** Rwanda & the economics of charity

Topics: Welfare, Theory
28 Jul 1994

From: ervan

Humor break: This morning I received a letter from the Democrtatic National
Committee which begins: "President Bill Clinton would greatly appreciate
your opinions concerning his Administration..." Somehow, I doubt it.

Anyway, the question for the day is: why are sending aid to Rwandan
refugees? I don't think the answer is so obvious as it might seem.

The standard answer is that we should show sympathy for such tragic
suffering. I'll grant that. The next question is how much sympathy? It's
easy to be upset, but ask the next bleeding heart you see if they sent $100
to the cause. How is it that the U.S. collectively has more generosity than
citizens do individually? If you are willing to send $10, fine, but if you
are not willing to send $20, how can it make sense for the government to be
generous on your behalf by taking another $10 in taxes (which is about the
amount spent per
taxpayer in this first phase)? How theft has become characterized as
charity is another topic.

"It only helps if we all act together" is a common but wrong answer. If $10
buys 100 gallons of clean water, $20 buys 200 (close enough for the purpose
of this argument). Whatever benefit there is to the giver (or recipient)
of charity is realized individually as surely as it is collectively. If I'm
one of 100 persons that give $10, I get as much good out of that as if I'm
one of 1M persons that give $10. Charity is not a public good (in the
economic sense).

"A single person can't tell where help is needed" is also wrong. Give $10
to CARE once and you'll be bombard with information about where money is
needed. Also, private agencies tend to be more efficient than the
government at at distributing aid. Don't even ask what it costs to fly a
C-130 in. "I can't be bothered with keeping track of new disasters in the
world (but would send aid if I could)" falls in a pretty much similar
fashion. If your charity ends at not bothering to open paper or the beg
letters CARE sends you, I don't think you are very interested in helping.
In any case, the 'information' objection can be met by simply authorizing
CARE to charge $X to your credit card every month. You never have to worry
about being informed and can give all you want.

Most people who make the 'we should be generous' argument really mean that
we should be generous with someone else's money. That's not a very
compelling position. Some might answer the original rhetorical question by
saying that 'I would give, but the government has already given what I would
have.' This is clearly evasive since their have been lots of famines the
U.S. government has not seen fit to intervene in. How much have people
individually donated to those causes? Some to be sure, but it sets a limit
on how charitable people are. As an aside, the same 'we should be generous'
argument is applied to domestic welfare. I like to ask liberal students
(who generally pay very little in taxes) who much they donanted personally
and then how much I should be forced to donate?

So, back to the original question: why is the U.S. government in Rwanda? I
propose several theories:

1) The government as idiot theory -- We have $1.5T which we are not giving
back to the people we stole it from and we cannot spend any more on our
junkets so we might as well look like humanitarians.

2) The world opinion theory -- There is some vague and intangible benefit in
getting other countries to do what we want because they now 'like us' for
being 'generous'.

3) The imperialism theory -- The U.S. seeks permanent political or military
influence in the region. There is some support for this. The current aid
package is entirely to the benefit of the Hutu government in exile. As
usual, the food is being turned into weapons (one way or another).
Meanwhile, the Tutsi's who have gained power get nothing. Robert Atwood
(Clinton's envoy to the region) wrote in an editorial yesterday that
military intervention was needed to establish "order" instead of just
supplying "humanitarian" aid. In other words, imperialism is called for.

Regardless, we should never have gone and we should get out. Anyone who
thinks more aid is 'needed' (and I'm not saying it isn't), is free to give
all they want. They are free to try and convince everyone who'll listen to
give more.