practice, which has gone on for more than a decade. In fact, some of the nonprofit groups say it has worked well and are pressing for sharp increases in the amount of American food shipped for sale and distribution to support development programs.
The Christian charity World Vision and 14 other groups, which call themselves the Alliance for Food Aid, say that CARE is mistaken; they say the system works because it keeps hard currency in poor countries, can help prevent food price spikes in those countries and does not hurt their farmers. Not least, they argue, it also pays for their antipoverty programs.
But some people active in trying to help Africa’s farmers are critical of the practice. Former President Jimmy Carter, whose Atlanta-based Carter Center uses private money to help African farmers be more productive, said in an interview that it was a flawed system that had survived partly because the charities that received money from it defended it.
Agribusiness and shipping interest groups have tremendous political influence, but charitable groups are influential, too, Mr. Carter said, because ’’they speak from the standpoint of angels.’’
Some charities that champion the system bristle at such suggestions. Their allies in Congress say that maritime and agribusiness interests are essential allies for programs to aid the hungry.
’’Sure it’s self-interest if staying in business to help the hungry is self-interested,’’ said Avram E. Guroff, a senior official at ACDI/VOCA, which ranked sixth in such sales last year. ’’We’re not lining our pockets.’’
But Peter J. Matlon, a Nairobi-based agricultural economist and a managing director of the Rockefeller Foundation, said in an interview that converting American commodities into cash for development was a case of ’’the tail wagging the dog,’’ with domestic farm policies in the United States shaping hunger-fighting methods abroad.
The nongovernmental organizations ’’have been ignoring this evidence for years that there’s a negative impact on the prices farmers receive,’’ Mr. Matlon said.. He is involved in an effort by the Rockefeller Foundation and the Bill and Melinda Gates Foundation, financed with an initial $150 million, to increase the productivity of Africa’s farmers.
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