On Saturday, the Wall Street Journal editorial page (subscription req.) opined on the generosity of Americans, borrowing heavily from the Hudson Institute’s Index of Global Philanthropy, on which we have blogged before here and here:
When the U.N.'s Jan Egeland called the U.S. "stingy" with foreign aid a couple of years back, he was playing to a stereotype promoted by those who want governments to redistribute global incomes. He was also wrong, and now we have the data to prove it.…In 2004, the latest year for which many numbers are available, Americans -- through schools, religious institutions, companies, foundations and families -- gave at least $71 billion to the developing world, more than three times what the government gave.…Official aid promoters will respond to this good news about private giving with their standard complaint that American foreign aid is still too low as a fraction of GDP. If development depended on government transfer payments, no number would ever be high enough.
The problem with the argument is that it offers no definition of “generosity,” without which the claim to have “proved” Americans are generous is empty. Thus the editorial fits the definition of sophistry: plausible but fallacious argumentation.Two-thirds of the $71 billion in so-called “private aid” is remittances sent by immigrant workers to their families back home. If this is generosity, then I am generous to feed, clothe, house, and school my children. Moreover, the $71 billion works out to just 66 cents per American per day. If this is “proof” we are generous, what is the standard? 50 cents a day? The church once asked for a tithing, or tenth, of people’s incomes; on a gross domestic product of $12.5 trillion, that is $12 per American per day. Or we could judge the United States by the standards of its peers--but here the editorial is silent, with no information about other rich countries. The best available cross-country data on private giving to poor countries, from the Organisation for Economic Co-operation and Development, use a narrower definition of private aid. They put American giving at 10 cents per person per day. That includes probably 3 cents for rich Israel, and still puts us behind Switzerland (12 cents), Ireland (16 cents), and Norway (27 cents). And those countries give at least twice as much per person in government aid. (See my paper with Scott Standley.)The Commitment to Development Index, designed by the Center for Global Development, takes a more coherent look at how much rich countries are helping or hurting poor ones, by rating not just foreign aid policies but those on trade, investment, migration, environment, security, and technology. Compared to other rich countries, the U.S. is weak on foreign aid and the environment, strong on trade, investment, security, and technology, and average on migration. That puts it in 12th place out of 21--much higher than where the usual comparisons of government aid put it, but hardly a spot worthy of a global leader.
