Thursday, January 13, 2011

Why I think less government will increase charitable givings

Jeremy asked in the comment section of a recent post:

Speaking as someone who works in food-relief, charity is very limited and always will be. Only when people use government to wield grander resources, or when markets find a profitable solution do the problems cease. Do you know of any systemic issues that were solved by the nonprofit sector? I don't.

Why do free-marketeers assume charities will grow in a libertarian world - a world where there's a strong emphasis on the "self."
Jeremy has two questions. My answer to the first is, no, I can't think of issues that were solved, but I can name major victories within issues. That's because solving systematic issues is too lofty a goal. The work of Norman Bourlaug thwarted mass starvation in parts of Mexico, India and Pakistan, but starvation is a pretty big issue for one group to tackle.

You also have to look at charities that get government support - does that rule them out? The Campfire Program in Zimbabwe was started by NGOs, academia and government programs. Does that mean the government aspect was crucial, or does some small government action superficially tag all charities once they get going?

Look at the case of Harlem Prep - a non government school that was successful until it was poisoned by government help. Harlem Prep didn't solve the issue of poor education for inner city kids, but it did solve it in that neighborhood.

What about Dr. Jonas Salk and the March of Dimes on polio? Salk gave his amazing vaccine away, and the March of Dimes did a lot to stamp out polio. Should we take it on faith that without government grants Salk never would have made his discovery?

You don't hear this from my side enough, but non-government aid and support will never create a utopia. The voluntary aid I advise will always miss people and issues. Important things will be overlooked.

But compared to what? Why must my flawed solution be compared to a fictitious perfectly-managed government that solves every problem? How effective has government been? Does anyone really believe LBJ's War on Poverty has helped the problem?

As to the second question, why I think charity will increase if we focus on the self more, the first reality is people will have more money left in their pockets. They will also see themselves as responsible for the things government is no longer doing.

Charities are by no means perfect. The nonprofit world has a corruption problem, but unlike government, no one is forced to give them money. I agree with you that that is one of the advantages of a government solution - its easy to marshall the resources for the program. However, its also a curse. Its very easy to marshall resources for the bad programs.

Charities compete with each other to attract donors, and an America that relied on charities more would see more scrutiny in charitable givings. Bad charities will go out of business, while bad government solutions stay intact.

Government solutions also have nasty side effects. For example, giving more aid to single mothers encourages poor families to break up. I expect this effect would be much smaller in charities as they can exercise their judgment on who to help and change the rules quickly if a problem occurs.

As for the objectivist philosophy of the self discouraging people from helping others, I think don't think we should assume people would radically change their philosophy in this modified world. Our friends on the right already give more to charities than our friends on the left, because the lefties seem to think paying taxes counts as helping the poor.

I think most people feel they have a duty to help others when they can, and as I said before, limiting government programs will empower them to help more than they can now.


  1. Very well said, Michael. As a conservative libertarian, I feel it is my duty to give generously to charities that I deem worthy. Thus, as a rule, I give quite a bit when I am presented with the opportunity. I don't do this because I'm rich or want thanks. I do it so that when the left claims that libertarianism will destroy the poor and the helpless, I can stand as one who would fight for them in any governmental structure.

  2. Suffice to say - you've swayed me in many other arguments, but I'm sorry, I find this one to be the least convincing.

    Libertarian objectivism is still the antithesis of charity. And I AM going to assume that in a modified libertarian world that people would have a modified philosophy - an objectivist one. Maybe not at the individual level, but I think it would take a different collective philosophy to get to that different world.

    Also - you know me - I'm a sort of centrist. I wasn't comparing your flawed system to a fictitious and perfect government system. In reality, I think the best method will be an amalgamation of multi-sectoral and inter-sectoral accomplishments. I think business, charity and government form a sort of trinity and bring to the table all sorts of vices and virtues - none of which warrant castrating or idolizing.

    I could go on about how I'm not convinced by some of the examples above. I could provide counter-examples that show that government CAN accomplish big things (Smallpox for example) but I don't want to go back and forth. Gov isn't the silver bullet. I'm not arguing that. But it has strengths worthy of employing - more so than Libertarians can admit.

  3. On a side note:

    “Charities compete with each other to attract donors, and an America that relied on charities more would see more scrutiny in charitable givings.”

    No. This is unequivocally a bad model because the “better” nonprofit won’t necessarily win, but rather the one which can appeal to donors the best. And donors aren’t necessarily the best at prescribing solutions. I am intimately familiar with this. Furthermore, in my experience (and personal frustration) nonprofits accomplish more by collaborating than competing for the same donor dollars.

    On another side note:

    "giving more aid to single mothers encourages poor families to break up."

    Know many happily married couples that would divorce to save money? And an emphasis on the opposite would be subsidizing bad marriages which can't be good for children either.

    It also assumes a two parent household is inherently better for children. I have a (formerly) single mother who would tell you otherwise.

  4. Jeremy, we both agree it's a flawed system. Something I should have mentioned is that less people will need any sort of help in a world with less government spending. For example, it's well understood that unemployment benefits increase unemployment.

    Let me provide you with a good example for your point that charitable contributions are impacted by appeal more than need - breast cancer charities. This is a real cause, but the disproportinate amount of money they collect compared to, say, prostate cancer is unbalanced.

    But like I said before, the same is true for government funding. I think both are weakened by the human element when money is divided.

    I'm not compelled by your reply that it would weed out bad marriages and relationships. It would impact families on the margin, and someone who's poor may be willing to sacrifice a happy relationship if it will help their kids.

    As for two-parent households as better for children, on the average, yes. I believe that very strongly and the evidence is on my side. That doesn't mean that your experience was subpar by any means, this is just on the average.

  5. Save the Ta-Tas!

    Re: single vs. married parents - I wouldn't use either marital status as a requisite for assistance.

    Re: unemployment - there are other forms of charity/assistance. You can help people without rewarding them for sloth.