$9 Billion Was Given Globally for Haitian Relief But More Than 170,000 Haitians are Still Living in Tents; Bulk of Aid Went to U.S. Firms

What happened to the global community’s $9 billion in aid? Despite the fact that a sum of money almost equivalent to the GDP of Haiti was disbursed to non-governmental organizations, for-profit contractors and other agencies, most Haitians live without a reliable supply of electricity, clean water, or paved roads. Several thousand Haitians still live in (now tattered) tents provided as part of the relief effort.



The Red Cross says it spends an average of 91 cents of every dollar on programs and services. This is the lie they repeat over and over again. In fact, the truth is opposite of what they claim. The Red Cross spends about 91 cents of every dollar on operating expenses and administrative costs and about 5 cents of every dollar on grants for its tax-exempt purposes.

Red Cross under fire! Where’s the money for Haiti?

March 30, 2010

Amadi Ajamu - This video was posted on YouTube April 1 by teslakontrol, who wrote, “After the Red Cross released a two-month report saying that they spent $106 million in Haiti, I went to look for evidence that it was actually spent in Haiti.”

As the Haitian people brace themselves for the hurricane and rainy season with no shelter and no supplies for millions, the United States, France, Canada and other nations are attending the United Nations Donors Conference on Wednesday, March 31. At the conference, these wealthy nations will “donate” funds to over 3,000 non-governmental organizations, most of them headquartered in their own countries. They are in effect paying themselves. 

 The American Red Cross has already admitted to financing its own debt with donations given for Haiti relief. According to its official report on the first two months since the devastating Jan. 12 earthquake, they collected over $354 million for Haiti but have spent only $106 million. Yet only half of the 1.3 million people made homeless by the quake have even a tarp as the rainy season begins.

Demanding an independent accounting, the Friday Haiti Relief Coalition protested at the American Red Cross headquarters in New York City on March 22. They’ll repeat that demand on Wednesday, March 31, at the United Nations in Dag Hammarskjold Plaza, 47th Street and First Avenue, during the Haiti Donors Conference at 9:30 a.m. and 1:30 p.m. Another key demand is that Haitians must determine for themselves how they want to rebuild their nation.

In Haiti, recent rain presages the heavy tropical downpours of the coming rainy season and the hurricanes that may follow. In addition to the nearly 300,000 who died in the earthquake or from their wounds, thousands more could die this spring from exposure and water-borne disease. Time is of essence. Shelter is needed now.

Where is all the money going? That was the burning question asked by the crowd that converged on the doorstep of the American Red Cross on March 22 led by the Friday Haiti Relief Coalition. The coalition was organized by the December 12th Movement days after the earthquake and has raised funds and delivered a tractor trailer full of water to Leogane, Haiti. A second trip is being planned now.

With young people in the lead, the December 12th Movement’s Friday Haiti Relief Coalition turned out in force – in the rain – March 22 on the doorstep of American Red Cross headquarters in New York City to demand that all the money donated for Haiti be spent in Haiti now – especially for shelter from the rain. Extraordinary teachers in the movement encouraging students to stand up and speak out for Haiti is people’s education in action! – Photo: Amadi Ajamu

“We have been on the ground and we know the people are in need of shelter. The money collected by the Red Cross for Haiti is not getting there. We are tired of the excuses. That’s our blood down there and our money. We demand immediate shelter for our people,” said coalition member April Raiford.

Red Cross personnel nervously scampered back and forth as the protesters chanted, “Stop stealing the money! Where’s the money!”

Omowale Clay of the December 12th Movement said: “We will keep organizing and mobilizing our people until the Haitian people get shelter and supplies. The American Red Cross has not been held accountable for the hundreds of millions they have collected in the name of Haiti and we won’t let them off the hook. They did the same thing during Hurricane Katrina in New Orleans. The money donated to Haiti is for the people in Haiti, not the Red Cross CEO and executive bureaucrats. Haiti needs shelter now!”

The Friday Haiti Relief Coalition also has a committee looking into the possibility of a class action lawsuit against the American Red Cross. The coalition meets every Friday at 6:30 p.m. at Sistas’ Place, 456 Nostrand Ave., Brooklyn, NY. For more information, call (718) 398-1766.

Bulk of Haiti earthquake aid went to U.S. firms, organizations

April 9, 2013

Democratic Underground - A new report on American aid to Haiti in the wake of that country’s devastating earthquake finds most of the money went to U.S.-based companies and organizations. The Center for Economic and Policy Research analyzed the US $1.15 billion pledged after the January 2010 quake and found that the “vast majority” of the money it could follow went straight to U.S. companies or organizations, more than half in the Washington area alone.

Just 1 percent went directly to Haitian companies.

The report’s authors said that a lack of transparency makes it hard to track all the money. “It is possible to track who the primary recipients of USAID funds are, yet on what are these NGOs and contractors spending the money?” authors Jake Johnston and Alexander Main wrote. “What percent goes to overhead, to staff, vehicles, housing, etc.? What percent has actually been spent on the ground in Haiti?”

USAID did not respond to requests to comment on the report Friday.

The group has been a critic of U.S. foreign policy in the past, accusing the U.S. of a top-down approach to aid that does little to alleviate poverty in impoverished Haiti.

The report also finds that the biggest recipient of U.S. aid after the earthquake was Chemonics International Inc., a for-profit international development company based in Washington, D.C., that has more than 4,800 employees. [Editor's Note: In July 2011, a year and a half after the January 12, 2010 Haitian earthquake, Chemonics transitioned to 100% employee ownership.]

Aside from the World Bank and United Nations, Chemonics is the single largest recipient of USAID funds worldwide, having received more than US $680 million in fiscal year 2012 alone.

Chemonics and Neoliberalism in Haiti: The case of rice
Haiti Info, Vol. 3, #24, 16 September 1995

With the focus on the impending privatization of state-owned enterprises, it is easy to forget Haiti has been undergoing similar measures since the early eighties, when the Jean-Claude Duvalier government began to apply some liberal measures, and with the big push for liberalization in 1987. The current privatizations are only one aspect of an over-arching program aimed at integrating Haiti more into the international market which, in Haiti's case, means the U.S. and its multinational companies.

An examination of the plight of Haitian rice, of symbolic and food security importance because it is the second-most consumed cereal crop, offers a look at how liberalization has effected and will continue to effect the Haitian population and economy, and shows clearly the cynicism of the international lenders (the International Monetary Fund (IMF), the World Bank and Inter- American Bank (IDB)), U.S. government agencies, and the current government, all of which know their policies are leading to the further impoverishment of peasants, further dependence of Haiti on the U.S. for basic foodstuffs, and the shift of Haiti's best lands into the hands of export-crop agribusinesses.

Historical/Economic Background

Not long ago, Haiti was self-sufficient in rice. Haitian rice is expensive to produce (for example, in the 80s, it was 40% more expensive to produce than Thai rice), due to a number of reasons: low level of mechanization; high cost of leasing land; high cost of fertilizers and other inputs; usurious credit systems where peasants pay up to 100% interest per month; high taxes; high transport costs, and a disorganized, exploitative system of distribution and marketing. Like other agricultural products, historically it has been produced in the complete absence of state regulating agencies or support and an untrammeled exploitation of the peasants. An IDB study in the 80s determined, for instance, that in the Artibonite Valley, where most rice is grown, about 22% of the land are plots of 3.26-10.25 hectares and are owned by 1.7% of owners; 23% of the land are plots of 1.01-3.25 ha., owned by 4%; 37% of plots measure .26-1 ha., owned by 31%, and the majority of landowners, 63%, have plots measuring .01-.25 ha., accounting for only 18% of the land.

Another interesting statistic is that only 70,000 ha. of land in Haiti (32,000 in the Artibonite) is irrigated, whereas studies indicate 200,000 ha. (a total of 40,000 in the Artibonite) could be irrigated, showing the potential for higher production.

(...)

The breaking down of Haiti's rural economy through the flood of U.S. products, the destruction of the creole pig and other measures are not by hazard. They are part of the same neoliberal vision pushed by the U.S. and the multilateral institutions in all “dependent” countries. By the early 1980s, the U.S. Agency for International Development (AID), had decided Haiti should not grow its own food or develop any national industries. The international division of labor, AID and the other planners and bankers said, called for Haiti to do “export manufactur(ing) and process(ed) agricultural products, but with a sharply growing need to import grain.” Through Ronald Reagan's Caribbean Basin Initiative (CBI) in 1983, a vast increase in food aid and credit for agroindustries and other programs, during the 80s, “experts” worked consciously to dismantle the rural economy even though, according to authors DeWind and Kinley, AID knew that would cause increased poverty and “a decline in income and nutritional status.”

(...)

Rice Corporation of Haiti

One of the companies to profit was Erly Industries, which had positioned its Rice Corporation of Haiti (RCH) perfectly to take advantage of the coup.

Erly, a massive agribusiness headed by Gerald Murphy and his son Douglas, is the largest marketer of U.S. rice (as well making agricultural chemicals and orange juice). Its 1994 rice sales topped $350 million.

In December, 1992, a year after the coup and three years after filing papers in Port-au-Prince, it signed a nine-year contract with the illegal government of neoliberal champion, former World Bank employee and illegal Prime Minister Marc L. Bazin, where it promised to import at least 5.5 MT per month. (RCH also promised to help improve rice production in the Artibonite with U.S. agronomists, but three years later, they are not evident. What is more likely is that RCH will position itself to buy up land as little and big landowners go broke, and then grow export products like oranges.)

The RCH deal was squired through the various Washington and Port- au-Prince agencies by Larry Theriot, the first director of CBI and now V.P. of American Rice, one of the Erly rice spin-offs.

Erly knows the ins and outs of Washington. Despite a reputation that even the New York Times questioned and a brush with bankruptcy a few years ago, the Murphys still have many friends and they get subsidized loans, government contracts and other perks. In addition to the agribusiness, Gerald Murphy, a longtime Republican and supposed close friend of Ronald Reagan, wholly owns Chemonics, one of a myriad of parasitic “consulting firms” that live off of AID. Founded in 1976, Chemonics had won over US$89 million in AID contracts during the first six months of 1995 alone, and is now bidding heavily for contracts in at least two ministries here (justice and environment). Murphy, a Harvard Business School graduate, said he set up Chemonics because he “always wanted a way to do two things: one, have my own CIA; and two, be helpful to people.”

U.S. Aid to Haiti: “Troubling” Lack of Transparency, Effectiveness

Haitians, U.S. taxpayers unable to verify how U.S. aid funds are being used on the ground”

April 3, 2013

Global Research - A new report from the Center for Economic and Policy Research (CEPR) identifies significant problems with the delivery of U.S. aid in Haiti and finds an overall lack of transparency on how the billions of dollars obligated for U.S. assistance to Haiti are being used. The report, “Breaking Open the Black Box: Increasing Aid Transparency and Accountability in Haiti,” by CEPR Research Associate Jake Johnston and Senior Associate for International Policy Alexander Main, examines the effectiveness of U.S. assistance to Haiti, how it is being administered, to what extent it is adhering to the “USAID Forward” reform agenda and what steps can be taken to ensure its more effective and transparent delivery.

“Billions in U.S. aid money are going to Haiti with little transparency to ensure that it is being used effectively,” paper co-author Jake Johnston said. “The situation for many people in post-quake Haiti is especially daunting, but for USAID it has been business as usual. No care has been taken to ensure that U.S. taxpayer dollars are being best utilized in Haiti.”

The report notes that the few audits and evaluations of USAID’s programs in Haiti since the earthquake present a “troubling picture of the manner in which U.S. relief and reconstruction efforts have been conducted so far.” Contractors have hired far fewer Haitians than promised, Haitian businesses were largely excluded, goals were not met, there was inadequate supervision of grantees, and USAID had not conducted internal financial reviews of contractors.

The paper shows that of the $1.15 billion in contracts and grants awarded since the 2010 earthquake, over half went to the top 10 recipients of global USAID awards, with the largest recipient being the for-profit company Chemonics International Inc., the single largest recipient of USAID funds worldwide aside from the World Bank and U.N. Meanwhile, just 0.7 percent of USAID awards have gone directly to Haitian businesses or organizations.

Much of the lack of transparency has to do with the scant information available on subawards – the subcontracting done by the direct recipients of USAID awards. Of the $540 million in contracts awarded by USAID, only one of them, MWH Americas, has reported any information on the use of subcontractors to the USASpending.gov database. Among grantees, only five have reported sub-grant data.

The paper notes that despite USAID’s “Forward” reform agenda, the agency has blocked disclosure of additional information, including through Freedom of Information Act requests.

The paper makes several recommendations for how to improve transparency and accountability around the $1 billion in outstanding obligated U.S. aid funds for Haiti, as well as around any additional aid funding in the future. These include making data available on subcontractors; ensuring awardee compliance with federal regulations and contract requirements; reducing reliance on large, multi-year contracts that favor traditional partners while increasing direct contracting to Haitian entities; strengthening USAID’s capacity to carry out effective monitoring and evaluation of assistance programs; making all evaluations publically available; ensuring the involvement of local populations; and making all available information on assistance programs accessible to Haitians – including via translations to Haitian Creole.

“Without transparency, not only is it impossible for U.S. taxpayers to know what is being done with their money, but the Haitian government and the Haitian people have little opportunity to ensure that U.S.-funded projects actually assist Haiti in rebuilding and dealing with ongoing urgent humanitarian needs,” paper co-author Alex Main said.

Haiti Quake: Four Years Later, We Still Don’t Know Where the Money Has Gone

January 7, 2014

Center For Global Development - January 12, 2014 marks the fourth anniversary of the massive quake in Haiti that left over 200,000 people dead and several million people homeless.  The response from rich countries was overwhelming—over $9 billion was disbursed towards relief and reconstruction efforts ($3 billion from the United States, an estimated $3 billion in private contributions, and another $3 billion from foreign governments).  Four years later, the earthquake in Haiti is mostly forgotten.  The UN Office of the Special Envoy for Haiti and charitable organizations such as the Bush Clinton Haiti Fund have quietly closed their doors.  Many non-governmental organizations in Port-au-Prince have scaled down their operations.  Other disasters, such as Typhoon Haiyan, dominate the news.

I can think of at least two reasons why we should still care about what happened in Haiti.  The first reason is that despite the fact that a sum of money almost equivalent to the GDP of Haiti was disbursed to non-governmental organizations, for-profit contractors and other agencies, most Haitians live without a reliable supply of electricity, clean water, or paved roads. Several thousand Haitians still live in (now tattered) tents provided as part of the relief effort.  The second reason is that understanding what happened in Haiti is critical if we want to do a better job with relief and reconstruction efforts in the aftermath of future natural disasters.  Despite commitments made by rich country governments and non-governmental organizations towards greater aid transparency, and the availability of easy-to-use tools such as the International Aid Transparency Initiative (IATI) and UN OCHA’s Financial Tracking Service, it is impossible to trace how the money was spent, how many Haitians were served, and what kinds of projects succeeded or failed.

The United States is the single largest donor to Haiti.  To be fair, USAID has released some data from its files.  And it has committed to reporting its data in the standard IATI format. The USAID Transactions database does have data on obligations and disbursements for FY2013  (disbursements are shown in Figure 1).  We know that 92 percent of funds disbursed in FY2013 went to organizations that are based in the US. Figure 2 shows that the majority of disbursements in FY13 were to for-profit companies; Figure 3 shows that Chemonics—a for-profit provider—received 7 of the largest 10 contracts, totaling $42 million.  Separately, USAID has also released data on local procurement through its USAID Forward initiative. These figures are total disbursements for FY13 and may reflect disbursements for contracts made prior to the 2010 earthquake.

This is where the trail goes cold.  Typically, USAID’s primary contractors use subcontractors to implement their projects; these are the actors who actually get the work done in Haiti (and elsewhere). USAID’s primary contractors are obligated to report data on the activities of their subcontractors, which in turn should be made public in accordance with the Federal Funding Accountability and Transparency Act of 2010.  But this information is nowhere to be found.

Figure 1: Total disbursements in FY13

Figure 2: Disbursements by vendor type

Figure 3: Top Ten Contracts by Disbursement

Vendor Name	Vendor Location	Vendor Category	Disbursed	Application Account
Chemonics	US	For Profit	$9,268,540	Economic Support Fund
Thor Construction, Inc	US	For Profit	$8,544,511	Economic Support Fund
Chemonics	US	For Profit	$7,015,593	Economic Support Fund
Chemonics	US	For Profit	$6,400,000	Economic Support Fund
Chemonics	US	For Profit	$5,595,220	Economic Support Fund
Chemonics	US	For Profit	$5,216,654	Economic Support Fund
Thor Construction, Inc	US	For Profit	$5,058,992	Economic Support Fund
Chemonics	US	For Profit	$4,770,297	Economic Support Fund
Management Sciences for Health	US	Non Profit	$4,275,519	Global Health & Child Survival
Chemonics	US	For Profit	$4,094,521	Economic Support Fund

There are other challenges.  The labels used to categorize USAID’s spending (for example “ Economic Growth”, “Governing Justly and Democratically”) are not easy to interpret.  They do not correspond to the categories and sectors used in USAID’s Foreign Assistance Dashboard, but rather to USAID’s strategic goals.  Also, almost half of the transactions data have missing values for the Data Universal Numbering System (DUNS), which serves as a unique identifier for vendors and transactions. Data on local procurement contracts in Haiti, released through the USAID Forward initiative also lack this information, making them impossible to compare with the transactions data, despite being released by the same organization. In addition to the missing DUNS data, 35% of vendor names (corresponding to $16 million in disbursements) and 34% of award numbers ($18.4 million) are not reported.

Members of the United States Congress have recognized that data transparency is necessary for continued progress in Haiti; as well as for effective foreign assistance writ large. Led by Rep. Barbara Lee (D-CA), the House recently passed HR 3509, Assessing Progress in Haiti Act of 2013.  The bill requires a GAO report reviewing US assistance efforts, which is an important first step.

It is an outrage that four years after the quake in Haiti, we have almost no idea of where all the money has gone.  Without data on procurement, expenditures, and outcomes, we cannot know what works and what does not.  USAID’s subcontractors routinely provide data on their activities to the prime contractors—these data can and should be made public by USAID.  The International Aid Transparency Initiative is the ideal platform to report data in real time, but simply publishing to USAID’s existing data portals is a relatively simple process that USAID should move forward with this year.