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Privatizing foreign aid in the U.S.

Although the Bush administration has now pledged $350-million for the Asian tsunami catastrophe, claims that America is "stingy" are still in the air. The criticism stems from the much-touted fact that the U.S. government's foreign aid ranks last among developed countries as a percentage of gross national income.

This rankles, as Americans tend to think of themselves as a generous people. How can we, the richest nation in the world, not be more caring? The answer is simple: We actually are.

For one thing, our government gives the highest absolute amount in foreign aid _ more than $16-billion in 2003. And this does not include the cost of our global military presence, which helps provide the stability needed for economic growth, or the billions spent on developing medicines that save millions of lives in poorer nations.

Most important, however, Americans generally help people abroad the same way they help people at home: through private charities, religious organizations, foundations, corporations, universities and money sent to relatives. In 2000, all this came to more than $35-billion, more than three times what the government gave. And this does not include giving by local churches or by overseas affiliates of American corporations.

The fact is, foreign aid is being privatized. A study by the Foundation Center found that international giving by foundations grew by 79 percent 1998 from 2002, while overall giving grew by only 42 percent.

Private giving is usually faster, nimbler and more directly accountable than government aid. Overhead costs are lower, and it can better avoid interference by corrupt officials. It's no surprise that some of the first groups on the scene in Asia were private; on the day of the earthquake, CARE bought food for more than 8,000 Sri Lankans along with purification supplies and sleeping mats for 500 families.

The Europeans assist the needy abroad as they do the needy at home, primarily through government programs. This makes them appear generous: Norway ranks first in allocating .92 percent of its gross national income to foreign aid. But Norway's $2-billion of yearly aid is less than what American companies alone give.

So rather than talking about our stinginess, the Europeans and the United Nations should look to increase the role of private donors. After all, the victims of a tsunami do not care whether the food, medicine and clean water come from a government or an independent charity.

Carol Adelman, a senior fellow at the Hudson Institute, is a former assistant administrator of the U.S. Agency for International Development.

The New York Times