A Note on Donations

I had an interesting discussion in my NGO Management seminar last night that I wanted to share regarding donations to the relief efforts. We were discussing the concept of capacity and the fact that it is possible for a specific organization to take in more money (in the form of donations, etc) than they are capable of redistributing, so the excess money actually gets wasted in the form of innefficiency, corruption, etc. It was very interesting to me that someone brought up that the Red Cross in the US has actually reached this point -- they are not being very transparent about it, but they have as much money as they can handle for the relief efforts in Tohoku, and so they have not been asking for money specifically for Tohoku -- but people are donating anyways. These donations become "unrestricted funds" that the Red Cross can use for any purpose. Long story short, people who think they are giving money to aid Tohoku, actually may not be doing so.

I asked my professor where we should donate instead, and his recommendation was actually to hold off at this time until the situation stabilizes and needs can be evaluated. He compared the situation to someone fertilizing grass -- too much coming in too soon can actually be detrimental, while a measured but continuous amount over a longer period of time will have better results!

In summary, I found this discussion a very interesting juxtaposition to the messages coming out of the media saying Donate now! Aid now! While it is true that there are needs that should be met immediately, it seems that holding off some donations until the long-term needs become apparent may actually be a better long-term recovery strategy.