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Charities Report Record Donations

$337 Million In Private Funds Raised for Relief

By Alan Cooperman and Jacqueline Salmon
Washington Post Staff Writers
Saturday, January 8, 2005; Page A01

U.S. charities have reported raising more than $337 million so far for emergency relief in countries devastated by the Indian Ocean tsunami, in what some are calling the greatest outpouring of donations for a foreign disaster in American history.

The rapidly mounting private contributions could soon dwarf the $350 million in aid committed by the U.S. government, fundraisers said. The American Red Cross alone has raised nearly $150 million, and it said yesterday that it foresees the need for $250 million more.

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Encouraged by President Bush, who made a $10,000 personal donation and declared that "the most important contribution a person can make is cash," the givers range from movie stars writing million-dollar checks to a 9-year-old California boy who gave up his birthday party and asked his mother to send $250 to Asian children instead.

Many charities that specialize in international humanitarian work are reporting all-time high contributions. The Baltimore-based Lutheran World Relief said it pulled in more money in one week than it usually does in a year. Samaritan's Purse, run by the Rev. Franklin Graham, said the number of its online donations first doubled, then tripled, setting new records every day after the Dec. 26 tsunami.

But with dozens of organizations vigorously competing for gifts, several have taken what one expert on philanthropy termed the "fundraiser's nuclear option" -- promising that every penny they receive will go to tsunami relief, with no money held back to cover overhead.

Though attractive to donors, that is a controversial step that some nonprofit groups say merely shifts or hides administrative costs. In addition, domestic charities are starting to worry that the tsunami will cut into their donations. Specialists in disaster relief question whether so much more money and attention should go to victims of a Christmas-time tsunami than to victims of no less deadly but more humdrum catastrophes, such as wars and famines.

"Nobody is saying these victims are undeserving. But imagine if you were injured in a car wreck and you needed a transfusion, and whether you got it or not depended on how spectacular a pile-up you were in," said Peter Walker, a former director of disaster policy for the International Federation of Red Cross and Red Crescent Societies who now heads the Feinstein International Famine Center at Tufts University.

The sum donated by Americans after the tsunami -- which took more than 147,000 lives, mainly in Indonesia, Sri Lanka, India and Thailand -- is still much smaller than the $2 billion raised for the families of the nearly 3,000 people killed in the attacks of Sept. 11, 2001.

But Patrick M. Rooney, director of research at the Center on Philanthropy at Indiana University, said the pattern of giving is the same: a torrent of donations, most relatively small. After Sept. 11, he said, two-thirds of Americans contributed, and three-quarters of the gifts were for $100 or less. Since the tsunami, online donations to the American Red Cross have averaged $104 on Yahoo.com and $81 on Amazon.com.

Many of the questions about fairness and transparency are the same, too. The record amounts being raised will put the entire nonprofit sector under scrutiny, said Paul C. Light, a professor of public affairs at New York University who studied the impact of Sept. 11 on charities.

"The sector rises and falls and gets tested in moments like this when a lot of people who don't ordinarily give [decide] to participate," Light said. "And then they follow quite closely what it is they got for their money."

In most cases, what they will get will not be clear. Michael Wiest, chief operating officer of Catholic Relief Services, said field workers for private relief groups are just starting to divvy up responsibilities in the chaotic aftermath of the tsunami. Moreover, many charities are raising money faster than they can spend it or are holding back funds for longer-term reconstruction.

The American Red Cross, for example, has committed $30 million of the $150 million it has raised. Of that, $25 million has been sent to the U.N. World Food Program, and $5 million will be spent on supplies, including 95,000 hygiene kits that contain soap and toilet tissue.

Unlike in past emergencies, charities are discouraging donations of clothes and canned goods. Doctors Without Borders announced this week that it has in hand all the money -- $50 million, including $20 million from U.S. donors -- that it will need for immediate relief. But for groups intending to do long-term reconstruction, "I don't see where we will reach a saturation of resources," Wiest said.

The speed of Internet fundraising, the proliferation of aid groups and the shift to cash from in-kind donations make dollar-to-dollar comparisons with past disasters impossible. Some scholars believe that in inflation-adjusted dollars, the most generous response ever to a natural catastrophe was in 1923, after the Great Tokyo Earthquake and Fire that killed at least 100,000 people.

But in recent memory, U.S. aid groups said, the only foreign disasters that have elicited a comparable response were Hurricane Mitch in Central America in 1998 and the Ethiopian famine of 1984-85 -- and many expect the tsunami to break all fundraising records.

Dean R. Owen, spokesman for the relief group World Vision, said it has set a fundraising goal of $50 million, the largest single target in its 54-year history.

"Clearly, this is outpacing anything we've ever seen," said Lisa Bonds, spokesman for Lutheran World Relief, whose appeal has already topped the $4 million the agency collects in a normal year.

Charities said timing helped. Families together between Christmas and New Year's Day watched the disaster unfold on television.

In Austin, Philip and Donna Berber and their three sons made a breakfast table decision to contribute $1 million. The Berbers, who sold an online trading company to Charles Schwab & Co. for $488 million in 2000, had previously concentrated their philanthropy on Africa.

In Elverta, Calif, fourth-grader Will Molnar gave up his ninth birthday celebration after seeing coverage of children who lost parents in the tsunami. He asked his mother to donate the money she would have spent on his party and presents to the Christian Children's Fund. "I hope it will be spent on all the families and help them," he said in a telephone interview.

To stimulate more giving, large and small, Bush this week named two former presidents -- his father George H.W. Bush and Bill Clinton -- to head a "massive private relief effort." He also signed legislation yesterday allowing deductions on 2004 tax returns for tsunami-related contributions made until Jan. 31.

But Brian A. Gallagher, chief executive of United Way of America, said he is worried that small, domestic charities might suffer.

"There is so much attention on the tsunami . . . that if you [small charities] don't have the resources to get to your donors and break through, then I think it's likely that they will get hurt," Gallagher said.

Some fundraisers are also troubled by promises from the Salvation Army, Lutheran World Relief, AmeriCares and other groups that they will channel all tsunami-related contributions directly to the region, with none to be spent on domestic overhead.

The American Red Cross, which drew criticism after Sept. 11, 2001, when it hesitated to pledge that every dollar raised would go to the victims' families, has been explicit about its costs this time. Chief executive Marsha J. Evans said expenses directly associated with administering the relief effort -- an estimated 6 percent -- will come out of the relief fund.

"Everyone wants nonprofits to be as efficient as possible, but also it costs money to build a secure Web site, it costs money to process checks, it costs money to send money abroad," said Rooney, at Indiana University. "Those fixed costs don't go away. Some other donor or program is paying for them directly or indirectly."


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