Thursday, December 22, 2011

Help That Really Helps - The Charity Problem

Does anyone out there remember Band Aid? Back when I was growing up their hit single "Do they know it's Christmas?" was a wake up call to all us MTV crazed teens and pre-teens that not only was there a big scary world outside of America, but there were places that were out of the pizza delivery zone. Horrors! Many of us, after recovering our composure with a big handful of chips washed back  with a new liter sized bottle of Coke, begged our parents to send a turkey to Africa to feed the starving babies. We were going to save the world!

Fast forward 25 years and what do you know, not only are there still starving babies in Africa and around the world, but we have witnessed even greater horrors like what happened in Darfur. We sent our turkeys and our biggest rock stars delivered them, so what the hell happened?

In a word - failure. But how could that be? It felt so right. 

As I blogged about before, if what we really want is to do better, we need to embrace this failure and learn from it. 

In the case of Africa part of our failure stemmed from ignoring the underlying conditions that were the root cause of their poverty in the first place. As in most cases those causes were a combination of economic factors and government corruption. Andrew Mwenda detailed the fallacy of solving poverty with aid best, in his TED talk on June 2007:

Like many people who criticize good intentions he took a lot of heat for the things he said, including jail time.

It is hard to accept that our well intentioned giving could have failed to be a help. It is almost too much to bear that it was in fact harmful. Yet if we really want to make a difference we have to take a step back and consider the results. To do otherwise suggests that our giving was entirely a narcissistic venture designed to boost our own self-image and shave our taxes, a truly ugly picture indeed.

So what is a genuinely well intentioned person to do in this season of giving and collecting tax deductions? First be honest with yourself. If you give to any charity you are going to benefit, either in terms of a tax deduction or in terms of an over all positive feeling that you are a good person. Both of these things are OK. In fact it's great that giving makes us feel so good otherwise it would probably happen a whole lot less. The challenge is to prevent those positive feelings from blinding you to the outcome of your giving. 

Fortunately the internet is making it increasingly easy to verify those results. The website Admitting Failure deals specifically with non-profit ideas that haven't worked. We can also look to the news, as in the case of donated clothing, to get a more textured picture of how our good intentions are playing out in the world of real economics. And perhaps most saliently we can look at the success stories of the world, like rise of the Chinese economy. Naturally there is some debate as to which factors were the most important in leading to their fantastic turnaround, but there is little doubt that deregulation, privatization and the introduction of the free market played a major part.

Evaluating these factors in terms of my personal giving strategy (which I will explore in more depth in future posts) has led me currently to favor micro-lending sites like Kiva. I do not think that it is the only way to help, but in general terms I think it is the best bet, and yes I said bet. I believe that it is important to think of our charity as a form of investment, and by that I mean it is a gamble, on our own parts and for those we intend to help. It is not a sure thing which also manages to make us a great person. As with all our other investments, if we want them to do well, it behoves us to choose them carefully and keep an eye on them. 

Happy Holidays, and Good Hunting for better giving. As always share your stories of success and failure.

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