Nonprofit Newswire | Private Contractors Don’t Appear Better at Cuban Aid than Nonprofits They Replaced

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April 8, 2010; Associated Press | What was said to be a good idea at the time doesn’t seem to be so smart today. Responding to “scathing” Congressional scrutiny of nonprofits that received money to support efforts to democratize Cuba, the Bush Administration in 2008 awarded a record $45 million to private contractors to support what the Associated Press calls “regime change.”

Now, two years later, Congress is again asking questions about what this money is accomplishing—if anything—and “whether contractors have fared any better than the foundations, universities and nonprofits that were once solely responsible for the aid.”

Among those demanding answers are Senator John Kerry and Representative Howard Berman. Berman, a California Democrat who chairs the House Foreign Affairs Committee, wants to know what is actually working “to benefit the Cuban people.” Adds Berman, “In the recent past, our committee’s oversight of these programs has uncovered outrageous abuses from personal shopping trips to hundreds of thousands of U.S. taxpayer dollars simply pocketed outright.”

The biggest recipient of funding is Washington-based Creative Associates International, which received $6.5 million in 2008 and is now up for an additional $2.5 million. Although it had done work in the past n Afghanistan and Iraq, the AP reports it had no experience at the time it received the first contract.

Another big winner was Bethesda, Md.-based Development Associates International, which got a $4.5 million contract. Despite earlier concerns of waste and ill-managed grants to nonprofits, some in Congress are pushing to reverse the Bush policy of favoring private contractors. A Miami Republican, Rep. Lincoln Diaz-Balart, says nonprofits “have historically been the most experienced and effective in providing democracy assistance in Cuba.” As the AP notes, compared to contractors, nonprofits generally have lower overhead and are often subcontracted by the for-profit companies.—Bruce Trachtenberg