Save the Children: A Different Kind of Child Abuse

Save the Children's fund-raising strategy is at odds with its goal of helping children.

As communities often receive a small portion of the sponsor's contributed dollar, they are obviously going to ask questions about where the money goes. All the explaining in the world would not make this question go away or our own strategy look good in an investigative report.

-- Charles MacCormack, President of Save the Children, in a confidential memo to the files.

 


As Congress began its debate on welfare reform last March, a group of Democratic congressmen entered the House chamber wearing colorful neckties adorned with child-like drawings. Women members wore similarly painted scarves. On several occasions President Bill Clinton has been seen wearing the same type of ties, and the vice president owns at least one. Larry King wore one of the ties when he interviewed the president and vice president together recently on CNN. So far, Republicans seem to have rejected the style.

The ties and scarves , designed by children, are promoted as a fundraising project by the charity Save the Children, which keeps fifty-seven cents of the $27.50 retail price to use for its work. But that, of course, is not the reason to buy them. Rather, the ties are worn as a very public declaration of concern for children. In the American realpolitik, that translates into support of the Democrats' policies to change welfare as opposed to the Republicans' plans to cut it back and hand over what's left in block grants to the states . While Save the Children doesn't involve itself in partisan disputes, they are clearly proud that their organization has been acknowledged in Washington as a symbol for the welfare of children.

What the Democrats don't realize, however, is that dangling beneath their chins may be the best of all arguments against the Republican initiative. If they would stop grandstanding in the name of children for a moment, they might find in Save the Children a real case against legislation that would shift part of the administration of assistance programs from government to private hands. The reality behind this child-centered charity is a lesson for anyone who thinks that private organizations are by definition more efficient, compassionate, or effective than big government.

Most people know Save the Children from its recent print ads which ask people to "help stop a different kind of child abuse" and from its television advertisements, the ones that now feature former All in the Family star Sally Struthers pleading on behalf of poor children who, she explains, are waiting for you to step forward and become a sponsor. Struthers' plaintive voice drifts over horrific images of fly-covered starving children. Then with the lens tightly focused on one child, she informs the public that all it takes to redeem this child from a life of poverty is twenty dollars a month, sixty-five cents a day. Your decision right now about whether or not to pick up the phone and take out your credit card will determine if this child lives or dies.

The ads seem to have been on the air for years, though Struthers has only worked for Save the Children since January, 1994. Before that, for 17 years, she delivered a nearly identical plea for Christian Children's Fund, another organization that raises funds through sponsorship. (It appears that much of the public thought Struthers was working for Save the Children all along.) A number of Save the Children staffers , especially those in fundraising, thought the veteran pitchwoman was past her prime and doubted very much that her residual celebrity would translate to positive numbers on Save's bottom line. "She was delivered to us as a fait accompli," recalls Sally Franz, who used to work for Save as a fundraiser.

But the move had the support of the senior staff at the organization including Save's new president, Dr. Charles MacCormack. MacCormack (Everyone calls him Charlie.) had taken over a year earlier at a time when the organization desperately needed strong leadership, a new direction, and a calming influence. His predecessor, James Bausch, had been hounded from office by a vicious staff rebellion waged with innuendo, personal attacks -- including anonymous threatening letters to his wife -- and leaks to the press about the ostentatious waste of sponsorship funds. Bausch was said to have been an embarrassment to the organization after it was revealed that his salary and benefits added up to more than $300,000 a year. The leaks became so bad that Bausch came in one day and had all the fax machines disconnected. When Bausch finally left he took with him a $225,000 severance package that itself became an issue of contention and led to the resignation of at least one board member, writer Michael Dorris, and a lot of bad feelings. MacCormack, who had been on the board at the time, was not active in the coup, but he now leads the organization with an executive staff partly composed of the people who were.

With their new leadership, higher visibility, and new celebrity spokeswoman, Save now believes that the controversies are in the past, and they can get back to the business of helping children.

Westport, Connecticut is among the wealthiest towns in America. Its shoreline, by Long Island Sound, is rimmed with multi-million-dollar mansions. Westport's Main Street runs along the Saugatuck River and is lined with upscale boutiques such as Laura Ashley , Brooks Brothers and Barney's. Over the past fifteen years it has been transformed from a quiet New England town to a less understated, more New York, kind of suburb where, according to the complaints of one Westport native, the wives of big city executives drive the streets in expensive cars speaking on their cellular phones. Save the Children's headquarters sits just across the river from Main Street in a two-story former school building that once housed the Famous Writers' and Famous Artists' Schools. The building is actually three separate structures, awkwardly joined, each built in a different decade from the 1950s through the 70s. Just beyond the reception area is Save the Children's gift shop, where the ties and scarves can be purchased along with a wide selection of Third World crafts.

The goods are generic in a multicultural way, mute ambassadors from Africa, Asia, Latin America. The charity's more distinctive products are tacked on a bulletin board outside the shop's entrance. Little red-and-white folders resembling greeting cards contain photos and thumbnail descriptions of children. Each bears the Save the Children corporate icon, a Gumby-like cutout of a child with its hands raised; employees refer to the symbol as red baby Jesus, or just RBJ. Below the folders a hastily hand-written sign reads: Choose a Child. Inquire at Desk.

This combination of generic Third Worldness, corporate imagery, and the sad faces of distant but real human beings sums up the charity's peculiar appeal. Its goals are satisfyingly broad -- simply "the children" -- yet achingly specific: Each sponsor receives, so to speak, a child. The sponsor can track the child's transformation with cards and letters from the child and through progress reports from Save the Children. The organization pioneered this fundraising technique with Appalachian children in the 1930s. It has since been adopted by dozens of other charities around the world. (World Vision, Children Incorporated, Childreach, Plan International, and others use sponsorship.) As a way to raise money it is unparalleled. Sponsorship links the donor directly to a needy sad-eyed target of the charity's work, rather than to a faceless fund-raiser at the end of a solicitation letter. The charity's bureaucracy becomes invisible. The sponsor feels connected to an actual person and will believe that his or her money, or most of it, will be going to help that child.

But sponsorship is a con game. And as in any con game, the mark, in this case the sponsor, is duped into believing the improbable because his or her judgment is clouded by the possibility of getting something valuable on the cheap. Anyone thinking clearly about the miserable poverty of the children in these ads would have to conclude that twenty dollars a month, sixty-five cents a day, is not by itself enough to substantially alter the oppressive environments they inhabit -- especially since much of that money has to be used to pay for more TV ads, cover the costs of the charity's bureaucracy, and maintain the links between Save's more than 100,000 individual sponsors and their children. What sponsors are really buying, is, as stated in Save's brochures, a sense of well-being and "deep satisfaction." That's a real bargain at $20 a month, but it doesn't leave much for the children. The pitch that is so appealing to donors, seems absurd when one is in the field confronting the challenges of economic development. And it puts Save in a bind: If they ignore some of the sponsored children, they can do more effective work for the others. If they try to do something for everyone, they run the risk of accomplishing nothing at all. Its commitment to sponsors clashes with its promise to the children.

Save the Children enjoys one of the best reputations in the charity business. As it announces in its own advertising, "Today, Save the Children is one of the most respected relief and development organizations in the world...." That is certainly true. Money magazine, in its annual ranking of charities last year, rated them third among relief and development charities and noted that 82.1 percent of its expenditures were used for "program services." According to Save's tax forms for the 1994 fiscal year, that number is up to 82.9 percent, which may push the organization higher in this year's rankings. The new numbers show nearly 80.5 million dollars going to "program," from total revenues of over 97 million dollars collected from more than 100,000 sponsors. Save every year prints a pie chart divided into three slices. The two little slices are always fundraising and management. The big slice, always more than 80 percent, is "Program Services." The pie chart is packed into all of Save's promotional mailings and proudly displayed in all the pamphlets hanging from the bulletin board.

Charlie MacCormack is proud of that pie chart and of the sponsorship program, which he regards as the real strength of Save the Children. Sponsors are not driven, he said, by the "crisis du jour" Instead they become interested in the child. "If they're supporting a child in activity in Bangladesh, and they're gonna stay for 10, 12, 14 years whether Bangladesh is in the newspapers or not." This solves one of the biggest problems relief and development organizations face: If they start raising money for a calamity in Rwanda or Somalia, by the time the funds are gathered and dispersed, the worst of the emergency has usually passed and the organization is sitting with millions of dollars earmarked for one place while a new crisis is forming somewhere else. Sponsorship is a steady and predictable source of operational funds.

MacCormack's office is located in the second-floor beside what Save employees call the fishbowl, a conference room with large windows opening up to the river, and a glass inside wall that allows sunlight reflected from the water to fill the wide corridor lined with Save's executive offices. From the windows, of his sparsely furnished office MacCormack can see the back side of shops along Westport's main street and watch the water rise and fall with the tide.

MacCormack is 54 years with gray hair and mustache, rosy cheeks and a round face. He speaks clearly and quietly in calm tones. When he talks about the children, a thin smile breaks across his face and his voice radiates warmth. The goal of Save the Children, MacCormack began, "is making better lives for children." What followed was a well-rehearsed recitation of good works and lofty goals; but nothing much more specific or quantitative than making better lives for children.

When pressed for more concrete details MacCormack's relaxed confidence wavered somewhat and then became completely shaken when I began to ask questions about Save the Children's financing, questions about the pie chart. It is the deception inherent in the pie chart that provides the key to unraveling the con game that is Save the Children.

The pie chart is misleading in two ways: First, it tracks the proportion of all expenditures that go to program, not the proportion of all donations. The distinction is probably lost to potential sponsors, who might naturally assume that the pie chart is a representation of how their donations are being spent. But most of Save's funding comes not from individual sponsors but from U.S. government and United Nations project grants. Expenditures are nearly three times donations, so even if Save spent none of the sponsors' money on programs, they could still find a way to claim that 75 percent of the money they spend is going to program services. The pie chart really says nothing about how sponsors' money is spent.

The second misleading thing is neither the pie chart nor the pamphlet explain exactly what "program services are." The reason Save the Children and Money emphasize the program services statistic is, presumably, that it is seen as a rough approximation for "money that actually helps people," as opposed to funds spent on overhead and fundraising expenses. "Program," one would assume, is what should go to the children in the folders. Why else trot out the statistic to use for rankings and as pie charts in promotional literature?

But Save's idea of "program" is probably broader than that of its sponsors. In fiscal 1994, it included nearly $4.5 million for travel, $3.5 million for supplies, $15.5 million for salaries, and $2.2 million for rents. Save's non-public financial statements show that film, holiday cards for sponsors, the gift shop, and craft catalog were also charged to program expenses. The total of the sponsors' dollars that actually went in grants to field programs was 45.1 million, less than 50 percent. In turn, just over half of that money was given in grants to other organizations to actually implement projects. Those organizations presumably have their own salaries and administrative expenses to pay as well. None of that is reflected in Save's official representations.

Over the last few years, the pie chart has been more than an illustration used in Save the Children's advertising. It has been a contentious issue within the organization. Last year Save's general counsel convinced the organization to remove it from print ads because it put them in violation of solicitation laws. Beyond that, a number of Save staffers and employees have begun to suspect that the organization is more concerned with keeping the proportions of the pie chart intact than with actually helping children.

I asked MacCormack how he thought sponsors might interpret the organization's statements about the amounts of money going to "program:" "When they see that on average 82% goes to programming, well, they think that's great," he said. "They think that's what it ought to be."

"Do you think they understand that program includes rents and salaries?"

"Well, first, I mean, 82% is going to the program, on average, of all-----of the hundred million that comes in here.. 82 million goes to program. .. But then if you look at everything that goes in and everything that goes out, 82.7 million goes to... to the program. So that is, that's correct." MacCormack seemed to have expected the question while at the same time he acted as if he were puzzled by it. This was the reaction of all the Save executives I spoke with that day: It was as if no one had ever been thickheaded enough to raise that issue before.

But that specific question had come up frequently, from people within and outside the organization. And MacCormack himself had been concerned enough about the deception to raise it in a letter to Save the Children's board of directors. In fact, there are hundreds of pages of reports and memos from within Save the Children revealing that its top executives have long been aware that the organization is not delivering on its promises. The documents also suggest that Save has expended more energy patching up it public image than it has improving the projects for the children.

A year before I'd met with MacCormack, an internal report by a Save the Children consultant had specifically examined the question of how sponsors' money was being spent. The consultant, Shelby Miller, is a recognized authority in the field of early childhood development, and someone with much more than an outsider's view of Save the Children. For six years she had been a program officer for the Ford Foundation, supervising grants made to Save. When we met early one morning at a New York diner, she prefaced our discussion by telling me that she'd only agreed to talk because Save had done nothing to address the problems she'd found a year earlier despite the fact that she made a series of detailed recommendations for improving Save's programs.

Her criticisms fell into two broad and related categories, developmental and operational.

Discussing Save the Children's operations, Miller's report says the actual amount and proportion of sponsorship dollar that reached the children is "woefully inadequate." While sponsorship is an effective tool for raising money, it requires a tremendous amount of administration to track all the individual children, a fact that Miller pointed out in her report: "Typically, there is little or no relationship between those arranging sponsorship and those administering services. However, a huge amount of staff and volunteer time is devoted to the maintenance of sponsorship." In our conversation, Miller described this as a chasm between what sponsorship means to donors and what it means to the children and their communities. "The chasm has a big price tag. On the sponsor side, you're sold the concept that for $20 a month or whatever it costs, we're going to transform this kid's life through all these kinds of strategies - or whatever it is they put in the ads. On sponsored family side, it's sold as whatever it takes to sign them up; but it's a much more minimalist promise."

On the developmental side, she said that Save lacked "a commonly accepted and understood theoretical perspective" on which to carry on and evaluate its own work. It's not enough to just say you're helping children. Childhood development is a science, Miller explained. There's no room for a sentimental, noblesse oblige, pity-the-poor approach to the work. "Programs must be carried out over long periods with demonstrations and models and constant analysis to find out what works. Then the programs must be focused. Few of Save's projects fit these criteria. It's because of a lack of commitment. Save has no detailed objectives, no strategy. It's a freeing experience if you can commit to a strategy. If you know what you do, you don't waste time and money. Then you can commit 80-90 percent of your time on what you want to achieve." The bottom line is this: Save the Children's projects don't work.

Miller's anger with Save the Children is not over the duping of sponsors. It comes from two types of damage she sees the organization doing in the field of childhood development. First, at a time when funds are in short supply, Save is spending money to create the illusion that it's helping. And secondly, Save is spreading the idea that it's easy and cheap to change the lives of children. "We know how to help kids," Miller said. "We do. The models and methods are there. The fact is that is cost $4-5,00 a year for a preschool intervention. The research has been done. With very few exceptions, Save isn't delivering. Their approach to development work is totally scattershot. The problem with Save is that they're wasting resources and goodwill, and they're doing it in the name of children." Miller's annoyance grew as she spoke.

She concluded our first conversation with the suggestion that maybe Save the Children should just liquidate all its assets and make a block grant to another agency that is doing some good somewhere.

When I raised Miller's report in my meeting with MacCormack he briefly stared out the window. His face grew red and then said "I haven't read it, so I can't say there but certainly, the sort of the arguments are, that you can't get enough out into the communities... I don't know whether she makes this argument or not, but you can't get the development results, you know...And if that's what's said, then that I wouldn't agree with."

Whether or not he actually read a report that his organization spent $15,000 to produce, MacCormack did know what I was talking about. It was an issue had been repeatedly brought to his attention by Save the Children's in-house attorney and at least once by the organization's outside auditor.

Save COO Carolyn Miles, CEO and President Charles McCormack and Ann Curry

And MacCormack himself, in the spring of 1993, was extremely worried about the amount of money that the organization was able to deliver to projects. At that time he visited Christian Children's Fund at their headquarters in Richmond, Virginia. MacCormack was with familiar company there because CCF now employs a group of former Save the Children staffers including, at that time, its president, Paul McCleary . The purpose of the trip was to do some fact finding and compare notes. When MacCormack returned to Westport he wrote a concerned memo to the board of directors.

It began with the usual self-congratulations:"Save the Children takes justifiable pride in the fact that between 80-85% of our income goes to program services." Then the tone quickly shifts as it focuses on the central problem that has long haunted the organization: "However, this is an average figure. It masks the fact that some of our income streams go 100% to program ... For example, our food aid is 100% program and our public funding from the U.S. government and the United Nations probably averages 90% to program. This means that, on average, a much smaller percent of our private revenues are allocated to programs," he wrote. In other words, 80 percent of a sponsor's contribution does not go to program expenses, even under the organization's broad definition of what program services are.

MacCormack's concern here is not with finding a way to get more money to programs, but with Save the Children's image. He's worried about the pie chart, not about the children.

As the memo continues, MacCormack eases his own concerns by invoking the magic word, leverage: "In general, we use these private funds to leverage other sources of funding, thus achieving a multiplier effect on terms of our private donations." This concept of leverage was raised in every conversation I had at Save the Children. What it means is that Save receives grants, mostly from the U.S. government, that it must use in very specific ways on specific projects. These are restricted funds. Even though a sponsor donates money to Save the Children with a specific child in mind, sponsorship funds are really the only unrestricted assets Save has. Save has no obligation to spend the money on the sponsor's child, in that child's village, or on projects at all. Save in fact uses those funds to pay for administering the restricted money it gets from the government. That's leverage.

The relative calm that MacCormack conveyed to the board was missing from a memo written a day earlier to the files: Our Save the Children 'alumni' at CCF consider our situation 'a disaster waiting to happen,' he wrote. "As communities often receive a small portion of the sponsor's contributed dollar, they are obviously going to ask questions about where the money goes. All the explaining in the world would not make this question go away or our own strategy look good in an investigative report." Again, he's focused on making his operation "look good."

If MacCormack had any concerned about the small amounts of sponsorship money getting to the field, a year later he hadn't done much about it. Shelby Miller produced her damning report in April, 1994 and then on May 6, 1994, Pamela R. Winnick, Save the Children's in-house counsel, returned from a tour of the organization's projects and wrote a memo to the board of directors, revealing:

1. In some of our programs, no sponsored children are receiving benefits.

2. Even in our best programs (e.g. Kentucky), only 60% of the sponsored children appear to receive any benefit.

In this memo, Winnick is clearly in MacCormack's camp, worried about Save the Children's public image. She wrote that she was anxious to put Save in a "defensible position in the event of an investigation by a government agency and/or media." But over the next months she would visit more projects and discover that Save the Children's only concern was their image. A series of memos and letter document her growing disillusionment and frustration with Save the Children.

Winnick first sought confidential outside legal advice from Daniel L. Kurtz, an attorney in private practice who had once served as Assistant Attorney General in Charities Bureau of the New York State Attorney General's office. Kurtz reviewed Save's fund raising materials and compared them with the reality of the organizations projects. He sent his opinion back to Save: "We believe that the situation at present is likely to constitute a substantial violation of state solicitation laws." Kurtz warned of serious problems for the board and recommended that Save change its advertising, which would solve the problem in the short run, until it could change its programs to more closely approximate the claims being made for how funds were spent.

Winnick apparently tried to coax the organization toward revising those claims. A month later, on June 15, she wrote a memo advising that callers to Save's 800 number be told "83% of SC's overall expenditures goes to program services," as opposed to 83 percent of donations. But if callers insist on knowing more, they should be forwarded to Westport. "Under no circumstances can we make the direct representation that 83% of the sponsorship dollar goes to programs."

In the Summer of 1994, Save's outside law firm, Day, Berry & Howard of Hartford addressed Winnick's concerns. Their assessment was much more measured and diplomatic, but echoed Winnick's opinions.

Thomas J. Groark Jr. of Day, Berry, & Howard also checked with KPMG Peat Marwick, Save's outside auditors. Edward J. Molloy, a partner in the accounting firm, wrote to Groark on June 30, 1994. He said in his letter that he had been in contact with Najeeb Halaby, the chairman of Save's board of directors. "I indicated to Mr. Halaby that there was increasing pressure on all non-profit organization to provide donors with accountability for their donation and in this regard, I saw even more pressure on SC....I expressed my concern on the frequency with which problems kept surfacing. It was obvious that in many programs a gap existed between what was said and what was done.

"In my mind, the sponsorship program is a very difficult and expensive program to administer and, can go wrong very quickly..."

Molloy mentions several times in his letter that senior management is aware of the problems and is in the process of correcting them.

On July 7, 1994 Winnick wrote back to the board members : "While I commend Day, Berry & Howard and senior management for concluding that there exist problems with sponsorship, I must, with all due respect, take issue with the implicit conclusion that the problems are being resolved in any significant manner."

She restated the problem: "Even our best U.S. field office, Appalachia, using volunteers and community workers, spends 30% of sponsorship money on actual programs. It does not appear that we will ever exceed that amount in the U.S. In Senior Management Team meetings, the figure of $60-70 per sponsored child (25-30% of the sponsorship dollar) seems to have evolved as the optimal amount.

"According to the analysis prepared by Program Operations actual program deliver in Bridgeport will be $22.82 per sponsored child in FY '94, under 10% of the sponsorship dollars attributable to that site. Further, in that location, a significant proportion of sponsored children will not be served by that office."

Winnick writes of the Waltersville Elementary School in Bridgeport, CT with 4000 sponsored children, which should have generated $96,000 sponsorship donations in that year. "I visited that school on June 8, 1994 and learned that for over two years, no benefits whatsoever have gone to this school. In July 1994, a check in the amount of $10,800 (barely 10% of the aggregate amount attributable to the 400 children) will be given to the school for an 'academic Olympics,' a writing contest for all 840 children who attend that school. In a city such as Bridgeport, is this an appropriate use of sponsorship money, both qualitatively and quantitatively?"

Winnick continues: "In light of examples such as Bridgeport, our presentation of sponsorship is highly misleading. The Sponsorship Guide, our communication with sponsors, states that '[Y]our sponsored child begins benefiting from your support right away -- perhaps through nutritious food and clean drinking water ... education ... basic health care....' and '[Y]our continued presence in this young life can mean the difference between sickness and health, illiteracy and education,' and that '[o]ver 84 cents of every dollar we raise goes directly to benefit needy girls and boys.' Television ads featuring Sally Struthers promise that 65 cents a day will bring 'lasting benefits' to communities and 'help rescue one girl or boy.' How does a writing competition 'rescue' a little girl or boy?"

In the same memo Winnick reminds the board members that "The rules of the Better Business Bureau clearly state that 'at least 50%' of public contributions be spent on the programs and activities described in solicitation, in accordance with donor expectations."

In the Fall of 1994, Winnick left Save the Children for "ethical reasons," as she explained in a statement issued through her attorney. "During my tenure, I became concerned, both legally and morally, about their fundraising practices and undertook my own investigation. I presented my findings to Dr. MacCormack and then to the Board of Directors."

Delores Tootsie and Phyllis Wittsel were trying to remember what it was like when they were sponsored children on the Hopi reservation in the 60s. The sisters didn't recall much. Those were the check-to-child days when Save sent a portion of the sponsor's donation directly to the children. Check-to-child was phased out in the late seventies and early eighties. They remember getting ten dollars every three months or so that they would use to buy a new pair of shoes or some school supplies. Then Phyllis suddenly recalled getting a copy of the soundtrack from the movie, Help from her sponsor, a Beatles fan club, though she can't remember where they were from.

We were having lunch at the tribe-owned restaurant, on the northern Arizona reservation just outside of the town of Kykotsmovi, which everyone calls K-Town. The town is a collection of ramshackle buildings and mobile homes on a gentle rise emerging from the Arizona desert. It's just off the main road, and not a place where the tourists stop. Road signs direct them past the town to the Hopi cultural center, restaurant, bookstore, and museum. In the middle of the morning the town was completely silent. The most modern building in town is the two-story tribal council headquarters where Delores works in the personnel department.

The patrons of the restaurant were evenly divide between Hopis and tourists. As it was the only restaurant for miles, the dining room was hectic and loud. Many of the Hopis there seemed to know each other and many worked for the tribe, the only real employer around. The sisters were soft-spoken and well-dressed women in their 40s. Dee was more talkative but more cautious about what she said.

I asked them if sponsorship had changed their lives in anyway. They both laughed. But, Dee, explained, families whose kids are being sponsored now would rather go back to check-to-child days. "At least that way they know where the money is going," she said.

Both sisters have worked with Save the Children recently. Dee was a community development coordinator for Save from 1988 until the end of 1992. And though Phyllis doesn't work for Save, her job on her village development committee puts her in charge of Save's project there.

"Westport was never really satisfied," Dee said. "People here wanted funding for cultural type programs. They wanted to hire Hopi people to come and teach about Hopi things. Save wanted more visible projects. They were more interested in Christmas parties and Easter egg hunts. The parties were to serve as enrollment drives as well or as vehicles to gather already sponsored children to update their status for sponsor reports."

Tootsie figures that on average, Save's project grants were in the area of $1,800 for a year. That would be in a village of some 50 or sixty sponsored children averaging $35 or less per child per year. (Those same sponsored kids would have generated more than $10,000 a year for Save the Children's administrative costs.) From here the gap between "program expenditures" was very real. While Save the Children might consider its executives' salary to be legitimate program costs, only the sum of cash available for projects made much difference here.

Each year the local committees would have to produce a project proposal that Save would choose to either fund or return for changes. Year to year, the projects were unconnected. One year a playground might be built, the next year funds might be raised for a summer program for the children. But then there would be no money to maintain the playground.

"They would start projects that were never completed," Tootsie said. "A greenhouse project was started one year. The greenhouse was built but there were no funds available to keep it going. It's sitting there unused. There is playground equipment still stored. In my village there is a foundation for a warehouse that's been there for years ."

It was a complaint I'd heard at two other Arizona sites I visited. The Save grants were so small that they would be used for little treats for the kids, not for serious developmental purposes. At the Gila River reservation outside of Phoenix, for example, Jeff Williams, who works for the council there, told me that Save's funds one year covered a couple of weekend trips to a swimming pool in the summer for 56 sponsored children.

Williams, whose Sacaton community will be phased out this year seemed not to care very much. I asked him if losing Save the Children would hurt the community? Williams shook his head.

"Has Save changed the lives of anyone here?"

"No, nothing has changed."

"Did they ever provide medical care?"

"No."

"Education?"

"No. It's fluff. We're not losing much."

Williams told me I should talk with Christine Thomas, who used to work in Save the Children's Phoenix office as a donor services coordinator, the liaison between sponsors and the children. Thomas lives on the Gila River reservation outside of Phoenix, just past the point where the air-conditioned shopping mall culture of the city stops and the rural emptiness of the reservation begins. She commuted into Phoenix every day where one of her jobs was to open all the mail that passed between sponsors and children, mostly for the protection of the child, but also to prevent kids from asking sponsors for horses and cars and things that might alienate them. She would often send letters back to be rewritten. She also spent a lot of her time driving around delivering packages that sponsors would send to the kids. Shelby Miller referred to this as the Pony Express problem. Because of the vast distances between projects, people from the branch offices could spend ten hours driving just to drop off a small package of clothes.

"We're not benefiting all sponsored children," she said right from the start. "We're not. We never have been." Thomas said that when she went into the field she found some sponsored kids were 19 or 20 years old and were raising families of their own. "Some of them -- quite a few -- don't realize they're being sponsored. And a lot of the children aren't needy. The pressure is on from headquarters: We're given a month to sign up so many children or our budgets will be cut. So we signed up anyone who came through the door. As long as the sponsor doesn't ask then there's really no problem according to Save the Children." This was also a reaction that Delores Tootsie got when she first went into the communities. Thomas confirmed how little money was actually getting out to the villages. "Save doesn't like the communities asking where the money goes. I know several cases -- like Blackwater -- where we phased out because communities asked too many questions."

And then some of what little money they had was spent on what many regarded as frivolous activity. According to Thomas and others, communities were told to use some of the available money to celebrate Save the Children's Founder's Day every May. The parties were designed as recruiting tools. "We were told it was mandatory," she said.

Thomas lost her job at then end of March when the Phoenix was closed down as a cost-cutting measure. According to Thomas, sponsor notification letters went out on March 24. "We had known since October, but we were instructed not to tell anyone." When communities phoned the Phoenix office to ask questions, they got a recording saying the number had been disconnected. Even as they were making plans to close the office, Save was still recruiting children and was distributing a flyer around Gila River, which read:

 

Sponsorship
Brings
$$$
Into Your Community

No one familiar with Save the Children found it surprising that they would still be looking for children while phasing out their programs. Recipients long ago seem to have accepted the fact that there is no connection between program and sponsorship. "What you've got is a system built on the backs of low income communities," Shelby Miller said. In fact, Save seems to be less of a development agency than a professional fundraising operation, but with one big difference. No professional fundraiser could get away with keeping 80 percent of the gross.

Save's rationale for spending most of the money in Westport, for charging executive salaries against "program," is that people in Westport do "programming." But there was little evidence of Save's hand in any of the development projects I saw in Arizona or anywhere else. In Brooklyn's Bed-Sty neighborhood, for example, Save was a relatively minor contributor to the Tabernacle Elementary school. The small, private school supplied 325 children to Save's sponsors, and Save returned $16,000 a year, about 20 percent of the $78,000 it would have collected. The money was a tiny part of Tabernacle's budget, but it did help slightly reduce the tuition costs for students' families. Save never did any "programming" but they did hang a Red Baby Jesus outside the school, and would often show the school off as an example of its inner city projects. They were, in essence, trading photographs and biographies of their children for a small annual cash allotment.

In all the years that Save has worked on the Hopi reservation, Dee Tootsie can recall lots of activity aimed at signing up kids but can name only one or two projects that ever did any good. She doesn't remember ever getting any guidance or programmatic assistance from Save the Children, only pressure to sign up more children and keep the reports coming. One of the final insults in 1992 was when Save had turned down projects in eight villages , and the committees failed to come up with any proposals acceptable to Save the Children. According to the rules, if a community can't spend the allocation by the end of the fiscal year, the funds are lost. They can't for example, wait two years and do a larger project. As time was running out, Save suggested a solution. So in 1992 several hundred children in villages received gift certificates to Wal-Mart for denominations of between 10 and $25 dollars. The store was located in Gallup, New Mexico, some 90 miles away. Dee Tootsie typed up the gift certificates and delivered them herself. Then she resigned.

Based on her sister's experience Phyllis Wittsel wasn't anxious to get involved with Save, but 35 sponsored kids and budget of $1,850 fell into her lap. Last Spring they submitted a proposal for a summer program for the kids, designed to keep them away from drugs and other problems that are common on reservations. The community wanted recreation equipment and arts and crafts supplies, and electronic learning games. The proposal was submitted late, in June of 1994. The Save office in Gallup said that it would take a few days to cut the check. But the money never came, and the village ran the program anyway, ending in late July. Two weeks after the program ended they were contacted by Save, which told them that the money had been converted into a $1,700 credit at that same Wal-Mart in Gallup. They had two days to spend the money or lose the funds. "We couldn't find anything we needed," Wittsel says. "So we called Save and asked if we could spend the money somewhere else and were told no. Get a VCR, or a TV they told us. Save only cared that the money was spent."

Arizona is unquestionably the worst Save the Children has to offer. Its internal documents show that only $21.54 per child reached the field in 1993 out of the $240 donated. But, according to the same document, other regions didn't fare that much better.

Appalachia $67.22
Bridgeport 25.18
New Mexico 38.59
Southeast 26.05
Southwestern 24.36
Mississippi Delta 44.07

On average that comes out to $35.29 per child across the U.S. (The Appalachian program, which Save considers to be its best, is also it's oldest. One of the reasons why the numbers look better is that half of the 6000 sponsored children have two sponsors.)

"Get this," Wittsel said as we were finishing lunch, "A couple of months ago Save the Children sent us a plaque in a Save the Children tote bag. The plague sad `In appreciation of excellence' or something like that. I don't know what it was for. Maybe they thought it was necessary to do something."

Similar stories emerged from Save the Children's overseas programs. One former country director described how upon starting his new job learned that most of the sponsored children in his program were receiving nothing more than Save the Children T-shirts, hats, and invitations to parties. When he eliminated the toys and games, fewer than half the children enrolled in sponsorship programs were receiving anything at all.

MacCormack didn't dispute the figures but insisted that I wasn't telling the whole story. Westport, he said, delivers much more than sponsorship dollars. He offered two examples.

"We are looking at a kind of emergency response, early childhood center kit to jump start early childhood programs after floods and earthquakes and other natural disasters. And we have learned that what children most need at that time is a re-establishment of continuity, of normalcy. They need to kind of get back into their regular lives. And so we've put a trunk together that has coloring books, crayons, disinfectant, plastic sheets, toys, etc."

The kits, however, don't exist yet. And when they are put together, most children won't be able to benefit from them anyway. But, beyond that, the emergency kits are exactly the kinds of programs that Save needs for the pie chart. The materials are donated by companies that are able to write off the full wholesale value of the materials. That value then becomes a donation to Save the Children which can register it as a donation that goes 100 percent to "program" to counterbalance sponsorship funds used for administration.

MacCormack's other "major example," was the "Eyes on the Future" program, which provided eyeglasses on Indian reservations. On the phone, MacCormack told me that sponsorship paid for the program, but later his office sent me a fact sheet that contradicted that claim noting that it turned out that eyeglass frames were donated by ClearVision optical Company, tools and materials came from the American Optometry Association and Hilsinger Corp. The total value put on the in-kind contributions was $500,000. Again, that's one hundred percent in and one hundred percent out to beef up the pie chart.

"The Eyes on the Future program was dreadful," said Connie DiLego, who worked for Save the Children as a full-time volunteer on the Navajo reservation in Tuba City, Arizona. "It was just awful. This was a one-time deal, not a commitment to eye care."

DiLego had moved to Tuba City from Massachusetts to do volunteer work with the Navajo. At first she thought Save the Children was the perfect vehicle but rapidly soured on the organization. For her, Eyes on the Future was typical of Save's programs: "We were informed there was going to be an eye exam plus free eyeglasses. They were also supposed to examine the elderly, which I thought was wonderful. When the day came hundreds of people showed up. I think they were a bit overwhelmed. People were supposed to get glasses within a month or two. We waited well over a year in some cases and then some glasses came with the wrong prescriptions. They wouldn't mail them to the people directly so we had to go to Gallup to pick them up."

So many people began calling the Tuba city office that DiLego started handing out the 800 number in Gallup. "You've got a 70 or 80-year old couple calling Gallup, and they're told they have to drive four hours to pick up their glasses. Many of these people don't have cars or can't afford the gas if they do. Then Save said they were going to start charging for the glasses. It seemed that they were making up the rules as they were going along."

DiLego also pointed out that many children had grown or had their prescriptions change while waiting for their glasses to show up. And, since it wasn't a long term commitment from Save the Children, there's no telling where the kids are going to get glasses next year. Children who broke their glasses or outgrew them couldn't count on getting a new pair.

"It seemed to me that the child didn't matter," DiLego said. "The children were a means to their end. And the end was their pie chart. It didn't matter if Jeffrey Yazzie had shoes or not." In response to a question, DiLego said, "I'm trying to think if there is one kid whose life was changed who's going to have a better future because of what Save the Children did. No, I honestly can't. I can't name any one person about whom I can say his or her life was changed."

And it is "lasting, positive change in the lives of children worldwide" that Save the Children sells to sponsors in ads in newspapers and magazines across the country. Those ads always feature photographs of emaciated or disfigured children in the most extreme conditions, not the children that Save usually works with. Almost everyone I spoke with on the reservations felt stigmatized by the ads. "In earlier times, sponsored families in the United States were not that likely to see Save's advertising, because of the absence of television and magazines." Shelby Miller wrote. "Now they do, and some are offended."

Many of the people who have worked with Save and others in the charitable community have been offended as well. Sally Franz, who formerly did fundraising for Save, was sitting in her office one day in early 1994 when a colleague rushed in to show her the new Save the Children ad from their new advertising agency. The headline read, Help Stop a Different Kind of Child Abuse. It was printed across the bottom of a photograph a dying and abandoned Sudanese child being observed by a patient and healthy looking vulture. The ad copy continued: "This abuse is merciless. It preys on innocent, fragile lives and brutalizes them with utter poverty...with constant hunger...with relentless diseases...with no hope for even a basic education." Franz looked at the ad and was horrified, not at the photograph but at Save the Children for using it to raise money. To her and other people in the organization the irony wasn't very subtle; it was Save the Children that was merciless, preying on innocent, fragile lives.

Franz recalls that one of her African colleagues was particularly upset by it. Franz and her colleague agreed, "The message of all our advertising at Save was that Africans are too stupid and ignorant to take care of themselves. And if we don't do it, their parents and their government aren't responsible enough to do it."

In addition, Save wasn't even working in Sudan where the photograph was shot. And even if they had been working in Sudan they wouldn't have been providing famine relief. This was a famine caused by war, nothing that a small Save the Children community development projects was going to address in the least. No amount of money donated to Save was going to help that child or the thousands of others in the region.

As word spread around the organization, Franz recalls, most of the staffers joined her with the same overwhelmingly negative reaction. MacCormack and the executives, however, were proud of it. "They were very proud of it because they said it was gonna get a great response and it was hard hitting, " Franz says.

The ad also managed to annoy the community of relief organizations, not exactly known themselves for their sensitive portrayal of Africans and other dark-skinned people. Jerry Michaud the Executive Director of the End Hunger Network, wrote to MacCormack. calling the ad a "cheap shot." and described it as "hunger porn." "At first I thought it was a Feed the Children ad," Michaud wrote, referring to the Oklahoma City-based organization that is universally despised for their lack of ethics in the charity world.

Michaud wrote that it reminded him of an angry African delegate to a conference who said: " The more desperate our conditions are portrayed in the U.S. media, the more money you American organizations seem to raise for your own overhead and projects." The delegate could have continued and said that the more desperate Africa seems the less likely it is to get investment and the assistance it really needs to develop.

Michaud also wrote a letter to InterAction, a consortium of voluntary organizations working in relief and development complaining that the ad violated the "minimum standards for fundraising solicitations."

Soon after the first Save the Children ads appeared, the photographer Kevin Carter was awarded a Pulitzer prize for his photograph. Save's executives felt exonerated. They called a staff meeting to gloat. "They just thought that was so sharp of them that they picked out this Pulitzer Prize winning photo," Franz recalls.

One of the executives stood up and said, "Just goes to show ya, you just have to go ahead even when you have criticism." They also announced that there had been a ten percent increase in phone calls to Save's 800 number since the ad had run "Nobody talked about the fact that a 10 percent increase in calls didn't mean they were all positive calls. And nobody ever showed me figures that those calls equaled money," Franz said. (Four months after he won the Pulitzer, photographer Kevin Carter committed suicide. Save continues to use his photograph in its ads.)

Save the Children has had some other irritating public relations problems in the past: In the Spring of 1985 a young student in a public school in the small town of Hughes, Arkansas came home from school and dropped his knapsack on the floor. Later as his mother was going through the boy's belongings she found a photograph of a man and a woman and a letter addressed to her son. The letter said that the man lived in New Hampshire and hoped someday to come to Arkansas and see the boy and his family.

The boy's parents went to the school and then they went to an attorney. Together they learned that the couple in the photograph were Save the Children sponsors paying $16 a month (the fee at that time) for the support of their child. Not only did they not know their child was being sponsored, they weren't particularly needy. It was soon revealed that around 100 students in the town had been enrolled in the program without the knowledge of their parents.

In October of 1985 parents of 21 children filed a $21 million lawsuit, against Save the Children, the county director and six public school teachers, alleging that Save had used their children in advertising campaigns without their permission. According to the suit, the teachers obtained permission to photograph the children and collect biographical information on them "deceitfully and without the consent or knowledge of the students' parents or legal guardians." The suit charged the teachers were paid $1 for each completed application and photograph. In addition, publication of the photographs and biographical information by Save the Children subjected the families "to ridicule, embarrassment and shame in the community as impoverished and oppressed individuals."

The suit was settled for what was described by one attorney as "a substantial sum" and the records were sealed.

Then, in April of 1986, Forbes Magazine published an article revealing that Save wasn't exactly hand-carrying donated money to recipient children and that funds were instead being pooled into community development projects. Though the organization had stopped the check-to-child programs five years earlier, their advertising continued to give the impression that your child got your money.

Save tried to make it all sound like a misunderstanding, but in reality the deception was quite deliberate. Forbes reported: "SCF staffers find such revelations particularly embarrassing. `Many have asked that the ads be more representative of what we're actually doing,' says one field director. `We even recommended that we get away from child sponsorship and just sponsor communities. But headquarters doesn't address our questions.'"

The Forbes article led to an NBC television investigation by Connie Chung's short-lived magazine program, and the subsequent firing of on employee who spoke with NBC. Then, in September 1986, in response to a threatened law suit from the attorney general of the State of Connecticut, Save the Children agreed to follow new guidelines in advertising in which they would state clearly that sponsors' donations were pooled. (Even though the ads all contain that line today, callers to Save's toll-free numbers are immediately asked if they want to sponsor a boy or a girl, and in which country. The impression still lingers that "your" child is receiving your gifts.) Shelby Miller pointed this out in her report: "There continues to be some lack of understanding among sponsored children and their families that the funds raised through sponsorship are pooled for community programs. This has been confounded by the following facts: that there have been no activities in some communities, that some sponsors send checks and gifts directly to the child, and that the information given to both sponsors and sponsored children's families is not entirely clear. The sponsor is still `sold' the concept on the basis of an individual child."

In 1992, as the staff uprising against president James Bausch went into full swing, the Washington Post began an investigation. But Bausch and Board chairman Dana Ackerly resigned before the article was published. The story was killed as the new chairman Najeeb Halaby, former director of the FAA and president of PanAm, ascended to the chairmanship.

In all three of these cases Save went on a global media alert. Chris Cassidy, who was in a small town in Somalia, remembers a meeting that was called in Mogadishu in 1986 to warn of Connie Chung's investigation. "When I started asking for details about the charges against Save, I was told to shut up and be a good soldier," Cassidy recalls.

Many Save staff members have been gotten the impression that the organization devotes more energy to repairing its image in the press than it does addressing the concerns that have been raised. One of those most bewildered by the organization's strategy was former board member Michael Dorris. On July 22, as the organization was expecting the Post article to appear, he wrote to board chairman Dana Ackerly, "We should take responsibility for `news' about Save the Children, especially if it is potentially damaging, thereby defusing any impression of our being reluctantly `exposed'...If we've made mistakes, let us admit them and go forward..." Dorris was also miffed because he had been asked by Save the Children to talk with the Post reporter, writer-to-writer, to see about getting the story killed.

Three days later Dorris wrote to the board, protesting the confidential severance package that had been approved for James Bausch. The $225,000 settlement had been approved because Save wanted to avoid the publicity of a potential lawsuit from Bausch, who had grounds to sue for breach of contract. "Having recently seen first-hand the situation in Zimbabwe," Dorris wrote, "I cannot in good faith agree that it's better to avoid embarrassment or the threat of litigation than to pay for the digging of 9000 new wells in a country on the verge of fatal thirst." He said that Save "must be scrupulously honest and forthcoming with financial information; to that end, I urge that a full disclosure of any settlement terms be made public."

Dorris's advice wasn't taken, and on August 13 he resigned from the board, citing "the non-acknowledgment of past errors of judgment, to a general wariness toward legitimate outside, objective scrutiny of our operation." Dorris also wrote that he was disturbed by "the fact that my mailings from Westport have contained far more information about procedures (i.e., who one may or may not talk to) than the content of our programs."

Save the Children did not take Dorris's advice. Instead they called James Lukaszewski, a corporate public relations commando who is called upon by companies expecting bad publicity over chemical spills, hazardous-substance exposure, faulty and dangerous products or nasty labor problems. Lukaszewski, whose high-priced consulting firm is based in White Plains, New York, met with Save the Children executives on September 2, 1992 to discuss the Post investigation. Among the materials Lukaszewski was given were the three letters from Dorris.

In his resignation letter, Dorris mentions one other problem he had with Save the Children: "the amount of time and money we have spent in litigation against Feed the Children." In 1986, Save sued Feed the Children for trademark infringement. The name of the newer organization was too close and likely to cause confusion. That suit is due for a settlement any time now, but Save has spent between $300-$500,000 a year of sponsorship funds pursuing it.

It was through this maelstrom that Charles MacCormack ascended to Save's presidency in 1992 with the clear intention of making changes. His visits to Christian Children's Fund and other organizations were meant to chart a program for the future, and to learn from the "best practices" of other organizations.

CCF, MacCormack noted in his March 15, 1993 memo to the files, was a much more efficient organization than Save. "They have very lean headquarters staffing. Their entire fundraising staff, producing over $100 million in private funding, is seven. This compares with 36 fundraising and public relations employees at Save the Children (58 if one counts the sponsor servers and sponsor fulfillment employees)."

The memo also reflects an understanding that Save the Children was in danger of being left behind in the fast-changing world of development charities, where organizations were becoming more professional, businesslike, and streamlined: "Paul McCleary, the CEO of Christian Children's Fund, envisages that, in the next century there will be a handful of major worldwide relief and development organizations. These organizations will be looked to by government and international organizations because of their professionalism and their worldwide outreach. He considers CARE, Catholic Relief Services and World Vision to have already reached their critical mass. He intends that Christian Children's fund will be in this key group.

MacCormack concluded: "It seems clear that our own sponsorship strategy is flawed from beginning to end. We have to make sure that sponsored children, families and communities have a real stake in the success of our program. As a quid pro quo, we have to make sure that these groups take on much more of the responsibility for administering the sponsorship program at the field level. As a result of this, we can reduce our field office staffing. Finally, we must invest in the systems and the customer service people to make sure that our sponsors know that we are meeting their needs."

MacCormack's conclusion is probably the only one the administrator of a sponsorship agency could reach. Given a choice of how to spend limited resources, the needs of the sponsors must come before the needs of the children. The survival of the organization depends on it. Fewer staff will work in the field. More staff will be in Westport to keep the sponsors happy. Save will become a much more efficient fund-raising machine. But one, as Shelby Miller said, built on the backs of children.

"There is no one on the staff of Save the Children who is an expert in the field of early childhood development," Miller said. "There is no one there who knows what it will take and has been willing to make the commitment necessary to go out there and make a difference." Again, Miller became angry. "Who's getting served here?" she asked. "It's the sponsors."

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