Skewing The Definition Of Charity

I haven’t written about the death of Hugo Chavez. My only comment is, “If this man cared so much about the poor, why was he worth millions when he died?” In contrast, how much was Mother Theresa worth when she died? Just an observation…

Today’s New York Post posted a story about how the death of Hugo Chavez will impact Citizens Energy Corp, the organization founded in 1979 by Joe Kennedy, Robert F. Kennedy‘s oldest son. The organization provides assistance to Massachusetts residents who need help paying for heating oil in the winter. The charity is able to do this by buying crude oil from Venezuela at below market price, selling it at the market price and using the difference to provide oil for people who need it. It really is a good idea and works well.

People should be paid fairly for their work, even when they work for a non-profit organization, but somehow I think we have forgotten that a non-profit organization is supposed to be supporting a cause of some sort and that’s where most of it’s money should go.

The article reports:

After Joe Kennedy left Congress, he returned to run Citizens Energy. That job paid him $86,311 in 2010. But the bulk of his income comes from his for-profit companies — Citizens Enterprises Corp. and Citizens Investments Ltd. — which together paid him $807,390 in salary and benefits. Kennedy’s wife, Elizabeth, raked in $346,764 from the nonprofit, where she is marketing director, and from the for-profit companies.

I would have left Congress too! Note that Elizabeth Kennedy was making more than $300,000 from the nonprofit company. I really think that is a little much.

The article concludes:

The oil started to flow in 2005 via two related nonprofits. Citizens Programs Corp., a charitable foundation, takes in the heating oil — $59 million worth in the fiscal year ending June 30, 2011. It immediately sells the supply to an undisclosed “prearranged buyer,” according to its tax returns. The proceeds are used to buy 100 gallons of heating oil for 200,000 needy households in 25 states and Washington, DC.

The distribution is done through Citizens Energy, which receives a $5 million management fee from Citizens Programs.

Citizens Programs uses some of its oil riches — $4 million in fiscal year 2011 — to pay for its ubiquitous advertising program. Running a call center and the “Joe-4-Oil” hot line costs $1.3 million.

A spokesman for the groups refused to answer questions about the operation.

Kennedy also funnels cash to his family’s own causes, including the Robert F. Kennedy Center in DC.

I think Joe Kennedy’s commitment to helping the poor stay warm in the winter is wonderful. The cost of living is high in Massachusetts, and a lot of people have been helped by Citizens Energy Corp. I just wonder about the details of how the money was spent.

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