Nothing wrong with selfish giving – just don’t call it philanthropy

Tactical Philanthropy has an interesting discussion of “non-optimized giving”: New Philanthropy Capital CEO Martin Brookes “confesses” to “wasting charitable funds” on a cause he doesn’t believe is the best, and Sean responds that “Under your logic, we should all feel guilty about all of our giving that does not go to the single best charity in the world … Be proud of yourself, Martin. You’re a great philanthropist.”

I don’t think it’s wrong to make gifts that aren’t “optimized for pure social impact.” Personally, I’ve made “gifts” with many motivations: because friends asked, because I wanted to support a resource I personally benefit from, etc. I’ve stopped giving to my alma mater (which I suspect has all the funding it can productively use) and I’ve never made a gift just to “tell myself a nice story,” but in both cases I can understand why one would.

Giving money for selfish reasons, in and of itself, seems no more wrong than unnecessary personal consumption (entertainment, restaurants, etc.), which I and everyone else I know does plenty of. The point at which it becomes a problem, to me, is when you “count it” toward your charitable/philanthropic giving for the year.

My personal approach is to designate a certain percentage of my annual income for pure altruistic giving (most recently to the Stop Tuberculosis Partnership). When a friend asks me to give to a charity they’re “running for”, I give a small amount and think of it in the same bucket as holiday gifts – it doesn’t affect the size of my annual altruistic gift.

I believe that the world’s wealthy should make gifts that are aimed at nothing but making the world a better place for others. We should challenge ourselves to make these gifts as big as possible. We should not tell ourselves that we are philanthropists while making no gifts that are really aimed at making the world better.

But this philosophy doesn’t forbid you from spending your money in ways that make you feel good. It just asks that you don’t let those expenditures lower the amount you give toward really helping others.

Comments

Nothing wrong with selfish giving – just don’t call it philanthropy — 7 Comments

  1. Right, I give to my church but I don’t consider it philanthropy — it’s a resource I personally benefit from.

  2. I agree that Harvard is probably not among the more financially strapped nonprofits, but what about smaller colleges? My wife and I went to a small liberal arts college on scholarships, and our school pretty much never produces the kind of people who can later give seven or eight figure donations. She feels that we’re in about as good a position to give to them as any alumni of our college ever are, and that we owe them something for having educated us for free. I’m more of the Givewell mindset, i.e. get the most change for your dollar possible, which is why we’ve started giving to Villagereach. Any thoughts?

  3. I think that it’s fair to count donations that are not optimized for pure social impact as being partially philanthropic, discounting them by the fraction of social impact that they have relative to the most effective options. Implicit in Holden’s post is the idea that much charitable spending goes to charities that are many times less cost effective than those charities selected for cost effectiveness, so that the philanthropic value of such donations is negligible. And perhaps the idea that people have trouble accurately performing such discounting: see http://lesswrong.com/lw/6z/purchase_fuzzies_and_utilons_separately/ for such a perspective.

    Jason, my own feeling is that donations to your alma mater are most likely to be dwarfed by comparison with VillageReach in cost effectiveness and so that Holden’s approximation is valid in this case and you should conceptualize donations to your alma mater as satisfying a personal need rather than pushing toward a better world, and so not classify them as philanthropy.

    However:

    (1) it’s possible that I’m wrong in my judgment, not knowing your college’s financial situation and how well they use money (you would know more about this than I would) though I suspect not in light of the issue raised here http://blog.givewell.org/2010/01/28/can-choosing-the-right-charity-double-your-impact/ ,

    (2) you and/or your wife may have a different conception of what an ideal society would look like than I do

    (3) maintaining a happy marriage has value too, both intrinsic and instrumental.

  4. “Right, I give to my church but I don’t consider it philanthropy — it’s a resource I personally benefit from”

    Fair enough….except that the $$$ you give doesn’t get earmarked solely to serve your needs. Others personally benefit from that Church as well, so I would absolutely consider it philanthropy.

  5. “Fair enough….except that the $$$ you give doesn’t get earmarked solely to serve your needs. Others personally benefit from that Church as well, so I would absolutely consider it philanthropy.”

    Very true, but that’s the case with every “selfish giving” donation we’re talking about, right? Wikipedia, one’s alma mater, and a church all benefit other people (which is why “selfish giving” is kind of a harsh term, it’s much less selfish than, say, buying a Lexus). I think the issue is intentionally choosing a charity that one knows to be cost-ineffective for personal reasons.

    I think a much worse example of selfish giving would be a multimillion dollar gift to a university to have them build a building and name it after you. Once again, more selfless than buying a yacht, but there’s always a big element of ego implicit in such a donation.

  6. I agree with most of what Jonah says, which applies to the comments both by Jason and Mike. I do think it is easiest to count a gift as “consumption” rather than “philanthropy” when the primary purpose of the gift is for yourself – your feelings, your friends, etc. – rather than trying to do as much good as possible.

    Jason, it sounds like the main reason you are considering giving to your alma mater is out of a sense of “debt repayment.” (Maybe a better way to put it is “equity repayment,” since your alma mater gets nothing back from many of its alumni, and has to get huge returns from the successful alumni to “break even.”) I think this is a valid reason to give, but:

    • It still seems like a good idea to examine your alma mater’s financial situation and what the actual impact of your gift would be. If they turn out to have much more funding than they need/will use for scholarships, I imagine you’d reconsider.
    • I would put the gift in a different mental bucket from “philanthropy.”.

    I’m speaking here only about how to think of your own position – obviously from there you’ll have to negotiate/compromise with your wife if she sees things differently.

  7. I don’t think you should feel guilty about giving.

    I do think you should ask yourself whether your hard-earned money should go to a cause with a bad leader, ineffective programs, ridiculous overhead, etc.

    When you think of the fact that the number of nonprofits increased by 33% in the last ten years, you realize that there definitely are nonprofits that are really helping people, serving a need, running on a shoestring, and there are those that are merely paying lipservice to the cause they espouse. I do hope that Givewell exposes these fraud charities, to help us find the real ones we need to give to.