After the Sep. 11, 2001 terrorist attacks on the U.S., Congress gave the government sweeping new powers to crack down on not-for-profit organisations that were using their charitable status as cover for funneling funds to terrorist groups.
These powers include the authority to designate any charity as a material supporter of terrorism. This action demands virtually no due process from the government, denies the target to see the evidence against it, and can result in freezing of a charity's assets, effectively shutting it down. Since 9/11, the government has shut down dozens of charitable groups, but only three have ever been charged and brought to trial for supporting terrorist causes. None has been convicted.
It seems the government can designate any organization as terrorist without proof, and can freeze assets without showing ties to terrorism or illegal acts. A report Collateral Damage: How the War on Terror Hurts Charities, Foundations, and the People They Serve estimates that since 9/11 it is estimated that over $6 Billion in assets, from charities and foundations labeled as terrorist organizations, have been frozen. A charity without access to its funds is often effectively shut down.
It also asserts that the government has used its surveillance powers against charitable groups for political purposes. It charges, "In addition to providing aid and services to people in need, charitable and religious organisations help to facilitate a free exchange of information and ideas, fostering debate about public policy issues. The government has treated some of these activities as a terrorist threat. Since 9/11, there have been disturbing revelations about the use of counterterrorism resources to track and sometimes interfere with groups that publicly and vocally dissent from administration policies."
In 2005, the American Civil Liberties Union (ACLU) launched its Spy Files Project and uncovered an intricate system of domestic spying on U.S. non-proﬁts largely condoned by expanded counterterrorism powers within the USA PATRIOT Act.
Many legitimate and effective organisations have suffered because of the undemocratic and heavy-handed application of these powers.
The report finds that "U.S. counterterrorism laws have made it increasingly difficult for U.S.-based organisations to operate overseas. For example, after the 2004 tsunami, U.S. organisations operating in areas controlled by the Tamil Tigers, a designated terrorist organisation, risked violating prohibitions against 'material support' when creating displaced persons' camps and hospitals, traveling, or distributing food and water."
For aid organisations like the International Red Cross, compliance with U.S. counterterrorism laws can force NGOs to violate standards of neutrality in their work. The Principles of Conduct for the International Red Cross and Red Crescent Movement and NGOs in Disaster Response Programmes state, "The humanitarian imperative comes ﬁrst. Aid is given regardless of the race, creed or nationality of the recipients and without adverse distinction of any kind. Aid priorities are calculated on the basis of need alone."
In some cases, the report declares, counterterrorism laws have caused nonproﬁts to pull out of programmes.
So, right-wingers are always promoting charity as the alternative to public programmes and social services... how can they be effective when they have to face these kinds of problems?