Philanthropy strikes back

If you’re here to read the latest update on the GiveWell project, see this post.

There are a lot of possible objections to my last post; to voice them, I’m bringing back our old friend, the Straw Man, for an exclusive interview.

Straw Man: When you say you prefer charity (helping individuals) to philanthropy (addressing root causes), do you mean you ALWAYS prefer short-term to long-term solutions, and that all research/advocacy/outreach programs should be illegal?

Holden: No. But I think there’s value in making charity the default mode, asking for a higher burden of proof before switching to more difficult and ambitious methods. I think most foundations go in the opposite order, jumping straight to “How can we wipe out this problem?” The two examples I gave in my last post seem like really good ones.

Straw Man: But don’t you think that by helping individuals, you’ll be perpetuating the very problems you seek to address??

Holden: How so?

Straw Man: Hang on, I’m still recovering from how cool I sounded just now. OK. There are a couple different arguments that charity perpetuates the very problems it seeks to address. First, the lefty one: by helping people, you’ll give the government an excuse to ignore them.

Holden: Are there any instances in recorded history where a popular social program lost support because of the argument that charity takes care of it? I doubt it, and here’s why. A charity isn’t a reasonable candidate to replace the government until it’s covering all affected parties (which generally is not a possibility, even in the long term) – and until that point, the charity’s successes are just evidence that more of its activities are needed. If a charity addresses 1%-95% of the needy population, and it’s clear that what it’s doing is working and that that 1%-95% is far better off for it, that seems to me like it helps rather than hurts the case for universalizing the program. Anecdotally, I’ve already seen this with NYC education – the state is willing to partner in “experimental” initiatives (small schools, for example) that already have some track record thanks to the voluntary sector.

“This is a great program, it clearly works, it’s clearly good for our society, but we shouldn’t allocate government funding to it because 501(c)(3)’s already have it covered” doesn’t sound like an argument that would fly in an actual political contest (let me know if there are any examples of this happening). It sounds like the kind of argument that people are afraid “other people” will be snookered by.

Straw Man: OK, now the righty argument that charity perpetuates the very problems it seeks to address. By providing people with free health care, education, etc., you remove the incentive for them to pull themselves up by their own bootstraps.

Holden: I don’t think I’ll ever understand where people get the idea that depriving someone of basic needs is a necessary, or appropriate, way to motivate them to work. All of the most driven, entrepreneurial, hard-working people I know have never had to worry about having food, shelter, health care, or education. In fact, most of them have never had to worry about anything much. People want more than they have, period (whether we’re talking about money, meaning, or anything else you get from hard work). So what if food surpluses mean farmers don’t have to grow food anymore? They’ll do something else useful – just like the rest of us who’ve never had to grow food.

Straw Man: But what about sustainability? By providing free medicine, we could be stopping programs that seek to provide cheap medicine. That’s not just a waste of money – it could be stopping people from providing services in much more sustainable, expandable ways.

Holden: This is a real concern. It’s one of many reasons that charity has to be researched carefully and monitored constantly. In fact, I think one of the questions any charity has to ask itself is, “How much can our clients pay for our services?” They should charge as much as possible, until the point where they’d be pricing out people who need help. And they should always be revisiting this question.

That said, leaving people to rot until/unless “the market” solves their problems is irresponsible. There’s no question that there are people out there who need help they can’t afford to pay for, and this fact isn’t going away anytime soon (especially if nobody’s providing them with the things every human needs to become self-supporting). Serving people who need help, while constantly reassessing how much they need it, seems like the only appropriate road to take.

Straw Man: So to sum up: you just like Band-Aids, and you don’t want to see real change in the world.

Holden: First off, every person helped is real change; secondly, I do want to see large-scale change, but I’d rather learn as we go than spend 20 years trying to implement an untried master plan. What I really want to see is a kind of “research” grounded in reality: donors simultaneously helping people and learning how best to help people, by documenting and discussing what they’ve done. This approach – transparent, heavily evaluated, results-oriented charity – can’t solve all our problems or fully replace direct assaults on “root causes,” but it has the potential to build the evidence and knowledge we need for enormous changes, as well as making sure that we’re doing some actual good along the way.


Philanthropy strikes back — 5 Comments

  1. >>“This is a great program, it clearly works, it’s clearly good for our society, but we shouldn’t allocate government funding to it because 501(c)(3)’s already have it covered” doesn’t sound like an argument that would fly in an actual political contest (let me know if there are any examples of this happening). It sounds like the kind of argument that people are afraid “other people” will be snookered by.

    Bush Administration cut several million dollars from elementary school funding because “Gates Foundation has [smaller class size, smaller schools] covered.”

  2. I doubt that’s a quote from the administration.

    My impression is that the administration failed to fully fund their program, for reasons that are basically unclear (I’d guess some combination of budget concerns and Bush’s ideology). They have caught plenty of flak for it. In all the debate over this move, I’ve never heard the Gates Foundation come up – and if it did come up, that would be pretty bizarre, since the Gates Foundation works on a limited # projects in a limited # areas and will never have the scope of the govt.

    I’m not well-informed on this issue, though – just sharing my impression of the situation. If you have a link to something that shows a connection between Gates’s work and Bush’s cuts, please share.

  3. Here’s the quote:

    “In its 2007 budget proposal, for example, the Bush administration eliminated a $93.5 million program to underwrite the development of smaller schools, specifically citing the increase in support for those schools from “nonfederal funds” from the Gates Foundation and the Carnegie Corporation.”

    NY Times, August 13, 2006, Stephanie Strom, “Gates’s Sharity Races to Spend Buffett Billions”

    Here’s the link

  4. And here’s the actual quote from the proposal (no NYT article-specific spin):

    A separate program is not needed for the purpose of creating smaller learning communities. In the past 5 years, funds available from this program and from private sources have met the demand. Under the most recent competition, conducted in 2005, school districts in two States received about half of the total funds available for grants, and a third of applicants and grantees had received previous grants. Many of the eligible schools have not chosen to create smaller learning communities because of the lack of compelling evidence on the effectiveness of the smaller learning communities strategy in strengthening high school education and raising achievement. The remaining need for assistance in creating smaller learning communities can be adequately supported with formula grant funds from Title I Grants to Local Educational Agencies or State Grants for Innovative Programs—the latter of which specifically authorizes the creation of smaller learning communities. Also, the President’s proposed new High School Reform initiative will give educators greater flexibility to design and implement approaches for improving the achievement of high-school students. The PART rated this program Results Not Demonstrated.

    On one hand, I can no longer say that I’ve never heard of private philanthropy being used as justification for cutting govt programs. On the other …

    • This is not a broad social program being cut, but a small, contained “experiment.” In fact, it’s “root cause” philanthropy (the Gates programs have elements of both this and charity) doing exactly what people fear charity will do, crowding out govt. I don’t really even think that that’s a bad thing – when it comes to experimenting and giving grants in untested waters, I’d rather see foundations doing it than govt anyway.
    • The mention of private money is given along a whole slew of other justifications – the primary one being that the results are unproven (largely true, I believe) – and the cut was made along side a HUGE slew of other cuts.

    It’s common in politics to pull out any and all justifications for a move, regardless of whether they’re good or plausible. This particular justification does appear alongside in the proposal, but I still don’t believe it’s been a real part of the political battle (largely because this connection was so hard to Google!) There’s a long distance between what we see here and the idea that Gates bears any significant responsibility for cuts in education spending.

    Anyway though, I shouldn’t have been so black and white. When you pay for a public benefit, you’re always opening yourself up to the risk of replacing someone else’s money. I just think that in the scheme of things, the political risks of cutting or preventing social programs are tiny next to the benefits of (a) developing more proof of concept, to fight the opposite battle; (b) helping people.

    Lucy, thanks for the link.