Thursday, January 28, 2010

Dateline Davos: January 28, 2010

Attending the 2010 World Economic Forum (WEF) annual meeting is a whirl, and you stay on the move. My first session was on social networking where CEOs and top executives from most major sites – LinkedIn, Facebook, Myspace, and Twitter – were answering questions from eager participants on censorship, the value of transparency, and whether literacy, education, and teaching are threatened by social marketing sites. I then hurried to a panel on chronic diseases, where experts worried about the new pandemic of “Globesity,” and an African Minister of Health warned that cancer was now killing more of his countrymen than AIDS, TB and malaria combined. Senior fellow, Jeremiah Norris, and I have been urging the global health community for over twenty years to do more about chronic diseases because they are the largest killers and cancers, cardiovascular disease, strokes and diabetes are a tremendous burden on worker productivity and national healthcare expenditures. It was good to see some serious attention being paid to the no longer “silent” epidemic of chronic diseases.

Topics and events here in Davos range from climate change to energy, nuclear threats, philanthropy, Shakespeare, foreign aid and trade, economic growth, the Great Recession, the economics of happiness, to James Cameron talking about his latest work, Avatar, and Lang Lang, renowned Chinese pianist, playing for us all in the packed Congress Hall.

I participated in a great session on “Rethinking Philanthropy,” with Judith Rodin, President of the Rockefeller Foundation, Martin Fisher, head of Kickstart, Matthew Bishop, New York Bureau Chief of The Economist USA, Alvaro Rodriguez Arregui, Co-founder and managing partner of ICNIA Partners, and Justice Muhammed Taqi Usmani, Vice President, Darul-Uloom in Pakistan. The focus was on the challenges faced by philanthropy today and the innovations for future. Technology in philanthropy as well as in so many fields discussed here at the WEF sessions, reigns supreme. Former President Clinton, who spoke to us today, said he never realized the extent and importance of technology and how cell phones and text messaging have been essential to disaster management operations and fund raising. The Index of Global Philanthropy and Remittances, has been featuring new technologies in philanthropy and remittances over the last four years, and it is exciting to see this field continue to grow and improve.

I was especially happy to finally meet Martin Fisher whose project, Kickstart, we featured in our very first Index. Martin’s manual irrigation machine, The Money Maker, is manufactured in Africa, and he now tells me that over 90,000 Africans have bought this low cost, efficient machine and increased their incomes. His plans are to stick with this winning model and scale up in even more African countries.

The WEF has formed a partnership with the Clinton Global Initiative and the UN to address both immediate and longer term needs in Haiti. Former President Clinton laid out the needs and plans for now and the future, citing the distribution system for just getting humanitarian goods to people is the most critical. He cited over 150,000 dead and 200,000 injured with hundreds of thousands still needing shelter, food and water. The focus of all these partners is on, as Clinton put it today, “Rebuilding the country they want to be, not what they were.” With analogies to Rwanda’s recent growth through its good governance, he was optimistic about the chances for Haiti. Whether Haiti can pull this off is of course the big question in a country that has failed miserably over the years. This will be an opportunity to take the lessons we have learned from past development aid mistakes and try to get it right in Haiti. The terrible tragedy of Haiti has brought the Obama Administration and the world’s development aid network a chance to make some lasting changes in a long suffering country.

Carol Adelman
Director & Senior Fellow
Center for Global Prosperity

Friday, January 15, 2010

Private Response to Haitian Earthquake Expected to be Significant

Today President Obama said “we need to summon the tremendous generosity and compassion of the American people” as he pledged $100M towards the relief effort.

Americans are responding swiftly and generously to needs in Haiti—even before the President’s encouragement.

Within five hours of the earthquake, World Vision had enabled their website giving vehicle. According to
The Chronicle of Philanthropy, charity software provider, Convio, expected to process more donations within a day of the earthquake than it had in their busiest day of 2009 which yielded $20M.

With deaths estimated between 30,000 and 100,000 and approximately 3 million people affected, cash is needed now in the first but fleeting search and rescue phase of the post-disaster response. The window for rescue will quickly come to a close and food, shelter and medicines will be needed before any reconstruction can begin. At the bottom of this blog is a list of different organizations to which you can donate.

While the President has been quoted as saying that this is "one of the largest relief efforts in our recent history", unfortunately Haiti’s disaster quickly follows Myanmar’s cyclone that killed 100,000 and the earthquake in China that claimed almost 90,000 lives.

It will be some time before the world knows the true extent of the damage in Haiti, but based on previous responses to natural disasters around the world, it is likely that the bi-lateral and multi-lateral pledges will be generous, but the private response will be even greater.

While it may have been the Chinese government’s intent to limit the amount of foreign aid received in the face of the earthquake, the U.S. government gave $3.1M as compared to the $90M of donations from American corporations. The government of Myanmar blocked as much outside help as possible following the cyclone, but Americans gave $30.1M to help the Burmese as compared to the official U.S. aid of $24M. Finally, the 2004 Indian Ocean Tsunami claimed the lives of over 230,000. American citizens gave over $2B as compared to the official government assistance of $350M. It should be noted that these tallies do not include the military response which in the case of the tsunami could have been as high as $500M—a sum still dwarfed in value by the private sector response.

Technology is moving money faster and hopefully encouraging greater generosity through the ease of donating via text messaging and the internet. Questions remain about the potential profit that credit card companies stand to gain, with the exception of Capital One who waives all fees for all charity transactions. Citizens should be wary of schemes and take precautions to give to reputable organizations:
World Vision, Doctor’s Without Borders, Partners in Health, Global Giving to name a few.

Given the proximity of Haiti to the U.S., the size of the Haitian Diaspora in the U.S. and the fact that President Obama is keen to be distinguish himself differently from the perception of how his predecessor responded to Katrina, it is likely that this is just the beginning of a response that is sure to be sizeable and perhaps of unprecedented proportions.

Heidi Metcalf Little

Senior Fellow & Deputy Director
Center for Global Prosperity

How to Help in response to the Haitian Earthquake

Philanthropy Action: This blog gives advice to people interested in donating to Haiti who want to ensure their donations are effective.
Harvard Business Review: Blog by Timothy Ogden on how to Help in Haiti.
InterAction: Gives lists and summaries of organizations that are helping in the relief efforts in Haiti.

If you are interested in giving Now:

Catholic Relief Services
World Vision
Doctor’s Without Borders
Partners in Health

If you are interested in giving to Reconstruction:

Haiti Partners: Long established organization working in Haiti. They have created an earthquake response fund where donations will go to emergency and long term needs.
Global Giving: Has different partners in Haiti that you can choose which different organizations to give to.
American Jewish World Service: This organization supports community-based organizations in Haiti.
Yelehaiti: Funded by singer Wyclef Jean in 2005, they have organized an earthquake fund to respond to immediate needs and reconstructive needs of Haitians. The easiest way to donate to Yelehaiti is by texting YELE to 501501 which will donate $5.
Help Haiti Now: a registered non-profit established in 2005. They are based in Montrouis and are ok. Donations are going to support displaced Haitians north of Port Au Prince in Montrouis area.
Geneva Global: Has 5 community based partners in Haiti. Geneva Global is in the process of creating a fund that will allocate donations to their different partners in Haiti.

Tuesday, December 8, 2009

Private Sector Leverages Comparative Advantage to Fight Slavery

As former lead diplomat and interagency coordinator in the federal government to fight human trafficking, I had the privilege to learn a ton about an often ignored, discounted, or misunderstood crime and abuse. From a woman I met in Romania who got TB as a sex trafficking victim in the UK, to the young woman I met in Bangkok who was subject to beating in a secluded Thai seafood processing factory after fleeing repressive Burma, human trafficking is about gross exploitation.

Sometimes it’s about moving across borders, but often it is not. Never having crossed any borders, the U.S.-citizen teenagers who are prostituted throughout America and the people of disadvantaged castes trapped in bonded labor in rice mills and brick kilns in India are human trafficking victims by dint of domestic law and U.N. protocols. “Trafficking” refers to the human trade – treating people as pure commodities robbed of freedom and equal dignity.

Eschewing jargon, human trafficking is best seen as slavery -- typically without chains, but slavery nonetheless.

While the public sector has much to do to help victims and punish their traffickers, so much is to be done by other actors.

I’m now the Executive Director and CEO of Polaris Project, named after the North Star which, with the help of ordinary citizens, guided slaves to freedom in the Underground Railroad. Polaris Project is devoted to breaking the backbone of traffickers in America by reducing the profit and raising the risk. The U.S. government has turned to us as a nimble NGO capable of running the primary national human trafficking hotline (1-888-3737-888) ( ) We serve as a catalyst in the anti-trafficking movement, from the essential micro level of victim services to the macro level of reforming laws and their implementation.

Not just nonprofits, but funders and investors outside of government are essential to the ultimate goal in fighting slavery today: abolition rather than mere mitigation and regulation.

Some philanthropic funders have entered this space. Humanity United funds anti-trafficking nonprofits and the leading coalition Alliance to End Slavery and Trafficking (aptly named ATEST, summoning the image of faithful witness to crimes against human dignity). Additionally, the NoVo Foundation, led by Jennifer and Peter Buffett, has committed to supporting work to empower women and girls against the dehumanization of sex trafficking. (Full disclosure: both fund Polaris Project.) Within a two-week period this autumn, Polaris Project was featured at the Clinton Global Initiative Annual Meeting where President Clinton highlighted human trafficking as a problem deserving action. Polaris Project was recognized for its anti-trafficking work in the U.S. and Japan and for the commitment it made to be an exemplar for the world. I also had the opportunity to speak at the annual meeting during the more politically conservative Philanthropy Roundtable. Yet there’s still a largely untapped opportunity for philanthropy to help the goal of abolition.

Businesses have a part to play too. First, they need to implement in deeds a kind of Hippocratic Oath to do no harm. They mustn’t wittingly or unwittingly spur on human trafficking. In the area of labor, businesses should make supply chains more accountable. The Department of Labor has given them a tool by promulgating a report on countries in which various sectors are tainted by forced labor and onerous child labor. Moreover, there need to be more businesses like Manpower Inc. who admirably seeks to eliminate shark-like labor recruiters who help enslave people through lies, seized passports, and usurious debt.

Businesses should also avert enabling human trafficking for sex—whether airlines and hotels work to not facilitate sex tourism; landlords rebuff brothels; or internet advertisers refuse to allow commercial sex (and with it, sex trafficking) to be promoted by their businesses.

Businesses can contribute to philanthropy against trafficking, and often have comparative advantages to bring to the fight. Just take three partners of Polaris Project:

The direct financial support, legal and technical advice, and research services of LexisNexis – is part of the company’s significant commitment to advancing the Rule of Law around the world. LexisNexis Risk & Information Analytics Group worked with Polaris Project to develop and implement a new web-based system that allows all employees of our national human trafficking hotline to access the same information in real time. It allows employees to service those in need by being able to field and respond to hotline calls more quickly and provide up-to-date, accurate information about local resources and service providers.

In late 2008, Wyndham Hotel Group generously donated one million Rewards points to Polaris Project. We utilize these points to provide emergency hotel stays to victims of human trafficking. Wyndham Hotel Group provides the first step in the recovery process for these victims who have nowhere else to turn. The support of Wyndham Hotel Group is so vital to victims of human trafficking that the Wyndham Hotel Group and Polaris Project relationship was listed in the 2009 Trafficking in Person (TIP) report released by the Secretary of State, Hillary Rodham Clinton last June.

And the aforementioned Manpower recently signed a partnership MOU with Polaris Project. Polaris Project will help Manpower employees gain more expertise on human trafficking in the labor market, and in turn Manpower will help Polaris Project by offering job training and job placement for victims we serve in places like Washington, DC; Newark, NJ; and Tokyo, Japan.
Philanthropists and businesses have slowly entered the fight to end human trafficking. But only when their role matches that in fields like development, international education, HIV/AIDS, and domestic violence will we have the hope of realizing the goal of a world without slavery.

By Ambassador Mark P. Lagon
Mark P. Lagon, PhD. is Executive Director and CEO of Polaris Project, a leading anti-human trafficking nonprofit, running the 1-888-3737-888 national hotline. He was formerly Ambassador-at-Large to Combat Trafficking in Persons at the Department of State.

Thursday, December 3, 2009

Leave the "overhead" to Santa

You're a savvy spender. You use the internet to compare prices, and in a tight economy, you're likely to spend a little time finding and settling on the best price to maximize your budget. Given your smart spending habits, you probably are thinking that the charity most deserving of your money this season is the one that spends the least amount on administrative costs. Before you visit Charity Navigator to see which group can divine the lowest overhead ratio, STOP! Let's think about this a minute.

If you had a choice this Christmas of giving to an organization that frees 10 girls from sex slavery in India and spends 10% on overhead costs or a group that rescues and rehabilitates 100 girls from the same desperate situation but spends 20% on overhead, I bet you'd choose the one that has the greater impact but spends a little more on overhead.

Overhead ratios are popular proxies for measuring efficiency. Especially when the charities you're interested in supporting are in developing countries. It's one thing to be able to see the impact of the local YMCA in the community but a whole other issue when you want to give to an organization in Zimbabwe that you can't see, where you know the government is corrupt, and with whom you may not have any personal relationships but where you know the need is great. It's not that these overhead ratios are a bad idea--it makes sense that you would want to contribute to an organization that spends more on children in need than on mailing out fund-raising letters. But efficiency measures miss the point and are often incorrectly calculated. What we really want is to give to organizations that are effective in changing people's lives for good. The trouble with this aspiration is that it's hard to figure out who is really effective at rehabilitating trafficked girls, healing sick people, eliminating homelessness or eradicating poverty.

When you think about giving to charity, it's my guess that you first give to causes you care about, to organizations you believe in or to programs that your friends ask you to support. If you have any largesse left after reading heart-tugging stories that pull at your wallet, it's possible that you might be looking for some way to compare various charities and decide which ones you will support.

This giving season, leave the "overhead" to Santa as he navigates his way down your chimney, and look for organizations who report on results, find user-reviews of non-profits at,, or, and support organizations who work to measure, as best they can, the tangible ways that people's lives or the systems that impact them are changed.

Heidi Metcalf
Senior Fellow & Deputy Director
Center for Global Prosperity

Tuesday, December 1, 2009

The true cost of the public health approach to HIV/AIDS

This year’s World AIDS Day is particularly timely, arriving a day after World Health Organization recommends a “phase out” of one of its main ARV drugs: Stavudine.

The WHO promotes the public health approach to global AIDS: treat as many as possible, as quickly as possible, as cheaply as possible. In fact, all UN agencies and many NGOs followed WHO's lead and promoted a public health approach as well. In the public health approach, the interventions are designed to be quick, inexpensive, and cover as many people as possible--as in epidemics for infectious and parasitic diseases. On the other hand, in a clinical approach, medical records are the standard method for recording a patient's response to a therapy.

Now, some 4 million patients are under Antiretroviral (ARV) treatment, yet neither WHO nor any other UN agency has any patients' outcome data of a clinical nature to show for the billions expended--until yesterday. On November 30, the
WHO's press release recommended that "countries phase out the use of Stavudine, or 4dt, because of its long term, irreversible side-effects." Stavudine is one of the components of the triple dose combination ARV from India identified as the "backbone" of WHO's '3 by 5' program, launched in December 2003. Stavudine, in single or combination forms, is also one of the most widely used ARVs in Africa.

The triple dose combination ARV was licensed by the Drugs Controller General (India) as a 'formulation' on 26 July, 2001, with several conditions for its use. Among them:
1. "Warning": To be sold by retail as the prescription of a Registered Medical Practitioner only";
2. No reference in the advertisement or medical literature is made that the government has approved the drug.
WHO subordinated both conditions: the first by recommending that tens of thousands of community health workers (not registered medical practitioners) be trained to deliver ARVs and the second by lending its considerable institutional legitimacy to ARV formulations from India which hadn't been approved by any stringent regulatory authority.

Yesterday, the WHO recommended a phase out of this drug due to its long term, irreversible side-effects. If a clinical approach had been used in AIDS treatment, then we would know that patients were having adverse reactions to Stavudine because the medical records would reveal the progress of treatment or lack thereof. Clinicians would then change the therapy and monitor patients to see how they were responding.

To make matters worse, while the WHO has recommended the phase-out of Stavudine, it has not suggested a drug re-call, a standard practice of R&D companies in Japan, the EU, Australia, and the US. With a considerable pipe-line of Stavudine in process, how many more patients must suffer "irreversible side effects" in the absence of a drug re-call?

What is the cost for medical treatment of those affected with "irreversible side-effects" from its use? Did WHO recommend, according to the UN's Universal Declaration on Human Rights, that 'patient consent forms' be secured before Stavudine was administered? Given Stavudine's extensive use in Africa, it is likely that the long term medical care costs for these patients will be larger than the ARV treatment costs for the remainder of patients that were fortunate enough not to have followed WHO's original recommendation of December 2003.

How will AIDS treatment be sustained in the face of such irresponsible treatment protocols?

Stavudine should be the wake-up call for all agencies involved in the treatment of global AIDS. The best thing that the Global Fund can do to improve treatment of AIDS patients is to abandon the public health approach and adopt a clinical health approach. In the short-run, it may be more expensive, but as Stavudine has shown, in the long run it will be greatly less expensive.

Jeremiah Norris
Senior Fellow
Hudson Institute
Center for Science in Public Policy

Thursday, November 12, 2009

The New USAID Administrator: Transactional or Transformational?

As the Obama Administration’s pick for USAID Administrator, Dr. Rajiv Shah is highly credentialed and experienced in the field of foreign assistance and development as well as in the political ways of the world. The question I have for him is whether he will be a transactional or a transformational leader? Will he continue business as usual or finally do the much needed makeover of foreign aid - one that recognizes that the developing world and the delivery of foreign assistance have fundamentally changed, now needing an entirely new government aid business model. (See my previous work with Nick Eberstadt in the Weekly Standard, or in AEI’s Development Policy Outlook.)

If he listens to the concerns of most in the development field, he’ll be transactional – busy moving boxes on organizational charts at USAID and throughout the rest of the government, fighting for more money and people, trying to make USAID a preeminent and independent agency, and decrying the number of USG offices that dispense foreign aid and the lack of coordination therein. In short, he'll be focusing on much loved topics among government officials and the contractors and NGOs who receive billions of USAID dollars.

The topics, however, are of little concern to the people in poor nations. They would much prefer a transformational leader who views developing countries and the people in them as partners, not “recipients,” who expects those partners to have local ownership in aid projects by contributing their own resources and time, and who demands the utmost transparency and accountability in the management of aid funds. They would prefer a leader who focuses on the results of a project in the field, who surveys people in developing countries on what their problems are and how USAID projects could be improved, who provides funds for locally identified problems which will vary from country to country and not necessarily fit into all the earmarks and special interests in Washington, DC.

U.S. Government foreign aid is now a minority shareholder – only 9 percent in the total U.S. financial flows to the developing world. Philanthropy, private investment and remittances make up the rest and dwarf USAID’s budget. This is the new reality of how assistance and investment to the developing world is being delivered. The new USAID Administrator should open up the USAID bidding process to the thousands of privately funded programs by foundations, corporations, PVOs, religious organizations, and individuals, so they can more easily compete with their ongoing successful initiatives or their new innovative ideas.

Most importantly, the new USAID Administrator - to be transformational - needs to understand that the current USAID business model is very broken. By that I don’t mean broken organizational charts, lines of reporting, coordination or morale. (All the new USAID Administrator has to do is read up on what
African and other leaders, have been saying about our foreign aid to know that they don’t care which government aid agency is providing resources, or whether Dr. Shah or Deputy Secretary Jack Lew is signing off on projects, or whether aid officers are demoralized or not.)

They care about being a real partner in USAID projects, having their own skilled, local talent used in projects, and having money spent to develop local capacity and institutions so that they can help themselves and graduate from foreign aid the future. They prefer this demand driven assistance versus the predominant top down project design process where USAID gives huge awards to expensive contractors with high overheads, who then write a lot of reports, make a lot of trips, and hold a lot of meetings with astonishingly poor evaluation of results. (See previous work by
Bill Easterly, Raj Desai and Homi Kharas.) President Obama expressed his concerns on how "western consultants and administrative costs end up gobbling huge percentages of our aid overall." Also, in this same radio address he has noted the importance of demand driven ideas, good governance, and value of investment in addition to aid.

Once the broken business model is fixed, the government aid development community won’t have to call for new organization charts, new seats at the National Security Council, or elevating the topic of “development” as a core pillar of U.S. foreign policy. All this will miraculously happen when there are results that everyone can see and that are delivered at reasonable costs. USAID slipped onto the back burner because it lost its way and didn’t adjust to a new developing world with local talent to work with and a large and vibrant private sector engaging in innovative, faster and more efficient ways of delivering foreign aid. Its new role is still very important – as a convener of resources, helping to identify and support those private and public programs that are working and to bring them into countries that need them - to work with local talent.

Dr. Shah, leave the org charts alone and just find 12 good people who share a new vision for foreign aid, hire them, and get on with it. Nothing raises the stature of any USG agency than projects that work.

Carol Adelman
Director & Senior Fellow
Center for Global Prosperity

Tuesday, November 3, 2009

Where are the outcomes behind health aid?

The Bill and Melinda Gates Foundation have initiated a new endeavor called: Living Proof Project. Through it, they intend to show that American aid has materially improved the health of people in the developing world, and that Americans should see that their investments are working.

Prof. William Easterly's blog,
AidWatch, has criticized the Gates Foundation, mainly on the grounds that its positive contentions about aid are based on WHO data showing improvements in reductions in malaria incidence rates. The Foundation uses the WHO 2008 World Malaria Report as justification and proof that aid has produced positive outcomes. Initially, before the Report was published, WHO's director for malaria programming, stated that there were significant success in a number of countries. But then his report was never finalized and its specific claims were contradicted by WHO's own September 2008 World Malaria Report, by which time the director was no longer chief WHO's chief of malaria programming. Nonetheless, the Gates Foundation continued using his positive data, and it has surfaced in its Living Proof Project.

The larger question, though, is: does health aid affect health outcomes? Over the past few years, studies by competent organizations have wrestled with this issue. In 2001, the World Bank's Development Research Group published a
report showing "that the major driver on reductions in infant mortality is economic and educational: public health investments account for 5% of this decline."

In 2007, the International Monetary Fund released
a policy paper on health aid and infant mortality. It found that "despite the vast empirical literature considering the effects of foreign aid on growth, there is little systematic evidence on how aid effects health, and none at all on how health aid affects health."

In 2000,
the Bulletin of WHO discussed a 1997 examination of cross-national variation in child and infant mortality, finding that "95% of the differences could be explained by differences in income, income distribution, women's education, ethnicity, and religious activities."

A global health study which appeared
in Social Sciences and Medicine found that "public spending on health was statistically insignificant at conventional levels and total public spending explained less than one-tenth of the observed differences."

On evaluations of health projects, it is rare to find any of them based on base line departure points and control groups. Without these, we don't know what effect, for instance, a USAID health program has vis-a-vis other donors working in the same sector in the same country, and within that, if there has been a reduction in infant mortality, what portion of that can be assigned to the public sector vis-a-vis the private sector. For instance, according to the 2007
World Health Report, in Kenya, 78% of all national health expenditures are in the private sector. When there are improvements in infant mortality or maternal mortality, where does the credit lie?

Lastly, when there are health improvements, can they really be attributed to health inputs? Beginning some 30 years ago, USAID funded a rural electrification program in Bangladesh through the
U. S. National Rural Electric Cooperative Association. In 2007, a local research group in Bangladesh conducted an evaluation, using a control group (those homes not in the cooperative). The cooperative had 21 million members. The evaluation found that cooperative members' households had significant reductions in infant mortality, maternal mortality, increases in literacy, land ownership, higher educational levels, female education, and job acquisition. Although Bangladesh is one of the poorest countries in the world, it has reduced infant mortality rates by two-thirds--accompanied by an equal reduction in official aid flows.

In the form of public-private partnerships, those are living proof projects that were initiated by non-governmental organizations in which American’s can find reason for pride. Some 30 years ago, Merck started
a program to combat river blindness. It donated all the therapies required in whatever amounts needed, for the needed duration, into perpetuity. Today, some 20 different public and private organizations participate in this program which has prevented blindness in tens of millions of people, main children living in Africa. A World Bank Evaluation showed that once villagers were able to return to abandoned lands, 17 million hectares were returned to agricultural production, enough to feed 25 million people.

Returning to the Gates Foundation - the goals established by the Living Proof Project are laudable. However, they need to be matched by empirical-based studies that prove information on what the Gates Foundation has set out to show the American people and the world at large.

Jeremiah Norris
Senior Fellow
Hudson Institute
Center for Science in Public Policy