Reinventing the firm: from post-war relief to international humanitarian agency

Abstract

This article focuses on the humanitarian non-governmental organization (NGO) CARE, Inc., and its transformation from a temporary non-profit agency working in post-war relief to Europe, to a permanent humanitarian enterprise delivering food aid and technical assistance to the so-called ‘developing world’. It analyses CARE’s shift from its early days as an American voluntary agency delivering food and consumer products (donated by private individuals in America) to individuals in Europe to a large NGO that co-operated closely with the US government in food-aid distribution to the Global South. Its expansion and professionalization was embedded in the development of new forms of public-private co-operation in humanitarian affairs, as well as in the overall setting of an emerging competitive ‘humanitarian charity market’ in the non-profit sector. In order to expand its organization and mission CARE implemented new and innovative business strategies and fostered the increasing ‘managerialization’ of its humanitarian activities. The article stresses the economic dimension of NGO activity as one perspective (among others) that helps us to better understand the complex dynamics of the ‘rise’ of humanitarian non-state players during the twentieth century.

Keywords:

• American voluntary agencies
• food aid
• transformation of private relief

I. Introduction

In 1840 Alexis de Tocqueville published the second volume of Democracy in America. Comparing the political system of the United States with the French First Republic he wrote: ‘Americans of all ages, all conditions, and all dispositions constantly form associations.’ Impressed by the strong American tradition of independent voluntary action in most fields of social and political life, the French political thinker eventually stated that America, in his eyes, qualified as the ‘most democratic country in the face of the world’.¹ While de Tocqueville’s testimony aimed, partly at least, to alert his compatriots to the dangers of overly centralist government administration, it eventually left much deeper imprints on American self-perception than on French discourse. His narrative fitted perfectly into debates about ‘American exceptionalism’ and ‘small government’ since the 1950s, and has, in addition, informed central parts of US historiography on American philanthropy abroad.²

The (re)construction of a special and decidedly private ‘American’ tradition of assistance to the needy in other countries certainly has its merits. As Emily Rosenberg and others have shown, the ‘American century’ at large would not have been thinkable without private philanthropic groups, often with missionary backgrounds, participating in ‘spreading the American dream’ since the nineteenth century.³ This narrative becomes even more compelling when looking at the private humanitarian response to the First World War. The hardship caused by global industrial warfare triggered the establishment of innumerable private American relief agencies.⁴ These agencies co-operated both among themselves and with US (semi-)governmental organizations such as the American Red Cross and the American Relief Association, in what became an unprecedented relief drive to the benefit of suffering civilians in Europe.⁵

Recent research has shown, however, that this ‘humanitarian awakening’⁶ was not nearly as ‘American’ as is sometimes stated. Not only were European groups and international bodies extraordinarily active too⁷, British NGOs even participated directly in official US food-relief schemes, as Tammy M. Proctor has demonstrated.⁸ In addition, many of the supposedly ‘American’ relief agencies (like the Quakers or the Salvation Army for instance) had continental origins and strong transnational ties that allowed them to co-operate intensively with their partner organizations abroad.⁹

This evolving, genuinely international, sphere of humanitarian action serves as a background for this article which deals with the ‘rise’ of the humanitarian NGO Cooperative for American Remittances to Europe (CARE) in the wake of the even greater international-relief drive during and after the Second World War. CARE’s development from a temporary relief outfit founded in 1945 in New York City into a permanent humanitarian NGO working in more than 40 countries by the 1960s becomes plausible only against the backdrop of the evolution of a ‘global nervous system’ of NGOs that has exerted crucial influence on the transformation of humanitarian ideas and practice throughout the twentieth century.¹⁰ This global system was in the 1940s, however, still fragmented into regional sub-sections or institutional clusters. It is thus justified to speak of the (albeit highly diverse) American humanitarian voluntary agencies which were set apart from European or Australian NGOs by institutional cohesion and day-to-day co-operation on the local level.

While closely connected in the American Council of Voluntary Agencies for Foreign Service, these NGOs did not form an autonomous sector of non-state actors. De Tocqueville’s analysis of independent voluntary agencies, as private bodies, free from ties to the central government, is certainly little more than an anachronistic myth, or rather a hypostasised (neo-)realist ideal-type. In reality, most (American) agencies were far more interconnected to governments, institutionally, politically and economically, than historical and contemporary discourse would have it.¹¹ Just as economic relations after 1945 did not bring about the end of government supervision for private business, but rather a new phase of state regulation that has been dubbed ‘embedded liberalism’¹², the humanitarian non-profit sector also became increasingly integrated and more entwined with governmental organizations and international players.¹³ The unfolding story of humanitarian non-profit action after 1945 is thus not the story of boundless liberalization and the triumphal procession of private initiative in the international realm. It is instead an example of the steady professionalization of humanitarian NGOs, and the development of interconnections between sectors and fairly stable public–private partnerships in a field that repeatedly changed in outlook, coherence and composition.¹⁴

This article relates CARE’s organizational history and the agency’s growth to the ‘tremendous internationalization, institutionalization, and rationalization of global affairs’ that characterises the development of humanitarian action in this text’s time frame and beyond.¹⁵ It thus situates one particular American NGO within a whole sector which has – generally speaking – been growing since the 1920s, and which has been booming since the 1940s. This boom is generally attributed to the unfolding of ‘global’ consciousness and humanitarian sentiment, a corresponding private individual urge to engage in civil-society action (further enhanced by the ascendance of ‘development’-discourse), as well as to increased government spending on humanitarian and developmental NGOs based on Cold War rationales and privatization strategies.¹⁶ While these explanations are – as we will see – certainly valid, though very general, I argue that additional factors, pertaining more directly to specific NGOs, their entrepreneurial structures, management methods and their immediate environment, have to be taken into account. NGOs as organizations are subject to enormous internal and external (environmental) pressure. Hence, organizational stability, long-term continuity, or growth are not self-perpetuating processes. Rather, they require constant steering by the organization’s leaders, conscious adaptation and repeated changes of organizational structures, the agency’s mission and its overall ‘business model’. These changes and adaptations are certainly not driven by altruism or the humanitarian ideals of NGO members alone.¹⁷ While values and concepts do of course matter, leaders of humanitarian organizations are also forced to anticipate institutional, political and economic constraints and to react accordingly. The fact that CARE and many of its fellow American voluntary agencies were so closely connected to the US government created institutional restraints, but also tremendous new possibilities. As I will elaborate in more detail below, central elements of CARE’s humanitarian services in the field of food relief would not have been possible if it were not for the strategic decision of CARE’s leadership to invest time and resources into building a stable public–private partnership with the US government.

On a more general level, by the late 1940s, despite their status as non-profit enterprises, CARE, as well as many other (American) humanitarian NGOs, already displayed features and techniques of rational capitalist organizations, such as a separation of Board and Executive functions, standardized accounting methods, bureaucratic practices aiming at financial and organizational stability, and so on. These entrepreneurial characteristics gained in visibility and impact towards the 1960s. This was also due to the fact that the American NGOs were closely embedded in a market-like environment that correspondingly subjected all market participants to rules, such as competition and uncertain dynamics of demand and supply.¹⁸ While the American charity sector may have been a classical niche market – meaning that it was highly specialized and occupied by only a limited number of competitors (i.e. NGOs), funding institutions (i.e. governments, firms and international organizations), and customers (i.e. donors) – it was a market nevertheless.¹⁹ Operating in this market, all NGOs, or rather their executive management and Board, were repeatedly confronted with external pressures, as well as with internal organizational imperatives and resulting path dependencies that influenced organizational developments and decision-making.²⁰ The story of CARE has to be told against this backdrop. It is but one example among many, but it sheds light on both macro- and micro-trends, as well as on the factors which influenced the growth of NGOs in the second half of the twentieth century.

II. Born out of war: the initial CARE success story 1945–9

When CARE was eventually signed into existence as a non-profit body in late 1945, the organization had already undergone significant bouts of development. Leading members of religious and secular American voluntary agencies, civil servants and private business executives engaged in relief activities to Europe had been working and planning for months to set up this new private humanitarian non-profit enterprise.²¹ As a co-operative membership organization, CARE was set up to purchase, package and deliver personalized person-to-person packages to needy Europeans on behalf of private American donors during the immediate post-war crisis. The temporary agency thus offered a service that most of its 22 founding members, among them Labour Unions, and agencies with a religious or ethnic associational base, would have desired to provide to those in need, but were unable to do so due to the difficulty in making such transactions economically sustainable.

The original CARE packages (containing approximately 45,000 calories) were in fact surplus army rations purchased from the United Nations Relief and Rehabilitation Agency (UNRRA) and the US military.²² After supplies of these pre-packed rations were exhausted, the agency started putting together its own food packages. Upon purchase by a donor in the United States, a brown cardboard box containing relief goods was delivered to a designated individual overseas who would eventually sign a receipt (remittance) that was returned to the sender. This reciprocal concept – ‘overwhelmingly Smith to Schmidt’²³ – was innovative. In Europe, CARE packages were in high demand both due to their caloric value and because of their psychological impact.²⁴ The implicit message that individual Americans cared enough to send food to Europe – despite rationing at home and awareness of the fact that some of the recipients of this aid were former enemies²⁵ – played an important part in the success of the overall US post-war relief drive and certainly smoothed the process of European integration into Western liberal capitalism.²⁶ In addition, the choice of goods that were available in CARE’s packages served as a harbinger of the emerging transatlantic consumer society.²⁷ Boxes included modern and neatly packaged food products (such as canned meat, soup, flour, oil and rice) from well-known American brands, and even offered a small assortment of luxury goods such as coffee, chocolate and (initially) cigarettes (Figure 1).

Figure 1. Content of a CARE package, West Berlin, 1948. Source: Deutsches Bundesarchiv, Bild 183-S1207-502 / CC-BY-SA (Wikimedia Creative Commons License).

The latter provided a tantalizing taste of the variety and quality of produce in the capitalist West. Given the fact that the food inside the package reached millions of potential new customers abroad, it is not surprising that CARE had success in persuading American companies to donate sample products (such as soap or juice) to put into CARE’s relief boxes.²⁸ While recipients abroad were relatively easy to find, CARE experienced initial difficulties in familiarizing potential American donors with the concept of CARE’s package.²⁹ The original price of US$15 (approximately US$170 in 2011 prices) was deemed too high for potential buyers and was soon lowered to US$10.³⁰ To further publicise the programme, CARE's public-relations department successfully persuaded celebrities such as Bob Hope and Ingrid Bergman (Figure 2) to promote CARE publicly. These famous American testimonials gave the otherwise rather down-to-earth cardboard box an injection of glamour and conveyed the image that donating food via CARE was both a charitable deed to those in need, and a means of showing American patriotism and common sense.³¹

Figure 2. Ingrid Bergman at a CARE advertisement event, early 1950s. Source: http://blog.care.org.au/2011/05/12/65-years-since-the-first-care-package-was-delivered/ (Accessed 22 February 2014) reprinted with permission from CARE. A wider pictorial history of CARE is provided in David Morris, A Gift from America. The First 50 Years of CARE (Atlanta, 1996).

In 1947 CARE was, amongst other organizations, included in a US$2.5 million campaign by the Advertising Council³² – a semi-public organization that had recently switched from fundraising for the war effort to endorsement of public-health campaigns and charity funding.³³ Soon, CARE car posters and billboard ads promoted CARE’s concept nationwide. The fact that recipients were notified of their benefactors’ name, something that had hitherto been reserved for wealthy philanthropists, and could even thank him or her on the supplied remittance card, helped to democratise and popularise the charity process.³⁴ CARE’s unique combination of individualized relief, its choice of high-quality consumer goods for its boxes, as well as its leadership's close ties to government and business officials, which on more than one occasion earned the company publicity with political heavyweights such as Eleanor Roosevelt or Harry Truman³⁵, all contributed towards a rapidly growing profile both in the United States and in Europe. Having initially operated from a tiny office loaned by the American Council of Voluntary Agencies for Foreign Service, the official umbrella organization for American humanitarian non-profit agencies, founded in 1942, and with a modest workforce of 68 people, CARE soon moved into a more spacious office at 50 Broad Street, New York.³⁶ In order to handle distribution abroad, CARE operated more than a dozen offices in Europe by early 1946. From 1947, displaying some entrepreneurial ambition, CARE’s management even began investigating the feasibility of CARE operations in non-European countries.³⁷ In quick succession, CARE set up additional offices in Japan, Korea, the Philippines and other mainly Asian countries, and even began to diversify its portfolio of packages by offering Italian or kosher options that took regional or religious consumption patterns and – perhaps even more importantly – donor preferences into account.³⁸ By 1 January 1948 CARE had a total of 865 employees on its payroll.³⁹ Its income had also spiked: CARE had acquired roughly US$10 million from private donors in 1946, an amount which tripled by 1948.⁴⁰ Delivering almost nine million relief packages during its first four years of existence, CARE experienced a phase of ‘spectacular growth’, as contemporaries remarked. ⁴¹ This growth affected both CARE’s organizational structure as well as its geographical scope and was a source of tremendous pride and motivation for management and the majority of its still-growing workforce. In addition, this development was also perfectly in harmony with America’s ‘make-do’ business narrative. With growing publicity and a glowing reputation with the US government of being able ‘to get a job done with a minimum of wasted time and effort’, there was seemingly little to cloud CARE’s prospects as a humanitarian over-achiever.⁴²

III. From crisis to crisis? 1949–55

However, the apparent success story of this private humanitarian start-up proved short-lived. CARE had tapped into a rich vein of charitable potential directly after the war, and succeeded in attracting a considerable share of American charitable donations. Yet this was as much the result of its own efforts, its professionalism,and its unique means of donation as it was the result of often unambiguous favouritism by the US government. Public administrators and foreign-policy experts had identified CARE’s potential as both a ‘goodwill ambassador’ and a ‘valuable diplomatic and political weapon’ fairly early on and had repeatedly promoted CARE in public.⁴³ This situation created internal friction, however, as many CARE member agencies feared that both their reputation and their relative income would be curbed by CARE’s expansion.⁴⁴ In fact, CARE’s management, and particularly its Executive Director Paul French (who joined the agency in 1946⁴⁵), were determined to push the organization to the fore. French did not shy away from more or less open competition for donors and publicity with other private voluntary groups, and was keen to develop CARE into a large and independent relief agency in its own right.⁴⁶ This straightforward and ambitious attitude led to repeated unrest and debate among the Board of Directors, and eventually triggered a succession of resignations of member agencies during the 1940s and early 1950s.⁴⁷

The effect of these internal quarrels could be minimized in the early years of CARE’s existence, even if harsh internal conflict was undoubtedly a permanent threat to CARE’s stability, but larger structural difficulties arose from another source. As Europe’s recovery progressed, CARE and its fellow American relief agencies were falling victim to their own success. With their primary aim being hunger relief to war-stricken Europeans, this mission lost its urgency towards the end of the 1940s when food scarcity and malnourishment in most European countries disappeared. While fundraising had been an immense success throughout the immediate post-war period, donations from the American (and Canadian) public yielded less and less as private citizens redirected their expenditures towards private consumption.⁴⁸ Having reported a turnover of close to US$30 million in 1948, package sales declined sharply afterwards and CARE’s income fell dramatically to roughly US$9 million by 1949.⁴⁹ This downturn in private donations did not hit CARE alone, but affected all private American NGOs engaged in post-war relief, as is reflected in table 1 above. Hence, by the end of the 1940s, many American relief agencies went out of business. As a result, the surge in numbers of registered voluntary agencies that accompanied the end of the Second World War fell from more than 100 in 1946, to just approximately 60 by 1949.⁵⁰

Table 1. Combined income (private contributions only) to all PVOs registered with ACVFA.

Year	Private contributions
1948	US$128,800,548
1949	US$91,572,154
1950	US$71,244,716

Source: Rutgers University Archives, ACVAFS records (coll. MC 655) (henceforth ACVAFS), Box 52, summary statement of income and expenditures of voluntary agencies registered with the Advisory Committee on Voluntary Foreign Aid as shown in their quarterly financial reports, 1949–50 (corrected figures).

CARE, however, was not yet ready to wind up. While the agency’s potential impact and outreach overseas was still promising by the end of the 1940s, its financial situation was precarious. Confronted with serious signs of overextension, soaring operating costs and overheads that consumed more than 16% of its income, CARE’s Executive Director was eventually forced to make massive savings and layoffs.⁵¹ In August 1948, he reduced the company’s payroll substantially (from 865 to 698⁵²), followed by successive rounds of reduction in 1949 (502) and 1950 (339).⁵³ With fewer and fewer private Americans willing to buy CARE’s packages, however, CARE’s management and Board were becoming aware that an entirely new direction was required if the organization were to survive.⁵⁴

The committee on the ‘Future of CARE’, that was eventually set up in 1949 to ‘determine if there [were] areas where CARE could make a valuable humanitarian contribution before its carefully developed organization is dissolved’ is a good example of how humanitarian considerations and organizational imperatives interacted in a situation that was crucial for CARE’s survival. While the committee had reference to a value-based perspective, it underscored at the same time that voluntary agencies in general, and CARE in particular, had much to offer potential new partners.⁵⁵ First of all, it was obvious that hunger and malnourishment prevailed outside of Europe. The basic ‘problem’ of hunger to which CARE had originally responded was still there, and even growing in scale, albeit in other geographical areas and in different degrees of seriousness. CARE had shown in the past that it possessed expertise in tackling hunger and – perhaps more importantly – in enlisting the American population’s support in this task. Moreover, the agency could rely on established organizational structures both at home and abroad, a well-trained, flexible and devoted staff, tremendous public appeal, and the ambition to put into action its proven business model in another geographical context. Against this backdrop it was not unsurprising that US foreign-relations specialists were keen to make use of voluntary agencies and their personnel who offered ‘experience’, ‘altruism’, ‘flexibility’ and ‘mobility’ as highly useful qualities in a global political context characterized by rising Cold War tensions.⁵⁶

Generally speaking, co-operation between American voluntary agencies involved in foreign relief and the US government grew tighter and more formalized after the end of the Second World War. All American voluntary agencies operating abroad had been made to register with a special Government Advisory Committee for Voluntary Foreign Aid⁵⁷ from the 1940s onwards. In 1947, relationships between voluntary agencies and government evolved, when Public Law 84 made public ocean-freight reimbursements available to private humanitarian players for the first time.⁵⁸ Follow-up legislation, particularly sub-chapters of the Foreign Relief Act of 1948, further enhanced voluntary agency provisions and – unlike earlier stipulations – included reimbursements for private-relief shipments to countries in Asia, the Middle East and Latin America.⁵⁹ Between 1947 and 1949 CARE alone received more than US$2.2 million in government reimbursements for ocean-freight charges.⁶⁰ Similar or even higher sums were recovered by other large American NGOs such as the American Friends Service Committee, Catholic Relief Services, Church World Services, Hadassah and Lutheran World Relief.

Given that these subsidies alone were insufficient to compensate for falling sales of packages, it was both a fitting coincidence and the result of highly successful lobbying by CARE and the other American NGOs that an additional solution was found, albeit one considered temporary at the time. Starting in the late 1940s, the United States was experiencing growing economic difficulties with unsellable agricultural surpluses. Protectionist and interventionist policies, together with wartime production incentives that proved difficult to reverse after the cessation of hostilities, resulted in a glut of food staples and increasingly high storage costs for the US administration.⁶¹ The simultaneous (re-)⁶² emergence of debates about a growing ‘world food problem’ on the one hand, together with complaints about mountains of spoilt food in the US on the other, were difficult to explain to the American public. American voluntary agencies, as well as an increasing number of US foreign-policy experts, thus started urging the Truman administration to use the American agricultural surplus to help developing nations achieve the ‘four freedoms’ (alluding to the famous Roosevelt speech in 1941), most crucially freedom from want, as a prerequisite for peace.⁶³ It was at least partly due to successful lobbying (and rising Cold War tensions) that the US Agricultural Act of 1949 eventually included a section that allowed for the disposal of US surplus commodities to other countries.⁶⁴ While most of these commodities were given away on a bilateral, government-to-government basis, the Act also granted a small quantity to voluntary agencies to distribute abroad. This was welcomed by the NGO umbrella organization American Council of Voluntary Agencies (ACVAFS) as a tremendous ‘possibility of good’.⁶⁵ In the hands of private agencies, it was argued, American overabundance would ‘nurture not only the free individual, free from all tyrannies, including the tyranny of hunger, but also the free society’.⁶⁶

The prospect of food distribution from government-owned surplus stocks opened a whole new window of opportunity for CARE. Food aid was perceived as a key element in transforming CARE from an organization exclusively focused on European recovery into an international relief agency.⁶⁷ Subsequently, Executive Director Paul French submitted a memorandum to CARE’s Board of Directors in 1950, presenting his plans to ‘develop a program that would move a sizeable amount of […] surpluses to those in need’.⁶⁸ The proposal was discussed heatedly but largely favourably by CARE’s Board. French was authorized to proceed with his plans, seeking, however, the ‘cooperation of the recipient governments’ who were to assume the cost of ocean freights, internal delivery and administrative costs.⁶⁹ Already by this point, the plan envisaged establishing CARE as an intermediary between the United States and recipient governments. Government subsidies were to complement private contributions and to cover a major part of CARE’s organizational expenditures.

In 1950/1 CARE started with a first, highly politicized, food-aid programme to Yugoslavia.⁷⁰ The US$35 million programme (delivering mainly egg powder, dried milk and butter) was the largest aid scheme ever carried out by a private humanitarian agency up to that point, and served to bolster CARE’s income significantly. CARE, along with a couple of other American voluntary agencies – among them both former and current CARE members – stepped in ‘as “neutral” conduits through which the US government could furnish aid to (mostly Communist) countries.’⁷¹ Given that CARE’s first food-aid mission was successfully fulfilled, Executive Director French decided to base CARE’s future strategy on this kind of public–private partnership. Despite serious setbacks during the Korean Crisis (1951–3) when the US government withheld most surplus commodities for military purposes, French eventually managed to establish a stable claim to government donated food commodities.⁷² While the agency had initially used American surpluses to top up its packages, it soon switched to food-aid delivery in bulk. Throughout the first half of the 1950s, CARE set up school feeding programmes in more than two dozen countries in Asia, the Middle East and Latin America, all using surplus wheat, corn and milk powder. These food commodities were listed in CARE’s accounts as ‘dollar income for relief’, and were then transported overseas and labelled ‘expenditures for relief’, marking a general shift in both CARE's revenue model and in its accounting practices.⁷³ Distributing food surpluses helped enable CARE to achieve the shift from European relief to ‘food aid’ to the hungry in the developing countries. CARE was, in fact, able to increase its number of overseas offices to a total of 42. At the same time, the increased financial ties between CARE and the US government led to growing apprehension amongst many member agencies regarding the possibility of eventually becoming ‘a governmental or quasi-governmental agency’.⁷⁴ Given the fact that by 1955, income from government sources exceeded 78% of CARE’s overall annual income, with private donations declining at an accelerated rate, the danger of eventually ‘surrendering [CARE’s] independence’ was imminent and demonstrated quite plainly that CARE was once again standing at the crossroads.⁷⁵

IV. Reinventing the firm

By 1955 CARE’s transformation from a temporary post-war relief agency to a permanent humanitarian NGO working in the field of global food relief was by no means complete. Even though the Board had agreed to extend CARE’s organizational lifespan, hitherto considered temporary, in 1951, and had also voted for a name change to Cooperative for American Relief to Everywhere in 1952, CARE’s future was nonetheless still open.⁷⁶ The agency’s successes in tapping new public sources of funding did not diminish the problem of falling private contributions, thus calling CARE’s voluntary and private character into question. In addition, CARE’s new school feeding programmes required only a very limited number of staff: most programmes were merely supervised by CARE officials, whereas the actual distribution was handled by local administrators from the recipient country. Against this backdrop, CARE was once again experiencing signs of overextension, meaning that personnel costs and overheads were crushing the agency.⁷⁷ Even though Executive Director French had readily enacted organizational cuts and savings in the past, in 1955 he was no longer prepared to go down the same path. Hence, in the summer of that year, he suggested to the Board of Directors that CARE be dissolved ‘in a blaze of glory’.⁷⁸ Presenting detailed plans regarding possible liquidation costs (and even offering his resignation in order to underscore his determination), he argued that it was better to end operations while CARE was still at its zenith rather than risk a protracted demise – inevitably destroying the reputation of both CARE and its members in the process.⁷⁹ He had not anticipated, however, that his proposal would provoke heavy protest, especially among the remaining CARE field staff. Few of his colleagues were keen on liquidating the organization without even having tried to save it. Overwhelmed by the strong headwinds, French tried to retract his resignation and offered to devise a bail-out strategy.⁸⁰ His move came too late, however, as the Board of Directors decided to part ways with Paul French.⁸¹ Bidding farewell to its long-term Executive Director, it embarked on massive organizational restructuring in order to re-invent the firm and to eventually transform CARE into a major player in global food relief.

The following months were crucial in many respects. Given that CARE was still a complex organization, the Board of Directors decided to ensure continuity by asking French’s deputy, Richard Reuter, to step in as new Executive Director. Reuter’s career, which was typical in many ways, hints at the degree of institutionalization and professionalism that already characterised the field of American humanitarian relief by that point.⁸² He had joined CARE in the autumn of 1946 after his graduation in Economics and Business Administration at Amherst and Columbia University. Having gained his first professional experiences at a department store and with the American Friends Service Committee, he quickly rose to top-executive rank within CARE.⁸³ ‘Given Reuter’s experience and ‘in-house’ education, he represented a satisfactory replacement for his predecessor. Tasked with bringing CARE ‘back into the black’, Reuter was aware that this ‘messy job’⁸⁴ would entail serious organizational restructuring.⁸⁵ In less than a month he reduced overall operating costs by almost a third⁸⁶, ‘cut management in half’ by laying off 60 employees, and ordered the closure of all overseas mission ‘whose volume did not justify the expenses’.⁸⁷ For operational – and clearly not for humanitarian – reasons CARE thus terminated operations in Brazil, Chile, Costa Rica, Ecuador, Guatemala, Paraguay, Peru and Japan.⁸⁸ Together with the recent closure of European missions, this shrunk CARE’s overseas presence from 42 offices to a mere 20. Faced with the challenge of saving at least US$1 million for the fiscal year 1956, Reuter closed the Internal Audit Unit, cut travel costs considerably, and widened the intervals between CARE’s overseas conferences.⁸⁹

This shake-up may have been necessary, but it was certainly not a cure-all for CARE’s woes. Management thus decided to take further steps to professionalize both its advertising strategies and donor handling in order to win back private donors. Adhering to CARE’s principle that ‘charity was a big business and as such it should be run with business efficiency’, it was eventually decided to engage professional business consulting.⁹⁰ Commercial public-relations and consulting firms had only recently begun to promote new fundraising and marketing techniques to voluntary groups. Searching for ‘profits in non-profits’⁹¹, they engaged in selling and marketing the results of the on-going process of the ‘scientification of the social’⁹² to non-governmental groups that were willing to pay for these expertise. Immediately after Reuter had taken over management, CARE ordered a first study by the ‘godfather’ of public relations Ernest Dichter in order to better understand donor motivations and constraints. After Dichter’s general findings that commended CARE for its people-to-people concept, and reminded the NGO to take advantage of the fact, that donations were ‘often a kind of bribe’ meaning that donors were subconsciously ‘paying taxes to God’⁹³, CARE’s Board authorized a number of opinion polls and further studies on donor preferences and new marketing techniques.⁹⁴ CARE’s management, as well as its Board of Directors felt that for a charitable organization like CARE, it was imperative to ‘determine, through consumer research, which appeals offer the best potential for developing copy ammunition for CARE that will excite people and motivate them to support CARE’s humanitarian activities’.⁹⁵ Some of the resultant findings were rather disheartening, however. A major study on donor orientation that was conducted during the summer of 1958 showed, for instance, that American donors tended to be fairly ‘conservative’, meaning that they clung to CARE’s original incarnation as a food-relief agency and were thus unwilling to go along with a gradual shift into the field of more complex development aid programming. In addition, most Americans still preferred their donations to go to Europe rather than to developing nations (Table 2).⁹⁶

Table 2. ‘What areas of the world would you be personally most interested in helping?’*.

Europe	43%
The Middle East	25%
Mexico and Central America	23%
Africa	16%
Non-Communist Asia	15%
South America	13%
All	6%
Do not know	4%
None	13%

Note: ^*Multiple answers possible.

It was against this backdrop that Reuter and his colleagues eventually developed a new concept called the ‘CARE Food Crusade’. It combined the traditional package concept with a new appeal for aid to the hungry in developing countries, and was intended to solve ‘the ever present problem of translating latent interest in overseas relief to actual financial support’.⁹⁷ Under the Food Crusade label, donors could purchase a CARE package made of US agricultural food surplus at the price of one dollar. This single dollar paid for re-packing and handling of government-donated foodstuffs into smaller packages and conveyed the message that giving to the world’s hungry was as easy as it was affordable.⁹⁸ Once again supported by the Advertising Council, the campaign was continued for well over a decade and proved to be highly successful in raising both donor awareness for the ‘Third World’ and organizational revenue.⁹⁹ It was also thanks to this campaign that CARE was partially successful in increasing its nominal income from private donations (Table 3).

Table 3. Private contributions to CARE, US and international origin

1956	US$4,306,901
1957	US$7,028,141
1958	US$6,681,745
1959	US$7,973,525
1960	US$9,296,125
1961	US$8,955,430

Note: ^*CARE’s fiscal year: 1 July– 30 June of following year.

Source: NARA, RG 286, UD 499, Box 144, CARE financial statement for FY 1961.

It is noteworthy that with closer donor relations restored and new public forms of donor appeals in place, the general problem of accepting government funds lost a degree of urgency. CARE’s growing success in enlisting private American donors in the global fight against hunger thus helped to restore its image as a private NGO with the American public. With time, and given the overall rising tide of development thinking and practice, promoted not least by European NGOs, throughout the 1950s and 1960s¹⁰⁰, CARE eventually even managed to familiarise private donors with more complex development-aid programmes and eventually added ‘self-help’ schemes and ‘community development’ programmes, all using American agricultural overabundance, to its portfolio.¹⁰¹ CARE’s close relations with the US government stayed a topic of concern, however – both within the American NGO community as well as in the international sphere. While most American voluntary agencies were generally uncritical of government contributions and merely questioned CARE’s practice of ‘acting more as an intermediary between the US government and the foreign government’¹⁰², NGOs on the other side of the Atlantic, for example Oxfam, followed a relatively strict (quasi de Tocquevillean) ‘no money from government’ policy, aside from income-tax recovery, and continued to contest, at least internally, what they perceived as the unsettling closeness of many American humanitarian NGOs to ‘official US aid’.¹⁰³

V. Conclusion

CARE’s shift into large-scale food relief supplied by American overabundance changed the agency in several crucial ways. First of all, this new source of income prompted CARE’s adaptation in the face of several external institutional challenges. The administration of government-donated commodities, for instance, forced CARE to adopt new accountancy and book-keeping methods due to the standardized reporting requirements of government bureaus.¹⁰⁴ Given the fact that many of the large American humanitarian NGOs – most prominently the American Friends Service Committee, Catholic Relief Services, Church World Services, Hadassah and Lutheran World Relief – were engaged in food-aid delivery from the early 1950s onwards, this led to a gradual but visible process of standardization and bureaucratization among many of these NGOs.¹⁰⁵ These signs of ‘institutional isomorphism’¹⁰⁶, resulting from financial entanglement and increasingly formalised relations between private and governmental players, were in some ways countered by agencies’ ambitious attempts at offering private American donors the chance to partake in innovative aid programmes. Given the general similarities of the services offered (that is, food-relief programmes in the developing world) the individual agencies were forced to compete for both public subsidies and their share of private donations from the public. From the mid-1950s onwards, American humanitarian NGOs thus settled on flexible relations that fluctuated between proactive co-operation, as in the American Council of Voluntary Agencies, and often fierce competition over concepts, donor money and public funding both at home and abroad. CARE was successful in consolidating its position, however, relying as it did on its reputation as a professional secular agency, as well as on modern and innovative fundraising techniques, together with the public-relations tactics it implemented after Reuter took over management. By the 1960s the agency ranked third among the largest humanitarian NGOs in the United States. Additionally, CARE’s new concept and mission necessitated the creation of numerous divisions within the organization and triggered CARE’s professionalization. From the mid-1950s onwards, CARE offered food-and-tool packages, large food-aid schemes and eventually even educational development-aid programmes. This broader portfolio required multiple departments and more complex structures of corporate governance, however. As long as CARE had only offered one central product – the original CARE package – its organizational structure profited from centralized governance and a comparatively strong Board of Members. Starting in the mid-1950s, in view of growing financial and operational challenges, CARE’s management gained influence. CARE operations demanded highly skilled administrators with both a thorough business education and experience in the non-profit sector. Given its good reputation, its close embeddedness in the field of non-profit relief, and, last but not least, its practice of paying comparatively high wages, CARE was relatively successful in finding and keeping motivated personnel. With executive functions gaining in complexity, CARE’s Board of Directors was slowly but surely pushed towards representative and supervisory power. This process was demonstrable through less frequent Board meetings, and by both the integration of corporate members to the Board of Directors, and the establishment of a representative National Advisory Committee.¹⁰⁷ To some extent this shift in the relationship ‘between ownership and management’ in CARE paralleled the general process of ‘managerialization’ which Alfred Chandler identified in industrial companies in the twentieth century.¹⁰⁸

From a more general perspective, and pointing to my initial hypothesis regarding the danger of the retrospective oversimplification of historical developments through simplistic narratives, these developments showed that CARE’s ‘rise’ from a temporary organization into a permanent humanitarian NGO was not a foregone conclusion but instead a dramatic succession of ups and downs, dead ends and compromises. During its first 15 years of existence, the agency was repeatedly forced to reinvent its business model, its general mission, its relations to other organizations, its revenue base and, lastly, its public image. Confronted with permanent, and sometimes radical, changes in both its institutional environment and its own organizational basis, there was more than one juncture that might have altered the story beyond recognition. The fact that CARE ‘survived’, and even expanded, can certainly not be attributed to private initiative alone – as CARE’s new orientation towards public subsidy quite plainly demonstrates. Had it not been for government funding, CARE’s story might easily have ended in the late 1940s or early 1950s, along with many other American humanitarian NGOs. Against this background, CAREs ‘ascent’ does not necessarily reveal the triumph of private initiative alone, but rather the strength of mutual forms of public–private co-operation within US foreign-policy institutions – particularly in the context of the Cold War – and humanitarian affairs in general.

Note on contributor

Heike Wieters holds a PhD in history and works as a postdoc researcher at the Department of History at Humboldt-Universität zu Berlin, Germany. Since 2013 she is the co-leader of an international interdisciplinary research group on the transformation of welfare institutions in Europe (Saisir l’Europe). Her PhD project dealt with the humanitarian NGO CARE and its development from an organization focusing on post-war relief to an international humanitarian player providing development aid. Her current research project deals with the transformation of private and public welfare institutions and insurance schemes, as well as with changing perceptions of risk and social security in industrialized countries after 1945; special research interest includes the history of old age and inter-generational solidarity, as well as the history of international (non-profit) corporations since the nineteenth century.

Funding

This work was supported by the Arts and Humanities Research Council [grant number AH/K002805/1].

Notes

1. De Tocqueville, Democracy in America, 215f.

2. Friedman, “Philanthropy in America,” 5; Curti, American Philanthropy Abroad.

3. Rosenberg, Spreading the American Dream; Porterfield, “Protestant Missionaries.”

4. The standard monograph is still Curti, American Philanthropy Abroad, chapters 9 and 10; see also Zunz, Philanthropy in America, 55–66.

5. Maul, Silent Army, 107–12; Irwin, Making the World Safe, 174–82; Patenaude, The Big Show.

6. This is a quote from Julia Irwin’s book entitled, Making the World Safe, The American Red Cross and a Nation's Humanitarian Awakening.

7. Cabanes, The Great War, 144; Barnett, Empire of Humanity, 82–94.

8. Proctor, “An American Enterprise.”

9. Fischer-Tiné, Global Civil Society, 57–66.

10. O'Sullivan, “Global Nervous System.”

11. Salamon, “Government-Nonprofit Relations,” 329–67.

12. Ruggie, “International Regimes,” 379–415.

13. McCleary, Global Compassion; Hall, Inventing the Nonprofit Sector.

14. Hilton et al., The Politics of Expertise, 63–8; Salvatici, "Help the People".

15. Barnett, Empire of Humanity, 21.

16. Paulmann, “Conjunctures in the History,” 220–5; Smyser, The Humanitarian Conscience, 53–90; Iriye, “A Century of NGOs;” Zunz, American Philanthropy, 137–67.

17. Smith, More than Altruism, 10; Tvedt, Angels of Mercy, 25f.

18. Weisbrod, “Nonprofit Mission and Financing,” 4.

19. Brown and Slivinski, “Nonprofit Organizations and Market,” 140–58; Galambos, “Nonprofit Organizations and Commonwealth,” 82–104.

20. Hansmann, “Role of Nonprofit Enterprise,” 841.

21. Campbell, History of CARE, 5f.

22. CARE records. Manuscripts and Archives Division. The New York Public Library. Astor, Lenox, and Tilden Foundations (henceforth CARE), Box 1170, minutes of board of directors meeting (MBDM), 8 Dec. 1945; minutes of executive committee meeting (MECM), 14 Dec. 1945.

23. CARE, Box 26, Arthur Ringland to Paul Comly French, 10 Feb. 1949.

24. Sommer, Humanitäre Auslandshilfe, 172–9.

25. National Archives II at Maryland (henceforth NARA), RG 469, UD 668, Box 1, How the German Public views the CARE Organization, Classified report by Reactions and Analysis Branch Information Service Division of Public Affairs Office, 6 March 1950.

26. Veit, Modern Food, 6, 58–76; on this general issue see also: Cullather, “Foreign Policy of the Calorie,” 337–64.

27. On the CARE package see: Wieters, “Hungerbekämpfung und Konsumgesellschaft;” from a more general angle see: de Grazia, Irresistible Empire, 338–43; Rosenberg, Spreading the American Dream.

28. CARE, Box 69, Memorandum on CARE member agency relations 1955; see also: Announcement in American Journal of Public Health 39 (November 1949), S. 1445; CARE to send Soap abroad, in: The Sprague Electric LOG, 25 June 1949, p. 1.

29. CARE, Box 1170, MBDM, 18 June 1946.

30. CARE, Box 1170, Report of CARE Finance committee, 30 April 1946.

31. Baur, From Victim to Partner.

32. NARA, RG469, UD664, Box 2, letter Alex Hawes to members of the board of CARE, 21 Nov. 1947.

33. Lykins, Total War to Total Diplomacy, 65f.

34. Zunz, Philanthropy in America, 176.

35. ACHESON ASSAILS THREE-FIFTHS LAG IN MAY FOOD RELIEF, by Bess Furman, Special to the New York Times, 8 May 1946, p. 1.

36. CARE, Box 1170, MBDM, 28 Dec. 1945; MECM March 1, 1946, MECM, 2 May 1946.

37. CARE, Box 1170, MECM, 9 Jan. 1947.

38. CARE, Box 1170, MECM, 6 Aug. 1947; MBDM, 27 Aug. 1947.

39. CARE, Box 1, Executive Director’s report, 1 Sep. 1948.

40. NARA, RG 469, UD 658-A, Box 1, CARE Schedule ICR (compiled for ACVFA) resources received for foreign operations 1946–1952, 18 May 1953.

41. CARE, Box 3, final report of survey committee to the CARE board of directors, 26 May 1948.

42. NARA, RG 469, P212, Box 1, summary minutes of Advisory Committee meeting, 29 March 1955.

43. Griffith, “Selling of America,” 396; NARA, RG469, UD679-A, Box 1, Suggested outline for remarks of C. Tyler Wood, Assistant to the Deputy Administrator, Economic Cooperation Administration, Dec. 1948.

44. CARE, Box 69, report on CARE member agency relations, 19 Jan. 1955.

45. CARE, Box 1170, MBDM, 6 Nov. 1946.

46. CARE, Box 1170, report of the committee on management, 2 Feb. 1949; MBDM, 2 Feb. 1949.

47. CARE, Box 1170, MBDM, 24 March 1954.

48. Cross, An All-Consuming Century, 88.

49. NARA, RG 469, UD 658-A, Box 1, CARE Schedule ICR (compiled for ACVFA) resources received for foreign operations 1946–1952, 18 May 1953.

50. McCleary, Global Compassion, 63. This figure pertains to government registered voluntary agencies only.

51. CARE, Box 26, summary statement of income and expenditures of voluntary relief agencies registered with the Advisory Committee in Voluntary Foreign Aid as shown in their quarterly financial reports, 1 April – 30 June 1949.

52. NARA, RG 469, UD 664, Box 2, CARE Executive Director’s report, 4 Feb. 1948.

53. CARE, Box 3, Paul C. French, Executive Director’s report for the board of directors meeting, 13 Sep. 1950.

54. CARE, Box 1170, special meeting of the members, 20 Nov. 1951.

55. CARE, Box 1170, MBDM, 17 Jan. 1951.

56. NARA, RG 469, UD 679-A, Box 5, restricted memo by Sullivan (Technical Cooperation Administration) “The Role of Voluntary Agencies in the Point IV Program”, 27 January 1953.

57. Starting in 1939 all voluntary agencies were obliged to report directly to the Department of State. In early March 1941 the President’s Committee on War Relief Agencies (PCWRA) was established, and was, only a few months later, in summer 1942 shifted, remodelled and re-named the President’s War Relief Control Board (PWRCB). This body was not only entitled to register new agencies but also to oversee the fundraising, management and distribution of relief overseas. After the War, the Advisory Committee on Voluntary Foreign Aid (a subdivision of the State Department) was set up.

58. Public Law 84, 80th Congress, 1st Session, H.J. Res 152, Joint resolution providing for relief assistance to the people of countries devastated by war, 31 May 1947.

59. International Economic Cooperation: Foreign Assistance Act of 1948, in The American Journal of International Law 43, no. 2 (1949): 4–93, here p. 86.

60. NARA, RG 469, UD 658-A, Box 1, Schedule ICR, CARE prepared for ACVFA, 18 May 1953.

61. Dean, An Opportunity Lost, 13–18; see also: Federico, Feeding the World, 196–205.

62. Amrith and Clavin, “Feeding the World,” 36–9; Jachertz and Nützenadel, “Coping with Hunger?,” 103–5.

63. “Give our Crop Hoard to Asia, Morgenthau Urges,” by Henry Morgenthau, Jr. in: the Washington Post, Sunday, 30 Oct. 1949; CARE, Box 26, letter Paul French to Arthur Ringland (ACVFA), 17 Oct. 1949; “Hunger as Democracy´s Foe,” by Paul C. French, in the New York Times, 18 Aug. 1950.

64. Barrett and Maxwell, Food Aid After Fifty Years, 13–16; Ahlberg, Transplanting the Great Society, 21f.

65. NARA, RG 469, US 667, Box 1, Joseph P. Chamberlain (ACVAFS) to Arthur Ringland (ACVFA), 29 Sep. 1949.

66. ACVAFS, Box 8, ACVAFS statement (draft) “The continuing challenge of American abundance),” 13 Nov. 1956; see also: ACVAFS statement “The moral challenge of American abundance,” ACVAFS statement before the “Agricultural House Appropriation Committee, 30 April 1954.

67. CARE, Box 1170, MBDM, 2 Feb. 1949.

68. CARE, Box 5, memo by Paul French to board of directors, Subj: agricultural surpluses, 8 Sep. 1950; Box 3, Paul C. French, Executive Director’s report to board of directors, 13 Sep. 1950.

69. CARE, Box 6, Murray D. Lincoln to Charles Taft (ACVFA), 29 Sep. 1950.

70. CARE, Box 1, Charles Bloomstein, History of CARE manuscript, 373–6.

71. Wallerstein, Food for War, 33; Poland and Yugoslavia were not actually Communist but lead by socialist governments under soviet influence.

72. CARE, Box 4, report of CARE near east/far east conference, Colombo Ceylon, 29–31 Jan. 1951, undated.

73. See Wieters, “Auf dem Rentierschlitten.”

74. CARE, Box 3, memo for Mr. Wallace Campbell for use in presenting my views to the CARE board, by Harold Miner (treasurer), 21 Feb. 1952.

75. CARE, Box 1170, MECM, 16 Feb. 1955.

76. CARE, Box 1170, special meeting of the members, 20 Nov. 1951; CARE, Box 1170, minutes of special meeting of the members, 22 Oct. 1952.

77. CARE, Box 73, CARE income sheets, 1954 und 1955.

78. Campbell, History of CARE, 70.

79. CARE, Box 6, detailed line-up of estimated liquidation costs, 1955.

80. CARE, Box 6, memo Paul French to Planning and Policy Committee, 12 July 1955.

81. CARE, Box 1170, MECM, 13 July 1955.

82. Abramson and McCarthy, “Infrastructure Organizations,” 344.

83. CARE, Box 883, biographical sketch Richard Reuter.

84. CARE, Box 6, Richard Reuter to Paul Gordon, chief of missions region IV, 22 July 1955.

85. CARE, Box 7, Richard Reuter, report to subcommittee on management, 20 July 1955.

86. CARE, Box 6, value of goods shipped against expenses incurred, 1 July 1950 through 30 June 1955, the exact figure was US$2,992,300.

87. CARE, Box 6, Richard Reuter, progress report no. 1, 25 July 1955.

88. CARE, Box 1070, MECM, 21 Sep. 1955.

89. Cazier, CARE, A Study, 302f; NARA, RG 469, Far East Subject Files, Box 91, progress report 3, Richard Reuter, 15 Aug. 1955, attachment to Department of State instruction regarding changes in leadership and programme of CARE, Inc., 30 Aug. 1955.

90. ACVAFS, Box 33, Copy of Testimony of Richard W. Reuter of CARE Presented before the New York State Joint Legislative Committee at Public Hearing, Wednesday, 16 Dec. 1953.

91. McKenna, World's Newest Profession, 111–44.

92. Raphael, “Verwissenschaftlichung des Sozialen.”

93. CARE, Box 854: “Memo on why people give Donations”, submitted to the National Insurance Company, Columbus, Ohio, Submitted by the Institute for Motivational Research, Inc. NY, Ernest Dichter, PhD President, December 1955; see also the edited volume by Schwarzkopf and Gries, Ernest Dichter and Motivation Research.

94. CARE, Box, Box 1171, MECM, 27 May 1959.

95. CARE, Box 6, Bennett-Chaikin special analysis team, suggested research programme for CARE, Jan. 1958.

96. CARE, Box 6, Bennett-Chaikin, Special Analysis of Atlanta, July 1958.

97. CARE, Box 1170, MBDM, 19 Oct. 1955, indirect quotation by Richard Reuter.

98. CARE, Box 7, position paper on CARE’s utilization of U.S. agricultural surplus (preliminary staff draft), no date [1956].

99. CARE, Box 26, Richard Reuter to Elizabeth Bromley (WMCA), 28 Dec. 1955.

100. There is some research that tends to depict post-war development as the “invention” of a new concept that did not exist before, see for example Rist, History of Development, 69f; this position has been challenged in recent years, with good arguments and based on rich amounts of sources; see for example Ekbladh, Great American Mission, 3.

101. Wharton Jr., “Aiding the Community,” 64–72; Unger, “Investieren in die Moderne,” 270.

102. NARA, RG 469, P212, Box 1, summary minutes of Advisory Committee meeting, 29 Mar. 1955.

103. Special Collection, Bodleian Library, Oxfam Papers, MS. Oxfam PRG/2/3/13/22, J. W. Jackson (Special assistant to the Director, Oxfam) to Bernhard Ross (Department of Social Welfare, Brywn Mawr College), 3 Jan. 1967; J. W. Jackson to Lesly Kirkley (Director Oxfam) Report on Visit of Oxfam America, Inc. 6^th–9th July, 1971.

104. NARA, RG 59, Ai, 5322, Box 7, notification about establishment of ACVFA register on Voluntary Agencies, 8 July 1952.

105. Hammack and Heydemann, "Introduction", p. 6f.; Loya and Boli, “Standardization in World Polity.” While Loya and Boli focus on the establishment of technical ISO standards, their general argument is applicable to less formal and less technical variants of standardization as well.

106. Powell and DiMaggio, “Iron Cage Revisited,” 155.

107. CARE, Box 1170, minutes of board of directors meeting, 30 Jan. 1952; Box 30, list of CARE National Advisory Committee members, 1954–1969.

108. Chandler, Visible Hand, 491.