An "Award" Corporations Don't Want to Win

The annual meeting at Davos, Switzerland organized by the World Economic Forum (WEF) usually brings juicy benefits for transnational corporations, except for a handful that are singled out for a dubious distinction by civil society groups: the Public Eye Awards for irresponsible corporate behavior.

Nominees for the Awards this year include Alcoa, Bayer, Coca Cola, Chevron, Novartis, Walt Disney, Citigroup and Nestlé.

The Awards are aimed at highlighting particularly irresponsible behavior on the part of corporations in the areas of the environment, labor rights, human rights and taxes.

The Award winners are selected from nominees proposed by non-governmental organizations from around the world. The negative Awards are aimed at simultaneously counteracting the influence of the WEF, and to contribute to a debate on the darker zones of globalization that is merely profit-oriented. The goal is to make a point that transnational corporations should be subjected to binding international rules that force them to accept legal responsibility and accountability for their actions, and when it is warranted, punishment.

Two international non-governmental organizations, Pro Natura - Friends of the Earth Switzerland and the Berne Declaration organize the event. Pro Natura, Switzerland's largest environmental group, with some 100,000 members and 45,000 donors, is a non-profit, non-governmental organization founded in 1909. For its part, the Berne Declaration, based in the Swiss capital, was founded in 1968 to promote more just, sustainable and democratic North-South relations.

[Gustavo Capdevila, ipsnews.net]


US Congress discuss aid for Global Pandemics

In the confusion of this post-Cold War, terrorist-troubled world, Congress is betting more and more foreign aid dollars on fighting that one common foe everyone can agree upon: infectious disease.

"Medicine can be a currency for peace" says Senate Majority Leader Bill Frist, a surgeon and a force behind the change. The increase parallels -- and is energized by -- efforts by private philanthropists like billionaire Bill Gates, who pledged Friday to triple his contributions to fight tuberculosis.

Mr. Frist's involvement begins with his medical background, including missions to Africa. As Sen. Frist uses his office and medical credentials to promote public focus on battling disease, the Bill and Melinda Gates Foundation estimates it has committed $6 billion to global health initiatives. The foundation also has promised to increase spending against tuberculosis over the next decade to $900 million from $300 million.

"People question if the government can do it all," Sen. Frist says. "To have the private sector step up and lead in targeted areas captures synergies that otherwise wouldn't be there. I think it's critically important. I really applaud him."

[Excerpt from an article by David Rogers, The Wall Street Journal]


Your Tax Dollars at Work

A just published U.S. government audit of its spending of aid on Iraqi reconstruction reveals incredible irregularities and improprieties, including tens of millions of dollars in cash deposited and withdrawn from a vault without any tracking documentation and up to $60,000 in reconstruction funds gambled away by an American soldier.

U.S. officials "did not effectively manage" more than 2,000 contracts worth $88 million, according to the report by the Special Inspector General for Iraq Reconstruction, which covered spending during 2003 and 2004 in six southern and central provinces.

In one Iraqi city, the United States paid $108,140 for renovations that were never made to an Olympic-size swimming pool. And signed off on repairs to an elevator in the city's general hospital that later crashed to the ground, killing three people.

Read full New York Times article


The Realities of Exporting Democracy

President Bush made “the spread of democracy” his Administrations’ primary mission. But soaring rhetoric has often clashed with geopolitical reality and competing U.S. priorities.

Beyond its focus on Iraq, Washington has stepped up pressure on repressive regimes in countries such as Belarus, Burma and Zimbabwe -- where the costs of a confrontation are minimal -- while still gingerly dealing with China, Pakistan, Russia and other countries with strategic and trade significance.

In the Middle East, where the US administration has centered its attention, it promoted elections in the Palestinian territories, even as it directed money aimed at clandestinely preventing the radical Islamic group Hamas from winning. [Regardless, Hamas won, snatching power from the ruling old guard Fatah, taking a 76 seat majority in the 132-seat Palestinian Legislative Council.]

And although it has now suspended trade negotiations with Egypt, it did not publicly announce the move, nor has it cut the traditionally generous U.S. aid to Cairo.

[Washington Post]


Egypt, 2nd Largest Aid Recipient

After Israel, the U.S.’s next largest aid recipient is Egypt.

How does democracy fare there? Following are excerpts from a recent Washington Post article:

Sitting in a prison cell halfway around the planet, an Egyptian opposition leader forced President Bush this month to confront the question of how serious he was when he vowed to devote his second term to "ending tyranny in our world."

Ayman Nour, who dared challenge Egypt's authoritarian leader [Hosni Mubarak] in manipulated elections, was sentenced on Christmas Eve to five years on what U.S. officials consider bogus charges.

President Hosni Mubarak agreed to let challengers run against him for the first time , a visiting Laura Bush praised the "wise and bold" move. But shortly after she left, Mubarak supporters orchestrated attacks on democracy demonstrators. The presidential election was manipulated, and a subsequent parliamentary election degenerated into violence and mass arrests.

The arrest of Nour [who ran] against Mubarak presented a singular challenge to Bush, who promised in his inaugural address to stand with "democratic reformers facing repression, prison or exile." The White House pronounced itself "deeply troubled" and demanded Mubarak "release Mr. Nour from detention."

Nour remains behind bars.

UPDATE May 2006:
CAIRO, May 18 -- An appeals court on Thursday upheld the fraud conviction of Ayman Nour, the candidate who challenged President Hosni Mubarak and his 25 years of one-man rule in elections last year, effectively consigning the fiery lawyer to five years in prison.

2/3rds of US Aid goes to Israel and Egypt

While the total amount of aid given by the US might look very generous,

“US Senator Patrick Leahy noted that two-thirds of US government aid goes to only two countries: Israel and Egypt.”

[As stated at World Economic Forum in New York, February 2002]

US Aid to Palestine -- for Democracy

The Bush administration is spending foreign aid money to increase the popularity of the Palestinian Authority on the eve of crucial elections in which the governing party faces a serious challenge from the radical Islamic group Hamas.

The approximately $2 million program is being led by a division of the U.S. Agency for International Development. But no U.S. government logos appear with the projects or events being undertaken. U.S. officials say their low profile is meant to ensure that the Palestinian Authority receives public credit for a collection of small, popular projects and events to be unveiled before Palestinians select their first parliament in a decade.

U.S. officials say they fear the election will result in a large Hamas presence in the 132-seat legislature. Hamas is classified by the U.S. government as a terrorist organization. But its reputation for competence and accountability in providing social services has made it a stiff rival of the secular Fatah movement, which runs the Palestinian Authority and has long been the largest party in the Palestinian territories.

The program highlights the central challenge facing the Bush administration as it promotes democracy in the Middle East. But in attempting to manage the results, the administration risks undermining the democratic goals it is promoting.

P.S. - Hamas ended up unseating the U.S. backed favorite, winning a major number of seats in the Palestinian legislative process, with 77 percent of the 1.3 million registered Palestinian voters casting ballots

[Washington Post]

Israel largest recipient of US aid

Israel, a country of 3 million, is the largest recipient of US aid of any country in the world.

Since 1987, the US Congress has annually been approving a foreign aid bill totaling an average of $3 billion of American taxpayers' money to Israel: $1.2 billion in economical aid, and $1.8 billion in military aid.

After the 1973 war, the US aid to Israel constituted largely of military and economic grants to help strengthen the Israeli defense forces. This included $12-80 million, which was annually granted towards the establishment of Jewish settlements.

Since the gulf war in 1991, the US has additionally been offering Israel $2 billion annually in federal loan guarantees, which brings the total US foreign aid to Israel to about $5 billion, or $13.7 million per day.

Nearly all past loans to Israel have been forgiven – leading Israel to claim that they have never defaulted on repayment of a US loan – with most loans made on the understanding that they would be forgiven before Israel was required to repay them.

Other forms of aid to Israel are a result of "consequential" aid, such as the approximate $1.5 billion in total tax-deductible private donations from numerous Jewish charities and individual donors. The ability of Americans to make what amounts to tax deductible contributions to a foreign government (Israel) does not exist for any other country.

Including "consequential" aid to Israel this adds up to an approximate $8 billion in total US foreign aid annually to Israel.

All in all, this is the largest amount of foreign aid given to a country, and constitutes over 30% of the total amount of US foreign aid budget.

Israel’s population comprises just .001% of the world’s population and has one the world’s higher per capita incomes.

[Source: The Washington Report on Middle East Affairs]


The invisible poor die in invisible numbers

The invisible poor die in invisible numbers.

As most people visualize it, famine is the aftershock of some calamity that has left thousands of the starving flocked together, emergency food kept from their mouths by the perils of war or the callousness of despots or the impassibility of washed-away roads.

But more often, in the developing world, famine is both less obvious and more complicated.

Even small jolts to the regular food supply can jar open the trapdoor between what is normal, which is chronic malnutrition, and what is exceptional, which is outright starvation. Hunger and disease then feed off each other, leaving the invisible poor to die in invisible numbers.

[Excerpt from article written by Barry Bearak, NY Times Magazine]


The World is Getting Hungrier Each Year

I have never forgotten my first experience of ordinary life in an African village. I had been in Ethiopia, covering the terrible famine of 1985, with its haunted lines of starving, blank-eyed faces, sitting waiting for death. But I had not been to an ordinary village.

Not long after, I traveled to Sudan, where drought had also shriveled the land. Halfway to the famine area, we stopped to refuel our four-wheel-drive. There by the roadside in the parched scrub was a dusty straw-thatched hut. Outside a family was huddled around a meager fire made from a handful of sticks. The children had swollen bellies and thin limbs. The mother was cooking a single piece of flat bread which was the entire meal for the whole family.

"Why didn't you tell me we were in the famine area already," I said to my guide.

He laughed. "That's not famine," he chided. "That's just ordinary life in Africa. Being hungry is normal."

The world is getting hungrier, according to a report issued by the United Nations food agency. Across the world an estimated 842 million people are today undernourished—and that figure is climbing, with an additional 5 million hungry people every year. The figures, says the report by the Food and Agriculture Organization (FAO), "signal a setback in the war on hunger."

The report repeats the familiar statistic that the West spends 30 times more on domestic farming subsidies than it does on aid. It catalogues how the U.S. spends $3.9bn a year subsidizing its 25,000 cotton farmers—more than the entire GDP for Burkina Faso, where 2 million people depend on cotton for their livelihood.

Europe is now the world's second-largest sugar exporter, even though EU sugar costs twice as much to produce as does that of Third World peasants.

The harsh truth is that the industrialized world has abandoned any pretense that trade negotiations have anything to do with development.

"Bluntly stated," the report concludes, "the problem is not so much a lack of food as a lack of political will." Bluntly stated, the problem is that none of us really cares.

[Excerpt of article by Paul Vallely, The Independent]


Global Poverty Quiz

1. In which country does 1 out of 4 children live in poverty?
United States

Answer: In the United States, 1 in 4 children lives in poverty.

And in Canada, 1 in 5 children live in poverty.

Global Poverty Quiz {question 2}

2. What percentage of the world's population lives in absolute poverty?
(Note: Absolute poverty is defined as earning less than $1/day.)

Answer: As disturbing as they may seem, 25% or one in four people in the world lives on less than one dollar a day, or absolute poverty.

Global Poverty Quiz {question 3}

3. In 1960 the richest 20% of the world's population had more than 30 times the income as the poorest 20%? What was this number 35 years later?

it went up from 30 to 50
it went up from 30 to 82
it decreased from 30 to 15
the rich and poor had the same income

Answer: It went up from 30 to 82.
The rich are getting much richer and the poor are getting much poorer.

Global Poverty Quiz {question 4}

4. The world's richest 15 people have incomes equal to the Gross Domestic Product of which countries?
Western Europe
Sub-Saharan Africa

Answer: The world's richest 15 people have incomes equal to the GDP of all 48 countries in sub-Saharan Africa.

Global Poverty Quiz {question 5}

5. Out of the world's 1.5 billion people living in poverty how many are women?

Answer: 70%. Almost 3/4 of the poor people in the world are women.

Related to this,
How much of the land in the world is owned by women?

Answer: Women own and control only 1% of the land on this earth.

[Source: the New Internationalist magazine's Poverty issue.]

For another quiz on the topic.


Who Helps the World’s Poor?

Governments from post-industrialized countries are the primary donors for international development and relief.

While this comes as no surprize, governments have significantly decreased their contributions in the years since the end of the Cold War

Between 1992 and 1997,official assistance from leading industrialized countries dropped 30 percent, while their GNPs jumped almost 30.

The United States ranks last among the world's 28 top foreign aid donor countries, and its foreign assistance levels have dropped dramatically over the past 10 years, according to the United Nations Human Development Report.

When you look at countries' foreign aid relative to the size of their economies, the United States is devoting 0.1 per cent of its gross national product (GNP) to help the world's poorest countries, less than any other industrialized nation.


Westerners are pretty rich

You may think your salary is paltry, but compared with most of the world's population, you're up there with Bill Gates. A new website, the Global Rich List, starkly illustrates the worldwide distribution of wealth.

For example, individuals in the United States who make less than $9,300 are officially poor, according to the U.S. Census Bureau's definition of poverty. But compared with the rest of the world, their income is in the top 12 percent.

An annual household income of $42,200 --the U.S. median in 2001-- is enough to land someone in the world's richest 1 percent, according to the site.

"The idea is to really make people think about how rich they are compared to the rest of the world," said Nicolas Roope, one of the site's creators.

[Source: Leander Kahney, in Wired]


Perspective on Poverty

"Poor depends on where you are", Davan Maharaj writes in the Los Angeles Times

In the United States, an individual who makes less than $9,310 a year is considered poor.

For the developing world, the World Bank sets its poverty line at $730 a year ($2 a day).

For rest of article


Who has enough money to help the poor and oppressed?

So who has enough money to help the poor and oppressed?

I’ve always thought the following brings perspective:

If you have food in the refrigerator, clothes on your back, a roof overhead and a place to sleep...you are richer than 75% of this world.

If you have money in the bank, and in your wallet, and spare change in a dish someplace ...you are among the top 8% of the world's wealthy.

If you woke up this morning with more health than illness...you are more blessed than the millions who will not survive this week

If you have never experienced the danger of battle, the loneliness of imprisonment, the agony of torture, or the pain of starvation...you are better off than 500 million other people.

If you can attend a meeting at a church, synagogue, mosque or temple without fear of harassment, arrest, torture, or death...you are more blessed than two billion people in the world.

If you can read this … you are more blessed than over two billion people in the world who cannot read at all.

Have a great day, count your blessings, and pass this along to remind everyone else how blessed we all are.


World Hunger and Jumbo Jets

Over 9 million people die worldwide each year because of hunger and malnutrition.

This is about 25,000 people dying every day, or over 1000 every hour, for lack of food.

Over half of these numbers are children.

This is the technical equivalent of 45 jumbo jets crashing every single day, though the latter is what would instead make headline news.


World Hunger statistics

Over 9 million people die worldwide each year because of hunger and malnutrition. 5 million of these are children.

Approximately 1.2 billion people suffer from hunger (deficiency of calories and protein);

Some 2 to 3.5 billion people have micronutrient deficiency (deficiency of vitamins and minerals);

Meanwhile, elsewhere some 1.2 billion suffer from obesity.

In the West, food wastage is also high:

In the US 40-50% of all food ready for harvest never gets eaten;

In the United Kingdom, 30-40% of all food is never eaten, and in the last decade the amount of food British people threw into the garbage pail went up by 15%;

Overall, approximately $38 billion dollars’ worth of food is thrown away, every year.


Over 5 Billion Live and Die in Developing Countries

Despite fertility declines in most countries and reduced life expectancy due to the HIV/AIDS epidemic in some African nations, the global population reached 6.5 billion people by the end of 2005 and should hit seven billion by 2012, according to a report released by the Population Reference Bureau (PRB).

Meanwhile, fertility in some of the world's poorest countries -- almost all of them in Africa -- has remained virtually unchanged over the past 25 years. Niger, where famine caused by drought and last year's locust infestation now threatens some three million people with starvation, has the highest fertility rate at an average of eight lifetime births per woman; followed by Mali, another drought-stricken nation, and Guinea-Bissau, at 7.1 births per woman; Somalia, 7.0; Uganda, 6.9, and Afghanistan, Angola, Burundi, and Liberia, all at 6.8 births per woman.

By contrast, the lowest fertility rates -- far below the 2.1 children per woman considered to be "replacement level" in developed countries -- are now found in Central and Eastern Europe and East Asia.

The new Data Sheet, which includes the latest statistics on a range of health, income, and population indices, in addition to fertility, for 207 countries and territories, estimates the global population as of mid-2005 at 6.477 billion, of which 5.266 billion people live in developing countries.

By 2050, however, China, whose tough population policies have helped reduce its fertility rate to Western European levels, will have been overtaken by India. India will have 1.628 billion people by that date, while China is expected to have 1.437 billion, according to the report.

The United States is also expected to hold its place as the third most-populous country with 420 million people, compared with its current 296 million, while Indonesia, the fourth largest country today with 222 million people, will also hold its position with 308 million 45 years from now.

The standings of the next six-largest countries, however, are expected to change, as Pakistan, which currently ranks number six with 162 million people, is expected to nearly double its population and overtake Brazil (currently 184 million) as number five.

Nigeria, which currently ranks ninth with 132 million people, is also expected to nearly double its population over that period, moving it into seventh place right behind Brazil and displacing Bangladesh, whose population is expected to grow from 144 million to 231 million.

Other countries that are expected to have populations greater than 100 million in 2050 include the Philippines (142 million) Mexico (139 million); Uganda (131 million); Egypt (126 million); Vietnam (115 million); and Turkey (101 million).

Sub-Saharan Africa's population will increase the most -- from 752 million people today to 1.729 billion by 2050 -- or 130 percent. Sub-regionally, Central Africa is expected to experience the fastest growth (increasing by 175 percent), while southern Africa's population will remain stagnant over the period due in major part to HIV/AIDS pandemic which has reduced life expectancy in several southern African countries to less than 40 years -- the world's lowest.

[From article by Jim Lobe, Inter Press Service News Agency]


African Poverty

An overview of some of the economic challenges facing the African continent:

Most of Sub-Saharan Africa is in the World Bank's lowest income category of less than $765 Gross National Income (GNI) per person per year. Ethiopia and Burundi are the worst off with just $90 GNI per person.

Even middle income countries like Gabon and Botswana have sizeable sections of the population living in poverty.

North Africa generally fares better than Sub-Saharan Africa. Here, the economies are more stable, trade and tourism are relatively high and Aids is less prevalent.



Tackling poverty with technology

It is hard to believe that 19 shiny flat screen computers can cure the ills of this tiny community (Dipichi) in South Africa's arid north where people battle every day against poverty, AIDS, illiteracy and hunger. Yet U.S. computer giant Hewlett-Packard Co. and South African President Thabo Mbeki are promoting Dipichi's smart new IT lab as a blueprint for how technology can trigger growth and tackle poverty across the world's poorest continent.

Bridging the so-called digital divide in Africa became a popular mantra among aid workers and government officials during the tech boom that started in the late 1990s but it fell from favor as countless ill-conceived rural IT centers went unused.

Skeptics asked what use a computer was when people were hungry, dying of AIDS and too poor to send their kids to school? But as multinationals start to invest in South Africa and elsewhere on the continent, they are touting technology as a panacea for development.

"Bridging the digital divide is a non starter if we haven't even crossed the literacy divide," said Arthur Goldstuck, head of South African technology research company World Wide Worx. "There is a danger of ... delivering technology without making sure people can use it." One-off projects like the i-Community that help a handful of people are meaningless when high phone call and Internet access costs keep communications out of most people's reach, he said.

Hewlett-Packard (HP) says the Dipichi project will help create jobs, improve farming and educate.

"I saved someone from a poisonous snake bite after I learnt about first aid from the computer," said Rosina Ledwaba, a 39-year old home-based carer who lives in one of the village's tiny thatched huts with her five children and husband.


Tackling poverty with technology (2)

Next to the brightly painted shipping container that houses the IT lab, Viviane Marakalala proudly showed off the village vegetable garden, which has been packed with leafy cabbages since a group of women learnt about drip irrigation from a computer program.

"I had never seen a computer in my life but now I know how to use it," said Marakalala, 27. "We looked in the computer and it told us in our language how to use our water better."

Run in tandem with local government, the i-Community project links libraries, community centers, clinics and schools around the main town of Mokopane to the Internet, and includes a PC refurbishing center, call center and micro-lender.

It also includes IT centers in rural villages like Dipichi, which until recently had neither water nor electricity and can be reached only by a dirt road. Computers are operated using satellite technology and residents hope that their presence will pressure local authorities to link their villages to the electricity grid.

Miriam Segabutsa, one of the project directors, conceded computer literacy might not seem like an obvious priority for a continent racked by disease and hunger, but insisted it could improve quality of life for ordinary people. "It is not about teaching computers for the sake of computers, it is about giving people access to the information they need," she told Reuters.

Cell phone companies have adapted wireless technology for myriad development uses like low-cost banking for the poor, delivering price information to rural farmers and monitoring AIDS patients in sprawling townships.

Cellular technology has won praise thanks to the lightning spread of mobile phones across Africa but some commentators wonder whether computers and the Internet can be as useful. If only a minority of people in Africa's richest country have access to the Web, Internet use is even rarer in the rest of the continent, where populations are more scattered, resources scarce and where few multinationals dare to venture.



Charity being introduced to China

Chinese authorities are calling on the burgeoning middle class to help out the country's poor.

China, the greatest economic success story of the 21st century so far, is calling on its growing middle class to share more of its good fortune with the needy. The government has made an appeal for charity amid rising criticism that the spirit of philanthropy is developing a lot less quickly than the urge to accumulate wealth, as the country becomes richer but more divided.

Twenty-five years of spectacular economic growth are estimated to have created more than 10,000 people with assets in excess of $10m. But while the new rich are spending, investing and gambling more than ever, their willingness to give something back to a society which still contains tens of millions of people living on less than a dollar a day is being called into question.

"We ask for greater support from charity-based organisations and from society," a govt. minister said. "The Chinese government will make new policies, such as the introduction of tax breaks, and try to create a more a encouraging social climate for corporate donations."

The appeal would have been unthinkable a generation ago, when the Communist authorities boasted that they would provide for every social need, and displays of wealth would have been condemned as bourgeois and counter-revolutionary. But the private sector now accounts for more than half of China's economy. Although tax revenues have grown, public spending has not prevented a widening gap between rich and poor, particularly with regard to health and education.

[Excerpt of an article by Jonathan Watts, Guardian Unlimited]


New Way to Do Well By Doing Good

Making tiny loans to poor entrepreneurs in developing countries has long been a popular charitable cause, but it is now gaining traction as an investment.

Microfinance, as these loans are known, is aimed at lifting some of the world's most destitute people out of poverty by providing seed money for small businesses. Funding for the loans traditionally has come from charities and government-aid organizations.

Now, an increasing number of private funds are steering capital to microfinance -- and demanding a return, albeit a modest one in single digits, on their investments. By doing so, the funds hope to boost microfinance's reach and efficiency, while also drawing more capital from investors.

Investors can choose among a variety of new investment vehicles, including equity and debt investment funds; bond-like securities that are ultimately backed by thousands of tiny loans and so-called loan-guarantee funds where, in some cases, participants lend their creditworthiness rather than cash. Unlike charitable donations, microfinance investments don't bring an upfront tax break.

Many of the new investment instruments have been launched by nonprofit organizations long involved in the industry, including Grameen Foundation USA.

[Excerpted from an article by Rachel Emma Silverman, The Wall Street Journal]


Companies and Social Responsibility

Tarred by a raft of corporate scandals from Enron to WorldCom, social outreach can be a way to regain the high ground. That's probably one reason corporate giving hit an all-time high last year, according to philanthropy research group the Foundation Center.

More than mere public relations appears to be at work here. Companies are being forced to address the concerns of customers, employees, and investors -- in order to keep them. Such pressure is why last year Gap Inc. halted relationships with 70 of its overseas factories over alleged labor abuses, and has for the past two years issued a social responsibility report.

Or why Nike Inc. is now a world leader in setting safety standards for overseas workers. When the controversy over its sweatshops erupted several years ago, managers mistakenly believed they could afford to ignore the outcry simply by cranking out hip shoes. "It is no longer an option to sit on the sidelines," says Bradley K. Googins, executive director of The Center for Corporate Citizenship at Boston College.

More important, the calls for change are coming from inside the corporate walls. A new generation of employees is demanding attention to stakeholders and seeking more from their jobs than just 9-to-5 work hours and a steady paycheck. The number of Gen Yers -- those born between 1977 and 1994 -- in the working world has grown 9.2% since 1999.

Indeed, it has been a rude awakening for companies that have not embraced a more strategic approach to social responsibility. "Society has changed," says Betsy Reithemeyer, executive director of the Wal-Mart Foundation. "If you are the gathering place of the community, then you have a responsibility to it."

[Excerpts from an a BusinessWeek article, by Brian Grow, Steve Hamm and Louise Lee]


Philanthropy grows more strategic and focused

Timberland, the outdoors outfitter gives more than $1 million a year to a youth-corps nonprofit. In an increasingly competitive global economy, companies looking for an edge increasingly are recognizing that philanthropy can boost the bottom line, experts say.

Long gone are the days when corporate giving mainly reflected the pet causes of the CEO. Instead, corporations recognize that good corporate citizenship can improve the chances of attracting and retaining employees, customers, investors and partners.

Companies that align their giving with their business focus can be more effective in both, says Charles Moore, executive director of the Committee to Encourage Corporate Philanthropy.

U.S. corporations gave $12 billion to charity in 2004, or nearly 5 percent of all charitable giving, according to Giving USA 2005, an annual report of the Giving USA Foundation.

They also are working to integrate their philanthropy into their overall corporate social responsibility initiatives that can range from ethics, transparency and governance to human rights, environmental issues, health and safety, and employee rights, DaSilva says.

And as U.S. companies extend their global reach, they are expanding their global giving, says Sophia Muirhead, senior research associate at The Conference Board.

"As more and more companies do business globally, they are taking their American notion of philanthropy with them to the global stage," she says.

International issues also represent a big challenge for corporate givers. "It's incumbent on the philanthropic community, including corporate grantmakers, to get together and figure out how we're going to address this," she says.

[From an article by Todd Chen, Philanthropy Journal]


Iraqi Reconstruction Money Diverted

The good news: The Bush administration does not intend to seek any more funds for Iraq reconstruction than the $18.4 billion already allocated.

The bad news: Documents show that much of the $18.4 billion of funding allocated to date to rebuild Iraq has been diverted, and spent on military and security purposes.

Yes, roughly half of the reconstruction money has been eaten away.

So the fledgling Iraqi government will now somehow have to come up tens of billions of dollars of work yet to be done merely to bring reliable electricity, water and other services to Iraq's 26 million people.

Iraqi Reconstruction Money Diverted (2)

Here’s what happened to the money that was supposed to rebuild the country after the US invasion destroyed the country’s infrastructure:

Since the reconstruction effort began in 2003, midcourse changes by U.S. officials have shifted … from the rebuilding of Iraq's decrepit electrical, education, water, sewage, sanitation and oil networks to build new security forces for Iraq and to construct a nationwide system of prisons.

In addition, from 14 percent to 22 percent of the cost of every nonmilitary reconstruction project goes toward security against insurgent attacks, according to reconstruction officials in Baghdad. In Washington, the office of the Special Inspector General for Iraq Reconstruction puts the security costs of each project at 25 percent.

U.S. officials more than doubled the size of the Iraqi army, which they initially planned to build to only 40,000 troops. …At the same time, relentless sabotage has kept [electricity and oil production] output at or below prewar levels despite the expenditure of hundreds of millions of American dollars and countless man-hours.

Oil production stands at roughly 2 million barrels a day, compared with 2.6 million before U.S. troops entered Iraq in March 2003, according to U.S. government statistics. U.S. officials at the time promised a steady supply of 6,000 megawatts of electricity and a return to oil production output of 2.5 million barrels a day, within months.

Iraqis nationwide receive on average less than 12 hours of power a day. For residents of Baghdad, it was six hours a day last month, according to a U.S. count, though many residents say that figure is high.

The Americans, said Zaid Saleem, 26, who works at a market in Baghdad, "are the best in destroying things but they are the worst in rebuilding."

[Contains excerpts of an article by Ellen Knickmeyer, Washington Post]

Iraqi Reconstruction Money Diverted (3)

The Bush Administration predicted that the Iraqi people were going to receive US troops with open arms, not take up arms against them. It didn't play out that way. Insurgency --largely by Iraqi citizens --changed everything.

"Good morning, gentlemen," a security contractor in shirt-sleeves said crisply late last week, launching into a security briefing in what amounts to a reconstruction war room in Baghdad's Green Zone, home to much of the Iraqi government.

A screen overhead detailed the previous day's 70 or so attacks on private, military and Iraqi security forces. The briefer noted bombs planted in potholes, rigged in cars, hidden in the vests of suicide attackers. There were also mortar attacks and small-arms fire. The briefer also noted miles of roads rendered impassable or where travel was inadvisable owing to attacks, and some of the previous day's toll in terms of dead and wounded.

To one side, a TV monitor scrolled out the day's news, including McCoy's remark to reporters that December was the worst month on record for Iraqi contractors working on reconstruction, with more killed, wounded or kidnapped than during any other month since the U.S. invasion.

[Contains excerpts of an article by Ellen Knickmeyer, Washington Post]

Iraqi Reconstruction Money Diverted (4)

In January 2004, with $18.4 billion in hand for reconstruction package, the United States had allotted $3.2 billion of this to build up Iraq's army and security forces. But in the months to come, more money was diverted from other sectors such as:

Electricity – “More than $1 billion earmarked for electricity to build a police force and army capable of combating foreign and domestic guerrillas”

The national electrical grid has an average daily output of 4,000 megawatts, about 400 megawatts less than its prewar level.

Roads, bridges and schools – “The United States will spend $437 million on border fortresses and guards, about $100 million more than the amount dedicated to roads, bridges and public buildings, including schools.”

Education – “Education programs have been allocated $99 million; the United States is spending $107 million to build a secure communications network for security forces.”

Additionally, “hundreds of millions of dollars were shifted to fund elections and to take Iraq through four changes of government. Funds were also reallocated to provide a $767 million increase in spending on Iraq's justice system. The money has gone toward building or renovating 10 medium- and maximum-security prisons -- early plans called for four prisons -- and for detention centers nationwide.”

[Contains excerpts of an article by Ellen Knickmeyer, Washington Post]

Iraqi Reconstruction Money Diverted (5)

The shifts in allocations have led Stuart Bowen, the inspector general in charge of tracking the $18.4 billion, to talk of a "reconstruction gap," or the difference between what Iraqis and Americans expected from the U.S. reconstruction effort at first and what they are seeing now.

A poll conducted earlier last year that found less than 30 percent of Iraqis knew that any reconstruction efforts were underway. The percentage has since risen to more than 40 percent.

"It is easy for the Americans to say, 'We are doing reconstruction in Iraq,' and we hear that. But to make us believe it, they should show us where this reconstruction is," said Mustafa Sidqi Murthada, owner of a men's clothing store in Baghdad.

"Believe me, they are not doing this," he said, "unless they consider rebuilding of their military bases reconstruction."

[Source: Article by Ellen Knickmeyer, Washington Post]


The Cost of Conquering World Hunger

Solving the World's major problems isn't always a costly, complicated undertaking.

Would you be willing to fork out $50 this year to cut world hunger in half? Put another way, would you pay $50 to do your part to feed millions of men, women and children who are otherwise slowly starving to death?

The OECD – a group of the major industrialized nations – proposed a plan for cutting World Hunger in half by the year 2015.

This plan would cost the average taxpayer in these industrialized countries $50 a year. The question was asked: “If the US were willing to pay their share, would you be willing to pay $50 a year to cut world hunger in half?”

70% said they’d be willing.

Let’s do it! It's as easy as identifying a charity that funds overseas hunger programs and put our money where our mouths are, money that will put food in others’ mouths.

Budget perceptions: Program on International Policy Attitudes “Americans on Foreign Aid and World Hunger: A Study of U.S. Public Attitudes,”.


After the tsunami calamity

A little over one year ago, the Indian Ocean tsunami struck 14 countries, killing an estimated 223,500 people and leaving 1.8 million homeless.

Aid poured in and for once, the challenge was to spend the money rather than raise it. In Indonesia efforts had to be coordinated between 124 international nongovernmental organizations and more than 40 governments, multilateral banks and U.N. agencies. It had to struggle with the legacy of a long-running conflict in Aceh, a tradition of corruption in public administration, and the logistical obstacles created by the tsunami. Not surprisingly, it took time for reconstruction to get underway.

So far about 25,000 houses have been built in Aceh, but at least 60,000 people are still living in tents and perhaps five times that many are living with relatives. The World Bank projects that 18 months will pass before enough permanent homes have been built for everybody.

No effort of this sort can escape criticism: There have been reports of poorly built homes that people do not want to move into and of relief agencies failing to offer a transparent accounting of how benefactors' money has been spent. But reconstruction seems to be going well enough that the main need is not for recrimination but for commitment to completing reconstruction over the next two years or so. Vigilance against corruption and poor construction must be maintained, and donors must be prepared to allow their money to be used flexibly.

After the most generous humanitarian outpouring in history, the world has a chance to get reconstruction right. One year on, it is a work in progress.

[Source: Washington Post editorial]

Secondary effects of tsunami aid

When the tsunami hit, charity came pouring in from far and wide for the countries affected, including Indonesia. A year later, in the Indonesian province of Aceh, Muharram Idris, a former rebel commander who watched as the sea swallowed his village and family, now scoots around on a red motorcycle, tending to the business of peace.

The ethnic separatist guerrillas he once led have turned in their weapons and are retooling themselves as a political party. Tsunami aid helped quiet a 30-year-old civil war.

In Sri Lanka, the tsunami seemed to dangle the hope of reconciliation. It struck both government-held land and territory controlled by the Tamil rebels, and it brought the two sides together to heal and divide aid. Unfortunately, squabbles over aid combined with the legacy of recrimination have since worsened the conflict

In both Sri Lanka and Indonesia, nearly all tsunami-affected children are back at school. Swift intervention averted major outbreaks of disease. In Sri Lanka, 70 to 85 percent of adults who lost their livelihoods have regained their main source of income, and 41 of the island's 52 damaged hotels are open for business, according to a report prepared jointly by the United Nations and the government.

All told, the tsunami generated a record $13.6 billion in aid pledges, according to the United Nations.

Just as rare, donor countries kept their promises. The United Nations Office of the Special Envoy for Tsunami Recovery says 75 percent of the $10.5 billion pledged for reconstruction of tsunami-affected countries has been secured; by comparison, independent studies have found that no more than 10 percent of aid pledges were honored after the 2003 earthquake in Bam, Iran.

[Source: Article by Somini Sengupta and Seth Mydansin, The New York Times]