You may recall the flap caused by Nicholas Kristof‘s article in the New York Times about “Do-it-Yourself” foreign aid — about individuals and small groups trying to make the world a better place, on their own.
Some of those DIYers, or “amateur aid” organizations, will be among the participants at the Global Washington annual conference, which begins today on the Microsoft campus and, as it turns out, featured Kristof as the keynote speaker for its inaugural meeting last year.
As the video says, the Chos created One Day’s Wages (ODW) in 2009 when they decided to donate their $68,000 annual income to “fighting extreme global poverty.” This dramatic move prompted local media attention, and the Chos’ non-profit has since raised about half a million dollars, to be distributed to select causes.
Sounds good, but the problem with these kind of DIY humanitarian organizations, critics say, is that they can end up doing more harm than good. Problems of poverty are often more complex than they appear. And these small organizations are seldom adequately transparent or accountable.
Foreign Policy magazine was pretty blunt, simply saying “Nicholas Kristof is Wrong” while some critics were more nuanced. Others weighed in on all sides, either defending Kristof or saying he over-simplified.
Cho responded to my post on the Kristof article saying that any effort — big or small — can make a difference. In his response, he also invited readers of this blog to come to the ODW fund-raiser.
Given that this Seattle organization had been singled out for praise by the New York Times, I decided to take a closer look at Cho and One Day’s Wages. What I found, in a nutshell, is that they are supporting great work but could improve when it comes to financial accountability.
Their website claimed to have raised nearly half a million dollars. I assumed it also would include two key details: How much of that money had been distributed? And to which charitable causes?
There was no comprehensive description of funding on their website, though they did have some featured examples. I asked Cho for the totals and for the organization’s IRS Form 990, a financial disclosure form, which must be given upon public request (and which, at a minimum, donors should always look at when considering giving financial support).
It took a few days for Cho to get me the information so I contacted the Secretary of State’s office as well. I talked with Tabatha Blacksmith in the charities division. I learned that Cho, and Quest Church, had created a number of charitable organizations or “non-profit corporations,” some of which still existed and others the state had closed its file on for failure to supply the required financial information.
Here’s what Blacksmith said she found on file about One Day’s Wages:
One Day’s Wages (ODW) is currently registered as a “charitable organization” with the Secretary of State’s Charities Program pursuant to Washington’s Charitable Solicitations Act, RCW 19.09. The organization also recently submitted a renewal, but our office has not yet reviewed or filed the documents.
As we discussed, ODW has some language on its website that might be construed as misleading. According to the 2009 “Solicitation Report” that ODW submitted to our office, they spent 18% of their total expenses on charitable “program services”, not 100%. As a result, it is unclear why they have made the claim below.
We plan to issue a letter to ODW shortly, asking them to amend the language on their website within 14 days.
Blacksmith also said that Cho is listed as operator of Quest Church’s affiliated non-profit organizations, one known as Quest Community Development and others listed on the website such as Global Presence Foundation, which don’t appear to be currently registered.
I told Cho what the state agency said. He put up with a lot of questions from me (I’m neither a financial whiz nor an expert on non-profits). He never failed to respond and said he planned to look into the paperwork problems Blacksmith mentioned. The Form 990, which is now posted on the ODW website, said ODW in 2009 raised about $215,000 but only distributed a bit more than $5,000 for charitable purposes.
Cho explained that ODW’s plan is to eventually distribute 100% of those funds (minus some minimal financial costs) and that what had been distributed so far is not reflected in the 2009 report. The organization has only been around for a few years, he noted, and they want to be both careful and efficient with their financial support.
Since the 2009 filing, Cho said ODW has raised $474.929.70 (not counting what came in during the recent fund-raiser). So far, he said they had distributed a total of $180,624.90 to these causes and organizations:
Pakistan via World Vision & KASHF: $20,000Partners in Health: $44,219.98 (work in Haiti)World Concern: $56,276.92 (work in Haiti)Charity Water: $25,000 (Ethiopia)Heal Africa: $25,000 (Congo)
* Maiti Nepal: $25,000* Pakistan Relief (World Vision & KASHF): $10,000* Sustainable Development Research Foundation: $20,000* Zimele – $6,400** Our partnership with NURU is at $11,625.94 and will likely take couple more months to be fully funded at $15,000
One Day’s Wages generally acts as a middleman — raising money to donate to other, often more experienced organizations — and so avoids the criticisms leveled at some DIYers. But I asked Cho: Why not just tell people to donate to World Vision, World Concern or Heal Africa directly?
“We encourage that as well, but that just doesn’t work for a lot of people,” Cho told me. The appeal of One Day’s Wages comes from the fact that it is small, he said, and based in the community. It seeks to solve global problems but through a highly local and personal connection, he says.
At the end of our discussion, and my pestering questions, I felt pretty good about Cho and ODW. They do need to get in compliance with the authorities, but they appear to be contributing to a lot of good causes. My primary concern is the lack of simple and easy access to such basic financial information — and, frankly, the fact that my telephone call is what alerted state government to review ODW’s documentation.
The bottom line: We need a more reliable means for vetting small non-profit organizations.
If Kristof’s “Do-It-Yourself” revolution in foreign aid is the new reality, and these small organizations continue to populate the landscape, it’s in everyone’s interest — donors as well as the organizations themselves — to establish a routine, reliable system for assuring that DIY aid is being done effectively and as advertised.