Monday, August 13, 2007

Donating Money

Here's a big response to Million Dollar Journey's post on Charity MERs.

I haven't been really big on donations and it's part MER, part philosophical. I used to work for the YMCA (which is basically a charitable organization and pays that way), but I continued to work there even after getting a pay raise elsewhere b/c it had the greatest people to work with.

From an MER perspective, big charity organizations have all kinds of overhead issues and donating money to an group means that you're effectively empowering that group to take decisions you may not agree with. If I donate $500 to the Cancer Society, where does that money go? If I have a deep-seeded belief that future research money should go into retro-virals (say b/c I don't "believe in pills"), the Cancer Society may not share that belief, heck they may spend most of that money researching new pills and chemotherapy mixes, which is exactly what I don't want them to do.

Take a look at the Red Cross during 9/11 (and other crises on a smaller scale). Millions of dollars were donated to the Red Cross as part of a knee-jerk reaction but nobody knew where it was going or what it was for, they just donated.

And this is where we venture into the philosophical.

Why am I donating to the Cancer Society or the MS Society or Breast Cancer or any of these Hospital Research Foundations?

"Curing" cancer is undoubtedly a noble goal, but why do they need my donations? Don't they already get government grants, aren't we already paying for these in some way? And if we're not when do we switch it over? Why do we authorize big drug companies to do Cancer Research when they have conflicting interests with the public good? Drug companies spend 15% on R&D and 85% on Marketing & Advertising and they have no interest in curing people b/c it's not good for their investors. Cured people do not bring in as much money as people who "remain sick" while they're not using your drugs. Now any publicly traded company is required by law to be acting in their investors' best interests. So we're actually requiring drug companies to behave in a manner that isn't good for public health AND we're applying free market concepts to a system that isn't ruled by supply and demand (see Hospital Bills in the US).

When I donate money to a "healthcare"-related field, I'm basically just throwing more of my money into the already bloated and poorly-designed healthcare field. So obviously, I have some philosphical reservations about making donations (despite losing 2 family members to cancer in the last 2 years).

By the same measure we get groups like Make Poverty History (no, you're not getting a link), that hire on tons of big stars but have this horrible, unsustainable plan. I want to make this clear, I spent one hour on their site, a site dedicated to "Making Poverty History" and I did not find one definition of Poverty, not one. Most systems use some type of sliding scale: i.e.: everyone making less than X is poor, but that makes it pretty tough to eliminate poverty b/c it's a sliding scale! They have a goal that is basically impossible (like the War on Drugs), so they don't get any of my money!

Same goes for most of the "help the poor" type of groups. Given the unfit definitions of "poor", giving money to these organizations is pretty sketchy. I mean, we're already paying money into the welfare (EIA) system and numerous government subsidy programs at the provincial and federal level. So we're already donating tons of money to help those less fortunate, shouldn't we be more scrutinizing of the programs we're already paying for before we offer more money?

Truth is I haven't donated money in a few years, b/c I just can't find people I'd like to give to. My fiancé and I have discussed Kiva a couple of times, and that's probably my only good lead, b/c you're not actually giving, you're helping people help themselves.

At the end of the day, I've come to a pretty simple personal conclusion: I don't believe in giving money (with maybe Kiva as the exception). I believe in giving time and stuff, especially for those who are less fortunate. Money is corruptible (very liquid) and often hard to trace. Money is not the type of thing we want to give those who are less fortunate. We want to give a means of survival to those who are less fortunate so that they can earn the money to support themselves.

I don't want to send a million dollars to Kenya to build a new school. I want to send a boatload of building supplies and a pair of contractors to help the Kenyans build their own school. Heck we could even earmark the money to pay the Kenyans. I don't want to give money to a country that just lost 100,000 people in a landslide, they don't need money. They need a flotilla of medical supplies, foodstuffs, blankets, clothes and building materials and that's what they should get.


Jun said...

I agree with you and admire your concern for those who are less fortunate.But I think giving money or goods is just the same, they can always sell your donated goods to earn money. So it's really hard to trust if your donation will be in good hands.

Gates VP said...

Thanks Jun for the comments. I know that the big hole in my program is the fact that people can sell the goods we give them.

The only counter I have is that we should not be giving less fortunate people goods they can afford to sell. This was originally in response to a Canadian blog post, so it's worth looking at the Canadian welfare (EIA) system (now governed provincially)

They basically have a computer program that reads a bunch of charts and tells you how much money you can get based on the severity of the situation: # of kids, disabilities/illness situations.

This number is obviously very minimal, but it's not "indexed" regularly. So when the adjust for inflation every five years you get four solid years where that money just isn't worth as much (and that's a big deal when you're at the bottom).

These people, who often have serious life and/or money-related issues are being given meager amounts of money by the "last chance system". But really, they don't "need" money. What they need is a place to stay, warm food, clean clothes and health care access (which is universal here in Canada).

If you just give money to the parents, there is no guarantee that the kids will be adequately fed or clothed. In fact my Mother's a secretary in the public school system, she can assure you that this is the case. People usually just fall back on the "it's not enough money" excuse and who the heck are we to say that we got the numbers right? Our numbers are probably 4 years out of date.

So instead of giving money, we cut a cheque for the landlord and have food & supplies delivered weekly. When winter comes along we can coordinate with Salvation Army (and others) to find appropriate snow gear for all of the kids. If they need entertainment, they can use the public library and we can even help subsidize a bus pass if the parent needs one to get to work.

But giving money to people who have problems handling money just doesn't seem like the way to go.

Of course, I'm still open to disagreements.

Patrick said...

Hey Gates, I've gone through yet another one of your posts as I work on waking up and watch OLN... :)
Anyway, I have given cash donations to various organizations, however I think that will decrease in favor of more active pursuits.
I find it very unsatisfying to make a cash donation. I often make it and not think of it again until I declare the tax deductible donation on my income tax. Wow...
Instead of sending money to help build schools in Kenya as you mention, why not actually GO to Kenya and help them build the houses/schools...? Besides being more satisfying then writing a check, you will actually know where your time/financial investment is going, you'll have experience/memories, and you may even have a little fun heaven forbid! Situations like that could easily change your life for the better, just as much as it could help theirs.

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