In a previous post we showed how the competition for funds led NGOs to adopt policies known to be harmful.
In a paper by Alexander Cooley and James Ron, The NGO Scramble: Organizational Insecurity and the Political Economy of Transnational Action (pdf file), they describe the situation in Goma, Zaire (now DR Congo) after the genocide in Rwanda. Goma was filled with Hutu refugees, including many participants in the genocide. Two hundred NGOs had made their way to Goma and competed for more than $1 billion in relief-related contracts.
As one journalist noted after a 1995 visit, Goma had become a “three-ring circus of financial self-interest, political abuse and incompetence” where aid had become “big, big money,” and any NGO “worth its salt . . . recognized that it had to be in Rwanda.” As a result, he said, aid INGOs “parachuted” by the hundreds into Goma, creating “chaos and madness.” Another Western reporter described Goma as an “aid agency supermarket” in which aid groups “blare[d] out their names and logos like soft drink manufacturers,” plastering everything from water pumps to T-shirts with advertisements. Competition was fierce, he wrote, and aid groups were desperate to be involved in the Goma relief effort so that they could bolster their fund-raising capacities back home.
Cooley and Ron conclude,
Once established, transnationals are organizations like any other. To survive in a competitive world, they must justify their existence to donors, secure new contracts, and fend off competitors. Under specific institutional conditions,these imperatives will produce dysfunctional results. In the 1990s scholars established the importance of transnational networks and organizations for global politics; now we should turn our attention to the material incentives shaping their actions.