Sunday, February 22, 2009

Reserves or Aid?

Any charity has to make that decision, assuming, of course, that the charity does have reserves. The Army Emergency Relief (AER), a charity that is legally separate from the Army, has decided that reserves are more important than aiding its constituents, members of the Army. In the period 2003 - 2007, AER put $174,000,000 in reserves and doled out $64,000,000 in aid. This, at a time when their Navy and Air Force counterparts did exactly the opposite. While maintaining anywhere between one and three years expenses in reserves is considered sound practice, AER has twelve years in reserve.

While AER is separate from the Army, it is controlled by it. The Army even pays the salaries for most of AER's employees. Because of this tight control, the Associated Press found:

• Superior officers come calling when AER loans aren't repaid on time. Soldiers can be fined or demoted for missing loan payments. They must clear their loans before transferring or leaving the service.

• Promotions can be delayed or canceled if loans are not repaid.

• Despite strict rules against coercion, the Army uses pushy tactics to extract supposedly voluntary contributions, with superiors using language like: "How much can we count on from you?"

• The Army sometimes offers rewards for contributions, though incentives are banned by program rules. It sometimes excuses contributors from physical training — another clear violation.

• AER screens every request for aid, peering into the personal finances of its troops, essentially making the Army a soldier's boss and loan officer.

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