Clinton Foundation: What’s More Problematic…How Dollars Were Raised Or Spent?

Much is being made of the upcoming book release, “Clinton Cash: The Untold Story of How and Why Foreign Governments and Businesses Helped Make Bill and Hillary Rich,” by Peter Schweizer.   It is depicted as the most “feared book of a presidential cycle.”  Among a “trend” of coincidences, the book points out a number of foreign entities who paid speaking fees to Bill Clinton, and contributions to the Clinton Foundation, all the while Hillary Clinton was running the State Department.  While connecting these kinds of dots inside the beltway can be an obsession, and probably very exciting, the more important and for many, less exciting question is, “what impact or human benefit have these dollars produced?   Photo: Stringer/Reuters.
Organizations like Charity Navigator, GuideStar and others provide the necessary due diligence for potential benefactors to measure the effectiveness or “impact” charitable organizations have had in the past.  Recently, Charity Navigator placed the Clinton Foundation on its “watch list,” citing ” an atypical business model” that “doesn’t meet our criteria.”  GuideStar’s status of its review of the Clinton Foundation is incomplete, citing the Foundation did not participate in its “GuideStar Exhange” nor did provide GuideStar with its request for an “Impact Summary.”  All that GuideStar has to go on is a “mission statement” and IRS forms (i.e. 990).  Let’s follow the money.
According to the New York Post, the Clinton Foundation brought in $140 million in 2013 and spent only $9 million on direct aid (New York Post).  While the numbers on their face (990 Form)can support such a statement, its irresponsible journalism to make that claim.  No, we are not here to get the Foundation “off the hook!”   If you look at Foundation’s 2013 990 filings you will find $117 million in total revenues, $49 million in salaries, $46 million in “other,” and $10.9 million in grants.  Of the $46 million in other (defined as: other, office expenses. travel, conferences, depreciation, direct program expenses, capital charges, procurement & shipping, telephone, other),  direct program expenses were $6.6 million.  That’s right the description of “other” includes two more “others.”
The first step in understanding program effectiveness is understanding program costs.  According to the 2013 filings, we can add together grants ($10.9 M) and direct program expenses ($6.6 M) for a total of $17.5 million or 14.9% as compared to the revenues received.  Are we at “responsible journalism” at $17.5 million versus the New York Post’s $9 million.  Probably not. However the problem is…we have nothing else to go on.  For 2013, all further expenses were lumped into “salaries” or “other.”  Having not spoken to Charity Navigator, I would speculate this is the area were they ran into difficulties, remember the…”atypical business model” and doesn’t meet our criteria?”  Due to a lack of transparency, this is as far on the analytical train we can go.  We don’t know how much of the remaining $95 million in expenditures were related to programs, and thus “impacts.” The real question remains, why does the Foundation report in this manner?
Interestingly enough on their website the Clinton Foundation purports that in 2013, 88.4 % of expenditures were Programs related, 7% Management and General, and 4.6% Fundraising (Clinton Foundation Website).  Now wait a minute! You can’t have it both ways.  As a non-profit organization, if you don’t want to be transparent enough to show actual program costs, you don’t get to make claims of program cost efficiency.  That’s not responsible management.

 

 

 

 

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