Most needles are able to be very thin because they are only dealing with small amounts of fluid transfer, measured in milliliters or less.
Blood donation needles are quite a lot larger diameter so as to be able to handle a full point of fluid in a reasonable time period.
It really is not that bad. I am a member of the three gallon "club" from all the donating I have done.
I like to joke with the phlobotomist about "do I get to chose my own leech?" and "do you have any hand grips to squeeze with red and white streamers on the end, like my old tricycle?"
It doesn't feel that bad--it's not a hole punch. And the bright side is after having that done a number of times, you won't even notice the tiny needles.
And it is a great service, as not only does blood get used up by emergency rooms at quite a pace, they also can't store it for extended periods, so any left after a couple of months has to get tossed anyway. They can't stockpile it like water or oil, for instance.
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