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Updated 3/25/11 12:15pm – see “Update on OCHA and Reliefweb” section below

Last week, we issued our recommendation for donors regarding disaster relief/recovery in Japan. Since then, we’ve been considering new information, investigating our view further, and getting feedback from many. This post is a clarification and update of our position.

Our bottom line position remains the same as in last week’s post. We believe that Japan will spend as much as it needs to in order to optimize its relief and recovery effort, whether or not you give (this is not the case for all disasters). We therefore recommend Doctors Without Borders, which helps with relief and recovery efforts worldwide (including far less well-resourced efforts). For those looking to help Japan specifically, the Japanese Red Cross is the best option we see.

The rest of this post will:

• Discuss three distinctions that are key to our position:
  • “No funding needed” vs. “No room for more funding.”
  • “Relief” vs. “Recovery” vs. “Restitution” vs. “Everyday aid.”
  • “Appealing for donations” vs. “accepting donations.”
• Discuss new information regarding the positions of the U.N. OCHA, the Japanese government, the Japanese Red Cross, and nonprofits working in Japan (all of which we considered last week in coming to our conclusion that the relief/recovery effort had no room for more funding).
• Address various objections that have been made in response to our position.
• Wrap up our current position and link to more recommended reading for those interested.

Three key distinctions

“No funding needed” vs. “No room for more funding”

We would never claim that the Japan relief/recovery effort is unnecessary (or does not require money). “Room for more funding” is a specific term we use to refer to whether additional donations would result in more of a given activity. We have written extensively on this topic (see our overview of “room for more funding” analysis as well as our multiple blog posts on the topic).

If it is the case that both (a) Japan requires an extensive, expensive relief and recovery effort; and (b) the government and relevant nonprofits will be funding this entire effort regardless of how many donations come in from individuals … then the relief and recovery effort has no room for more funding, and the actual impact of donations is something other than relief and recovery (for example, freeing up government funds for other activities or for lower taxes). This is, in fact, our best read on the situation in Japan (we believe the relief and recovery effort will not be improved by overseas donations).

“Relief” vs. “Recovery” vs. “Restitution” vs. “Everyday aid”

Relief: When a disaster hits, there is generally an immediate and important role for governments and nonprofits: search-and-rescue, medical treatment, getting basic supplies and temporary shelters to those affected, etc.

Recovery: Following the immediate relief phase, there is generally also an important role for government and nonprofits in helping with recovery. For example, in Haiti, large numbers of people are homeless and living in camps; a year after the earthquake, the camps still need to be managed while higher-quality transitional shelters need to be built. Speaking more generally (and just from impressions), there will often be people whose situation has changed so drastically that there’s essentially no debate that they should receive assistance (financial or otherwise) from government/nonprofit sources.

Restitution: to me, the above two terms refer to activities that few would dispute can/should be handled by government/nonprofit actors. They do not include “undoing or compensating for all damage” or “putting everything back the way it was.” I would refer to efforts to do so – above and beyond what I’ve characterized above as “recovery” – as “restitution.”

Any disaster will leave many people worse off than they were before, and many of these costs will be borne by private individuals and/or private insurance. To completely restore the area as though the disaster had never occurred is infeasible, but some “restitution” – gifts to compensate people for what they’ve lost – can be desirable to donors, depending on their values.

I believe that the best form of restitution, in a setting such as Japan with a highly functional and powerful economy, is likely to consist of cash payments to survivors. This leaves all the decisions about what to build up to the people in the area. And I believe that there is a point where even cash transfers begin to do more harm than good, since it is infeasible to determine exactly who should receive how much.

Everyday aid: in our review of the relief/recovery effort in the year following the 2010 Haiti earthquake, we noted that many of the activities charities were reporting under the heading of “disaster response” sounded to us like the same activities that are common all over the world, in non-disaster situations: microlending, programs focused on improving education, etc.

Our current take is that there is no room for more funding in Japan’s “relief” or “recovery,” and that donations are likely to have the effect of increasing “restitution,” “everyday aid,” or activities outside of Japan. We believe that Japan will spend as much as it needs to in order to optimize its relief and recovery effort, whether or not you give; this is not the case for all disasters.

3. “Appealing for donations” vs. “accepting donations”

In our experience, it is almost unheard of for a nonprofit organization to say it does not need donations (even when, as in one case, its core activity has no room for more funding and it is regranting funds to other major nonprofits).

There are people whose job it is to raise money, and more money can always be used to do more of something. However, if the Japan relief and recovery effort had room for more funding – i.e., if the government and nonprofits could not afford to pay for what they’re generally accepted to be responsible for in this situation – we would expect behavior beyond soliciting donations. Among other things, we would expect a formal, quantified appeal, like the ones that Reliefweb has posted for many other areas; more on this immediately below.

Update on OCHA and ReliefWeb

Last week we observed that no appeal had been posted to Reliefweb’s Financial Tracking System and that very limited funding had been reported; we contrasted this with the situation for Haiti three days after the earthquake hit.

It is still the case that the Financial Tracking System lists appeals for many countries but lists no appeal for Japan (archived).

The amount of funding posted is substantially higher than it was last week, with over $300 million given and over $175 million pledged. Nearly all of this (84% of gifts; 69% of pledges) consists of private gifts to nonprofit organizations including Red Cross organizations.

We think it’s important to note that aid from larger donors is still at very low levels: about $28 million from U.S. agencies (of which over $20 million is through the military) and $13 million from other governments. For contrast, on 1/25/10 (12 days after the Haiti earthquake hit), OCHA reported $740 million in funding with an additional $1.1 billion in pledges; we don’t have the breakdown between private donors and large donors at that date, but we know that for the 2010 appeal overall, the U.S. alone has given over $1 billion, over 10% of the total for 2010. For details see our annotated versions of the 2010 Haiti data and current Japan data.

Another data point is the behavior of foundations, which reported over $37 million for the 2010 Haiti appeal (same data linked above) vs. $6,115.00 to date for Japan. The Gates Foundation, in particular, gave two grants within a week of the Haiti earthquake but doesn’t appear to have given anything for Japan so far.

There are many ways to explain this behavior. (For an alternative to mine, see my conversation with John Hecklinger (DOC).) My feeling is that these major funders would be sending more to Japan than they had to Haiti if they felt Japan had serious room for more funding. This is particularly true of the U.S. government since Japan is a U.S. ally.

We also reviewed the latest situation report from OCHA. The section on “International assistance” makes it clear that the government continues to accept only a fraction of the assistance offered, and the tone toward nonprofits is also noteworthy:

The Government of Japan has requested that its position on international donations of relief items and on international Non-Governmental Organizations (NGOs) operating in Japan be made public. With regard to relief items, “the Government of Japan has received offers for relief goods/material from many countries, international organizations, NGOs and private sector. The Government is identifying the needs and establishing a mechanism for storage and transportation to affected people. Therefore, it is recommended not to send any relief goods without coordination with the Government and local governments”.

Concerning offers of assistance by NGOs, the Government of Japan states that “Search and Rescue operation phase still continues in the affected areas at this moment and the access to those areas is strictly limited to rescue workers. It is also reported that there is temporary shortage of petrol in the affected area. International/foreign NGOs are recommended to wait until the situation improves so that those NGOs are able to conduct their activities in a self-sustainable way”.

Prime Minister Naoto Kan has expressed his appreciation on behalf of the Japanese people for the condolences and assistance Japan has received from the international community in response to the earthquake and tsunami. He thanked the generous assistance extended by the rescue workers, search dogs, and nuclear power experts from various countries as well as in-kind contributions such as food, medical supplies, blankets, and other supplies. He noted that over 670 NGOs and other organizations had offered assistance to date.

The Government of Japan has received 130 offers of assistance from countries as well as 33 offers from international organizations. It has accepted relief items from 15 countries to date.

Update 3/25/11 12:15pm:A staff member from OCHA has responded to my query.

Dear Mr. Karnofsky,

Apologies for the delay in responding to your message.

I am attaching OCHA’s latest situation report which states the Government of Japan’s position on international assistance. Given the Japanese national capacity to respond, there will be no international, inter-agency, multi-sectoral appeal for assistance.

We have updated our site with much of the information from the Philanthropy website and others.

Please don’t hesitate if you have any other questions.

Update on the Japanese government and Japanese Red Cross

As noted above, the government has continued to accept only a fraction of the assistance offered. A statement by Moody’s implies to us that the government will be both willing and able to finance the relief and recovery.

The Japanese Red Cross has been a considerable source of confusion.

• Early situation reports stated that “The Japanese Red Cross Society, with the support of the International Federation of Red Cross and Red Crescent Societies, has determined that external assistance is not required, and is therefore not seeking funding or other assistance from donors at this time” (see our previous blog post).
• The current situation report has altered language:
  

  This bulletin is being issued for information only, and reflects the current situation and details available at this time. The Japanese Red Cross Society (JRCS) has mobilized its staff and resources nation-wide and domestic donations are being received to assist affected communities. JRCS is receiving cash contributions from some Red Cross Red Crescent National Societies in the spirit of solidarity.

• The New York Times quotes a representative as saying, ” At present, the Japanese society is not launching a national or international appeal, but expressions of solidarity in the form of unearmarked financial contributions would be gratefully received.”
• Quentin Fottrell writes:
  

  Naoki Kokawa, director of the International Department at the Japanese Red Cross in Tokyo, says the Japanese Red Cross didn’t issue an “international appeal” as a specific tool to fundraise, but that doesn’t mean it doesn’t want or need your assistance.

  “The statement is certainly misleading and will be misunderstood by those outside of Red Cross/Red Crescent who do not know our system,” he says.

  An international appeal would be centralized in Geneva, Switzerland as it was when the Red Cross raised money in the aftermath of the earthquake in Haiti, Kokawa says, but media reports that charities working in Japan don’t need or welcome money are untrue.

  “This message that the Japanese Red Cross was not asking or accepting money was disseminated around the world,” he tells Pay Dirt. “That’s not true. We don’t need Geneva to manage external funding. We can manage it alone. But we need lots of money.”

• The donation page for the Japanese Red Cross (archived) states, “If you want to donate money to the affected population of earthquake and tsunami, please contact your national Red Cross/Crescent society, which may have already launched fundraising campaign within your country.” We find this odd in light of the NYT’s statement that “The American Red Cross keeps 9 percent of any money it raises, which means that as of Tuesday [March 15] afternoon, it had raised more than $3 million for itself through the Japan campaign.”
• The donation page for the Japanese Red Cross continues to state that “All the fund received under this account will be transferred to the Distribution Committee, which is formed around the local government of the disaster-affected prefecture and to be distributed directly among the affected population of earthquake and tsunami,” which may or may not be indicating that it plans on giving out cash benefits to survivors.

We believe that the Japanese Red Cross is facing pressure from many sides, including from organizations like the American Red Cross that have a direct interest in its accepting/soliciting donations. We believe that there is plenty of room for interpretation regarding its current funding needs, and that the above-discussed distinction between “appealing for” and “accepting” donations comes into play.

Our take is that the Japanese Red Cross (a) wants donations and does not want to do anything to discourage people from giving; (b) is not engaging in some of the behaviors we’d expect of an organization that perceives room for more funding in its relief/recovery effort. These behaviors would include a formal international appeal, through Reliefweb if not through the Red Cross system; declaring a fundraising target; accepting and soliciting donations earmarked for relief and/or recovery; and requesting and facilitating direct donations rather than encouraging people to give to local Red Crosses that take a cut of their own.

We believe that the Japanese Red Cross is a reasonable outlet for people looking for their money to be spent in Japan, as opposed to “wherever in the world it is most needed.” Our feeling is that overseas donations will not be crucial to (or, likely, used for) its relief/recovery effort. We would guess that they will more likely be used to fund what we’ve referred to above as “restitution” or “everyday aid.”

I did call the organization on Sunday night looking for clarification. I was given an address to email my questions to, which I then did; I haven’t heard back but will post something if and when I do.

Update on nonprofits

Last week, we noted that many nonprofits appear to be “on standby.” This week, it appears that activity by nonprofits has increased, but it is hard to say how significant a part of the effort they are, as well as whether they have “room for more funding” as defined above.

International nonprofits

We haven’t seen an up-to-date, consolidated account of nonprofits’ reports on their activities. Here is what we have found:

• The InterAction (archived) and Chronicle of Philanthropy (archived) updates both seem out of date: for example, both state that World Vision is simply on “standby,” whereas World Vision’s website as of this writing states that it has been distributing supplies to 6000 people.
• The most recent multi-NGO update we’ve seen is a March 18th AlertNet article and opens with:
  

  Despite the high death toll and shocking devastation caused by last week’s quake and tsunami, aid workers are not pouring into Japan.

  By and large Japan, as one of the most developed countries, has the capacity to respond and it has only accepted international support in a few specific areas, such as search-and-rescue teams, medical help and nuclear specialists.

  About a dozen international aid agencies are offering help in the northeast of the country. Most are focusing on getting to especially remote areas or on providing specialist help to the elderly or children.

  It continues with brief descriptions of the activities of the Japanese Red Cross, Doctors Without Borders (MSF), Save the Children, Plan International, World Vision, Malteser International, Mercy Corps, CARE, and World Food Programme.

• We also looked up a few international “household name” nonprofits whose names have been particularly prominent in the wake of the disaster.
  • We haven’t seen any information on World Vision’s activities aside from the brief statement mentioned above.
  • Mercy Corps has made three blog posts (archived) since the AlertNet update but these don’t seem to add much clarity to its activities and progress (via its local partner).
  • International Medical Corps (which we noticed was featured by Groupon shortly after the earthquake hit as well as supported by GlobalGiving) still seems to be in the assessment phase as of March 23 (archived).
  • Save the Children’s press releases (archived) don’t appear to add more detail/updates on the earlier statement (from the AlertNet article linked above) that it is “setting up child-friendly spaces with teachers to provide a protective environment where children can play with each other.” (Save the Children has benefited significantly from a partnership with Zynga as well as receiving funds from GlobalGiving.)
  • Doctors Without Borders, which currently carries our bottom-line recommendation for donors, has released two reports in the last week (archived) discussing its work on chronic diseases for the elderly. This group, which is not raising funds for Japan, has made at least as good a case as any other international NGO we’ve seen that it is helping in Japan – a good reminder of the distinction between “no room for more funding” and “no funding needed,” discussed above.
  • Direct Relief International is taking on the role of grantmaker to local organizations (archived) -more on this idea below.

Japanese nonprofits

Some have taken the approach of raising money for (or recommending) Japanese nonprofits, which (a) may be better positioned to help; (b) presumably will ensure that all donations are ultimately spent in Japan, even if more along the lines of “restitution” or “everyday aid” than “relief/recovery” (see distinctions above).

• Saundra Schimmelpfennig points to two local coordinating bodies:
  • JANIC. Its current website (archived) lists members but gives little other information.
  • Japan Platform. The most recent updates on its website (archived) are a status update (PDF) and a list of recommendations for NGOs working in Japan (PDF), but not much clarity (in our view) on how much is being sought and for what activities.
• As mentioned above, Direct Relief International is taking on the role of grantmaker to local organizations (archived); Mercy Corps is partnering with (archived) a local organization, Peace Winds of Japan.
• GlobalGiving has been pooling donations and making grants to organizations it has determined are active on the ground, including some of those discussed above both Japanese and international (Japan Platform, Save the Children, International Medical Corps, Peace Winds). I had a conversation with John Hecklinger (paraphrased transcript posted with permission – DOC), GlobalGiving’s Chief Program Officer, about the selection process and thinking behind these selections.

There’s no question that there are Japanese nonprofits that are active and soliciting donations. What is unclear is

• Whether these nonprofits have “room for more funding” (as discussed above) as far as relief and recovery go, i.e., whether your donation is likely to lead to more relief/recovery activities or more other activities.
• The quality of these nonprofits’ work. This is worth being quite concerned about, in our view. Issues like the ongoing fuel shortage highlight the fact that nonprofits can get in the way, or do harm, if they aren’t actively helping. The government’s quote above also highlights the fact that assistance isn’t necessarily welcome at all times and places.

Personally, I don’t see a good reason for an impact-focused donor to give to any of the organizations discussed above. Very little information is available about any of them, their activities, or whether they have room for more funding. If I were to give to a Japanese organization with the aim of making sure my money was spent in Japan, I’d opt for the Japanese Red Cross, which has the advantages of

• Possibly planning to give out cash to survivors (see above), though I wish we had more clarity on this. (I did call the organization on Sunday night, and was given an address to email my questions to, which I then did; I haven’t heard back but will post something if and when I do.)
• Being very large and receiving a lot of money. I think Saundra Schimmelpfennig makes a good case for general consolidation and top-down coordination in situations like this one. The Japanese Red Cross always has the option to contract with (and thus grant) nonprofits that would be helpful, and I would guess it is much better than U.S. donors at determining which nonprofits these are.
• Being widely perceived as responsible for the relief effort as a whole, something I believe makes it more accountable than other nonprofits. My feeling is that most nonprofits are assumed to be doing good, and only get criticism for egregious blunders; by contrast, the local Red Cross tends to draw criticism for anything and everything that goes wrong or is non-optimal in a relief effort. I may elaborate on this idea in a future post. To me this is likely to have a serious impact on organizational incentives and behavior, and is a serious reason to prefer the local Red Cross as a donor, in a relief situation.

Our bottom line on nonprofits: odds are that some nonprofits are doing very helpful work and that some have “room for more funding” in doing helpful work. The problem is that we don’t have a way to figure out which these are. From the perspective of an overseas donor, I don’t believe that nonprofits present a good opportunity to help with the Japan relief and recovery effort.

Our bottom line

The situation regarding the needs of the Japanese Red Cross, as well as nonprofits’ opportunities to help, has become less clear to me, so I am less confident than before that donors have no outlet for contributing to the relief and recovery effort. However, that is still my position, and I stand by all of the statements at the top of our previous post.

Giving to the Japanese Red Cross is the most reasonable option I can see for donors determined to help Japan specifically; and I still think a gift to Doctors Without Borders is the most appropriate outlet for the emotions that most donors (particularly our audience) are likely feeling at this time. The latter is the best way I can see to ensure that your gift helps to both fund and improve disaster relief and recovery, even if not in Japan. And I don’t think giving to Doctors Without Borders now will stop anyone from giving to Japan-related efforts if more issues come up in the future.

Our responses to other objections and concerns

Could the lack of appeals for funding be due to issues around Japanese culture and communication styles?

Several commenters on our previous post raised this issue.

I think Saundra Schimmelpfennig (paraphrased transcript posted with permission – DOC) makes a good argument against this: “The people making these decisions are high up enough that they’re used to dealing with Westerners and understand Western culture.”

If, indeed, there is a miscommunication, I believe that the appropriate agents to resolve it are those working directly with the people responsible for making (or not making) appeals. I think that these people, in Japan, have better access to those who can help them communicate with Americans than individual donors have to people who can help them communicate with Japan.

Also note that the case for our recommendation is, by and large, based on actions and opinions of many different actors, not just statements from Japanese officials. The evidence we’ve cited includes Moody’s opinion regarding whether the Japanese government can be expected to finance relief and recovery; the lack of an official appeal on Reliefweb; the behavior of large funders such as USAID and the Gates Foundation who ought to be able to deal with any “cultural miscommunications” along these lines better than we can; and the behavior and communications of international nonprofits, which appear to be playing a limited role.

Is GiveWell’s recommendation “reckless?” Does it risk turning people off from giving in an urgent situation?

GiveWell’s recommendation is not to refrain from giving. It is to give to Doctors Without Borders – an organization that is active in Japan and is helping people in need around the world. For those determined to see your money spent in Japan, we are pointing to the Japanese Red Cross.

We don’t control the way our views are presented in the media, but if you read the presentation of our views on our website, you will not see any argument for simply holding onto your money.

Along these lines, we liked Brigid Slipka’s piece on using Japan as an inspiration to give, whether or not your money is spent in Japan.

GiveWell appears to recognize that different donors have different values in a situation like this: some are more interested in “helping people in desperate need” while others are more interested in “having their money spent in Japan, even if not as part of the relief and recovery effort.” Why does GiveWell present its recommendation to the former group as its bottom-line recommendation, instead of giving the two recommendations on equal footing?

We believe that much of our audience comes to us looking for a single bottom-line recommendation; they either have very low interest in putting in their own time and thought, or very high alignment with our values and trust in our judgment. In addition, we believe that forcing ourselves to give a single recommendation is a good way of forcing ourselves to think through a situation as deeply as possible. So we always give our bottom line in the form of a single recommendation that takes all factors into account, including factors that are subjective, emotional, unquantifiable, etc.

But we also seek to be as transparent as possible about the factors behind that recommendation. I believe we’ve been sufficiently clear that our bottom-line recommendation does not apply to donors determined to have their money spent in Japan.

Recommended reading

For those interested in learning more about the situation in Japan, we have a few recommendations.

General sources of information:

• Updated list of Japan-related articles from Good Intentions are Not Enough – this is the best curated collection of relevant reading that I’ve seen. Includes OCHA Situation Reports, which I find particularly informative.
• AlertNet and Reliefweb are more inclusive sources of news, articles, etc.
• Reliefweb also maintains updated information on appeals and funding.
• List of updates from the Japanese Red Cross.

Communication records from GiveWell’s investigations:

• March 19 phone conversation with Saundra Schimmelpfennig (paraphrased transcript posted with permission – DOC)
• March 21 phone conversation with John Hecklinger (paraphrased transcript posted with permission – DOC)
• Text of emails I sent to Reliefweb and Japanese Red Cross

Some other articles I found worth reading but didn’t link to above:

• Tales from the Hood argues that nonprofit staff know they shouldn’t be raising money for Japan, but are doing it anyway.
  
• An ALNAP piece on the need for better mechanisms for disaster relief (similar to an above-linked piece from Good Intentions are Not Enough)

• Reuters pieces on the progress of the relief effort as of March 20 and March 24.