Liberating charities in their fight against AIDS

By Tom Lamberti on December 18, 2008

December 1st marked World AIDS Day, a day created to honour those who have courageously fought against HIV/AIDS in Canada and throughout the world. To commemorate the occasion, McGill students, local Professors and community activists gathered in the Lev Bukhman room on the McGill University campus to discuss public policy options that would help those fighting HIV/AIDS.

McGill student and former Fraser Institute intern for charitable and voluntary sector issues Tim Mak pointed out that one of the major challenges

in the fight against HIV/AIDS is the need to further support charities focused on researching a cure and supporting those who are living with this condition. What is most notable about Mr. Mak's approach was that he proposed a unique alternative to the current norm, which usually revolves around lobbying for increased government funding for social spending programs.

Instead, Tim Mak argued that private charitable organizations were preferable for four reasons. First, competition between charities for donations creates real incentives for more efficient performance. Second, charities generally have specific goals and are closer to the problems they are trying to fix than government bureaucrats. As a result, they are more adaptable to changing circumstances on the ground. Third, charities are crucial to the creation of a sense of community. Finally, charities allow for personal freedom in that no one is ever forced to give to a cause they do not support.

Tim is right in supporting charities over government programs. Studies have shown that government funding for charities can undermine personal voluntary initiatives and reduce private charitable giving because potential volunteers and donors think the government is taking care of the problem.

This crowding out effect has been estimated to cost as much as 53 cents in lost private contributions for every dollar in public funding received.

To address the ongoing HIV/AIDS situation in Canada, Mr. Mak suggested that the best solution was to bring personal initiative to the forefront through greater tax incentives for charities. In order to increase charitable giving, he argued that the government should drastically increase the amount of tax credits given to those who donate to charities. This would have the secondary effect of increasing individual autonomy over our taxes. As Tim mentioned at the event, "we will all still have to pay taxes, but now we get to personally direct our tax dollars to where we think it matters most - supporting causes like HIV/AIDS."

In addition, Mak suggested that charities need to be objectively evaluated for efficiency and effectiveness in their program outcomes. Fortunately, there is already a system in place to allow for this. The Donner Canadian Foundation currently maintains a program that analyzes data submitted by charities at no cost and provides suggestions for better adherence to practices that have been identified as the best in the Canadian charitable sector.

Some might argue that Mr. Mak's approach was an unnecessary adherence to dogmatic free-market policies and didn't include any suggestions as to how the government could get more directly involved in the battle against HIV/AIDS. What the policies proposed do achieve, however, is a clear and accountable alternative to what is often inefficient and wasteful government spending.


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