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Who's A 'Penny Pincher'?
By Dick Morris


January 10, 2005

According to New York Times columnist Nicholas Kristof, America is a land of "penny pinchers" who are not sufficiently generous to the needy in the rest of the world. Citing our relatively low level of per-capita official governmental foreign aid, he refuses to take issue with the recent charge by a U.N. official that we are "stingy."

jpg Dick Morris

Mr. Kristof has his facts wrong.

Government-to-government foreign-development assistance, usually called "foreign aid" is only a tiny part of the massive American generosity to the peoples of the Third World. Kristof claims that our per-capita daily contribution of only 15 cents in foreign aid is lower than that of 22 other nations. He dismisses private philanthropy as only generating an additional six cents per day, per capita, still leaving us in last place.

But Americans are, in fact, very generous. Last year, we donated more than $240 billion to charity - about $800 per person, or in Mr. Kristof's terms, almost $2.19 per day, per person. Kristof only counts the 2 percent of that sum that goes directly for earmarked donations for foreign philanthropy. He disregards the vast amount of money spent to help the Third World by American charitable, religious and philanthropic organizations that are not exclusively dedicated to foreign activity. Nor does he include any mention of the altruistic volunteer work by Americans that benefits the needy throughout the world.

For example, 60 percent of all charitable private donations in the U.S. go to churches and religious groups. A large part of this money goes overseas, much of it to the Third World. In addition, much of the money Americans give to educational charities (7 percent of total contributions) winds up funding scholarships for foreign students. Funds given to promote health care (7 percent), human resources (9 percent) and the environment (3 percent) also find their way overseas. No other nation comes close to our total private-sector philanthropic giving.

But our government itself is far from deserving the appellation "stingy." We have catalyzed $150 billion in private investment overseas, largely in Third World nations, through the efforts of the Overseas Private Investment Corporation (OPIC), a public agency whose board is appointed by the president.

Our trade deficit with the rest of the world of $500 billion, a fifth of it with China, creates jobs and fights poverty throughout the world. By opening our markets to Third World trade more than any other nation, we create far, far more wealth in poor countries than all the governmental foreign aid in the world put together. The U.S. grants free-trade status to Mexico, one of the largest Third World nations, and is extending the same status to the Caribbean, Central America and Chile. Eventually, we plan to open our markets to imports from all of South America. We even passed a special exemption from our import quotas for textiles from Africa to foster jobs in that beleaguered nation. And we have led the way in granting hundreds of billions of debt relief to the world's poorest nations, much of it lent by American banks and the U.S. government.

Governmental foreign aid is not the sole locus of American generosity, although it certainly reflects the taxes paid by individual Americans. Investment, trade and private philanthropy are its epicenters. Indeed, about one third of the governmental foreign aid we do send abroad is for Israel and Egypt, a payoff for the Camp David peace accords of 1979.

Should we do more to help Third World nations? Yes. But increasing government-to-government foreign aid is not the way to go about it. We need to open our markets further to imports. With 4 percent of the world's population, we still have one-quarter of its wealth. Those supposedly compassionate liberals who advocate protectionism seem to think we should make a profit in our dealings with the other 96 percent of the world.

They're wrong. We need to lower or eliminate our sugar, beef, clothing and other import quotas and to repeal our farm subsidies. We can afford to widen our trade deficit and to subject our farmers to fair foreign competition. But these private-sector, capitalist solutions to the problems of Third World poverty do little to get a liberal's juices flowing. If the aid doesn't come from the government, extracted by taxes from American families, it doesn't count.

With Eileen McGann.

E-mail Howard Dean
Dick Morris at

Dick Morris was an adviser to Bill Clinton for 20 years.
Look for his new book, "Because He Could" about Bill Clinton.

Copyright 2005 Dick Morris,
All Rights Reserved.
Distributed exclusively by Cagle, Inc.
to subscribers for publication.


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