ProPublica and NPR Release Damning Exposé on Red Cross Projects in Haiti

June 03, 2015

(Updated June 4, 2015, 11:34 a.m. to include references to NPR’s report.)

ProPublica’s Justin Elliott and NPR’s Laura Sullivan have published damning new exposés on the American Red Cross’ work in Haiti following the 2010 earthquake (ProPublica’s here; NPR’s here). The reporting not only validates much of the criticism previously leveled at the ARC for its questionable priorities, slow pace of spending and short list of accomplishments; it offers some stunning new revelations – some of them coming from internal ARC communications.

One of the clearest failures is embodied in the ProPublica article’s headline. While the ARC itself says that it spent 35 percent of its funds raised for Haiti on shelter, and that it “has helped 132,000 Haitians to live in safer conditions—ranging from providing temporary homes and rental subsidies to repaired and new homes,” it has, ProPublica and NPR report, delivered only six new, permanent houses.

The article begins:

In late 2011, the Red Cross launched a multimillion-dollar project to transform the desperately poor [neighborhood of Campeche], which was hit hard by the earthquake that struck Haiti the year before. The main focus of the program — called LAMIKA, an acronym in Creole for “A Better Life in My Neighborhood” — was building hundreds of permanent homes.

Today, not one home has been built. Many residents live in shacks made of rusty sheet metal, without access to drinkable water, electricity or basic sanitation. When it rains, their homes flood and residents bail out mud and water.

The Red Cross received an outpouring of donations after the quake, nearly half a billion dollars.

The group has publicly celebrated its work. But in fact, the Red Cross has repeatedly failed on the ground in Haiti. Confidential memos, emails from worried top officers, and accounts of a dozen frustrated and disappointed insiders show the charity has broken promises, squandered donations, and made dubious claims of success.

The Red Cross says it has provided homes to more than 130,000 people. But the actual number of permanent homes the group has built in all of Haiti: six.

After the earthquake, Red Cross CEO Gail McGovern unveiled ambitious plans to “develop brand-new communities.” None has ever been built.

Through interviews with former government officials, community leaders, and former ARC staff, the report examines a number of questionable practices, including the broad and vague numbers with which the ARC has trumpeted its accomplishments in Haiti as the years have gone by (see our past scrutiny of these numbers here and here):

… the Red Cross said it has helped “more than 4.5 million” individual Haitians “get back on their feet.”

It has not provided details to back up the claim. And Jean-Max Bellerive, Haiti’s prime minister at the time of the earthquake, doubts the figure, pointing out the country’s entire population is only about 10 million.

“No, no,” Bellerive said of the Red Cross’ claim, “it’s not possible.”

Later on the report states:

There is reason to doubt the Red Cross’ claims that it helped 4.5 million Haitians. An internal evaluation found that in some areas, the Red Cross reported helping more people than even lived in the communities. In other cases, the figures were low, and in others double-counting went uncorrected.

The 130,000 people the Red Cross mentioned? Sullivan reports:

“For the American Red Cross and the Red Cross in general, shelter has been a priority,” says [General Counsel and Chief International Officer David] Meltzer, adding that the Red Cross has “provided homes for more than 130,000 Haitians.

“If you go to [those] people and ask them where they are living today, they will tell you ‘I am living in my home,’ ” he says.

But if you go in search of those tens of thousands of new permanent homes in Haiti, you won’t find them.

After several emails, the Red Cross acknowledged that the “130,000 Haitians” figure is made up of people who went to a seminar on how to fix their own homes, people who received temporary rental assistance, and thousands of people who received temporary shelters — which start to disintegrate after three to five years.

Worse, as Sullivan reports, the Red Cross’ failure to deliver on housing came after ARC CEO Gail McGovern 

went to a luncheon at the National Press Club in Washington and said that a fifth of the money the charity raised would go to “provide tens of thousands of people with permanent homes … where we develop brand-new communities … including water and sanitation.”

Some of the structural problems with the ARC’s reconstruction work in Haiti have not only happened with the Red Cross; indeed, they may be the rule rather than the exception. “Lacking the expertise to mount its own projects, the Red Cross ended up giving much of the money to other groups to do the work,” the ProPublica report states. “Those groups took out a piece of every dollar to cover overhead and management.”

Such practices are routine for USAID contracting in Haiti and elsewhere, as we have described in detail. That the money trail becomes more difficult to follow as contracts are subcontracted, and sometimes subcontracted again, is not a phenomenon unique to the Red Cross. But, as we have asked previously, how can the ARC be sure there is only 9 percent overhead when it contracts out its work? In fact, there is good reason to believe it is far higher, as ProPublica and NPR report:

Beyond all that, the Red Cross also spends another piece of each dollar for what it describes as “program costs incurred by the American Red Cross in managing” the projects done by other groups.

The American Red Cross’ management and other costs consumed an additional 24 percent of the money on one project, according to the group’s statements and internal documents. The actual work, upgrading shelters, was done by the Swiss and Spanish Red Cross societies.

Like other groups, the ARC found its efforts to provide housing hampered by the lack of credible land titles (although ProPublica and NPR note that these groups “also ultimately built 9,000 homes compared to the Red Cross’ six”). Less forgivable, as ProPublica and NPR describe, the ARC (and other organizations and agencies) hampered their own progress by employing few Kreyol-speakers and even fewer Haitians, and generated negative feelings in targeted communities. Again, this is a problem that plagued relief efforts overall. In the aftermath of the earthquake, coordination meetings were generally held in English and most Haitians were unable to participate.

The ARC deserves the scrutiny that ProPublica, NPR, Film @ 11, NBC Nightly News, and others have focused on it because of its status as the largest NGO operating in Haiti and its position as the go-to charity for Americans after the quake, due in good part to the media and “Michelle Obama, the NFL and a long list of celebrities,” as ProPublica and NPR note. “Inside the Red Cross, the Haiti disaster was seen as ‘a spectacular fundraising opportunity,’ recalled one former official who helped organize the effort.”

ProPublica and NPR detail how the ARC was left with millions of dollars after a $30 million housing project with USAID “collapse[d],” supposedly due to trouble accessing land titles, “and other issues.” NPR reports that the Red Cross found itself

struggling with how to spend housing money. McGovern wrote an email to her senior staff in November 2013 saying that a particular housing project was “going bust.” “We still are holding $20 million of contingency,” she writes in an email. “Any ideas on how to spend the rest of this? (Besides the wonderful helicopter idea?) Can we fund Conrad’s hospital? Or more to [Partners in Health]? Any more shelter projects?”

Red Cross officials wouldn’t say what she meant by the helicopter idea, but it’s a common reference in economics to giving money away — as in, throwing it out of a helicopter.

That the ARC was unsure how to spend tens of millions of dollars in Haiti is perhaps the most shocking revelation in the ProPublica and NPR reporting. The ongoing urgent needs in Haiti were – and are – well known. From at least 2011, it was clear what strategies might be effectively employed to eliminate cholera from Haiti, yet at the beginning of 2013, the cholera epidemic remained a humanitarian emergency (as it does now), with the New York Times and other outlets urging spending for its eradication. Sanitation and access to clean drinking water were – and are – related, urgent project areas where the ARC could have channeled some of its newfound resources. By January 2013, however, the ARC had spent 4 percent of its Haiti-related funds on cholera, and 12 percent on water and sanitation, according to its own accounting. (Of these, some projects had been “very behind schedule” or “crippled by ‘“internal issues that go unaddressed,’” ProPublica and NPR explain.) The ARC itself seems to have been aware that its cholera fighting efforts were woefully inadequate. NPR notes that “[then-director of the Haiti program, Judith] St. Fort summed up [a] 2011 memo: ‘To maintain the status quo, will only yield the same failed results.'”

The ARC took upon itself an outsized role after the Haiti quake; it had a responsibility to use the funds it raised sustainably and efficiently, delivering the maximum good per dollar that it could, while prioritizing Haitian involvement at every level. Instead, the tragedy of the Haiti earthquake seems to have become a way for the ARC to make a $100 million budget deficit vanish while offering plenty of overhead expenses for an array of projects, many never completed. Sadly, while many of the problems identified by ProPublica and NPR are shown to be “of its own making,” the lack of results, exclusion of Haitian voices and reliance on foreign expertise are symptoms of the aid industry’s problems writ large.

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